9.4.2  SOURCES OF INFORMATION (Cont. 1)

9.4.2.5 
Informants

9.4.2.5.4 
Registration and Handling of Confidential Informants and Cooperating Witnesses

9.4.2.5.4.12  (03-15-2007)
Deactivation of Confidential Informant

  1. When a CI is no longer providing information or assistance to the IRS, the individual should be deactivated. The IRS may also terminate the relationship for cause if the CI engages in conduct that violates the individual's agreement with the IRS. In either case, appropriate notification documented in writing and witnessed by two special agents shall be made if the CI can reasonably be located. If the CI cannot be located, efforts to locate the informant shall be documented.

  2. Whenever a CI is deactivated, SIT will be notified via an email through the SAC. This email needs to be forwarded to *CI-HQ-SIT-Confidential Informants. The email must include the control number, date of deactivation, how the CI was notified, who advised the CI and the reason for deactivation.

9.4.2.5.4.13  (03-15-2007)
Advisement of Taxable Income

  1. Every January CIs must be advised of the total amount of taxable payments made to them in the previous tax year. The SACs will direct the imprest fund cashiers to summarize the payments made to each confidential informant (SOC 9101 expense) and advise the controlling special agents of these amounts. In accordance with the LEM, special agents will contact the CIs and advise them of the total taxable amount paid and document the contact in a memorandum of contact. This memorandum will be placed in the control file and a copy forwarded to *CI-HQ-SIT-Confidential Informants.

9.4.2.5.5  (03-15-2007)
Control File

  1. The SAC will establish a control file for each approved CI.

  2. The SAC will ensure that all CI identities are protected in accordance with IRM 1.16.15, Physical Security Program, Minimal Protection Standards. The records must be stored in a security container or security room.

  3. The control file will contain:

    1. a photograph of the CI and fingerprints (if obtained)

    2. the results of a criminal history check of the CI

    3. Form 9831, Approval to Utilize a CI or CW

    4. Form 9832, Annual Suitability Review of a CI

    5. Form 9833, CI Identity Record

    6. Form 9834, Instructions to CI or CW

    7. Form 9835, Receipt for Cash

    8. any promises or benefits, and the terms of such promises or benefits, that are given a CI by a special agent or any other law enforcement agency, if available to the IRS (e.g., Memorandums of Understanding)

    9. deactivation documentation

    10. memoranda advising CI of total taxable income during tax year

9.4.2.5.6  (03-15-2007)
Index Files - Confidential Informants and Cooperating Witnesses

  1. The SAC will maintain an index file listing the CI's name, control number, approval date, current status of the CI (i.e., active or inactive), and the date of deactivation. This information will be filed in a security container or security room.

  2. The SAC will also maintain an index file for all Cooperating Witnesses listing the CW's name and date of approval to utilize the CW.

9.4.2.5.7  (03-15-2007)
Special Agent Authority

  1. A special agent does not have any authority to make any promise or commitment that would prevent the government from prosecuting an individual for criminal activity. A special agent must be cautious and avoid providing an informant with any false perception that the special agent has such authority.

9.4.2.5.7.1  (03-15-2007)
Responsibility of Special Agents when Dealing with a Confidential Informant or Cooperating Witness

  1. To protect the integrity of the relationship with the CI/CW and to enhance security, two special agents will be assigned to control the CI/CW. The controlling agents will always be fair and truthful with a CI/CW, and should make no promises that cannot be fulfilled.

  2. While controlling a CI/CW, special agents will not:

    1. Make any promises of immunity or give the impression that the special agent has the authority to do so.

    2. Authorize the CI/CW to participate in an act that would be unlawful if conducted by a law enforcement officer.

    3. Let a CI/CW determine the procedure to be used in the investigation or otherwise control the investigation.

    4. Condone any violation of law in order for a CI/CW to obtain information. If a defendant can show that the CI/CW was acting under some arrangement with Federal agents, he/she will have a viable defense. Whenever there appears to be a possibility of entrapment or some other unlawful act by a CI/CW, he/she should be guided in a manner that will prevent the occurrence of such acts.

    5. Maintain anything other than a professional relationship with the CI/CW based upon mutual respect. Special agents should guard against the relationship becoming personal instead of professional. A special agent's ability to be objective is jeopardized if a personal relationship develops with the CI/CW.

    6. Make any commitments for payment or protection to a CI/CW without proper authorization from the approving official as set forth in IRM 9.11.1, Fiscal and Budgetary Matters. Agreements made without authorization may become the personal responsibility of the maker.

    7. Intervene on behalf of a CI/CW with the IRS or with any other Federal, state, or local agencies.

    8. Offer to have the tax liability of a CI/CW compromised in exchange for information about another taxpayer. This prohibition includes, but is not limited to, agreeing to a reduction or elimination of the tax liability of an attorney, accountant, enrolled agent, or other return preparer in exchange for information about the client or such person. Questions in this area should be addressed to CT Counsel assigned to the special agent’s field office.

    9. Engage in sexual or social relationships with any CI/CW.

    10. Pay a source with personal funds.

    11. Interfere with, inappropriately influence, or impede any criminal investigation, the arrest or prosecution of a CI/CW.

    12. Accept any gifts from a CI/CW.

9.4.2.5.8  (03-15-2007)
Avoidance of Illegal Acts or Violation of Rights

  1. The IRS will not condone unconstitutional or criminal acts by a CI/CW in gathering information for the IRS. Such behavior can jeopardize the investigation. In accordance with the completion of Form 9834, Instructions to CI or CW, all CI/CWs will be advised of their obligation to not commit illegal acts.

  2. Special agents cannot use or encourage a CI/CW to commit acts that the IRS cannot otherwise authorize its undercover agents to commit. Examples include:

    1. Violations of criminal statues and infringement upon the constitutional rights of any person by IRS personnel or by CIs/CWs are prohibited.

    2. Directing a CI/CW to employ such techniques as illegal threats or assaults against any person, breaking and entry into another's premises without a search warrant, the illegal seizure of paper or other property, or the illegal interception of conversations.

    3. However, special agents in the performance of their official duties can employ investigative techniques that appear to, but do not in fact, violate a state or local criminal statute (e.g., holding oneself out as a drug trafficker or displaying jewelry represented to be stolen).

    4. Criminal Tax Counsel should always be consulted when questions exist as to the proper application of the law (Federal, state, or local) to a given situation.

9.4.2.5.8.1  (03-15-2007)
Information or Evidence Obtained Illegally

  1. Evidence illegally obtained may be utilized by the IRS if the unlawful taking was by a CI/CW without the participation or collusion of IRS employees. The CI/CW will be advised that the IRS may no longer accept any further information in this manner.

  2. In receiving unsolicited information for the first time from an informant, the IRS may accept the information and in accordance with its value, may pay for such information even if it may have been obtained illegally by the CI/CW. Special agents should consult Criminal Tax for guidance. Once authorization is received to pay the informant, the procedures under the Payments to Informants section must be followed.

9.4.2.5.8.2  (03-09-2012)
When Violations of Law Occur in Gathering Information

  1. If a CI/CW presents illegally obtained information and it can be ascertained that the CI/CW has had previous contact with the IRS, either in connection with the matter at hand or other matters, the SAC will review the facts and circumstances surrounding the incident.

  2. The SAC will review this information in an attempt to determine if an IRS employee, during a prior contact with the CI/CW, indicated or implied to the individual that illegal techniques would be condoned by the IRS or would be beneficial to an IRS investigation.

  3. The SAC will also seek a legal opinion from CT Counsel and the Federal prosecutor, if assigned, regarding the likelihood of the information being suppressed, should an investigation based on the information, go to trial.

  4. In all instances where illegally obtained information is presented to the IRS by a CI/CW, he/she will be advised that the IRS will not accept any further information obtained in this manner. The special agents dealing with the individual will prepare a memorandum documenting that the CI/CW was so advised.

  5. The SAC will determine whether appropriate law enforcement authorities should be advised. Notification, if deemed to be appropriate, will be in accordance with IRM 9.3.1, Disclosure and IRM 11.3, Disclosure of Official Information.

  6. Consider terminating the use of the CI and not utilizing the information obtained by the CI or leads derived from the information until authorized to do so by the Director, CI:IEO:OPS.

9.4.2.5.8.3  (03-15-2007)
Notification of Alleged Violations

  1. The SAC will notify the Director, Field Operations, of the facts relating to the alleged violation. The Director, Field Operations will notify the Director/Deputy Director, Operations, Policy and Support via a detailed written report and through SIT. Intervening reviewing officials may add their comments, if they so desire, by separate memorandum. The report will contain the following information:

    1. The facts and circumstances concerning the investigation with which the CI/CW was connected.

    2. The facts and circumstances concerning the illegal act(s) of the CI/CW.

    3. The action taken by IRS to disclose the illegal act(s) to the appropriate law enforcement authority, or the circumstances that led to the SAC's decision not to notify the appropriate law enforcement authority.

    4. A description of the information obtained through the CI/CW's illegal act(s).

    5. An assessment of the criminal potential of the investigation if the information obtained by the CI/CW is not used, and the SAC's opinion on whether the investigation should be closed or continued.

    6. Any circumstances that, in the SAC's opinion, would justify continued use of the CI or the information obtained by the CI/CW.

9.4.2.5.8.4  (03-15-2007)
Violations of Law Involving Serious Crimes

  1. For the purpose of this subsection, the term "serious crime" means any crime that is a felony under Federal or state law.

  2. Whenever the IRS has knowledge that a CI/CW has acted outside the scope of his/her IRS assignment and committed a serious crime, the SAC shall make a determination whether to notify the appropriate law enforcement authorities in accordance with IRM 9.3.1, Disclosure and IRM 11.3, Disclosure of Official Information.

  3. The SAC will notify the Director, Field Operations, by memorandum, of the facts and circumstances concerning the CI/CW's criminal violation, and provide a recommendation on reporting the violation and the continued use of the CI/CW.

  4. In determining whether to notify appropriate law enforcement authorities of criminal activity by a CI/CW, the reviewing and/or approving officials, as appropriate, shall consider the following factors:

    1. seriousness of the crime in terms of danger to life and property

    2. degree of certainty of the information regarding the criminal activity

    3. whether the appropriate authorities already know of the criminal activity and the CI/CW's identity

    4. degree to which notification would endanger the life of the CI/CW or another person

9.4.2.5.9  (03-09-2012)
Protection of a Confidential Informant's Identity

  1. Special agents should only disclose the identity of a CI to authorized persons who have an official need to know the identity of the individual.

  2. Written documents such as an affidavit, memorandum, etc., should not disclose the identity of the CI or the gender of the CI.

  3. During an investigation, communications with the CI are based on the CI's trust that his/her identity will not be disclosed and that he/she will not be harmed physically, economically, or otherwise because of his/her action in furnishing information to the government.

  4. The protection of a CI is absolutely essential in enforcement activities. However, there are certain judicial and administrative situations that require the disclosure of the CI's identity.

  5. Special agents will not divulge either the identity of the CI or the existence of a CI in the investigation to anyone other than authorized persons with an official need to know. Authorized persons include but are not limited to Supervisory Special Agents (SSA); Assistant Special Agents in Charge (ASAC); SAC; Directors, Field Operations; Associate Director, Office of Special Investigative Techniques; Director, Operations Policy and Support; and the Chief, CI.

  6. To provide maximum security regarding his/her identity and existence, all possible attempts will be made to ensure that a CI will not be used as a witness, placed in a position where he/she might become a witness, or unnecessarily identified in court without his/her consent.

  7. In order to avoid the conflict between preservation of a CI's anonymity and the possible disclosure of his/her identity during the investigation and prosecution, special agents should make a decision early in the investigation about the feasibility of developing other evidence to take the place of the CI's testimony at trial. If this is not feasible, the investigation should be closed.

  8. Communications of a CI should not be attached to income tax returns, associated with work papers, or included in the exhibits submitted with a report.

  9. The Federal prosecutor and his/her designee are required to maintain as confidential the identity of any CI and the information the CI has provided, unless obligated to disclose it by law or court order.

  10. If a special agent needs to provide Federal prosecutors with access to any CI information, they must return it to the special agent at the conclusion of the case.

  11. Employees have a continuing obligation after leaving employment with the IRS to maintain as confidential the identity of any CI and the information he/she provided.

9.4.2.5.9.1  (03-15-2007)
In the Courts

  1. It is the duty of every citizen to communicate to his/her government any information which he/she has relative to an offense against its laws. To encourage him/her in performing his/her duty, the courts have held such information to be confidential within the discretion of the government.

  2. The courts, on the basis of public policy, will not compel or allow disclosure of a CI's identity without the consent of the government unless such information is useful evidence to vindicate the accused, lessens the risk of false testimony, or is essential to the proper disposition of the case.

  3. Mere speculation as to the usefulness of the CI's testimony to the defendant is insufficient to justify disclosure of his/her identity. Instead, the defendant must indicate some concrete circumstances that might justify overcoming both public interest in encouraging the flow of information and the CI's private interest in his/her own safety.

  4. Since the privilege lies with the government rather than the CI, the government may waive it. Further, the privilege is deemed waived if the CI is put on the witness stand.

  5. Moreover, the Supreme Court has held that the government is not entitled to a presumption that all sources supplying information to the government in the course of a criminal investigation are confidential sources within the meaning of Exemption (b)(7)(D) of 5 USC §552, Freedom of Information Act (FOIA).

  6. Instead, the Supreme Court held that a source should be deemed "confidential" only if the source furnished information with the understanding that the government would not divulge the communication except to the extent deemed necessary for law enforcement purposes.

9.4.2.5.9.2  (03-15-2007)
On the Witness Stand

  1. If a special agent, who has promised a CI that his/her identity would be kept confidential, is asked to disclose such identity on the witness stand and no objection to the question is made or sustained, he/she should not refuse to answer. Instead, the special agent should state that he/she cannot disclose the information on the ground that it was a privileged communication to an officer of the government and that he/she is bound by instructions not to disclose such information.

  2. He/she should maintain this position pending instructions from his/her supervisors and advice from the attorney for the government.

  3. The special agent's failure to disclose this information may have several results:

    1. The court may, if it thinks that no harm is done to the defendant, accept the special agent's position

    2. The court may dismiss the action.

    3. The special agent's supervisors may release him/her from his/her obligation.

    4. If the special agent persists in his/her refusal to answer, the court may find him/her in contempt.

9.4.2.5.9.3  (03-15-2007)
Access to Name of an Approved Confidential Informant by the Inspector General

  1. If the identity of a CI is needed by the Treasury Inspector General for Tax Administration (TIGTA), Office of Audit, or Office of Investigations, the SAC will obtain approval through the Director, Field Operations from the Director, Operations Policy and Support prior to disclosing the information.

9.4.2.5.9.4  (03-15-2007)
Certification of the Imprest Fund

  1. Treasury Inspector General for Tax Administration, Office of Audit reports on investigative imprest funds requirement to contain a certification that the fund was properly utilized. To issue such a certification, TIGTA, Office of Audit must conduct audit tests to verify that a paid informant exists, that the informants information was evaluated prior to payment, and that the quality of the information was commensurate with the amount of the payment.

  2. To conduct such tests, TIGTA, Office of Audit must be given the true identity of a paid informant. Generally, such tests will be made only on random samples of informants.

  3. In rare instances, the Chief, CI, will divulge the names of other confidential informants to TIGTA, Office of Audit when deemed necessary.

    Note:

    The name of a CI is restricted to the TIGTA, Office of Audit supervisor conducting the audit and is not accessible to any other member of the TIGTA, Office of Audit staff. The name will not be contained in the TIGTA, Office of Audit report or working papers.

9.4.2.5.9.5  (03-15-2007)
Treasury Inspector General for Tax Administration Contact of a Confidential Informant or Cooperating Witness

  1. In the event TIGTA management determines it is essential to contact a CI to meet an audit or investigation objective, TIGTA, Office of Investigations personnel will make that contact.

  2. Treasury Inspector General for Tax Administration management will notify the Director, Field Operations of the intention to contact the CI. In those instances where it is deemed inappropriate to notify the Director, Field Operations, TIGTA management will notify the Inspector General or his/her designee of this decision who will advise the Chief, CI, of TIGTA's intention to contact the CI without notification to the Director, Field Operations.

9.4.2.5.9.6  (03-15-2007)
Documents of a Confidential Nature

  1. Tax returns and other documents shown to a taxpayer or a witness in the course of an investigation, or returns or similar documents to be produced in court, must be reviewed by special agents prior to such disclosure to ensure that nothing is attached (such as a CI's communication) that might reveal the existence or identity of a confidential source of information.

9.4.2.5.9.7  (03-15-2007)
Confidential Informants or Cooperating Witnesses Accompanying Special Agents

  1. There are circumstances when special agents may find it necessary or desirable to have a CI/CW accompany them on an investigative contact or activity. For example, the CI/CW might prove of value in identifying a witness or taxpayer, pinpointing a location, introducing a special agent to a witness or potential CI/CW, or, in exceptional circumstances, attending a witness interview.

  2. In using a CI/CW for these and similar purposes, special agents must exercise extreme care to protect the CI/CW's identity, provide for the CI/CW's physical safety, and prevent unauthorized 26 USC §6103 disclosure of returns or return information, (see 9.3.1, Disclosure). In instances where 26 USC §6103 issues are involved, advice of a field office CT Counsel must be sought.

  3. As a general rule, a CI/CW should not be present while special agents are conducting a witness interview. There are, however, exceptional circumstances when special agents may find it necessary or desirable to have a CI/CW accompany them on a witness interview (for example, when the CI/CW's presence during the interview will make a reluctant witness feel more at ease). In this regard:

    1. A CI/CW's presence is permitted only when the witness requests the CI/CW's presence, or the witness expressly consents to the CI/CW's presence. This request or consent must be documented by the special agents in the memorandum of interview or other interview record.

    2. Under no circumstances should a CI/CW be introduced as a Federal agent, nor should anything be said or done that would lead the witness to mistakenly believe that the CI/CW is a Federal agent, an IRS employee, or other government representative. Thus, it is very important that the special agents, and not the CI/CW, question the witness and otherwise control the interview. If the CI/CW's assistance is needed during the interview, the CI/CW should write out the questions and give them to the special agents.

9.4.2.5.10  (03-15-2007)
Payments to Informants

  1. Criminal Investigation employees must adhere to the following guidelines when involved with paying an informant:

    1. When a CI will not furnish information without payment, the special agents should first advise the individual of IRS reward procedures and the use of Form 211, Application for Reward for Original Information. If the individual does not wish to use these procedures, the special agents may find it necessary to purchase specific information. In these situations, the special agents should determine the value of the information and advise the individual that any agreement for payment is subject to approval by higher authorities.

    2. When evaluating the evidence to determine a value, consideration should be given to whether the information would have been brought to IRS' attention from other sources, the information has significant tax administration implications, the information has any potential probative value, and the investigative time that was saved by obtaining the information in this manner.

    3. Under no circumstances are IRS employees authorized to assure that a reward will be paid in any amount, to indicate the amount of probable recovery, or to confirm that a recovery was based upon the information submitted.

    4. Any payments requested that may exceed the threshold established through the Form 211 procedures must be coordinated through the Operations Policy and Support, Global Financial Crimes Section in National Headquarters. Global Financial Crimes will consult Criminal Tax and General Legal Services to prepare a special agreement.

    5. A Memorandum of Understanding must be prepared for any Confidential Informant who will receive compensation for future services or information (e.g., salary, lump sum or random payments, or awards based on a percentage of forfeiture). This will be coordinated with SIT. Special Investigative Techniques will consult Criminal Tax and General Legal Services to prepare a Memorandum of Understanding.

    6. Guidance for paying informants can be found in 9.11.1, Fiscal and Budgetary Matters.

  2. Delegation Order No. 16 (Rev. 16), Authorization to Approve Confidential Expenditures, authorizes payments for information, as well as other expenses necessary for gathering information in an investigation. The required authorization levels are as follows:

    1. Special Agent in Charge: $10,000 or less

    2. Director, Field Operations: $20,000 or less

    3. Chief/Deputy Chief: amounts greater than $20,000

  3. In Non-Title 26 investigations where taxable payments are made to a CI who is required to file a tax return a " Consent to Disclosure of Tax Information " (Consent), which is attached to a Form 9835, must be prepared to determine whether the CI reported all taxable payments made by the IRS during a specific calendar year. In order for the IRS to conduct such determinations in Non-Title 26 investigations, the CI is required to sign the Consent authorizing the IRS to access his/her tax information.

  4. One (1) Consent form is required for each tax year and will be completed at the time the first payment is made in each new tax year.

  5. The CI must consent by signing the attached Consent form. If the CI refuses to sign his/her name to the Consent form because of concern about a potential disclosure of the CI’s confidential relationship with the IRS, or because of some other confidentiality concern, the CI may, instead, enter his/her registration number. The CI’s entering of his/her registration number constitutes the CI’s signature for purposes of the Consent.

9.4.2.5.10.1  (03-15-2007)
Asset Sharing

  1. Instructions concerning asset sharing that involve payments to or on behalf of a CI are contained in IRM Chapters 9.7, Asset Seizure and Forfeiture.

9.4.2.5.10.2  (03-15-2007)
Claim for Reward

  1. Instructions concerning rewards for information submitted to the IRS are contained in IRM 25.2, Information and Informants Rewards.

9.4.2.5.11  (03-09-2012)
Management Review

  1. Each fiscal year, the Undercover Program Manager or SIT analysts will review each field office's CI activity to ensure compliance with IRS procedures and current guidelines. The review should ensure that proper documentation exists in the registration files.

9.4.2.5.12  (03-15-2007)
Title V Witnesses – Witness Security Program

  1. The DOJ, OEO maintains a continuing and residual relationship with a person who was enrolled in the Witness Security Program after he/she has been relocated. Because of this relationship, OEO requires that investigative agencies and attorneys observe certain restrictions in dealing with current of former participants with respect to new investigations.

  2. Once an individual has been accepted into the Witness Security Program, neither the witness nor any individual relocated because of the witness' cooperation may be used as a CI, unless the IRS can justify to OEO that the use of the individual in such a role is essential to the investigation.

  3. Similarly, without the consent of the OEO, neither the witness nor any individual relocated because of the witness' cooperation may be used as a witness in an investigation, other than the investigation for which the witness was placed in the program.

  4. Requests for the production of a protected witness must be made through the sponsoring attorney or the Director, Operations Policy and Support, Attention: Witness Security Coordinator. The request should be made at least 10 working days in advance of the requested date. This request should be prepared for the SAC's signature and submitted through the Director, Field Operations. The request must include:

    1. purpose of request

    2. date needed

    3. duration of appearance

    4. names of persons to be present

    5. name and telephone number of person to be contacted in the field office

  5. If, while working with a CI/CW, it is learned or suspected that the CI/CW was a Title V protected witness, the SAC will prepare a memorandum to be submitted through the Director, Field Operations to the Director, Operations Policy and Support, Attention: WSC. The memorandum will request contact with the OEO to determine whether the person was actually a protected person under the program and, if he/she was, to obtain approval from the OEO to use this person in the IRS investigation.

  6. The SAC should include in the memorandum a brief explanation as to the importance of this person to the investigation, whether it is anticipated that he/she will be called as a witness before a grand jury or at a trial, and any other information the SAC feels should be brought to the attention of the OEO.

  7. Until approval is obtained from the OEO, IRS will suspend its use of the individual as either a CI or witness. The use of a relocated witness by the IRS without the approval of the Director, OEO, could result in the witness(es) becoming the financial and physical responsibility of the IRS.

9.4.2.5.12.1  (03-15-2007)
After Request Approved

  1. The Witness Security Coordinator (WSC) for the IRS will forward the request approved by the Director, Operations Policy and Support, to the OEO. The OEO will forward approved requests to the Witness Security Division, US Marshals Service, or to the Inmate Monitoring Section, Bureau of Prisons, as appropriate and will forward an approved copy to the WSC for dissemination to the field. All communication to the OEO must be made through the Headquarters' WSC.

  2. Prosecutors and investigators are requested to conduct interviews in neutral sites which will substantially reduce the danger to the witness and assist with the economical deployment of US Marshals Service personnel.

  3. If a witness must be brought into a dangerous area, it is the responsibility of the prosecutor and the investigative agents to ensure that maximum use is made of the witness' time and that every effort has been made to keep such productions cost-effective. In the interest of security and economy, the witness must be returned to the relocation area or place of incarceration as soon as possible.

9.4.2.5.12.2  (03-15-2007)
Contacting Protected Witnesses in a Federal Prison

  1. Prior to contacting a protected witness who is an inmate at a Federal Correctional Institution under the jurisdiction of the Bureau of Prisons or under the custody of the US Marshals Service, it is necessary that approval be obtained from the OEO.

  2. If it is learned that an incarcerated, protected witness may be in jeopardy, the Director, Operations Policy and Support, should be notified, so that he/she can refer the matter to the OEO whose responsibility it is to coordinate the matter with the Bureau of Prisons. Arrangements may then be made to move the prisoner to another facility to assure protection.

9.4.2.5.12.3  (03-15-2007)
Contacts by Protected Witnesses with Internal Revenue Service Employees

  1. Occasionally, witnesses who have been provided protection by DOJ are faced with a situation where they believe their new identities may be in jeopardy because of the need to provide an IRS employee with information relating to their old identities.

  2. In such situations, the witnesses have instructions to notify their contact point in the US Marshals Service who will notify the OEO. The OEO will notify IRS' contact point in CI, the WSC, who will be responsible for any coordination with the WSC's of the other operating divisions in order to resolve the matter in a manner that will protect the CI's identity as well as IRS's interest.

  3. In addition, the above IRS procedures will be followed if, during the processing of a witness to be placed in Justice's Witness Security Program, the OEO determines that the witness has a IRS matter that should be resolved before the witness is relocated.

9.4.2.5.12.4  (03-15-2007)
Required Justice Reports When Using Title V Witnesses In Investigations

  1. Department of Justice requires that CI provide them with a report of significant events and results in CI investigations involving participation by a witness or Confidential Informant who has been accepted into Justice's Witness Security Program.

  2. A similar report is required by DOJ on CI investigations that involve the participation of an IRS protected witness or Confidential Informant.

  3. Reportable events include, but are not limited to, the following actions that may result from the participation or testimony of a protected witness or CI:

    1. executing a search warrant

    2. electronic surveillance

    3. arrest

    4. grand jury indictment

    5. complaint

  4. Reportable results include:

    1. guilty pleas

    2. acquittals

    3. convictions

    4. sentencing

    5. appeals

  5. If a Form 1327-A, Arrest Report is prepared or entries are made into the Criminal Investigation Management Information System (CIMIS) for any of the above stated events, a copy of the Form 1327-A or an "Investigation Profile Report" from CIMIS will suffice for this reporting requirement, provided the form or the screen print is accompanied by a statement regarding the significance of the witness' or CI's participation in the event or result being reported.

  6. The above report will be prepared for the signature of the SAC and submitted through the Director, Field Operations to the Chief, CI, Attention: Witness Security Coordinator. The report is due to the WSC within 10 work days after the last significant event.

  7. Reports involving witnesses or CIs under Justice's Witness Security Program will be coordinated by WSC.

9.4.2.5.13  (03-09-2012)
Use of Federal Prisoners

  1. A Federal prisoner is considered any person who is in the custody of the United States Marshal’s Service or the Bureau of Prisons (BOP), or is under the BOP’s supervision, even if held at a local facility.

  2. If the use of the Federal prisoner will result in the release or transfer of the Federal prisoner, or the Federal prisoner will be authorized to participate in illegal activity, or will participate in consensual monitoring, approval of the DOJ, Office of Enforcement Operations (OEO) must be obtained.

  3. When requesting the use of Federal prisoners, the SAC will prepare a memorandum that will be forwarded through the Director, Field Operations to the Director, Operations Policy and Support; Attn: Witness Security Coordinator, CI:IEO:OPS:SIT. The memorandum will include the following information:

    1. Identification information of the prisoner including, name, sex, race, date of birth, social security number, place of birth, citizenship, BOP register number, FBI number, miscellaneous number.

    2. Current location of prisoner including, facility name, city and state.

    3. Agency which has custody or supervision of prisoner and under what authority.

    4. Charges, including specific statutes, for which the individual is being detained, whether sentenced/not sentenced, and the sentencing details including date.

    5. A copy of the prisoner's arrest record/criminal history must be attached.

    6. The necessity of using the prisoner in the investigation including alternative investigative techniques which have been tried/considered and why these techniques have not worked or have not been tried.

    7. The name(s) and identification information of the target(s) of the investigation including their role in the crime or organization under investigation, their relationship/association with the prisoner and the principal criminal statute(s) involved.

    8. Whether the target(s) is/are aware of the prisoner's arrest or incarceration. If so, indicate the prisoner's cover story in order to safeguard the prisoner and the investigation.

    9. The details of the activity requested including, the role of the prisoner; the length of time needed; whether the prisoner will be released from custody of the USMS or BOP, and if so, into whose custody; whether the prisoner will be returned to the prison the same day or held elsewhere overnight, and if held elsewhere, provide that name, location and type of facility. Identify all judicial districts to which the prisoner will be transported. Provide details of the security measures planned to ensure the prisoner's safety, to limit risk to the public and to prevent escape, include the number of agents/officers to be assigned to the security detail including their agency affiliation; and the use of surveillance devices (body wire, video, etc) and where they will be hidden. When other law enforcement agencies are participating in this activity, at least two IRS-CI special agents must be assigned and one of those agents must be with the prisoner at all times.

    10. Whether the individual is expected to be a witness.

    11. Whether a re-designation in custodial location is expected to be necessary during or upon completion of the investigative activity.

    12. Whether or not the prisoner is represented by counsel, and if so, whether counsel concurs with the prisoner's participation in this activity. Identify whether the prisoner is facing pending charges. (If the prisoner is facing pending charges and is not represented by counsel, the agency must indicate that the prisoner is voluntarily participating in the activity and does not wish to consult with an attorney).

    13. The name, judicial district and telephone number of the Federal prosecutor endorsing the requested activity.

    14. Acknowledgement that the Federal prosecutor has considered entrapment issues and foresees no problems.

    15. Acknowledgement that the Federal prosecutor has determined that the planned operation does not violate the Attorney General's " Contact with Represented Persons" guidelines with regard to either the prisoner, or any target(s), or other persons to be contacted during this operation and that any McDade issues (28 USC §530B) have been addressed.

    16. If a continuance is necessary, an interim progress report should be submitted. A detailed progress report should be submitted at the conclusion of the activity.

    17. If the prisoner is on writ status, sealed court order(s) must be obtained after the request has been approved.

  4. Upon receipt of the memorandum, the Witness Security Coordinator, will promptly transmit the request to the Office of Enforcement Operations, Criminal Division, DOJ, where it will be coordinated with the Bureau of Prisons.

  5. The Office of Enforcement Operations will advise the Witness Security Coordinator, of its decision which, in turn, will be promptly communicated to the requesting field office.

  6. Within 45 days of the conclusion of the activity, the SAC will forward a memorandum detailing the results of the activity, through the Director, Field Operations to the Director, Operations Policy and Support; Attn: Witness Security Coordinator.

9.4.2.5.13.1  (03-15-2007)
United States Marshals Service Assistance

  1. The US Marshals Service will be requested to provide assistance when the release or transfer of a Federal prisoner is required as it is their responsibility for safekeeping and transporting in Federal prisoners.

9.4.2.5.13.2  (03-15-2007)
When United States Marshal’s Service is Not Available

  1. The United States Marshals Service will be requested to provide assistance in requests involving Federal prisoners due to their responsibility for the safekeeping of Federal prisoners.

  2. If such assistance is not provided by the US Marshals Service, enough special agents should be assigned to the custody responsibilities to provide the constant presence of at least two special agents.

  3. A security plan should be developed for the entire period of the temporary custody of the prisoner to ensure the safekeeping of the prisoner and the safety of all. This security plan should provide for:

    1. a personal search of each prisoner upon each occasion of taking custody

    2. no visits by other persons while the prisoner is in IRS custody, unless such visits facilitate the interrogation

    3. return of the prisoner to a Federally approved custodial facility or the prisoner's usual place of confinement at the end of each day

    4. adequate resources for constant, alert guarding of the prisoner if (c) is not possible

    5. use of personal physical restraint (handcuffs and leg irons) whenever appropriate

    6. on extended periods of custody, an appropriate system of communication with supervisory personnel and periodic status reports to the SAC

  4. All personnel assisting with the custody and interrogation of a prisoner should be constantly aware that the prisoner's cooperation may be motivated by the desire to escape from custody.

  5. If during the interview it becomes apparent that the prisoner may become the subject of a criminal investigation, the procedures for interviewing a person in custody should be followed.

9.4.2.5.13.3  (03-15-2007)
State or Local Prisoners, Probationers, Parolees and Supervised Releasees

  1. Prior to utilizing a state or local prisoner, probationer, parolee, or supervised releasee, the SAC shall determine if the utilization of that person in such capacity would violate the terms and conditions of the person’s incarceration, probation, parole, or supervised release. If the SAC has reason to believe that utilization of the individual would violate such terms and conditions, prior to using the person, the IRS must obtain permission of the state of local prison, probation, parole, or supervised release official with the authority to grant such permission.

  2. If the witness or informant is a non-Federal prisoner, the advice of the local Criminal Tax Counsel should be sought as to the process for securing custody under governing state law.

  3. State prisoners will be handled in the same manner consistent with the procedures outlined when the United States Marshal’s Service is not available.

9.4.2.6  (08-10-2004)
Treaties, Mutual Assistance Laws, Simultaneous Investigation Programs, and Agreements

  1. Information from foreign countries can be obtained through the following legal mechanisms:

    1. Tax Treaties and Tax Information Exchange Agreements

    2. Mutual Legal Assistance Treaties and Laws

    3. Simultaneous Criminal Investigation Programs (SCIP)

    4. Letters Rogatory

  2. Procedures for requesting information pursuant to these legal mechanisms are found in IRM 9.4.4, Requests for Information.

9.4.2.6.1  (03-09-2012)
Tax Treaties and Tax Information Exchange Agreements

  1. Among the legal instruments that permit exchange of information with foreign countries, pursuant to a criminal tax investigation, are tax treaties (formally known as Conventions) and Tax Information Exchange Agreements (TIEA). The Deputy Commissioner, Large Business and International (LB&I) is the delegated US Competent Authority for all tax treaties and TIEAs, while tax attachés assigned to LB&I have been delegated authority to sign certain correspondence for the Deputy Commissioner, LB&I relating to the exchange of information. The information obtained from these agreements can only be used for tax charges. If the information is intended to also be used for non-tax charges, it will have to be requested using a separate agreement. An updated list of the countries with which the United States has a tax treaty or TIEA can be found on the CI Web on International's Web page.

  2. The Simultaneous Criminal Investigation Program (SCIP) is a program implemented to facilitate exchanges of information under tax treaties and TIEAs in cases where there appear to be substantial tax violations in both the United States and another foreign country. Policy and procedures for using the SCIP to conduct criminal investigations are found in subsection 9.4.2.6.3.

9.4.2.6.2  (03-09-2012)
Mutual Legal Assistance Treaties and Laws

  1. The United States currently has Mutual Legal Assistance Treaties (MLAT) with a number of countries. The MLATs can be used to obtain information from a foreign country for only those US criminal violations listed in the MLAT. An updated list of the countries with which the United States has a MLAT can be found on the CI Web site on International's Web page.

  2. These treaties provide a vehicle to obtain testimony and tangible evidence from each country. The treaties offer a wide range of assistance from the judicial and executive authorities of each country involved. Each treaty designates the Attorney General as the Competent Authority for the United States who must handle requests under the treaty and whose approval is necessary for all requests. The Attorney General has delegated these powers and duties to the Assistant Attorney General of the Criminal Division. The MLATs can be used for both grand jury and administrative investigations. In some agreements, criminal tax charges are not listed in the MLAT, requiring the use of another bilateral agreement discussed in this section, to request the information.

  3. Pursuant to a request under an MLAT, the requested authorities may:

    1. supply official records

    2. locate persons

    3. provide service of process

    4. execute search and seizures of property

    5. arrange for the appearance of witnesses or experts before the relevant judicial authority

    6. secure extraditions

    7. transfer accused persons to the United States

    8. exchange relevant information relating to the laws, regulations, and international practices in criminal matters of the contracting state

  4. Criminal Tax Counsel assigned to the field office will contact the Department of Justice (DOJ), Office of International Affairs (OIA) concerning any potential requests for assistance pursuant to a MLAT involving an administrative case. The formal request must be made via memorandum from the SAC, with concurrence of the Director, Field Operations, to the Executive Director, CI:IO who will then forward it to the DOJ, OIA attorney working with the field office. The Chief, CI, will coordinate requests with DOJ, OIA. Requests should contain the following items:

    1. the subject matter and the nature of the investigation or proceeding

    2. the principal need for the evidence or information sought

    3. the full name, place and date of birth, address, and any other available information, such as nationality, which may aid in the identification of person(s) who are the subjects of the investigation or proceeding

    4. the name, address, and nationality of the person whose testimony or statements are sought, and/or from whom documents, records, or articles of evidence are requested

    5. a description of the documents, records or articles of evidence to be produced or preserved, and of the manner in which they should be reproduced or authenticated

  5. The request, insofar as possible and to the extent necessary, shall also include:

    1. a description of the particular procedure to be followed, if any

    2. a statement as to whether sworn testimony or statements are required

    3. a description of the information, statement or testimony sought

9.4.2.6.3  (03-09-2012)
Simultaneous Criminal Investigation Program

  1. The objectives of the SCIP are to:

    1. Conduct investigations of individuals and/or companies involved in substantial tax violations in the United States and other foreign countries.

    2. Eliminate the problems caused by taxpayers using the border to avoid production of records and reporting of income.

  2. Currently there are working arrangements for the conduct of SCIP with Canada, Italy, France, Mexico and Korea. The following procedures, which explain the Canadian SCIP, also apply to all countries with SCIP agreements.

  3. The Deputy Commissioner, LB&I is designated by Delegation Order No. 4-12, Delegation to Act as "Competent Authority" Under Tax Treaties and Tax Information Exchange Agreements, as revised, to administer the program in the United States.

9.4.2.6.3.1  (03-09-2012)
Simultaneous Criminal Investigation Program - Investigation Selection

  1. A Field Office's SAC should only recommend investigations for the program that has the potential for substantial liability and that indicates the subject is committing violations in both countries.

  2. The SAC will forward any investigations recommended for the program through the appropriate Director, Field Operations, to the Executive Director, CI:IO, (see Exhibit 9.4.2-1).

  3. The Associate Director, CI:IO will review the proposed case. If it meets the criteria to be included in the SCIP, it will be forwarded by the Executive Director, CI:IO to the Deputy Commissioner, LB&I.

  4. The Executive Director, CI:IO will inform the recommending field office, by memorandum, of the action taken and send an information copy to the Director, Field Operations.

  5. If an investigation is not accepted for the program, it will be worked as a routine investigation. If additional facts are developed, the investigation may be submitted for reconsideration.

  6. If an investigation is approved for the program, LB&I will transmit a letter to the Competent Authority requesting the foreign country's participation, (see Exhibit 9.4.2-1 Cont (1)).

  7. When the Competent Authority of the foreign country recommends an investigation for the program, the Executive Director, CI:IO will transmit a copy of the request to the appropriate SAC through the Director, Field Operations. The field office will evaluate the request within 60 calendar days and advise the Executive Director, CI:IO of its decision by memorandum routed through the Director, Field Operations.

  8. If the field office decides to participate, LB&I will send a Competent Authority acceptance letter, (see Exhibit 9.4.2-1 Cont. (2)). If not, LB&I will notify the foreign country's Competent Authority.

9.4.2.6.3.2  (03-09-2012)
Criminal Investigation Program - Exchanging Information

  1. Once competent authority letters have been exchanged and accepted, a Field Office's SAC will designate an SSA as the designated representative. The participating foreign country will also designate an investigation supervisor.

  2. The appropriate CI country attache' will coordinate an initial meeting to plan the investigative activity. The meeting will be held in the country which originated the request unless a mutually agreeable alternative location is determined.

  3. The Associate Director, CI:IO will provide a list to LB&I of individuals designated to participate in the initial and subsequent meetings. The list will identify the individuals by name, position, office, and security clearance. Names may be added or deleted as necessary. An LB&I employee, with Competent Authority will be present at all meetings with foreign officials.

  4. Subsequent meetings will be arranged by the SSA and the designated investigation supervisor. The field office will notify the CI country attache' so the attache' may, at their option, participate.

  5. Exchanges of information or documents must be made by the respective Competent Authorities. Information and documents to be exchanged will be transmitted by a brief letter describing the documents and prepared for LB&I's signature, (see Exhibit 9.4.2-1 Cont. (3)).

  6. The CI designated representative will note each document exchanged and maintain it in the investigation file. Each such document will also note that the information contained therein was secured under the provision of an income tax treaty and that its use and disclosure must be governed by the provisions of the treaty.

  7. Exchange of information is permissible in pre-indictment, as well as post-indictment investigations.

  8. Information that may be exchanged includes:

    1. Information related to the taxpayer, his/her companies, or named associates.

    2. Information relating to specific transactions believed to involve the taxpayer, his/her companies, or named associates.

    3. Title 31 information which is needed for tax administration, although requests for Forms 4789, Currency Transaction Reports, must be made on a specific name basis, since they do not fall within the routine information category of the present treaty.

9.4.2.6.3.3  (08-10-2004)
Simultaneous Criminal Investigation Program - Grand Juries

  1. Grand juries can be used in simultaneous investigations either at the request of the IRS or the attorney for the government, subject to DOJ approval.

  2. Information from a US grand jury may be furnished to the respective Competent Authority for tax administration purposes by way of a court order pursuant to Fed. R. Crim. P. 6(e). The treaty partner will be required to meet the requirements of showing a particular need for the information and that the information is sought preliminary to or in connection with a judicial proceeding.

  3. If a US multi-agency grand jury uses information received under the auspices of the tax treaty in an indictment and/or at trial, the indictment must include tax charges and must show a nexus between the tax charges and any other violations.

9.4.2.6.3.4  (08-10-2004)
Simultaneous Criminal Investigation Program - Witness

  1. The tax conventions with the respective SCIP countries contain no provisions requiring foreign witnesses to appear at trial. The resulting potential for trial problems should be evaluated both in making a request for a simultaneous investigation and during the investigation itself.

  2. If arrangements cannot be made for a witness to appear at trial, Rule 15 depositions or Letters Rogatory may be used, (see IRM 9.4.2.6.4, Letters Rogatory).

9.4.2.6.3.5  (08-10-2004)
Simultaneous Criminal Investigation Program - Disposition of Investigations

  1. Jeopardy or termination assessments, that include information furnished through the program, can be handled in the normal fashion. The appropriate Competent Authority must be notified before any such action is taken.

  2. Either country may withdraw from a simultaneous investigation at any time by advising the other country of its intent to do so, (see IRM 9.5.14, Closing Procedures).

  3. Prosecution reports are processed in the normal fashion, subject to any additional requirements, (see IRM 9.5.12, Processing Completed Criminal Investigation Reports).

  4. Simultaneous indictments and/or filing of charges is preferred if circumstances permit, making close coordination by the designated investigation supervisor imperative.

9.4.2.6.3.6  (03-09-2012)
Simultaneous Criminal Investigation Program - Travel

  1. All travelers on SCIP investigations must initially complete a continuous travel Form 1321, Authorization for Official Travel. Thereafter, International Operations will coordinate the processing with the Office of the Director, International (LB&I:TAAS) for authority to travel on a trip-by-trip basis, (see IRM 9.11.2, Domestic and Foreign Travel).

9.4.2.6.3.7  (08-10-2004)
Simultaneous Criminal Investigation Program - Disclosure and Publicity

  1. The tax treaty contains a secrecy clause restricting disclosure of information exchanged pursuant to the treaty. Access to such information is governed by 26 USC §6103 and may be exempt from disclosure under 5 USC §552(b)(3) pursuant to (j)(2).

  2. The competent authority should be alerted if any disclosure is contemplated.

  3. While CI may disclose information obtained during a simultaneous investigation to other IRS personnel for tax administration purposes, they must inform the competent authority or the designated investigation supervisor of the intended use of the information.

  4. Publicity in simultaneous or unilateral indictments should be handled in accordance with the procedures detailed in IRM 9.3.2, Publicity and Internal Communications.

9.4.2.6.4  (03-15-2007)
Letters Rogatory

  1. If a bilateral agreement does not exist with a country, it may be possible to use a letters rogatory to request the information. A letters rogatory is a formal request from a US Federal court, before which an action is pending, to the court of the foreign country in which the information/evidence is located.

  2. Normally, letters rogatory can only be used in a post-indictment or post-compliant stage of the investigation. However, the United Kingdom and Hong Kong's evidentiary rules permit courts to release evidence to foreign courts for criminal investigations that have been instituted. There also exists case law that recognizes a district court's authority to issue letters rogatory for criminal cases that have not yet been indicted. The special agent will work with the attorney for the government to petition the court to issue any such letters rogatory.

9.4.2.7  (03-15-2007)
Financial Investigations National Database Information Tracker

  1. Financial Investigations National Database Information Tracker (FINDIT) is a financial database developed by DOJ's Asset Forfeiture and Money Laundering Section (AFMLS).

  2. The database is centered primarily on bank account numbers. The database includes financial information gathered from money laundering investigations occurring throughout the United States and overseas. It includes information gathered from grand jury subpoenas, search warrants, informants, and undercover pick up operations.

  3. The objective of FINDIT is to identify domestic and international money launders and their connections to drug trafficking organizations.

  4. Financial Investigations National Database Information Tracker allows the special agent to identify relationships, methods, and trends that exist between past and present money laundering investigations occurring in various field offices in the United States and overseas.

9.4.2.8  (08-10-2004)
Terrorism Investigations

  1. In additional to the traditional information sources available, there are unique resources available when conducting terrorist investigations.

  2. Some of the information sources are listed below:

    1. USA Patriot Act

    2. Automated Case Support

9.4.2.8.1  (08-10-2004)
USA Patriot Act

  1. The USA Patriot Act amended the Right to Financial Privacy Act, by giving law enforcement and intelligence agencies the ability to obtain international terrorism related records from financial institutions via written requests, rather than subpoenas or court orders, (see IRM 9.4.4, Requests for Information).

9.4.2.8.2  (03-15-2007)
Automated Case Support System

  1. The Automated Case Support is administered by the FBI. The system consists of electronic case files that contains investigative information including interviews. Special agents with top secret security clearance and assigned to the Joint Terrorism Task Force (JTTF) have access to ACS.

Exhibit 9.4.2-1 
Simultaneous Criminal Investigation Program

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