7 August 2001

See contents of full IRS Handbook of Criminal Investigation: http://cryptome.org/irs-ci/irs-ci.htm

Handbook 9.8
Criminal Investigation at the Service Center


Chapter 1
Criminal Investigation Branch Organizational Structure
and Responsibilities

Contents

[9.8] 1.1  (04-14-1998)
OVERVIEW

  1. This chapter is intended to assist you in understanding the mission, structure, duties, and responsibilities of the Criminal Investigation Branch (CIB). Topics include:
    • CIB's Function and Organizational Structure
    • Role of the Chief, CIB
    • CIB Training
    • Security
    • Informant Information
    • Court Witness and Certified Transcript Program
    • District Office Undercover Operations Support
    • Support Of Wagering Investigations

[9.8] 1.2  (04-14-1998)
CIB FUNCTIONAL AND ORGANIZATIONAL STRUCTURE

  1. The following sections and subsections provides a broad spectrum concerning the structure and duties of CIB.

[9.8] 1.2.1  (04-14-1998)
Mission Statement

  1. In support of the overall IRS Mission, CIB detects fraudulent returns and prevents issuance of related false claims, supports the mission of Criminal Investigation field operations relative to tax administration and related financial crimes, in order to achieve, directly or indirectly, voluntary compliance with Internal Revenue laws.

[9.8] 1.2.2  (04-14-1998)
Functional Responsibilities

  1. The primary function of CIB is to identify and detect questionable refunds, prevent the issuance of false refunds and provide support for the 33 CI district offices.
  2. CIB assists CI district offices in identifying and assembling information on individuals and entities involved in civil and criminal non-compliance with the Internal Revenue Code and other related federal statutes.
  3. CIB is also the focal point at the service center for reporting suspicious criminal activity identified by other functions.
  4. Specific CIB responsibilities include:
    1. Maintaining controls on all taxpayer accounts under criminal investigation.
    2. Forwarding allegations of fraud received by the service center to the CI district offices.
    3. Coordinating CI's Questionable Refund Program (QRP).
    4. Developing questionable refund fraud referrals and submitting them to CI district offices.
    5. Providing court witnesses for criminal tax trials.
    6. Providing fraud awareness training to service center employees.
    7. Training district office QRP coordinators in the service center QRP process.

[9.8] 1.2.3  (04-14-1998)
Organizational Structure

  1. There are 10 CIBs servicing 33 CI district offices.
  2. Each CIB is staffed by service center employees managed by a GS-1811 or GS-340 Branch Chief.
  3. A CIB is located at the following Internal Revenue service centers:
    1. Andover Service Center
    2. Atlanta Service Center
    3. Austin Service Center
    4. Brookhaven Service Center
    5. Cincinnati Service Center
    6. Fresno Service Center
    7. Kansas City Service Center
    8. Memphis Service Center
    9. Ogden Service Center
    10. Philadelphia Service Center

[9.8] 1.2.4  (04-14-1998)
Managerial Oversight

  1. The Chief, Compliance Division, who reports to the Director of the Service Center, has line authority over CIB.
  2. The Director of Investigations, Office of Refund Fraud, provides functional guidance, through the Service Center Director, to the Chief, CIB.

[9.8] 1.3  (04-14-1998)
ROLE OF THE CHIEF, CIB

  1. The Chief, CIB, is responsible for accomplishing CIB's broad program objectives and procedural guidelines established by the Assistant Commissioner, (CI).

[9.8] 1.3.1  (04-14-1998)
Program Responsibilities

  1. The Chief, CIB, will consult with the Chief, Compliance Division, to ensure CIB's program objectives are consistent with service center objectives.
  2. Areas of responsibility include:
    1. Managing CIB employees and programs
    2. Quality reviews
    3. District QRP referrals
    4. Restitution program
    5. Controlling taxpayer accounts under criminal investigation
    6. Work planning and control tracking system
    7. Fraud awareness
    8. Referrals from service center employees
    9. Refund inquiries

[9.8] 1.3.1.1  (04-14-1998)
Managing CIB Employees and Programs

  1. The Chief, CIB, has line authority over all technical and clerical employees in his or her branch. The responsibilities include:
    1. Planning and organizing.
    2. Assigning and distributing work to subordinates.
    3. Providing criminal fraud expertise for district QRP referrals.
    4. Managing the CIB's budget.
    5. Selecting employees.
    6. Recommending personnel actions.
    7. Approving leave.
    8. Counseling employees.
    9. Providing necessary training.
    10. Practicing sound position management policies.
    11. Taking positive steps in support of affirmative action programs.
    12. Evaluating completed work and employee performance.

[9.8] 1.3.1.2  (04-14-1998)
Quality Reviews

  1. The Chief, CIB, is responsible for establishing and maintaining a structured internal quality review process for the following CIB programs:
    1. Questionable Refund Program
    2. Court Witness Program
    3. Control Function
  2. A review of each program will be conducted by the Chief or his or her designee on a semi-annual basis.
  3. A report detailing the findings will be prepared on or before each June 30 and December 31 and maintained in the CIB administrative files.

[9.8] 1.3.1.3  (04-14-1998)
District QRP Referrals

  1. The Chief, CIB, is responsible for the following relative to district QRP referrals:
    1. Determining criminal potential on fraud referrals developed by CIB employees.
    2. Determining criminal potential on fraud referrals from service center functions.
    3. Ensuring that an evaluation by the district office conforms with existing guidelines.
    4. Notifying referring functions whether the referral was accepted or declined within time frames specified in existing guidelines.
    5. When possible, personally meet with referring office to explain declinations.

[9.8] 1.3.1.4  (04-14-1998)
Restitution Program

  1. See chapter 4 of this Handbook for information concerning the court ordered restitution program.

[9.8] 1.3.1.5  (04-14-1998)
Controlling Taxpayer Accounts under Criminal Investigation

  1. The Chief, CIB, is responsible for the quality and timely input of CI Transaction freeze codes per existing guidelines.
  2. CI freeze codes are inputted by the CIB Control Function and consist of the following Transaction Codes (TC):
    1. TC 910
    2. TC 911
    3. TC 912
    4. TC 914
    5. TC 915
    6. TC 916
    7. TC 917
    8. TC 918
    9. TC 919
  3. These codes are discussed individually in another Chapter of this Handbook.

[9.8] 1.3.1.6  (04-14-1998)
Work Planning and Control Tracking System

  1. The Chief, CIB, is responsible for tracking time of CIB personnel.
  2. Time worked on CIB programs is tracked on the Service Center Work Planning and Control (WP&C) reporting system.

[9.8] 1.3.1.7  (04-14-1998)
Fraud Awareness

  1. The Chief, CIB, is responsible for the training of service center functional personnel in the recognition and referral of potentially fraudulent returns or other documents.
  2. The volume of in-house referrals varies between centers. The principal reason for this variance is the quality of the fraud awareness training; timeliness; encouragement; and interest by management. It is the Chief's CIB responsibility to secure a commitment from the service center management to allow fraud awareness presentations during training sessions or as deemed appropriate.

[9.8] 1.3.1.8  (04-14-1998)
Referrals from Service Center Employees

  1. CIB will receive in-house referrals from various functions within the service center on a continuing basis to evaluate for criminal potential. The referrals will primarily be from Document Perfection Branch, Examination Branch, Adjustment Branch, Underreporter Branch and Customer Service Branch.
  2. Cases may be referred via Form 2797, Referral Report of Potential Criminal Fraud Cases, or per their respective handbook instructions; however, some cases are referred based on fraud awareness training given to their tax examiners.

[9.8] 1.3.1.9  (04-14-1998)
Refund Inquiries

  1. Refund Inquiries will be received from various functions throughout the service center. Guidelines issued by Headquarters in April, 1994 are to be followed.

[9.8] 1.4  (04-14-1998)
CIB TRAINING

  1. The following sections provide information concerning the training of CIB employees

[9.8] 1.4.1  (04-14-1998)
Training Requirements For The Chief, CIB

  1. Reserved

[9.8] 1.4.2  (04-14-1998)
Training Requirements For CIB Employees

  1. Reserved

[9.8] 1.4.3  (04-14-1998)
Questionable Refund Program (QRP) Fraud Awareness Training At Service Center

  1. The Chief, CIB, is responsible for training and orientation of service center functional personnel in the recognition and referral of potentially fraudulent returns.
  2. The Chief, CIB, will secure a commitment from the service center management to allow fraud awareness presentations during functional training sessions or other group meetings conducive to fraud awareness training.
  3. Whenever possible, the Chief, CIB, should be personally involved in the training to ensure timeliness, quality, and a high management level of interest in the fraud referral program.
  4. The Chief, CIB, will maintain documentation on all fraud awareness training.

[9.8] 1.4.4  (04-14-1998)
District Office Training/Visitations

  1. On an annual basis the Chief, CIB, should coordinate with the Chiefs, CI, their attendance during CI Chief's meetings and/or district group meetings to discuss the following:
    1. CIB Services to District Offices
    2. Maintenance of CI Controls
    3. Questionable Refund Program
    4. CIB Fraud Referrals
  2. Travel to these meetings will be paid for from CIB travel allocations.
    NOTE:
    Refer to the Criminal Investigation Branch Desk Procedures for the CIB Training Program.

[9.8] 1.5  (04-14-1998)
SECURITY

  1. This section provides an overview of security requirements within CIB.

[9.8] 1.5.1  (04-14-1998)
Automation

  1. All systems are required to be accredited and certified per IRM 2(10)00 and the Computer Security Act of 1987.
  2. The Internal Revenue Security Certification program is the technical evaluation of computer security, requirements, regulations, and standards used to assist in the accrediting system.

[9.8] 1.5.2  (04-14-1998)
Firearms

  1. Firearms for Chiefs, CIB, are to be secured per text 9.11.4.8.1.

[9.8] 1.5.3  (04-14-1998)
Informants

  1. Protection of Informant Information and Identity require:
    1. Disclosure to only those employees having a need to know.
    2. Transmitted in double-sealed envelopes bearing instructions To Be Opened by Addressee Only.
    3. Protected per IRM 1(16)41 Chapter 300.

[9.8] 1.5.4  (04-14-1998)
Physical Security

  1. Physical security in the service center must conform to Protection Point Values (PPV) of IRM 1(16)41. (See exhibit 500-2.)
  2. CI personnel are authorized to control all keys and combinations within their office. (See IRM 1(16)41. Text 444.)

[9.8] 1.5.5  (04-14-1998)
Records And Property

  1. Records and property are to be secured per IRM 1(16)12 Exhibit 300-3.
    NOTE:
    Refer to the Criminal Investigation Branch Desk Procedures for detailed procedures relative to CIB Security.

[9.8] 1.6  (04-14-1998)
INFORMANT INFORMATION

  1. The following procedures should be followed when dealing with
    informants.

[9.8] 1.6.1  (04-14-1998)
Processing Informant Information Received by CIB

  1. Effective November, 1997, Customer Service will be responsible for receiving, screening, and processing all telephonic informant
    communications.
  2. Any telephonic informant communications received in CIB should be redirected to Customer Service at 1-800-829-0433. However, if the informant does not want to call the 1-800 number or be transferred to it, the employee must document all of the information provided by the informant on Form 3949, Information Report Referral. The Chief, CIB, should then forward Form 3949 to the Chief, CI, where the alleged tax violator resides.
  3. All written informant communications received in CIB, should be forwarded to the Chief, CI, where the alleged tax violator resides, for evaluation.
  4. All walk-in informants should be encouraged to go to the district office, CI. However, if the informant does not want to go to the district office, CI, the employee must document all of the information provided by the informant on Form 3949. The Chief, CIB, should then forward Form 3949 to the Chief, CI, where the alleged tax violator resides.
  5. Forward all informant information in double sealed, pink or gray envelopes, labeled confidential.

[9.8] 1.6.2  (04-14-1998)
Request for Reward for Information Provided

  1. If the informant indicates he or she wants a reward:
    1. Give the informant a Publication 733, Rewards for Information Given to the Internal Revenue Service, and a Form 211, Application for Reward for Original Information.
    2. Instruct the informant to return the completed Form 211 to the service center which services the area where the alleged tax violator resides. The addresses of the service centers are shown on the reverse side of the Form 211.
    3. Forward a copy of the Form 3949 or a copy of the written informant information to the Informant Claims Examiner (ICE) in Examination at the service center which services the area where the alleged tax violator resides.
  2. If a Form 211 is received in CIB with the written informant information, forward the original Form 211 and a copy of the written information to the Informant Claims Examiner.

[9.8] 1.7  (04-14-1998)
COURT WITNESS AND CERTIFIED TRANSCRIPT PROGRAM

  1. The Criminal Investigation Branch Court Witness Program provides court witnesses or certified transcripts for court proceedings.

[9.8] 1.7.1  (04-14-1998)
Court Witness Coordinator

  1. The court witness coordinator represents the service center Director in a judicial proceeding regarding the Director's role as the custodian of income tax returns and related documents.

[9.8] 1.7.1.1  (04-14-1998)
Testimony of Court Witness

  1. The quality of court witness testimony is crucial to law enforcement and voluntary compliance. The expertise, competence, and decorum of the witness contribute to the success of the prosecution's case.

[9.8] 1.7.1.2  (04-14-1998)
Responsibilities

  1. The duties of the court witness include, but are not limited to:
    1. Securing all available original tax returns.
    2. Securing other original documents and correspondence filed by the defendant with the IRS.
    3. Securing current certified transcripts of accounts, certificates of assessments and payments, or certificates of Lack of Record.
    4. Securing certified copies of original returns and documents.
    5. Researching all service center areas and Federal Records Center for pertinent information to aid in trial, e.g., returns, correspondence, receipts, transcripts, organizational functions, and documentation procedures.
    6. Meeting with U.S. Attorney prior to trial to discuss points of testimony, reviewing case files and exhibits, and any other documents to be presented as evidence during trial.
    7. Assisting U.S. Attorney and special agents as requested.

[9.8] 1.7.1.3  (04-14-1998)
Knowledge Required

  1. The court witness must have extensive knowledge regarding:
    1. All service center actions with respect to returns and documents under the custody of the Director.
    2. Complete processing procedures and functional responsibilities (past and present) of the service center, district, and Federal Records Center.
    3. All types of returns, due dates, filing requirements, and document systems (including the Electronic Filing System).
    4. All laws and regulations relating to Disclosure, Freedom of Information, and Privacy Act.
    5. Proper introduction of tax returns, certificates of assessments and payments, IRP Records, MFTRAX, and certificate of Lack of Record.
    6. Coordinating and conducting periodic court witness training for service center personnel.
    7. Responding to interrogatories or supply depositions or affidavits.
    8. Making all travel arrangements.
    9. Quality reviewing all completed Certifications for accuracy.
    10. Maintaining a current cadre of court witnesses.

[9.8] 1.7.1.4  (04-14-1998)
Authority

  1. To testify as a court witness for the service, the following procedures must be adhered to:
    1. MSC Delegations Order No. 56 (Rev. 6).
    2. Order No. RC-93, Rev. 2, Delegation Order No. 156.
  2. The quality and credibility of a testimony depends on expertise.
    1. The witness must be trained to answer only the questions asked.
    2. The court witness coordinator or designee must represent the IRS with the highest degree of integrity, efficiency, and fairness.

[9.8] 1.7.2  (04-14-1998)
CI District Office Procedures to Request Court Witness

  1. Requests for court witnesses by CI district offices are to be made by memorandum from the Chief, CI, to the Chief, CIB, who will be providing the court witness.
  2. The Chief, CIB, will follow the guidelines established by the service center Director relative to requests for court witnesses from service center functional areas.
  3. The Chief, CI, or his or her representative may telephonically request a court witness in exigent situations; however, a follow-up memorandum must be submitted to the Chief, CIB, within 2 calendar days.
  4. District Office CI will pay for expert witness travel pertaining to criminal investigations, e.g., trials, grand juries, etc. Testifying for civil trials should be assigned to non-CI expert witnesses.
  5. The Service Center Director will pay for expert witness travel pertaining to civil trials.
    NOTE:
    Refer to the Criminal Investigation Branch Desk Procedures for the Court Witness Program for detailed procedures and examples.

[9.8] 1.7.3  (04-14-1998)
Seals And Certification

  1. The primary purpose of certification is to satisfy the requirements of the rules of evidence and civil procedures. This is essential in authenticating a document for admission into evidence.
  2. Certification is accomplished by attaching Form 2866, Certificate of Official Record, with a seal affixed. The court witness coordinator is responsible for ensuring that the transcript is accurate.
  3. Transcripts are prepared for use in court per U.S.C. 1733(b), Rule 44 of the Federal Rules of Criminal Procedures:
    1. 26 U.S.C. 7514--Authorizes the seals of office.
    2. 26 CFR 301.7514--Governs the use of seals.
    3. 26 CFR 301.7622-1--Authorizes the Commissioner to designate persons to issue certifications.
    4. Delegation Order 198--Designates the persons who may issue certification and provide delegation of authority.
    NOTE:
    Refer to the Criminal Investigation Branch Desk Procedures for the Certified Transcript Program for detailed procedures and examples

[9.8] 1.7.4  (04-14-1998)
Request For Certification

  1. CI will request certified transcripts of account on Forms 4338-A and 4338 through the CIB.
  2. Special agents must allow the service a minimum of 4 weeks to secure and certify all documents.
  3. It is the responsibility of the court witness coordinator to see that necessary expedite procedures are established.
  4. Forms 4338 and 4338-A, IMF Information or Certified Transcript Request, will be used by CI personnel to request certified transcripts of Accounts. Requests will include but not be limited to:
    1. Certification of original and copy of returns.
    2. Certification of MCC and microfilm transcripts.
    3. Certification of certificates and payments.
    4. Certification of Lack of Record.
  5. All requests for transcripts of ADP accounts will be forwarded to the service center servicing the district requesting the transcript.
  6. Each request should cover the specific tax periods. Certify only information which is responsive to the Order.

[9.8] 1.8  (04-14-1998)
SUPPORT OF DISTRICT OFFICE UNDERCOVER OPERATIONS

  1. CIB provides Employer Identification Numbers (EINs) to Support CI District Office Undercover Operations.

[9.8] 1.8.1  (04-14-1998)
Requesting EIN

  1. All EIN requests from the districts and other law enforcement agencies for undercover storefronts and covert companies will be directed to the National Office Special Investigative Techniques Branch (CP:CI:O:S).
  2. Headquarters will obtain all pertinent information and coordinate with the designated service center Chief, CIB.

[9.8] 1.8.2  (04-14-1998)
CIB Contact Point

  1. The Chief, CIB, will ensure confidential and expeditious handling of all undercover EIN requests by designating a CIB contact point who will:
    1. Coordinate all National Office CI requests for undercover EINs.
    2. Obtain undercover EINs from the Entity Section at the service center.
    3. Maintain a record of all EIN requests.
  2. All undercover SSNs are controlled by the applicable Director of Investigations (DI) area office.

[9.8] 1.8.3  (04-14-1998)
Requesting Controls

  1. All requests to establish controls on master file for accounts related to an authorized undercover operation should be forwarded to the Chief, CIB, at the appropriate center.
    NOTE:
    Refer to the Criminal Investigation Branch District Office Support Desk Procedures.

[9.8] 1.9  (04-14-1998)
SUPPORT OF WAGERING INVESTIGATIONS

  1. The Chief, CIB, receives quarterly printouts, in duplicate, of Form 730, Tax on Wagering, and Form 11C, Special Tax Return and Application for Registry Wagering. The Chief, CIB, forwards these printouts to the districts.
  2. These printouts contain only the new filings for each quarter and are sorted first by service center, then district office, and then by alphabetical.

Internal Revenue Manual  

Hndbk. 9.8 Chap. 1 Criminal Investigation Branch Organizational Structure
and Responsibilities

  (04-14-1998)

05/02/2001 14:30:10 EST