Letter from Sen. Charles Grassley (R-IA) to OMB Director Mitch Daniels.
Re: Lost computers at various government agencies.
Date: August 15, 2002.
Source: Office of Sen. Grassley.
Official Portrait of Senator Grassley

August 15, 2002

The Honorable Mitchell E. Daniels, Jr.
Office of Management and Budget
705 Seventeenth Street, Northwest
Washington, DC 20503

Dear Mr. Daniels:

I am writing to bring to your attention what now appears to be a government-wide problem: lost, stolen or missing computers.

In recent days we have seen Inspectors Generals' reports of the Federal Bureau of Investigation (FBI) and Customs Service having thousands of computers that are lost, stolen or missing. Earlier in the summer we learned in another Inspector General report that the Internal Revenue Service (IRS) had approximately 2,300 computers that were lost or stolen. I'm worried that just as dryers have the knack of making socks disappear the federal government has discovered a core competency of losing computers.

Today, we have another Inspector General report with another finding that thousands of computers are unaccounted for and in addition that sensitive taxpayer information may be in jeopardy. The Treasury Inspector General for Tax Administration (TIGTA) reports that the IRS cannot account for the thousands of computers that they have provided to Volunteer Income Tax Assistance (VITA) and Tax Counseling for the Elderly (TCE) programs. Over 6,600 desktop and laptop computers are provided to VITA/TCE cites.

Unlike previous reports that could at least cite the number of computers lost or stolen, this report states that the situation is so poor that the IRS does not even know how many computers are missing:

The IRS developed the Information Technology and Asset Management Systems (ITAMS) to control its computer inventory in March 2001. The ITAMS database is the IRS' system of record for computer inventory control. (P. 3)

We performed a random match of 41 computers (with estimated acquisition costs from $1,082 to $3,565) from 10 listings of computer equipment obtained by SPEC [Stakeholder Partnerships, Education and Communication - - the entity that runs VITA/TCE] . . . and found that 38 (93 percent) of the 41 computers sampled were not on the ITAMS. (P. 6)

Without adequate internal controls, the computers could be lost or stolen without any knowledge by SPEC. (P. 7)

While the loss of computers is of great concern, the IRS admits that the real cost is the "value and sensitivity of the files included on the computers and their critical importance to the IRS' mission." (P. 4)

The VITA/TCE program provides valued taxpayer assistance to many low-income taxpayers as well as seniors. Thus, it is particularly disturbing that sensitive taxpayer information that was on these computers was not adequately protected. Again, the situation is so bad that TIGTA cannot even determine the number of the 1.1 million tax returns prepared under VITA/TCE in Filing Season 2001 that may be in jeopardy:

Because the location of the computers is not always included on the ITAMS and the fact that computers were not always added to the ITAMS, we could not determine the number of taxpayers whose e-file data may not have been adequately protected by the IRS from unauthorized disclosure or misuse. Information on tax forms is regarded as a prime target for identity thieves, including names, social security numbers, income, employment and bank details. (P. 9, emphasis added)

I am particularly frustrated that this problem of taxpayer information was highlighted in an earlier TIGTA report and that nothing was done in response to TIGTA recommendations to protect taxpayer information.

This most recent report highlights what appears to be a disturbing trend of government coming up short as stewards of the taxpayers money. Fortunately, Inspector General reports show that there are a few government agencies that have been exemplary in accounting for taxpayer money. Clearly, it is possible for government agencies to account for their computers.

I appreciate your good work at the Office of Management and Budget (OMB) to bring government credit card abuse under control and to consider action that will force those responsible for delinquent accounts to make good on such accounts personally. Additionally, I understand that OMB is working to improve government-wide policy with respect to relocation expenses. As you know from past correspondence, I have been troubled by earlier reports that revealed highly inappropriate use of government credit cards and questionable management of relocation expenses.

I know that your position naturally attracts criticism but I would say that I am very pleased with OMB's aggressive efforts to address these problems of government waste and fraud that I have brought to the public attention. I encourage you to similarly direct a government-wide effort to address the inability of agencies to account for the computers they have purchased with the taxpayers' money.

Thank you for your time and courtesy. If you have any questions, please contact Mr. Dean Zerbe or Mr. Robert Kerr of my staff at 224-5315.

Cordially yours,


Charles E. Grassley
Ranking Member

cc: Chairman Baucus