The woman at the center of the IRS scandal was put on paid administrative leave Thursday, marking the second agency official to be removed over the inappropriate scrutiny of conservative groups.
The news came even as two top senators called for Lois Lerner to be suspended on accusations of misleading their investigation into the tax-exempt organizations division of the IRS, which she led, and as new details emerged about her past.
A colleague of Ms. Lerner in her previous job as head of the Federal Election Commission's enforcement office said Ms. Lerner wasn't a partisan ideologue but rather was driven by a desire to keep money out of politics.
"Her default position is that money and politics is suspicious, so the people with more money are more likely to have violated the law," said Craig Engle, now a private attorney.
"When you get into the business of trying to approve people's future conduct, you're going to get it wrong. You end up picking winners and losers. And that is not the IRS' job."
As Republicans, the tea party and conservative Christian groups became more active, powerful and wealthier in recent years, he said they increasingly have been targets of Ms. Lerner.
Mr. Engle added that Ms. Lerner is an "honest person" but that she "got some things very wrong and then said some things very wrong."
"Bad judgment doesn't make you dishonest," he said.
A day after Ms. Lerner refused to answer questions at a congressional hearing, Danny Werfel, the IRS' new acting commissioner, told agency employees in an email Thursday he has selected Ken Corbin as the new acting head of the division that targeted tea party and other conservative groups from 2010 to 2012. Mr. Corbin has been deputy director of submission processing in the wage and investment division.
Mr. Werfel, in the letter, called Mr. Corbin a "proven leader during challenging times."
The news comes the same day Sens. Carl Levin and John McCain, who together run the Senate's permanent investigative subcommittee, sent a letter to the IRS accusing Ms. Lerner of dereliction of duty and calling for her suspension.
Mr. Levin, a Michigan Democrat and the panel's chairman, and Mr. McCain of Arizona, the subcommittee's senior Republican, said they already had been investigating a different aspect of Ms. Lerner's division and that their investigators interviewed her in April. She failed to tell the investigators about the controversy over targeting conservative groups for special scrutiny, the senators said.
"Given the serious failure by Ms. Lerner to disclose to this subcommittee key information on topics that the subcommittee was investigating, we have lost confidence in her ability to fulfill her duties as director of Exempt Organizations at the IRS," the two senators said in a letter to Mr. Werfel, who took control of the agency after President Obama asked acting Commissioner Steven Miller to step down last week.
Other lawmakers have said high-level IRS officials misled Congress by not informing them of the scrutiny of conservative groups seeking tax-exempt status, even after they were aware that dozens of members of Congress were concerned.
But the senators' letter is the first time anyone has shown Ms. Lerner, when given the chance, failed to tell Congress about the agency's singling out groups for special scrutiny that included the conservative buzzwords "tea party," "patriot" or "9/12" in their names.
Sen. Chuck Grassley of Iowa, the senior Republican on the Senate Judiciary Committee, also Thursday said it's his "understanding" that Mr. Werfel has asked Ms. Lerner to resign, but that she refused.
Mr. Grassley said the IRS "owes it to the taxpayers" to resolve the situation quickly.
"The agency needs to move on to fix the conditions that led to the targeting debacle," he said. "She shouldn't be in limbo indefinitely on the taxpayers' dime."
Rep. Darrell E. Issa, California Republican and chairman of the House Oversight and Government Reform Committee, said Ms. Lerner's invocation of the Fifth Amendment in refusing to testify before his panel Wednesday is no longer valid and that she remains under subpoena. He said the committee is looking at recalling her for testimony.
• Stephen Dinan contributed to this report.
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