Evening star., 1952-01-05
Cases Of Tax Fraud
Dropped for Reasons
|0f Health Revived
By Cecil HoIIond


Field Offices of the scandal-hit
Bureau of Internal Revenue have
been directed to survey all tax
fraud cases closed for health rea-
sons and reopen those not barred
by the statute of limitations, it
was learned today.
The instructions were sent out
December %. They directed bu-
reau officials to send to the Justice
Department for action those
cases not barred by the statute of
limitations and meeting the
agency's standards for prosecu-
ton.
The directive is a part of the
bureaus far-reaching program of
revamping policies and procedures
in the wake of disclosures of
widespread corruption and irregu-
larities in the Governments tax
collecting system.
The bureau has been severely
criticized in hearings before the
House Ways and Means subcom-
mittee investigating tax scandals
for dropping prosecution in tax
frauds where there is a medical
showing that the life of the tax
payer would be endangered by
the stress of a court trial. There
were suggestions by some of the
subcommittee members there was
no justification for such leniency
in clear cases of a fraud attempt,
Skepticism On Revamp Plan.
Other developments bearing on
the tax scandals included:
l. Members of Congress con-
tlnued to view with extreme eau
ton, If not outright skepticism.
President Truman's proposed re-
organization of the Revenue Bu-
reau and indicated they would de-
mand full details on the reorgani-
zation plan. In a surprise move
earlier in the week, Mr.. Truman
offered a plan that would abolish
all "a Collectors of Internal Rev.
enue and replace them with not
more than Is district commission
ers with broad decentralized au-
thority for administering the rev.
enue laws. ... ~.
2. Representative King, Demo-
crat, OF California, the chairman
OF the House investigating sub
committee, was expected to return
to Washington next week to direct
a full study by his group of the
Presidents proposal.
8. The House subcommittee went
ahead with plans for opening
hearings January 81 in San Fran
cisco on irregularities reported in
the collectors Office there. Two
members of the subcommittee
staff already have been sent to
San Francisco and Adrian w.
De Wind, the chief counsel, indi-
Gated he would leave for the West
Coast next week to take personal
charge Of the investigation pre-
ceding the public hearings.
Number of Gases Not Revealed.
The bureaus latest instructions
regarding health cases follows up
an early December announce
ment that it would no longer make
the decision on prosecution where
the question of the, life of the
taxpayer was brought into the
proceedings. In such cases, il
was said, the matter would be left
to the Justice Department, which
is charged with fraud prosecutions
The number of cases that may
be involved in the bureaus ruling
was not available. In addition to
those handled at the Washington
level many cases in the field have
not been prosecuted for reasons
of health.
Until recently, 1t was the bu-
reau's established practice not tc
push prosecution in fraud cases
If the health of the taxpayer was
precarious to the extent death
might result from trial. In such
cases, it was the bureaus policy
to require health examination
OF the defendant by a public
health physician.
The new instructions for posi-
BILE reopening of fraud cases in
volving health of the taxpayer
were worked out after the De-
cember decision to pass the re-
sponsibility for such action to the
Justice Department. They were
approved by Commissioner of
Revenue John r Dunlan