IRS officials testify on outage


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The simultaneous failure of a mechanical component and its backup — rather than any cyberattack — was responsible for the day-plus-long outage of several IRS computer systems last week, three agency officials testified Thursday.

During a two-and-a-half-hour long hearing before the Committee on Oversight and Government Reform, IRS Chief Technology Officer Terry Milholland and two colleagues gave the first detailed public account of what officials had previously described only as “a hardware failure” on Feb. 3 that left certain electronic tax tools unavailable for 30 hours.

[Read more: Identity thieves attack IRS E-File system]

Thursday’s hearing was one of 23 the committee has held in the past four years focusing on various document preservation and data security issues plaguing the IRS. This week, the agency revealed that cyber thieves had used an automated software bot in December to generate more than 100,000 E-File PINs for stolen Social Security numbers. If undetected, the PINs could be used to file a fraudulent tax return.

Nonetheless, a simple mechanical issue caused last week’s hardware failure — not a cyberattack as some had thought, Milholland said. Voltage regulators failed on their primary tax return server, he said, and while fixing it, the backup regulators also failed. The agency is currently investigating why both broke at the same time.

[Read more: Some IRS systems still offline after outage]

“They are a mechanical component that are under somewhat high-stress conditions when the computer is operating, and over time, one of the voltage regulators literally said, ‘I’m failing,’ and called an alert for the mechanic to come fix it,” Milholland explained.

Rep. Carolyn Maloney, D-N.Y., compared the issue to a software issue that forced the New York Stock Exchange to stop trading for four hours last July. The Department of Homeland Security saw no suspicious activity, so it didn’t hold a hearing or investigation.

“Yet we are going after the IRS today for a similar, temporary, subsequently resolved site outage, and I just feel that there is a little bit of an unequal treatment here,” she said.

During Thursday’s hearing, Oversight Committee Chairman Rep. Jason Chaffetz, R-Utah, showed great dissatisfaction with the IRS, as he has in the past. In October, he introduced a resolution to impeach IRS Commissioner John Koskinen. The resolution has 62 co-sponsors.

“There are already a number of examples of IRS incompetence and neglect, but several examples in the recent weeks has made it clear for the need for serious oversight and needed reform,” he said.

More sympathetic to the IRS, Rep. Gerry Connolly, D-Va., said the issues were symptoms of large budget cuts and faulty IT equipment. The IT and tax systems date back to the 1960s and ’70s, and use an outdated computer language, he said.

After 17 percent cuts to their budget over the years, the IRS’s budget is at the lowest it has been in five years, and is equivalent to the amount they had in 1998, Connolly said.

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budget, Departments, Government IT News, Internal Revenue Service, IRS, oversight, Regulations & Oversight, Treasury Department
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