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Part 9. Criminal Investigation

Chapter 5. Investigate Process

Section 6. Organized Crime & Strike Force

9.5.6  Organized Crime & Strike Force

9.5.6.1  (07-29-1998)
Overview

  1. This section provides information with respect to Organized Crime and Strike Force Programs.

9.5.6.1.1  (07-29-1998)
Definition of Organized Crime

  1. Organized Crime refers to those self-perpetuating, structured, and disciplined associations of individuals, or groups, combined together for the purpose of obtaining monetary or commercial gains or profits, wholly or in part by illegal means, while protecting their activities through a pattern of graft and corruption.

  2. Organized crime groups possess certain characteristics which include, but which are not limited to, the following:

    1. Their illegal activities are conspiratorial.

    2. In at least part of their activities, they commit or threaten to commit acts of violence or other acts which are likely to intimidate.

    3. They conduct their activities in a methodical, systematic, or highly disciplined and secret fashion.

    4. They insulate their leadership from direct involvement in illegal activities by their intricate organizational structure.

    5. They attempt to gain influence in government, politics, and commerce through corruption, graft, and illegitimate means.

    6. They engage in patently illegal enterprises such as drugs, gambling, and loansharking, and also such activities as laundering illegal money through and investment in legitimate businesses.

9.5.6.1.2  (07-29-2002)
Strike Force Objective

  1. The Strike Forces are directed toward the identification and investigation of taxpayers who derive substantial income from organized criminal activities. Coordination of enforcement efforts and close cooperation and liaison with other federal, state, and local enforcement agencies are necessary for effective Strike Force operations.

  2. As a major participant in the Strike Force, the IRS has two objectives:

    1. To enforce criminal sanctions by appropriate recommendations for prosecution of Strike Force taxpayers for criminal violations of the Internal Revenue Code or other related statutes when committed in contravention of the Internal Revenue laws;

    2. To assess and collect the proper taxes due, and to enforce civil sanctions by assessing and collecting applicable penalties.

  3. Investigations undertaken by the IRS in connection with participation in a Strike Force are solely IRS operations. At all times, control of the investigation is under the authority of the Commissioner of Internal Revenue or delegate.

9.5.6.1.3  (07-29-2002)
Management Responsibilities for Strike Force Activities

  1. The Chief, CI and the operating divisions share responsibility for:

    1. Implementing the objectives for the IRS’s participation in Strike Forces.

    2. Providing functional guidance to regional and field offices.

    3. Maintaining liaison with the Department of Justice (DOJ) to ensure full coordination of the Strike Force operations at the national level.

    4. Accumulating and disseminating information on unusual schemes, novel techniques, etc., for use in planning and executing examinations and investigations or the collection of assessments against taxpayers involved in illegal activities.

    5. Ensuring that the dissemination of information is consistent with IRM 1.3, Disclosure of Official Information.

  2. Each operating unit and the Director, Field Operations is responsible for:

    1. Determining whether the Strike Force representative position will be assigned to the area or field office, and where it is assigned to the area office, selecting the representative to fill that position.

    2. Implementing objectives in accordance with national objectives for the IRS’s involvement in a Strike Force in that region.

    3. Maintaining an effective regional Strike Force operation through periodic review of field office Strike Force activities to evaluate the effectiveness of these operations in their meeting of objectives and the proper utilization of personnel.

    4. Coordinating all Strike Force activities with field office and area aspects, as well as with all other area and field office programs.

    5. Exercising supervision and control over and evaluating each Strike Force representative assigned to the area office as to his or her relationship with DOJ and other enforcement or regulatory agencies involved in the Strike Force.

    6. Evaluating Strike Force inventories to determine that investigations qualify under the established criteria and that resources are being effectively utilized.

    7. Keeping Headquarters advised of any significant changes or problem areas in Strike Force operation.

  3. Each Director, Field Operations through the Assistant Special Agent in Charge (ASAC) is responsible for:

    1. Selecting and exercising supervision and control over the Strike Force representative when that position has been assigned to the field office, and evaluating their relationship with DOJ and other enforcement or regulatory agencies involved in the Strike Force.

    2. Gathering, assembling, evaluating, and disseminating directly tax-related information pertaining to the identification of areas of noncompliance within illegal activities and the principals, associates, and related entities involved therein, consistent with IRS procedures.

    3. Developing, implementing, reviewing, and updating Strike Force objectives in conjunction and in cooperation with the Strike Force representative.

    4. Participating in the identification of taxpayers for examination and/or investigation.

    5. Advising Headquarters, through the area office, regarding unusual tax avoidance or evasion schemes, novel examination, or investigative techniques, and other information useful in planning and conducting examinations or investigations or the collection of assessments against taxpayers involved in illegal activities.

    6. Providing access to files, investigations, and statistical information for use by the Strike Force representative in liaison work and in the preparation of any reports required of that position. Field offices involved with more than one Strike Force will separately maintain material for each Strike Force.

    7. Assuring that reviews as appropriate of each joint investigation are conducted by the respective agents and Supervisory Special Agents (SSA) to update the work plan and evaluate progress made on the investigation. The Strike Force representative will be invited to attend these reviews.

    8. Designating an operating division group manager to function, on an as-needed basis, as a program and technical advisor to the Strike Force attorney. The operating division group manager will remain under the supervision of the Territory Manager and will not function as a Strike Force representative.

    9. Ensuring that when the other operating division is involved in collection activity in a Strike Force investigation, the revenue officer will check the Strike Force files and CI work papers for any information that will assist in the collection of the outstanding liabilities.

    10. Ensuring compliance with the requirements of policy statement P–4–84.

    11. Ensuring that the dissemination of information is consistent with the disclosure statutes, regulations, and IRS policies and procedures.

    12. Meeting with the Strike Force attorney to evaluate IRS participation and resolve mutual problems as needed.

  4. Each Strike Force representative is responsible for:

    1. Maintaining a working relationship with and serving as the point of contact between the Strike Force attorney, other Strike Force members, and IRS personnel.

    2. Furnishing technical advice to the Strike Force attorney.

    3. Participating with the Strike Force attorney and representatives of the other agencies in the identification of areas of organized illegal activities to be investigated.

    4. Coordinating all IRS-related Strike Force activities with appropriate field and regional officials and other Strike Force members.

    5. Performing liaison work between IRS field offices and between IRS and other Federal, state, and local enforcement agencies on all related Strike Force matters.

    6. Developing directly tax-related information through other Strike Force members by personal contacts, reading reports, etc., and the dissemination of this to appropriate IRS personnel.

    7. Ensuring compliance with disclosure provisions in disseminating information to the Strike Force attorney and other participating agencies (see IRM 1.3).

    8. Soliciting information from the Strike Force attorney relating to persons or entities who may become IRS Strike Force subjects.

    9. Participating in the identification of taxpayers for investigation at the field office level.

9.5.6.1.4  (07-29-2002)
Criminal Investigation Strike Force Investigations

  1. At a meeting on June 19, 1979, between representatives of DOJ and IRS-CI, it was agreed that CI investigations would be categorized as Strike Force only if the DOJ attorney in charge of the Strike Force authorizes the inclusion of the CI investigation in the DOJ Strike Force.

  2. Under DOJ practice, the DOJ attorney in charge of the Strike Force will first obtain approval from the Chief, Organized Crime and Racketeering Section, DOJ Criminal Division, to include the investigation in the Strike Force through the use of a DOJ Case Initiation Report.

9.5.6.1.4.1  (07-29-2002)
General

  1. The procedures in this text apply to IRS field offices located within geographic areas established by a DOJ Strike Force.

  2. Criminal Investigation Strike Force investigations generally should involve principal figures involved in organized crime, as defined, or:

    1. engaged in organized criminal activities

    2. notorious or powerful with respect to local criminal activities

    3. receiving substantial income from illegal activities as a principal, major subordinate, or important aider or abettor

    4. infiltrating legitimate business through illegal means; or infiltrating legitimate business through loaning or investing therein the proceeds from illegal activities

    5. engaged in an occupation requiring registration as one who is engaged in receiving wagers

    6. designated as Strike Force investigation subjects under the IRS Strike Force program

    7. believed to be receiving substantial income from an illegal activity that is separate and apart from the alleged tax violations, such as corruption in government, welfare fraud, or commercial bribery

  3. Upon initiation of the CI investigation, and under the authority of IRC §6103(k)(6), the Special Agent in Charge (SAC) will by memorandum:

    1. Advise the DOJ attorney in charge of the Strike Force that CI is or will be conducting an investigation believed to qualify for inclusion in the Strike Force.

    2. Request from the Strike Force any information within its files which may have tax administration consequences or will in any way assist in the investigation.

    3. Report any return information, in a separate memorandum from (a) and (b) in this paragraph, which indicates a possible violation of federal criminal laws outside the jurisdiction of the Service.

    Note:

    Submit the memorandum if it reports return information which indicates possible violations of federal criminal laws outside the jurisdiction of the IRS, to the disclosure officer for review, and for a recommendation to the appropriate official as to the disclosure of the information pursuant to IRC §6103(i)(3). The disclosure determination will be made by the designated official as provided in Delegation Order 156 (as revised). (Also see IRM 1.3, Disclosure of Official Information).

  4. The ability to discuss the investigation with the DOJ attorney in charge of the Strike Force will depend on whether disclosure is authorized (IRC §6103(i)(2) or IRC §6103(h)(3)(B)).

  5. Identify CI Strike Force investigations in Criminal Investigation Management Information System (CIMIS) in item 14 Grand Jury Code/Date, by entering the appropriate code for the Strike Force city in which the investigation is controlled or was initiated.

9.5.6.1.5  (07-29-2002)
Disclosure Procedures in Strike Force Investigations

  1. The Tax Reform Act of 1976 has added several new disclosure provisions to the Internal Revenue laws. Under present law, the IRS can only disclose tax information under IRC §6103 or other provisions of the Code. Severe limits have been placed on disclosures made in non-tax criminal investigations. As a general rule, disclosures to Strike Force attorneys are limited to the circumstances set forth below.

  2. Special agents are authorized by IRC §6103(k)(6) to disclose return information to the extent necessary to gather data which may be relevant to a tax investigation. Under the authority of IRC §6103(k)(6) and the regulations promulgated thereunder, the IRS may request from the Strike Force any information within its files which may have tax administration consequences or will in any way assist in the investigation, but only if the necessary information cannot otherwise reasonably be obtained in accurate and sufficiently probative form or in a timely manner, and without impairing the proper performance of official duties or if such activities cannot otherwise properly be accomplished without making such disclosure.

  3. The IRS may disclose in writing return information, other than taxpayer return information, which may constitute evidence of a violation of federal criminal laws to the extent necessary to apprise the head of the appropriate federal agency charged with the responsibility for enforcing such laws.

  4. Under certain circumstances, IRS employees may advise Federal, state, or local law enforcement authorities immediately, or after securing an authorization, of the facts necessary to apprise such law enforcement authorities of possible violations of serious nontax criminal laws. Such disclosures are permitted only where the information to be disclosed is not tax information. For example, an employee may have information of a homicide, burglary, rape, robbery, or similar crime and disclose this to appropriate law enforcement officials according to the procedures found in IRM 1.3.

  5. Generally, disclosures of information will be coordinated with the Disclosure Officer to assure compliance with the pertinent disclosure statutes, regulations, and IRS procedures. All disclosures under IRC §6103(I)(3) and disclosures of nontax criminal violations should be in writing or sufficiently documented to provide a permanent record of the information released. This documentation should be retained in the investigative file.

9.5.6.1.6  (07-29-2002)
Grand Jury Relationship

  1. IRS participation in Strike Force activities may involve grand jury matters. IRS personnel so participating should be especially mindful of the provisions and procedures of IRM 9.5.2, Grand Jury Investigation. Restrictions governing the receipt and dissemination of grand jury information must be carefully observed.


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