IRS Issues Apology to Billionaire, Other Tax Leak Victims

The IRS apologized to Citadel CEO Ken Griffin for the improper disclosure of the hedge fund manager’s sensitive tax information, ending a year-and-a-half legal battle. (IR 2024-172, 6/25/2024)

Griffin withdrew his lawsuit from the US District Court for the Southern District of Florida June 24, according to news reports. He was one of many wealthy individuals, including former President Donald Trump, whose tax data was leaked to media outlets by former IRS contractor and Booz Allen employee Charles Littlejohn.

Littlejohn pleaded guilty to one charge of unlawfully disclosing income tax return information and was sentenced to five years in prison in January.

With the case settled, the IRS issued a public statement apologizing to Griffin “and the thousands of other Americans” affected by Littlejohn’s actions in his capacity as a contractor performing work for the agency.

“The IRS takes its responsibilities seriously and acknowledges that it failed to prevent Mr. Littlejohn’s criminal conduct and unlawful disclosure of Mr. Griffin’s confidential data,” read the IRS’ statement. “Accordingly, the IRS assures Mr. Griffin and the other victims of Mr. Littlejohn’s actions that it has made substantial investments in its data security to strengthen its safeguarding of taxpayer information.”

The statement continued in stressing the IRS’ intentions to work with Treasury watchdog agencies like the Treasury Inspector General for Tax Administration and the Government Accountability Office, as well as independent third parties, in beefing up data security measures.

Filed in December 2022, the complaint said the IRS was negligent and failed to prevent the Code Sec. 6103 violation from occurring. In April, the suit was partially dismissed, as Judge Robert Scola Jr. agreed with the government that Griffin did not make a valid claim for damages under the Privacy Act. The other count pertaining to Littlejohn’s classification as an IRS employee was retained.

According to the IRS, the resolution “will result in a stronger and more trustworthy process” moving forward.

“I am grateful to my team for securing an outcome that will better protect American taxpayers and that will ultimately benefit all Americans,” said Griffin in a statement provided to Checkpoint.