A former manager at the IRS Cincinnati office at the center of the controversy over the targeting of conservative political organizations seeking tax-exempt status tells NBC News she doesn’t think low-level employees acted on their own in flagging them for further scrutiny.  

But she also said that in her time at the IRS she has never known politics or partisan motivations to play any role in the office’s work, and doesn’t think it did in this case. 

Bonnie Esrig, a 38-year IRS veteran, worked as an area manager in the Determinations Unit of the IRS’ Exempt Organizations department in 2011 and 2012. According to a federal audit and IRS Congressional testimony, some employees in the unit used inappropriate selection criteria to flag the applications of Tea Party and other conservative organizations for further scrutiny, according to an audit by the Treasury Inspector General for Tax Administration. (Esrig worked on tax-exemption status issues in the IRS office, but for other types of organizations, such as charter schools – not on the political advocacy groups cases at the center of the controversy. She retired from the IRS in January.) 

The audit released last week by the Department of the Treasury’s Inspector General for Tax Administration found that IRS employees in that unit “targeted” conservative political advocacy organizations for additional review based on keywords in their organizations’ names, such as “Tea Party.” 

Esrig said that recent media headlines reporting that “rogue” agents were responsible and questioning whether the Obama Administration had played a role, surprised her, given her first-hand knowledge of the unit and its work. 

“Those were things that were not consistent with my knowledge of the way the organization works,” Esrig said. 

Esrig said she doesn’t believe that a few employees in the Cincinnati office made the decisions to use the inappropriate selection criteria – as the IRS has claimed to Congress and as the Treasury Inspector General reported in its audit. 

According to a congressional source, the IRS reported in a briefing to Congress that two “rogue” employees were responsible for the use of the criteria.

But Esrig said that doesn’t make sense based on her experience.

“The idea of two rogue employees,” Esrig said, “is inconsistent with the kinds of checks and balances that are inherent in the way the organization is set up.” 

Nor does she believe the IRS assertion in its response to the Inspector General’s audit that the use of such inappropriate selection criteria were “mistakes” and that “front-line career employees … made the decisions.”   

“Front-line employees (at the Cincinnati office) do not make key decisions about policy and how work is processed,” Esrig told us.  “Work is reviewed by the managers. The employees don't operate autonomously where there is no review. The managers review.

“I think that even if an employee were to veer off in a separate direction briefly, I would be very surprised if anyone could sustain that before management became involved.” 

But Esrig agreed with a second claim the IRS has been making: that the employees using the inappropriate criteria “acted out of a desire for efficiency and not out of any political or partisan viewpoint.”  

She said that she never saw any political or partisan behavior in her time in that office and that she does not believe that there was any political motivation behind the use of the inappropriate selection criteria. 

"I don't believe that it was in any way political," she said.  

Likewise, she said, she never saw any hint of partisanship during her nearly four decades with the IRS.

The Inspector General’s audit stated that, when it asked various IRS personnel, from Acting Commissioner Steven Miller to employees in the Exempt Organizations Determinations Unit, whether there had been any outside influence in the selection of the criteria, “All of these officials stated that the criteria were not influenced by any individual or organization outside the IRS.”

 Esrig told NBC News that she agrees that the IRS was not acting on any outside direction, presidential or otherwise.

 “The way the IRS operates,” Esrig said, “over my years of experience in various roles, including working in Washington, D.C, I have never seen anything come down where the administration was directing the IRS to handle something in one way versus another way.”

Esrig told NBC News she thought Miller’s testimony to a congressional committee last week that employees were using keywords as a shortcut to select cases more efficiently -- and not for political reasons -- was entirely plausible. 

“I absolutely believe that cases could be grouped for reasons that had absolutely nothing to do with partisan concerns,” she said. “I don't think that there is anything political about the grouping of cases.” 

The IRS Exempt Organizations Determinations Unit is located on the fourth floor of the Federal Building at 550 Main St. in downtown Cincinnati.  It is the location which receives, reviews and processes all applications for tax-exempt status, and from which letters of acceptance or denial originate.   

The IRS has reported to Congress that approximately 140 employees – most of them in Cincinnati -- have been doing the work on political groups cases, out of the IRS overall staff of 90,000.

Related story

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In recent years, those employees handled an increase in the number of political advocacy organizations engaging in both social welfare and political activities applying for tax-exempt status under section 501(c)(4) of the Internal Revenue Code.

NBC News has attempted to contact other IRS employees -- present and former, in Cincinnati and elsewhere -- who were involved with the tax-exempt determinations during the period when the targeting occurred, but those employees either have declined to comment or have not responded to requests.

Esrig said she has not talked to any of her former colleagues about the controversy, and is speaking only based on her experience in that office.

“I believe that the employees were trying to do the best job they could with the guidance they were given,” she said. 

Lisa Myers is NBC News' senior investigative correspondent; Rich Gardella is an investigative producer for NBC News.

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Officials in the Oklahoma City suburb ravaged by deadly tornadoes Monday complained earlier this year about FEMA’s foot-dragging over $2 million in federal grants for “safe rooms” in 800 homes that would protect people from severe weather.

“Our countywide Hazard Mitigation Plan still has not been approved by the State and FEMA,” said a statement posted in February on the City of Moore’s website. It said that changes to federal requirements occurred while the city’s contractor was preparing the plan, adding, “We’ve found that the FEMA requirements …  seem to be a constantly moving target.”

A spokesperson for the Federal Emergency Management Agency told NBC News the agency is “looking into” the city’s claim about delays.

In October 2011, the city collected the name of Moore residents interested in applying for the federal money. In order for residents to be eligible for the money, the city and other communities in Cleveland County had to submit an updated “Hazard Mitigation Plan” for FEMA and state approval. Moore started revising the plan late that year.

Slideshow: Tornadoes ravage Plains

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Destroyed vehicles lie in the rubble outside the Plaza Towers Elementary school in Moore, Okla., on Tuesday.

Launch slideshow

In May 2012, according to city’s website, the county-wide plan was almost finished and the city anticipated final approval of the plan by November.

“We intend to apply for $2 million in FEMA funding, which will assist approximately 800 Moore homeowners,” it said. “If a homeowner is chosen for the program … the homeowner will be eligible to receive up to $2,500 in rebate.”

But in an update in February,  the officials said the Hazard Mitigation Plan had to be rewritten because of the “new wrinkles.”

“However, the Plan is not our main obstacle,” it said. “The federal grant program which funds local initiative such as ours is funded by monies set aside during presidential major disaster declarations. Oklahoma has had a few of these declarations in the past couple of years, so there is not a lot of grant money available.”

The Oklahoma Department of Emergency Management and Gayland Kitch, director of emergency management for the city of Moore, did not immediately return calls from NBC News seeking comment.

Jim Seida /NBCNews.com

Aaron Miller, owner of Midwest Storm Shelters, shows off a safe room he installed in a new house in Joplin, Mo., in August 2011.

While bemoaning the delay in getting the grants, the unsigned statement played down the need for safe rooms, saying  Moore has no community or public tornado shelters because people “face less risk . . . in a reasonably well-constructed residence.” The city’s website also said that Moore faced only a “1-2 percent” chance of a tornado hitting the town on any spring day, and that if a tornado did strike, there was less than a 1 percent chance of it being as strong as the one that swept through town in May 1999 and killed three people.

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Kristen Lombardi /Center for Public Integrity

The 2,400-acre ExxonMobil petrochemical complex in Baton Rouge, La.

BATON ROUGE, La. — Shirley Bowman noticed the smell after 8 a.m. on June 14, 2012, her 61st birthday. In Baton Rouge, where the petrochemical industry dominates the landscape, foul odors resembling burnt rubber or propane are perennial. But this odor, caustic and potent, seemed especially foul — “like some sort of chemical,” she recalls.

Bowman found her daughter crying over a migraine. Her neighbors experienced headaches, dizziness, nausea. One family reported a toddler son coughing up phlegm; another, an elderly father collapsing on the floor. She soon suspected the cause: A leak of “steam-cracked” naphtha, a liquid mixture of volatile petrochemicals, occurring at the ExxonMobil Baton Rouge petrochemical complex a half mile away.

Four hours earlier, Exxon operators detected an odor in the East area tank field and discovered a “bleeder” valve on Tank 801 dripping naphtha into a sewer. The leaky valve dumped 411 barrels into the underground system, company records filed with the state show. The liquid traveled a mile before pouring into a separator pit, vaporizing along the way, and releasing tens of thousands of pounds of benzene and other toxic chemicals into the air.

What happened that day in Baton Rouge is one thread of a larger story about the often toxic, sometimes invisible releases emanating from oil refineries, chemical plants and other industrial facilities along the chemical corridor of Louisiana and Texas. Those unplanned emissions — known in regulatory parlance as “upsets” — are occurring more often than industry admits or government knows, according to more than 50 interviews with regulators, activists, plant representatives, workers and residents, and an analysis of tens of thousands of records by the Center for Public Integrity.

For many communities, these upsets have evolved into an unseen menace: They disrupt lives, yet the companies are rarely punished. In Texas, where activists have clamored for relief, state officials say enforcement efforts helped reduce the number of incidents by 6 percent; Louisiana officials cite an even steeper decrease, 41 percent since 2008.

Yet those numbers tell only part of the story. The mass of pollution emitted in Texas, the nation’s refinery hub, hit a five-year peak in 2011, the Center found -- so even as the number of reported events dipped, the amount of pollution increased. And, experts say upset releases are consistently underreported.

This hidden pollution can produce harm. Over the last five years, records show, upset events have yielded almost 4 million pounds of toxic air pollutants in Texas alone — the 189 chemicals deemed so harmful to health Congress sought to bring emissions under control two decades ago. That’s 2 percent of all upset emissions.

“These are a major public health threat,” acknowledges Larry Soward, a former commissioner at the Texas Commission on Environmental Quality, who served on its board from 2003 to 2009.

“Upsets” occur when equipment breaks down or production units are shut off, restarted and repaired; or, as regulations state, when there’s an “unavoidable” accident.

Under law, plant managers must notify officials when accidental releases exceed certain hazardous air thresholds, known in regulations as “reportable quantities.” In Baton Rouge, Exxon did this. Yet the figures it reported kept escalating.

At 5:10 a.m. that day, Exxon supervisors told the state the benzene leak would likely exceed the 10 pound reportable quantity. Within hours, they classified it “level 2,” barricading areas and monitoring the air. According to a call log, company officials found benzene levels “so high” bordering a rail yard, they advised the railroad “not to let anyone go through that area.” By 12:30 p.m., the company was testing 400 workers for exposure to the cancer-causing chemical.

The following day, Exxon reported that benzene emissions totaled 1,364 pounds during the leak’s first three hours. By June 20, it increased the number to 28,688 pounds. In its final report filed 60 days later, Exxon revealed the benzene total was actually 31,022 pounds. State regulators later deemed the leak “preventable,” issuing an enforcement order contending that Exxon “failed to provide notification of a change in the nature and rate of the discharge.”

The company, saying it accurately reported the release, is appealing the state’s order. While plant supervisors acknowledge the “large” leak, they say it didn’t threaten residents. Tests along the fence line showed “no community impact,” their records state; air sampling by state regulators back up the company.

“It was a large number. We regret that number,” says Derek Reese, Exxon Baton Rouge’s environmental manager. “But we believe we did an appropriate response to mitigate the impact.”

That’s little consolation to residents, like Bowman. “Everything seems to stop at that magical gate,” she says, motioning to Exxon’s South Gate adjoining her neighborhood. “But if you live here, you know. Chemicals are let out on you.”

Upsets plague plants, communities
The hazards extend far beyond Baton Rouge. In Texas and Louisiana, the vast number of plastics, power and gas plants provide an on-the-ground case study of a national problem.

Data collected by the Texas Commission on Environmental Quality, TCEQ, offer a rare window into this pollution peril; the state agency requires companies to report events online within 24 hours, as well as annual totals.

From 2007-11, just over 2,400 of the largest facilities across Texas spewed almost 180 million pounds of upset emissions, contamination on top of the 14.8 billion pounds of routine air emissions in that time. Nearly half the facilities experienced at least one event in that period, pumping out sulfur dioxide and other smog-inducing pollutants. The greatest concentration came in 2011: 58.1 million pounds.

The 20 biggest offenders — oil refineries and natural-gas plants in Kermit, Beaumont, Corpus Christi and beyond — account for more than half of all such emissions in Texas.

“It’s a lot of stuff,” says Neil Carman, a former state air pollution inspector who investigated upset events. Carman now heads the air program for the Sierra Club’s Lone Star chapter, which has filed several citizen lawsuits targeting illegal emissions.

Industry portrays the discharges as an inevitable — and overwhelmingly harmless — byproduct of manufacturing. Regulators have encouraged this casual attitude, some experts say.

For decades, critics say, the U.S. Environmental Protection Agency and state regulatory agencies have effectively ignored the emissions. Officials don’t count upset events in facility permits and compliance records, notes Kelly Haragan of the environmental law clinic at the University of Texas-Austin, because they “aren’t supposed to happen.” In August 2004, Haragan penned a 215-page report showing how easily facilities could get away with releasing more pollution than allowed by the federal Clean Air Act.

At times, she says, “It’s like having a whole other plant no one is even acknowledging.”

These incidents skirt normal pollution controls, instead venting into the atmosphere through flares and leaks. Plants can have scores of events a year, giving off a constant cloud of invisible pollution.

“A big dose of toxins are coming out of these facilities,” says Soward, the former TCEQ official, who now works for Air Alliance Houston, “and into fence line communities.”

The health effects are harder to measure; little research exists on the threat to residents. But recently, Dr. Mark D’Andrea, an oncologist at the University of Texas Cancer Center, began tracking 4,000 residents exposed to the poster child of all upsets — the “40-day Release” at the BP refinery, in Texas City, which belched 514,795 pounds of benzene and 20 other pollutants throughout the spring of 2010. Earlier this year, D’Andrea unveiled preliminary data showing the residents have “significantly higher” white-blood cell and platelet counts than their Houston counterparts. The data suggests BP’s release may have increased their risk of developing such cancers as leukemia, the doctor says.

In a statement, BP says it does “not believe any negative health impacts resulted from” its 40-day release. “To our knowledge, the University Cancer Centers’ pilot study does not support a claim for any plaintiff alleging injury from that flaring and has no relevance to those claims,” the company wrote, referring to pending litigation filed by 47,830 residents and workers against BP alleging health ailments caused by the release. D’Andrea has not been hired as an expert witness for either side in the case, but has testified in pre-trial discovery.

‘An invisible poison’
In Baytown, Texas, about 250 miles from Baton Rouge, ExxonMobil operates the nation’s largest petrochemical complex, replete with an oil refinery and two chemical plants. The mass of stacks, tanks and pipes spans 3,400 acres on Houston’s ship channel, looming over blue-collar neighborhoods nestled in its shadow. In Harris County, a manufacturer’s Mecca, Exxon’s refinery tops all 155 upset emitters, spitting out 3.8 million pounds’ worth from 2007 to 2011. 

Here, residents describe fiery flares that have rattled windows, belched black smoke and cast a sooty substance on the ground. At times, they’ve unleashed a thunderous boom, “like an Air Force fighter jet,” says Shae Cotter, who lived across a highway from the complex. He remembers the sound jolting him from sleep at 3 a.m. Occasionally, he videotaped flares aglow like celestial globes, flames ballooning toward his home.

Read the full report by The Center for Public Integrity

The Exxon complex ranks among the state’s biggest upset emitters involving carcinogens and noxious gases. Top chemicals include hydrochloric acid, 1,3-butadiene and benzene, toxins that can trigger skin irritations, respiratory problems, neurological disorders and gastro-intestinal diseases.

In a statement, ExxonMobil Baytown says it has worked with regulators to “greatly” reduce emissions. “We are proud of the overall reductions we have made,” the company wrote. Since 2000, Exxon notes, it has decreased total emissions at the Baytown complex by more than 50 percent. The company declined to provide similar statistics for the facility’s upset emissions. “ExxonMobil is committed to continuously improving the environmental performance of our Baytown Complex,” the company said.

Since December, the Baytown facility has set off a wave of upset emissions. One, triggered by a tripped compressor in the refinery’s Booster Station Four, pumped out 114,000 pounds of sulfur dioxide in 18 hours. It was the 20^th upset recorded there by company reports.

“Exxon is emitting all of these day after day,” says resident Marilyn Kingman. “Anybody who lives in the Baytown area is suffering.”

Smells drive some homeowners inside. Stuart Halpryn, whose house sits a quarter mile from Exxon, says he tried to adapt to the odors, along with the runny noses and allergy-like symptoms that he believes the odors caused. That changed in February 2009, when he says a valve leak at the refinery sickened his family. His four children suffered from such severe indigestion, he says, they missed school for a week. Later, he learned from reading Exxon’s report the leak had unleashed 17,432 pounds of six different toxic chemicals.

“Nobody really understands what’s being dumped on them,” says Halpryn, who moved his family to Kentucky in June. “It’s an invisible kind of poison that’s being rained down.”

The Center for Public Integrity is a nonprofit, independent investigative news outlet. For more of its stories on this topic go to publicintegrity.org. 

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The Justice Department’s secret subpoena for AP phone records included the seizure of records for five reporters' cellphones and three home phones as well as two fax lines, a lawyer for the news organization tells NBC News.

David Schulz, the chief lawyer for the AP, said the subpoenas also covered the records for 21 phone lines in five AP office lines -- including one for a dead phone line at  office in Washington that had been shut down six years ago. The phone lines at four other offices – where  100 reporters worked — were also covered by the subpoenas, Schulz said. 

Although AP had given general information about the subpoenas last week, it provided new details Monday about the number of cell and home phone records as it considers possible legal action against the Justice Department.

Schultz said the subpoena for a Washington phone line that had been shut down years ago raises questions about assertions by Deputy Attorney General James Cole, in a letter last week, that the subpoenas were narrowly crafted and only issued after a "comprehensive investigation" that included over 550 interviews and reviewing tens of thousands of documents.

Cole had said in his letter to the AP that "consistent with Department policy, the supboenas were limited in both time and scope."

Schultz confirmed that the subpoenas for the phone records were secretly issued to Verizon, which turned them over to the Justice Department without any initial notice to AP. On May 10, Justice notified AP of the subpoenas in a one-sentence letter, citing department guidelines that require such notice for media phone records after 90 days.

The  AP is considering filing legal action to challenge the Justice Department subpoena as overly broad and inconsistent with the department's own guidelines. On CBS’ “Face the Nation” on Sunday, AP President and CEO Gary Pruitt said the secret subpoenas were "so sweeping, so secretively, so abusively and harasssingly … overbroad, that it constitutes … an unconstitutional act."

Justice Department officials did not respond to requests for comment.

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Federally subsidized phone service for the poor provides a crucial lifeline for many low-income Americans, but providers of the service appear to have put tens of thousands of users at risk of identity theft, according to a report published Monday.

More than 170,000 records from two companies that provide the Lifeline service -- Oklahoma City-based TerraCom Inc. and its affiliate, YourTel America Inc. -- were posted online, a Scripps News investigation found. The records, from residents of at least 26 states, include Social Security numbers, dates of birth and information about participation in other government-assistance programs. Of those records, 343 were viewed by unknown individuals, an official for both companies acknowledged.

Click here to read the full report.

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Reuters

Steve Mortenson, the owner of the Trenton Water Depot in Trenton, N.D., reviews logs inside his depot on March 26.

WATFORD CITY, N.D. -- In towns across North Dakota, the wellhead of the North American energy boom, the locals have taken to quoting the adage: "Whiskey is for drinking, and water is for fighting."

It's not that they lack water, like Texas and California. They are swimming in it, and it is free for the taking. Yet as the state's Bakken shale fields have grown, so has the fight over who has the right to tap into the multimillion-dollar market to supply water to the energy sector.

North Dakota now accounts for over 10 percent of U.S. energy output, and production could double over the next decade. The state draws water from the Missouri River and aquifers for its hydraulic fracturing, the process also known as fracking and the key that has unlocked America's abundant shale deposits. The process is water-intensive and requires more than 2 million gallons of water per well, equal to baths for some 40,000 people.

As in all booms, new players race in to meet the outsized demand. At the heart of this battle is a scrappy government-backed cooperative, conceived to ensure fresh water in an area where its drinkability is compromised.

The co-op has decided to sell 20 percent of its water to frackers to help keep prices low and pay back state loans. That has not gone down well with the Independent Water Providers, a loose confederation of ranchers, farmers and small businesses that for years has supplied fracking water.

Since opening in January, the co-op has tried to limit the power of the confederation with an aggressive legal and lobbying strategy. The Independent Water Providers have fought back, arguing that the co-op shouldn't be selling fracking water at all. The state Legislature stepped in with a law last month designed to quell the tension and nurture competition, but industry observers expect the acrimony to continue.

"When all of us had nothing (before the oil boom), there was nothing to fight about," said Dan Kalil, a longtime commissioner in Williams County, home to many oil and natural gas wells. "Now, so many friendships have been destroyed because of water and oil."

Jeanie Oudin, an analyst with energy consultancy Wood Mackenzie, predicts the competition could push down North Dakota fracking water prices at least 10 percent in the next few years, or roughly $170,000 per well. That's a sizeable savings in a state where fracking costs are the highest in the country (remoteness meant there was little infrastructure in place). The water accounts for 20 percent of the roughly $8.5 million it costs to drill a North Dakota oil well.

NBC News

Click on the image above for an interactive map showing where the United States produces various forms of energy.

"Regardless of where operators get their water from, the growth in active water depots should increase the availability of raw water for hydraulic fracturing and ultimately bring down costs," Oudin said. The depots are where energy companies buy most of their fracking water.

The North Dakota Petroleum Council, a trade group for Statoil, Hess, Exxon Mobil, Marathon Oil and other large energy companies, declined to comment on the fight or to forecast how much water prices could fall. The council acknowledged that it would prefer multiple sources for the state's 8,300 wells.

Energy companies get most of their water in the state by trucking it from depots to oil and natural gas wells. Some wells require more than 650 truckloads to frack. Companies such as EOG Resources Inc and Halliburton Co are experimenting with ways to reduce their dependence on water.

Fracking water depots, which cost roughly $200,000 to build and can gross more than $700,000 per year, are typically small metal buildings on concrete slabs filled with pumps and small tanks connected to the Missouri River or local aquifers. They can have two to six hookups and fill water trucks with as much as 7,800 gallons of water per visit.

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The government-backed co-op has nine water depots to hold the fresh water that is piped from the treatment plant in Williston, about 45 miles north of Watford. It plans to build four more depots throughout the Bakken and hugely expand its pipeline system to bring fresh water to more homes. Small lines from the new pipelines will connect directly to some oil wells.

On the other side, Independent Water Providers member JMAC Resources will build more water depots in the region and a massive pipeline just south of the Missouri River to supply oil wells. Other members of the group have also applied for depot permits.

North Dakota water suppliers do not pay for water, and the state Legislature rejected a proposed water tax earlier this year. Each side's plans will rapidly increase the options that energy companies have to access water, further depressing prices.

Dangerous to drink
The co-op, officially known as the Western Area Water Supply Project, was designed to boost the quality of the water reaching western North Dakota homes. State studies for years had identified high levels of sodium, sulfates and magnesium in the aquifers.

In Watford City, a dust-caked community of 2,000 dotted with oil-workers' run-down RVs, the sodium level of the drinking water had been 18 times higher than the level recommended by the U.S. Environmental Protection Agency. "You would drink (it) and get high blood pressure," said Mayor Brent Sanford.

The high chemical content convinced Watford City officials in 2010 to support the co-op as it was being organized, Sanford said.

By selling 20 percent of its water to frackers, the government-backed co-op hoped to keep water prices for homes low and generate enough revenue to pay back $110 million in state loans for the project. The co-op sells water to frackers at roughly 84 cents a barrel, compared to 21 cents a barrel for homes. (One barrel equals 31.5 gallons, or about 119 liters.)

Denton Zubke, the co-op board's chairman and a credit union president, has defended the co-op's right to sell water to frackers as the independent ranchers and farmers decry what they see as government overreach into a private industry.

"Free enterprise was never going to bring potable water supply to rural parts of North Dakota," said Zubke, who also operates a private water depot. "The only way we foresaw putting these water pipes in the ground was to pay for them with industrial (fracking) water sales."

More than 230 million gallons of water flow every day past the Williston plant, and the co-op itself doesn't expect water demand from homes to exceed capacity until at least 2032, calming any shorter-term concern about fracking's taking water away from human uses.

Closest is best
Steve Mortenson, the Independent Water Providers' chairman, says he supports the co-op's clean-water mission but believes private industry is best equipped to provide fracking water. "We don't feel we should have state-backed competition," he said. "We never expected they would use the leverage of government to oppose private business."

Confederation members can chose at what price to sell their water; most sell at 50 cents to 75 cents per barrel. Mortenson sells at 65 cents per barrel at his depot in Trenton, a bedroom community on the state's western edge.

Mortenson, a soft-spoken rancher, offers washers, dryers, showers and free snacks at his depot as a gesture to the truck drivers who bring him business. Energy companies typically choose water depots closest to well sites to save on fuel costs, even if the price is higher than rival sites farther away. That has driven the building of even more water depots around the Bakken.

Zubke disputes the Water Providers' claim to be any better at selling fracking water. He fears expansion by the independents could jeopardize the co-op's ability to pay off its debt. Using a complex Depression-era federal law known as 1926(b), he and other co-op officials have been sending cease-and-desist letters to some confederation members throughout North Dakota. They've also lobbied state officials --so far, unsuccessfully -- to deny water permits to some independents.

Despite the contentiousness -- call it fracktion -- the Independent Water Providers and the co-op are sticking with their plans.

"We don't want to profit from the water," JMAC owner Jon McCreary said. "We want to profit by selling the infrastructure to deliver the water."

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A Justice Department audit report faults the federal government for gaps in tracking people with terrorism connections who were added to the Witness Protection Program.

Originally designed to protect people who testified against organized crime figures by giving  them new names and addresses, the program was expanded to cover witnesses who testify in terrorism trials. Some were purely witnesses. Some, however, were in the federal terrorism database as suspected terrorists themselves.

As recently as a few years ago, the report says, people in the program who had terrorism connections, but were given a new identities, could have flown on a commercial flight because only their old names were on the government’s “no-fly” list.  The report says it found "some" witness protection program participants who actually did fly.  The Inspector General says while government officials knew about their plans to travel and approved, "these individuals, on their own accord, could have flown" without approval.

Justice Department officials say that problem has now been fixed by disclosing the new identities to government agencies that maintain terrorism databases and by banning all participants in the witnesses protection program who are on the no-fly list from traveling on commercial flights.

The report also says that in July 2012, the U.S. Marshals Service was unable to locate two former participants in the witness protection program who'd been identified as suspected terrorists.  But government officials say two had left the program, and the United States, "years ago," after fulfilling their obligations to testify or serve prison time.

There are currently  no participants in the witnesses protection program who are unaccounted for, the officials said.

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Table saws are the tool of choice for millions of construction workers and do-it-yourselfers, which explains why they maim so many people in the U.S. – more than 67,000 a year, according to government estimates.

That number might be much lower, if saw manufacturers adopted a technology known as SawStop, which uses a weak electrical current run through the saw blade to detect when it comes in contact with a person, then almost instantaneously stops it .

But as FairWarning.org reports, power tool manufacturers and trade groups have opposed efforts to require SawStop or similar technology on table saws, arguing that the injury numbers have been inflated and that the government’s estimate of $2.36 billion in annual costs to society from table saw accidents is exaggerated. They also say that requiring such industry-reduction systems would destroy the market for popular lightweight saws, which cost as little as $100.

The resistance to the digit-saving technology “highlights the endless due process that makes it virtually impossible for regulators to enact safety measures over the unified objections of industry,” FairWarning’s Myron Levin writes in an eye-opening examination of the behind-the-scenes battle.

Click here to read the full report and see a video demonstration of the SawStop in action.

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• Dzhokhar Tsarnaev scribbled note inside boat where he was hiding
• Bomb plot briefing may undercut DOJ's case for AP records seizure

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While much criticism has been lobbed at the federal system for failing to adequately identify who is spending money to influence campaigns, 35 states have independent spending disclosure laws that are less stringent than federal election law.

In fact, in 30 states it’s impossible to total how much money outside groups are spending on campaigns, information that is mostly available when it comes to federal contests.

That’s according to a new 50-state analysis by the National Institute on Money in State Politics, which graded the states on disclosure requirements for super PACs, nonprofits and other outside spending groups.

Fifteen states — Alaska, California, Colorado, Connecticut, Illinois, Maryland, Massachusetts, North Carolina, Ohio, Oklahoma, Oregon, Rhode Island, Texas, Washington and Wisconsin — received an “A” grade, meaning the states’ laws were at least as robust as federal independent spending requirements.

New Jersey and Virginia, states where residents will be casting votes for governor and state legislature this year, were among 26 states that received a failing grade in the analysis  by the nonpartisan, nonprofit organization that focuses on the influence of campaign money on state-level elections and public policy in all 50 states.

The others were Alabama, Arizona, Arkansas, Georgia, Indiana, Iowa, Kansas, Kentucky, Louisiana, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, Nevada, New Hampshire, New Mexico, New York, North Dakota, Pennsylvania, South Carolina, Tennessee and Wyoming.

States were graded on a 100-point scale, based on how much information is provided to the public about non-candidate organizations that buy ads, often negative and misleading, just before an election. Six states — Alabama, Indiana, New Mexico, New York, North Dakota and South Carolina — didn’t garner a single point in the survey.

Independent super PACs and nonprofits intent on influencing campaigns proliferated in the wake of the 2010 U.S. Supreme Court’s Citizens United v. Federal Election Commission ruling, adding about $1 billion in spending  in federal races in the 2012 election cycle.

At the state level, lavish spending by outside groups often faces weaker disclosure rules than federal contests and receives far less media attention.

The result is a mishmash of rules, with some states scrambling to pass legislation in the wake of the high court decision while others show little interest in enacting any changes.

In South Carolina, for example, outside groups paid for ads attacking several state and local politicians in 2012 but were not required to report the spending.

Two federal court decisions have left the state without “any rules” related to outside groups’ spending, according to Cathy L. Hazelwood, deputy director of the state Ethics Commission.

State Sen. Wes Hayes, a Republican from Rock Hill, estimates that an anonymous group called Conservative GOP PAC, which despite its name has no apparent affiliation with the state’s Republican party, spent at least $100,000 on campaign fliers in an unsuccessful effort to unseat him.

He concedes that’s just a guess.

“I’ll never know the amount, just like I’ll never know who spent it,” Hayes says. Efforts to contact Conservative GOP PAC were unsuccessful, as the group has no office, no phone number, no website, did not file incorporation records with the state and no individuals have claimed membership in the organization.

Non-candidate, independent spending on elections can be broken into two general categories: “independent expenditures” and “electioneering.” With independent expenditures, potential voters are asked to back or oppose a candidate. With electioneering, a candidate is named, but there’s no explicit request for support or opposition.

In 25 of 50 states, electioneering advertisements are not required to be reported, according to the analysis by the National Institute.

The term “electioneering communications” came to be with the passage of the Bipartisan Campaign Reform Act of 2002. The federal law requires such expenditures be reported, but it applies only to television and radio ads that air shortly before an election.

In a few states, however, the definition of electioneering communications is broader than at the federal level, and may include non-broadcast expenditures like direct mail and print advertising. Independent expenditures refer to all expenditures used to support or oppose a candidate, including non-advertising costs like polling and yard signs.

Points were withheld in the survey based on the level of disclosure and whether disclosure forms differentiate between independent spending and other types of campaign expenditures.

While North Dakota scored a zero, the state passed legislation this year that will beef up disclosure requirements for outside groups once the law goes into effect Aug. 1.

The National Institute’s rankings focus solely on spending and not on donors to the groups that are doing the spending. Increasingly, “social welfare” nonprofits — currently at the center of a scandal involving the IRS — and trade associations are being used to hide donors’ identities in both federal and state races.

In New Mexico, outside political action groups spent heavily on races for the state Legislature, races that typically attract fewer than 20,000 voters. Once sleepy contests have become bruising battles fought through statewide television ads, said state Sen. Peter Wirth, a Democrat from Santa Fe.

He’s pushed a bill requiring greater disclosure by outside groups through the Senate three times (twice with unanimous approval) only to see it die in the state House after frenetic lobbying by “very powerful special interests” from both parties, he says.

“It’s bipartisan support in the open, and then behind the scenes it’s full-on bipartisan opposition,” Wirth says.

But several states have enacted disclosure requirements that go beyond federal requirements.

•In Maryland, corporations are required to alert shareholders about a company’s independent political spending;

•A “stand by your ad” provision in a 2010 Massachusetts law requires that in corporate-funded ads, the CEO appear in the spot;

•Alaska, California and North Carolina require independent expenditure groups to list their top donors in political ads.

The National Institute’s rankings also factor whether states require independent spending groups to disclose which candidate they are targeting.

Two states, Florida and Delaware, require that spending be made public but not the targets or the purpose of the spending. The result: It’s virtually impossible to track how much was spent by outside groups trying to hurt or help a particular candidate.

Thirty-six states will elect governors in 2014. Edwin Bender, executive director of the National Institute on Money in State Politics, said he hopes states with poor grades will strengthen their reporting requirements.

“The majority of states will elect their governors and other major statewide offices in 2014,” he said. “We think the public should know how much money is spent on these races, and by whom.” 

John Dunbar contributed to this report.

The Center for Public Integrity is a nonprofit, non-partisan investigative news organization in Washington, D.C. For more of its stories on this to go publicintegrity.org.

For more information about money in state politics, visit www.followthemoney.org.

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• Dzhokhar Tsarnaev scribbled note inside boat where he was hiding
• Bomb plot briefing may undercut DOJ's case for AP records seizure
• Cruel or necessary? The true cost of wild horse roundups

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CBS News via AFP - Getty Images

This image obtained April 19 courtesy CBS News shows Dzhokhar Tsarnaev, a suspect in the Boston Marathon bombing who was captured hiding in a boat in a Boston suburb.

Bleeding and hunted by police, Dzhokhar Tsarnaev scrawled a note inside the hull of the boat where he was hiding saying that the Boston Marathon bombings were retaliation for American action against Muslims, sources told NBC News on Thursday.

In the note, Tsarnaev, the lone surviving suspect in the marathon attack, said many of the things he told investigators from his hospital bed days later, after his capture, the sources said.

The note was first reported by CBS News.

Tsarnaev was discovered hiding in the boat, in suburban Watertown, Mass., on April 19 after a daylong manhunt that paralyzed Boston and its surroundings. He had been wounded in a firefight with police.

Tsarnaev, 19, is in a federal prison hospital in Massachusetts and has been charged with using a weapon of mass destruction. He could face the death penalty. His older brother, Tamerlan, was killed in the firefight.

Three people were killed and 264 injured when two bombs exploded near the marathon finish line April 15.

Dzhokhar Tsarnaev told investigators in the days after his capture that the brothers acted alone and were defending Islam after the American-led wars in Iraq and Afghanistan, U.S. officials have told NBC News.

Investigators are also focusing on a six-month trip to Russia that Tamerlan Tsarnaev made last year, looking for clues to his radicalization. He was buried last week at a Muslim cemetery in Virginia after cemeteries in Massachusetts refused the body.

This story was originally published on Thu May 16, 2013 8:02 AM EDT

Manuel Balce Ceneta / AP file

CIA Director John Brennan, shown testifying on Capitol Hill on April 11, testified he conducted a background briefing after the Associated Press reported the Yemen bomb plot in May 2012 to avoid "dangerous questions and speculation."

A massive Justice Department investigation into the disclosure by the Associated Press of an ongoing covert operation against an al Qaeda suicide cell in Yemen -- a probe that included a sweeping  secret subpoena of the press association’s phone records  -- has been justified by U.S. officials on the grounds that the news organization “put the American people at risk.”

But that assertion by Attorney General Eric Holder could be undermined by the White House’s decision to publicly comment about the operation at the time and reveal details beyond those in the original AP story, according to legal experts and counterterrorism officials.

Within hours after the AP published its May 7, 2012 story, then-White House counterterrorism adviser John Brennan, currently the director of the CIA, held a background conference call in which he assured television network commentators that the bomb plot was never a threat to the American public or aviation safety.

The reason, he said, is because intelligence officials had “inside control” over it.

He later told the Senate Intelligence Committee that he conducted the briefing to avoid “dangerous questions and speculation” about the operation.

Brennan’s account came after the AP reported what it called “an intelligence victory for the United States,” saying  intelligence officials had thwarted an “ambitious plot” by an al Qaeda affiliate in Yemen “to destroy a U.S. bound airliner” using a refined underwear bomb.  

U.S. officials say that, when they were first contacted by the AP, they were concerned publication of the story would endanger the life of a British informant who had penetrated the group. AP executives say they agreed to hold their story until they were assured by government officials that “national security concerns had passed.”

Brennan’s use of the phrase “inside control,” a detail not initially included in the AP story, quickly led U.S. news organizations to report that the plot had been foiled by an undercover informant.

“The U.S. government is saying it never came close because they had insider information, insider control, which implies that they had somebody on the inside who wasn’t going to let it happen,” Richard Clarke, former White House counterterrorism adviser to Presidents George H.W. Bush, Bill Clinton and George W. Bush and who participated on the conference call with Brennan, said on ABC’s “Nightline” that evening.

NBC’s Chief Justice Correspondent, Pete Williams, did further reporting for Nightly News the next night.  “It turns out that the bomber was actually an informant cooperating with intelligence services friendly to the United States,” Williams reported.

Bolstering his reporting was an interview with Homeland Security Janet Napolitano.

“I want to say that the device was always under control, and that no one in the Unites States was ever at risk because we did have control,” she said.

“The administration’s background statements helped reporters put two and two together and ultimately led to the disclosure that did reveal the existence of an intelligence source,” said Michael Leiter, the former director the National Counter-Terrorism Center under Presidents George W. Bush and Barack Obama and now an NBC News counterterrorism analyst. “That’s not to say that the original leak didn’t also do damage and undermine operations.”

Tommy Vietor, then chief national security spokesman for the White House, disputed the idea that Brennan disclosed sensitive details in his background briefing and said  it was “ridiculous” to equate Brennan’s use of the  phrase  “inside control” with having an “informant.”  

U.S. officials acknowledge that, after they were contacted by the AP and told it was going to publish the story, they alerted British intelligence, which scrambled to extract the informant and his family from Yemen. But the leak infuriated British officials and strained relations between MI-6, the country’s intelligence service, and the CIA, officials say. Moreover, U.S. national security officials familiar with the matter said the real damage was done by the original leak to the AP because it revealed that the FBI had possession of the bomb. It also ended any chance of using the informant in the future. “They were going to keep him in there,” said the official.

Still, the willingness of administration officials to publicly comment on the plot could undercut the Justice Department’s position if the AP decides to take any legal action challenging the secret subpoenas.

“It complicates considerably the force of the argument that this disclosure seriously compromised national security,” said Floyd Abrams, a leading First Amendment lawyer who represented the New York Times in a historic legal  battle over its publication of the Pentagon Papers.

In that case, Abrams noted, the Times successfully argued that much of what the Justice Department had argued was damaging in the papers had already been revealed in public statements by U.S. government officials.

David Schulz, a lawyer for AP, said the news organization is “exploring all our  options” for  legal action to challenge the Justice Department’s secret subpoena for about two months of AP phone records on 20 separate telephone lines in an effort to identify the leaker.

Related stories

AP, DOJ clash over seriousness of leak that prompted phone records seizure

AP calls government's records seizure a 'massive and unprecedented intrusion'

Among those options, he said, were filing suit for a “declaratory judgment” that the subpoena had violated its reporters’ rights and a demand for a return of the phone records and an order that the Justice Department destroy all copies. In doing so, the AP may cite the comments by Brennan as evidence that the leak did not harm national security in the way that the Department of Justice has asserted, h said.

“We were surprised by the attorney general’s comments yesterday about the potential security threat  from the leak under investigation,” Schulz said in an email to NBC News. “The president’s top national security advisor at the time said there was never a risk to air safety, and ‘no one in the United States was ever at risk.’ These shifting positions show the malleable nature of national security claims, and underscore the need for independent review by a judge when civil rights are infringed to protect against asserted security threats.”

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Jonathan Ernst / Reuters

U.S. Attorney General Eric Holder calls on a reporter during a news conference at the Justice Department on Tuesday.

Justice Department and Associated Press officials clashed Tuesday over leaked classified information that led the government to seize AP phone records, with Attorney General Eric Holder saying it “put the American people at risk” and the news organization’s chief executive insisting it delayed publishing its story until it was assured “national security concerns had passed.”

The day of back-and-forth public sallies came as new details emerged about negotiations between the AP and U.S. officials over the unauthorized release of classified information on a foiled bomb plot in Yemen, information that apparently triggered the investigation.

“This was a very, very serious leak,” Holder said at a news conference. “I’ve been a prosecutor since 1976 – and I have to say that this is among, if not the most serious, in the top two or three most serious leaks that I’ve ever seen. It put the American people at risk – and that is not hyperbole.”

Holder defended the secret subpoena for about two months of AP phone records on 20 separate telephone lines without prior notice as a necessary step, saying that trying to find the source of the leak “required very aggressive action.”

Holder’s comments and a letter from Deputy Attorney General James Cole defending the seizure of the AP records – without notifying the news organization until last week --  drew a stern response from AP President and CEO Gary Pruitt. He  blasted the action as "overbroad under the law," saying  that "more than 100 journalists work in the locations served by those telephones."

"Rather than talk to us in advance, they seized these phone records in secret, saying that notifying us would compromise their investigation," Pruitt said in a statement late Tuesday. “They offer no explanation of this, however.

Julie Fletcher / AP file

Associated Press President and CEO Gary Pruitt.

"Instead they captured the telephone numbers between scores of AP journalists and the many people they talk to in the normal business of gathering news."

Pruitt also defended the AP's decision to publish the story that apparently sparked the leak investigation.

The May 2012 AP article disclosed what it said was a CIA operation that foiled a plot to  plant a bomb on a  plane from Yemen on the first anniversary of Osama bin Laden's death.  

The covert operation involved an informant working for British intelligence, who passed along information about a plot to detonate a refined version of a so-called “underwear bomb” aboard a U.S.-bound aircraft, intelligence officials told NBC News.  The leak, and the CIA’s subsequent claim that it was behind the operation, infuriated the British, who said it put their operative at risk, according to the officials, who spoke on condition of anonymity.

Prior to the publication of the story, there were extensive negotiations among AP, White House and CIA officials, said the officials. The AP initially agreed to hold the story until May 8, 2012, thereby giving intelligence officials time to minimize any risk to the informant and his family, they said.

But as first reported by Reuters, the agreement broke down at the last minute over AP demands that the U.S. government officials not confirm the details of the news organization’s account for an hour after publication. A source familiar with the negotiations said White House officials concluded they could not make such a promise given they expected to be deluged with media inquiries about the matter.

Erin Madigan, a spokeswoman for the AP, disputed the Reuters account.

 “As we told Reuters a year ago, at no point did AP offer or propose a deal in relation to this story. We did not publish anything until we were assured by high-ranking officials with direct knowledge of the situation, in more than one part of the government, that the national security risk was over and no one was in danger.”

In any case, the AP ran the story on May 7. That evening, shortly before the network news broadcasts, then-White House Counter-Terrorism Adviser John Brennan held a background briefing for former counterterrorism advisers. The former advisers then appeared on television networks to talk about the foiled plot and maintain that intelligence officials had “inside control” over it.

Brennan, now CIA director, later told the Senate Intelligence Committee that he conducted the briefing to avoid “dangerous questions and speculation” about the operation.

Pruitt on Tuesday denied the article posed a threat to national security.

"We held that story until the government assured us that the national security concerns had passed," he said. "Indeed, the White House was preparing to publicly announce that the bomb plot had been foiled.

"The White House had said there was no credible threat to the American people in May of 2012. The AP story suggested otherwise, and we felt that was important information and the public deserved to know it."

Pruitt's statement  came after he received a letter from Cole, the deputy attorney general, which said  "there was a basis to believe" the phone numbers subpoenaed "were associated with AP personnel involved in the reporting of classified information." He said the subpoenas were "limited to a reasonable period of time" and were only taken after all "alternative investigative steps had been taken …  including conducting over 550 interviews and reviewing tens of thousands of documents." 

 The statement from the AP came as criticism of the Justice subpoena mounted on Capitol Hill and elsewhere.

 The House Judiciary Committee is planning to grill Holder about the matter at a previously scheduled oversight hearing on Wednesday, said Rep. Bob Goodlatte, the panel’s chairman.

“We definitely have some pointed questions about how and why it was decided to request such a broad and lengthy” subpoena, he told NBC News.

Holder has recused himself in the case, apparently because he had prior knowledge of the information that was leaked. If Holder says he can’t answer detailed questions about the case because of his recusal, Goodlatte said the panel will follow up with Cole, his deputy.

“We will definitely be pursuing this matter,” Goodlatte said.

His comments came as others voiced sharp criticism of the AP subpoena. Former Attorney General Michael Mukasey told Fox News on Tuesday that “it was a broader gathering of information that should never have been authorized.”

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Poor management allowed low-level IRS employees to single out Tea Party and other conservative groups seeking tax-exempt status for extra review, and the agency continues to drag its heels on fixing things, according to an inspector general's report obtained Tuesday by NBC News.

The IRS said in its formal response that it had satisfactorily answered all of the complaints in the audit by the Treasury Department's inspector general for tax administration. But Acting Deputy Inspector General Michael McKenney made it clear in a cover letter accompanying the document that "we do not consider the concerns in this report to be resolved," noting that the IRS objected to two of his office's nine recommendations calling for clearer regulations, stricter processes and better documentation of what the IRS is doing and why.

President Barack Obama said in a statement Tuesday evening that the report's findings were "intolerable and inexcusable." He said he had ordered Treasury Secretary Jack Lew "to make sure that each of the Inspector General's recommendations are implemented quickly."

The audit blamed confusion by IRS administrators for the inappropriate reviews, which Attorney General Eric Holder said Tuesday would be focus of a federal criminal investigation.

The report found that mismanagement led the IRS to ask some groups for unnecessary information — in some cases, it asked groups to list the names and address of future donors — and delayed processing of some groups' requests, some for more than three years.

The average delay was 13 months, it said.

Two IRS offices — the Washington headquarters of its Exempt Organizations unit, which is responsible for processing applications for tax-exempt status, and an office in Cincinnati called the Determinations Unit — come in for the brunt of the blame in the 48-page report, parts of which are redacted.

The audit found that in June 2011, the Cincinnati office distributed an expanded "Be On the Look Out" list of criteria for identifying potential political cases. The so-called BOLO list identified four reasons for officers to give an application special attention:

• "Tea Party," "Patriots" or "9/12 Project" is referenced in the case file
• Issues include government spending, government debt or taxes
• Education of the public by advocacy/lobbying to "make America a better place to live"
• Statements in the case file criticize how the country is being run

"The criteria developed by the Determinations Unit gives the appearance that the IRS is not impartial in conducting its mission," the audit concluded. "The criteria focused narrowly on the names and policy positions of organizations instead of tax-exempt laws and Treasury Regulations."

In its response, the IRS acknowledged "the mistakes outlined in the report," saying they were caused by "the lack of a set process for working the increase in advocacy cases and insufficient sensitivity to the implications of some of the decisions made."

Related: As applications swell, IRS nonprofit division overloaded, understaffed

The agency blamed low-level "front line career employees" acting out of what it said was "a desire for efficiency and not out of any political or partisan viewpoint."

It also claimed that some of the political groups were at fault because their applications were "vague as to the activities the applicants planned to conduct."

Groups seeking 501(c)(4) tax-exempt status can advocate for particular general political positions, but their primary purpose must be "social welfare," and they are barred from intervening in political campaigns.

"A number of applications indicated that the organization did not plan to conduct political campaign activity," the IRS said. But elsewhere in their applications, they "described activities that in fact appeared to be such activities," it said.

Many of the groups "did not understand what activities would constitute political campaign intervention," it said, even as it noted in the same document that "there are no bright-line tests" for what constitutes such activity.

"As the report discusses, these issues have been resolved," the IRS declared.

But the audit disagreed, saying: "Although the IRS has taken some action, it will need to do more so that the public has reasonable assurance that applications are processed without unreasonable delay in a fair and impartial manner in the future."

In a statement late Tuesday, the IRS contended that it didn't act out of any political bias, saying the cases singled out for review in the Cincinnati office since 2010 "included organizations of all political views."

The audit didn't specifically address allegations that Acting IRS Commissioner Steven Miller misled Congress because he knew about the inappropriate procedures but kept quiet for months before they were made public.

In a speech on the Senate floor, John Cornyn of Texas, the Republican whip, thundered that Miller "should resign today" if it is established that he "willfully misled Congress when inquiries were made earlier about this sort of scandalous political activity."

Sen. Orrin Hatch, R-Utah, said that regardless of whether it acted out of political bias, the IRS had made a mess of things.

"This was either one of the greatest cases of incompetence that I've ever seen or it was the IRS willfully not telling Congress the truth," he said.

In its statement, the IRS said it never intended to hide the issue. Instead, it said, it waited to say anything until it could see the audit "and we reviewed their findings."

In what was described as a "tough meeting" Tuesday, Senate Finance Committee Chairman Max Baucus, D-Mont., told Miller that "he is in for some serious questioning" from the committee, sources in the meeting told NBC News' Kelly O'Donnell.

The Finance Committee is expected to convene a hearing into the controversy, although one hasn't yet been scheduled. Baucus told Miller on Tuesday that the committee would accept nothing less than his "complete cooperation and transparency," one of the sources said.

Lisa Myers, Kelly O'Donnell and Richard Gardella of NBC News contributed to this report. Follow M. Alex Johnson on Twitter and Facebook.

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This story was originally published on Tue May 14, 2013 9:04 PM EDT

Singer-songwriter Carole King, left, and Joan Guilfoyle, head of the Bureau of Land Management's Wild Horse and Burro Program, have opposing views of the wild horse roundups.

The Bureau of Land Management's roundups of wild horses and burros fire strong emotions on both sides of the issue. Here, in their own words, BLM Program Chief Joan Guilfoyle and singer-songwriter Carole King, a wild horse advocate, present their views: 

Guilfoyle: 'We have too many of them out there'

As the head of the Bureau of Land Management's Wild Horse and Burro Program since August 2011, Guilfoyle is responsible for overseeing the government's helicopter roundups and the holding facilities for wild horses and burros.

Guilfoyle is an avid outdoorswoman who came to her job after holding other prominent positions with the BLM, National  Park Service and USDA Forest Service. She holds a bachelor's degree in zoology/ecology and a master's degree in environmental learning and leadership.

More information from roundup supporters:

Bureau of Land Management Wild Horse and Burro Program

National Cattlemen's Beef Association

The Wildlife Society

King: 'Leave them where they are'

King is not only famous for being one of America's great pop singers and songwriters, she's also an environmentalist who advocates for greater protection of wild horses.  

King supports the American Wild Horse Preservation Campaign, has worked with the Alliance for the Wild Rockies and has testified before Congress on environmental issues.  She lives on a ranch in Idaho near one of the government's wild horse herd management areas.

More information from roundup critics:

American Wild Horse Preservation Campaign

Wild Horse Education

The Cloud Foundation

Related stories

Cruel or necessary? The true cost of wild horse roundups

One man purchased 1,700 mustangs; where are they now?

Family nurses wild horse back to health

Complete coverage of wild horse roundups

Dave Philipps

Tom Davis at his corrals in La Jara, Colo.

The semis would rumble down country roads packed full of wild horses. Truckload after truckload, sometimes 36 horses at a time, all with the same destination: a ranch in the small town of La Jara, Colo.  

Records show that for years, the Bureau of Land Management sold and shipped more than 1,700 wild horses from its animal holding facilities to just one rancher. Now federal investigators are trying to figure out:  What did he do with all those mustangs? And did any of them ultimately end up being butchered in the slaughter plants of Mexico? 

Wild horse advocates fear the worst. They want to know the truth about the fate of the horses and whether the U.S. government looked the other way as the federally protected animals seemingly disappeared. 

“I want to know where the horses went,” said Laura Leigh of the group Wild Horse Education, which advocates on behalf of the wild mustangs. “It’s disgusting, it’s abhorrent.  Whoever signed that slip to approve those sales, I want to look them in the eye and say, ‘What were you thinking?’” 

Federal investigation
The BLM is charged with protecting wild horses under federal law and has confirmed that the Interior Department Office of Inspector General is investigating the agency’s sale of mustangs to rancher and livestock hauler Tom Davis. 

The Davis investigation comes amid a growing controversy over the BLM’s Wild Horse and Burro Program. The agency faces a dire situation: Nearly 50,000 horses captured during frequent roundups, so-called “excess animals,” are living in government holding facilities that are nearing capacity.  Horse adoptions are down, so the BLM has turned to selling the animals. 

The government says Davis, who paid just $10 per head, was the biggest buyer ever of wild horses. Its sale of the animals to Davis from 2008 to 2012 was uncovered by writer Dave Philipps in a September 2012 story, “All The Missing Horses,” for the nonprofit news organization ProPublica.  The story questioned whether Davis sent the horses to so-called “kill buyers,” middle men who export livestock to meat packing plants in Mexico, but reached no firm conclusion. 

At the time, BLM issued this response to the ProPublica story: “The BLM condemns any sale of wild horses for slaughter.  We care deeply about the well-being of wild horses, both on and off the range, and the BLM does not sell and has not knowingly sold or sent horses or burros to slaughter.” 

Slideshow: Big dustup over wild horses

Courtesy of The Cloud Foundation

Controversy over roundups of wild horses roaming the ranges in 10 Western states is reaching a boil, with ranchers, horse advocates and even the government itself in agreement that the Bureau of Land Management's Wild Horse and Bureau Program is "out of control." Click to view photos of the horses in the wild, and during and after the BLM roundups.

Launch slideshow

Davis did not respond to repeated attempts by NBC News to contact him for comment and his lawyer, former federal prosecutor William Taylor, declined to answer questions about the federal investigation of his client. 

But Taylor provided NBC News with a statement criticizing the government for not following part of the Wild Free-Roaming Horses and Burros Act.  While the 1971 law was enacted to protect wild horses, Taylor said, “Congress specifically amended the Act in 2005 to remove ‘excess’ animals from the Department of Interior’s protection, and to force the government to sell those animals without condition. … How does the government have any power under the Act to bring a case based on the sale of excess animals?”

The BLM acknowledges on its website that it is “not in compliance” with that part of the federal law which directs the agency to sell excess animals “without limitation” to any willing buyer, even to those who would slaughter the animals.

Last year, ProPublica reported that Davis is a proponent of slaughtering wild horses in the BLM’s holding system and that he had tried unsuccessfully to obtain funding to open a slaughter plant in Colorado.

“Hell, some of the finest meat you will ever eat is a fat yearling colt,” Davis was quoted as saying, “What is wrong with taking all those BLM horses they got all fat and shiny and setting up a kill plant?”

But Davis denied to ProPublica that he ever knowingly resold any wild horses for slaughter, saying he found “good homes” for the mustangs he purchased from BLM.  

Who needs 1,700 horses?
According to BLM sales documents obtained by ProPublica under the Freedom of Information Act, Davis told government officials he wanted the animals to “put on oil fields ... to keep grass controlled” and to “use for movies.”  

Horse advocate Leigh said neither of those explanations should have withstood the government’s scrutiny. 

“You know, I haven’t seen any Westerns coming out of Mexico with wild horses being stampeded in front of a camera,” she said.  “It’s a joke and it’s not a funny one.” 

So-called state brand certificates issued by the state of Colorado and obtained by NBC News indicate Davis shipped many of the animals he bought from the BLM to small towns near the Mexican border. The Colorado brand commissioner says approximately 431 horses shipped from Davis’ property “appear to be BLM horses” that were sent to unspecified addresses in towns in different parts of New Mexico and Texas, including Spofford, Texas, 36 miles from the Eagle Pass border crossing into Mexico. 

“It doesn’t take a rocket scientist to know that there are Mexican slaughterhouses across that border,” said Ginger Kathrens of The Cloud Foundation, a wild horse advocacy group. “So it’s not a stretch to think that those horses ended up going to slaughter.” 

Another advocacy group, the American Wild Horse Preservation Campaign, has called for the investigation of both Davis and the BLM. The organization’s director, Suzanne Roy, said, “I think the government looked the other way at what was happening to these horses. ... I think it was willful ignorance on the part of the government.” 

Joan Guilfoyle, chief of BLM’s Wild Horse and Burro Program, told NBC News she does not know what happened to the horses that were sold to Davis, but denied the agency did anything wrong.  “We have no knowledge of him being a person who has ill intent toward the horses,” she said, “so there was no reason to question the purchase of these (animals) because he has to sign the paper that says what his intention is.” 

In fact, 50 BLM bills of sale reviewed by NBC News indicate Davis agreed not to resell the wild horses for slaughter. On a BLM sales questionnaire, Davis’ name was signed on this declaration: “I agree to provide humane care and to not sell or transfer ownership of any listed wild horse or wild burro to any person or organization with the interest to resell or trade or give away animals for processing into commercial products.” 

An official familiar with the Davis investigation told NBC News that investigators are not only trying to determine what happened to the horses, but whether Davis violated any of the conditions of his purchase. 

Loyola Law School professor and former federal prosecutor Laurie Levenson said that, based on the bill of sale language, investigators could be trying to determine if there is evidence of a felony violation such as lying or making a false statement to a federal official. 

New sales rules
In January 2013, BLM responded to public criticism of its sale of wild horses to Davis by announcing new rules for the agency’s sales program.  In an effort to prevent future large sales of wild horses, the agency issued a memorandum stating: “Without prior approval from the (BLM) assistant director, no more than four wild horses and/or burros may be purchased by an individual or group within a six-month period.” 

Horse advocacy groups immediately criticized the new rules as “window dressing.”  Laura Leigh of Wild Horse Education said, “It changes nothing, especially when they add a little fine print in there.  There is no change.  It creates a press release so BLM can look responsible, like they’re listening to the American public.” 

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One month later, U.S. Rep. Raul Grijalva, D-Ariz., and 20 other members of Congress signed a letter to then-Secretary of Interior Ken Salazar, who oversaw BLM, citing the “substantial public outcry” over the ProPublica story on Davis.  The Feb. 13 letter said the co-signers were “troubled by your department’s lack of response to the legitimate concerns raised” by horse advocates and demanded an update about the Inspector’s General investigation.  Grijalava’s office said Salazar never responded to the letter.

Later this year, the Office of Inspector General is expected to present its findings to a U.S. Attorney, who will decide if any charges will be filed against Davis.

Lisa Myers is NBC News' Senior Investigative Correspondent; Michael Austin is a producer in NBC's bureau in Burbank, Calif.

DELTA, Utah -- The mustangs run with a spirit that makes them legendary here in the West. On a bitter cold morning, they descend from the Swasey mountains of central Utah and gallop for miles across the plains. Stallions and mares, beautiful and strong, guiding their young. 

It’s an enthralling scene, but also one that infuriates many Americans. Thundering choppers overhead are driving the wild horses, many that appear terrified, toward a trap. For most, these are their final moments living wild and free. 

A steel gate slams behind them.  There is panic.  Minutes later, families are split up, with males, females and their young eventually sent to separate holding facilities.

“I know how much they love their families and their freedom.  And in an instant they lose both,” said Ginger Kathrens, a filmmaker who has documented wild horse herds.

This recent roundup ended a season of wild horse “gathers” in which the government captured and removed thousands of mustangs from nearly 32 million acres of public land in 10 Western states.  

Afterward, the Bureau of Land Management reported new numbers likely to shock many Americans unfamiliar with the economics and politics surrounding the roundups: A record number of wild horses – almost 50,000 – are now living in captivity, far more than the 32,000 left on the range.  

Both critics and supporters of the roundups agree on one thing: the BLM’s Wild Horse and Burro Program is “out of control” and heading for crisis. With adoption rates falling, its cost has doubled in a decade to $78 million this year.  Even the government acknowledges “the current path is not sustainable for the animals, the environment or the taxpayer.” 

“The roundups are devastating for the wild horses, being terrorized by helicopters and stampeded for miles,” said Suzanne Roy, director of the American Wild Horse Preservation Campaign, one of several groups fighting the roundup program.  “It doesn’t make sense.  It doesn’t work.  It costs taxpayers money.  It costs horses their freedom, sometimes their lives.  It’s insanity.” 

A tug-of-war 
The BLM, which is responsible for protecting wild horses under federal law rejects that charge, insisting the roundups are “necessary and justified.”  

Joan Guilfoyle, head of the Wild Horse and Burro Program, says the wild horse population doubles every four years and needs to be thinned to preserve ecological balance on the public land. 

“If we stopped gathering animals, the population would continue to grow and grow and grow and the rangelands would continue to be overgrazed,” she said.

The BLM says there are currently 7,831 "excess" mustangs and that the "appropriate management level," the number of wild horses which can be supported in official herd areas, should be only 23,622.

Slideshow: Big dustup over wild horses

Courtesy of The Cloud Foundation

Controversy over roundups of wild horses roaming the ranges in 10 Western states is reaching a boil, with ranchers, horse advocates and even the government itself in agreement that the Bureau of Land Management's Wild Horse and Bureau Program is "out of control." Click to view photos of the horses in the wild, and during and after the BLM roundups.

Launch slideshow

Roy and other advocates insist wild horse overpopulation is a “myth propagated by the BLM and the livestock industry.”

“The reality is that there are a small number of wild horses out there, fewer than 32,000, and there are millions of cattle and sheep,” she said. “We don’t have an overpopulation of wild horses. We have an overpopulation of livestock on our public lands.”

Roy’s group recently analyzed how the government allocated forage in 50 herd management areas where there have been roundups in the past three years. It found 82.5 percent was allocated to livestock; 17.5 percent to wild horses. 

Bob Edwards, who retired in 2005 after 30 years with the BLM managing wild horses and working as a natural resources specialist, agrees that the deck is stacked.

“The wild horses are not getting a fair shake,” he told NBC News, speaking out against the roundups for the first time. “I don’t think they have been given their proper place on the landscape in the American West.” 

Guilfoyle argues that she must manage the land for “multiple uses,” including grazing for cattle, sheep and wildlife. 

And Utah rancher Fred Tolbert, who pays the BLM for permits to graze his cattle with wild horses, says the horses are overgrazing.  

“I’m on the range and I see what the damage is,”  said Tolbert, adding that he’d go out of business if roundups stopped.  “… If my cows don’t calve, I don’t make any money. There’s no feed, they’re not gonna have calves.” 

The National Cattlemen’s Beef Association also supports the BLM roundups and calls for more “aggressive and increased use of long-term fertility control” to stabilize the population. 

The BLM currently devotes only 1.5 percent of its wild horse budget to “population suppression,” such as treating female horses with the contraceptive PZP. But the agency says PZP works for only about one year after it’s injected and “has not been as effective as we had hoped.” So most of the program’s budget goes to rounding up and permanently housing horses and burros, which are kept in separate facilities.

Witnessing the roundups 
The Wild Free-Roaming Horses and Burros Act of 1971 states that wild horses and burros “shall be protected from capture, branding, harassment, or death,” but activists say the BLM program subjects them to that very treatment. 

“It’s my observation that the government continually violates the provision of the act that requires humane handling of these animals,” said Laura Leigh of the advocacy group Wild Horse Education. Leigh has taken BLM to court four times and has won two temporary restraining orders in lawsuits she has filed against the roundups. “I feel that removing wild horses by helicopter stampede is inherently inhumane.” 

Leigh says she has spent about 500 days observing roundups, living out of her truck, documenting injuries and even deaths with her cameras.  One of Leigh’s videos has been seen more than 2 million times on YouTube.  

“I’ve seen broken legs,” Leigh said, standing outside a BLM holding facility in northern Nevada. “I’ve seen legs ripped up by barbed wire. I’ve seen horses kicked in the head.  I’ve seen animals dragged by the neck with a rope.  I’ve seen a helicopter hit horses.” 

NBC News showed Guilfoyle, the BLM division chief, some videos taken by activists, including Leigh.  Among other things, the videos showed a stallion trying to escape from a roundup nearly ripping off his leg, horses in a trap pen with gouged and bloody faces and BLM’s contractor wranglers repeatedly applying electric shocks to horses that wouldn’t move into a trailer.  

“There are some very heartbreaking pieces in there, absolutely,” Guilfoyle said. But she characterized the injuries as accidents and “isolated incidents.” “They are still wild animals and accidents will happen,” she said.

BLM wild horse specialist Gus Warr questioned the editing of some of the activist videos.  

“I would challenge … the stuff you see on YouTube because you’re not seeing the whole picture, that is the worst of the worst,” he said.

Leigh responds, “My pictures and video do show the whole story.  What I’m showing is what BLM will not show the public.” 

Despite such incidents, BLM reports “the mortality rate during wild horse and burro gathers is typically about 1 percent or less.”  Among the common causes of deaths listed in BLM mortality reports: broken necks, head trauma and complications from the agency’s gelding of animals.

Critics say that many other wild horses die later of complications from the roundups, but the BLM attributes many of those deaths to pre-existing conditions. 

BLM reviews roundup 
The BLM conducted its own review of the 2011 Triple B roundup in Nevada, assessing video shot by advocates and its own staff.  The review found “aggressive loading procedures and excessive pressure by multiple handlers,” including:

• Helicopters pursuing horses too closely and for too long; 
• Excessive and inappropriate use of electric prod, based on animal welfare experts’ review of the videos;
• Kicking, pinning horses in gates and twisting of tails during loading.

The review team generally found operations “were done in accordance with current BLM policy,” but added: “External animal welfare experts, as well as BLM employees, split on whether or not horses had been treated inhumanely.”  

In January 2013, a federal judge issued a temporary restraining order halting another roundup after Leigh produced photos of a BLM helicopter driving wild horses through a barbed wire fence at the Owyhee Complex roundup one month earlier. 

Courtesy WildHorseEducation.org

A wild horse somersaults over a barbed-wire fence during a Bureau of Land Management-run roundup at the in the Owyhee Complex in Nevada in December 2012.

Judge Miranda Du later lifted the order, but barred the BLM from using “hot shot/electric prod treatment” on weanlings and “rushed and aggressive loading tactics.” She also instructed the bureau “to conduct the gather in a humane fashion,” not “in a manner where the horses are driven through barbed-wire fences.” 

Thirteen days later, the BLM issued an internal memorandum “to ensure that the responsible and humane care treatment of WH&B (wild horses and burros) remains a priority for the BLM and its contractors at all times.” The document lists 24 “expectations” intended to reduce abuses at roundups.  

But under the new guidelines: helicopters will still be able to hover over animals “when it is necessary,” electric prods can still be used on animals as a “last resort,” and wild horses will be treated “in a manner that is consistent with domestic livestock handling procedures.” 

Deniz Bolbol, a spokeswoman for American Wild Horse Preservation Campaign, called the memo a “charade” and said it is “the latest attempt by the BLM to weaken humane standards.” She also called the use of domestic livestock techniques a “significant step backward,” saying wild horses should be treated like wild animals, not livestock. 

As a result of its aggressive capture program, the BLM is running out of places to put mustangs. Long-term holding pastures in the Midwest are close to capacity. The BLM adoption program tries to find homes for the younger horses and burros it removes from the wild, but the adoption rate is on the decline -- only 2,598 animals were placed last year.

The BLM’s contracts for use of privately owned holding facilities for captured horses also have triggered disputes  among neighboring property owners, who fear that, among other things, the wild horses could overgraze the land, leaving them to either escape or starve. (A Montana ranch owned by NBCUniversal CEO Stephen Burke is among several parties appealing BLM efforts to locate about 700 wild horses on a nearby ranch.)

The slaughter ‘solution’
Federal law actually provides a “solution” -- it allows the sale of wild horses by the government to citizens “without limitation,” including sale for slaughter.

So far the BLM has taken a public stance against slaughtering the animals, but ranchers like Tolbert support the idea and say it would save taxpayers millions of dollars. 

“Let ‘em go to slaughterhouse,” he said. “What value are they now? ... They’re a drain.  They’re a negative.”

Guilfoyle said the BLM would not consider allowing wild horses to be sold for slaughter: “We never have and never will.”

But BLM records show the agency has considered slaughter as a way to solve the problem. In October 2012, the idea was floated again by BLM advisory board member Jim Stephenson at meeting in Salt Lake City: “The only real solution to this is to have a slaughter market,” he said.

In March, however, legislation known as the Safeguard American Food Exports (SAFE) Act was introduced in both the U.S. Senate and House. If approved and signed into law, it would prohibit the knowing sale or transport of all horses (wild or domestic) "for purposes of human consumption."

Edwards, the former BLM rangeland expert, said he thinks the days are numbered for wild horses in America.  “I think what’s going to happen in the long run is that the wild horses will eventually be removed from public lands, which I think is a tragedy,” he said. 

Filmmaker Ginger Kathrens, who has produced documentaries about wild horses, said, “The BLM would like to see wild horses gone, because with no wild horses, end of problem. ... Wild horses will be managed to extinction.” 

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But BLM program chief Guilfoyle insists that, despite the criticism and controversy, “We will always have wild horses and burros out there.  That’s our job.  We care about them and we’re going to do our best to have them out there forever.” 

Back in Utah, meanwhile, 160 mustangs chased out of the Swasey mountains by choppers this year will likely spend the rest of their lives in holding pens, eating hay at taxpayer expense, wild -- but not free.

Lisa Myers is NBC News' Senior Investigative Correspondent; Michael Austin is a producer in NBC's bureau in Burbank, Calif.

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Public criticism of roundups is not limited to wild horses. The Bureau of Land Management also conducts annual “gather” operations to remove “excess” wild burros from herd areas in the West.

In this video, advocates for the wild burros document "aggressive" roundup practices, including a helicopter hitting and flipping over a burro in the California desert in 2009 and a BLM contract wrangler manhandling a reluctant burro during a 2008 roundup in Arizona.

As with the wild horse roundups, the BLM defends the operations as humane and says that incidents such as these are both isolated and contrary to its contractor guidelines.

The BLM says there are about 5,800 wild burros living in the wild, mostly in Arizona, Nevada and California, but many advocates believe the wild burro population is much smaller and that burro roundups are unnecessary.

Lisa Myers is NBC News' Senior Investigative Correspondent; Michael Austin is a producer in NBC's bureau in Burbank, Calif.

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Amid withering accusations the Internal Revenue Service targeted tea party and other conservative groups with enhanced scrutiny, the agency faces another problem: It’s drowning in paperwork.

The IRS’ Exempt Organizations Division, which finds itself at the scandal’s epicenter, processed significantly more tax exemption applications by so-called 501(c)(4) “social welfare” organizations — 2,774 during fiscal year 2012 — since at least the late 1990s, according to an analysis of IRS records by the Center for Public Integrity.

Compare that to 1,777 applications in 2011 and 1,741 in 2010, federal records show. Not since 2002, when officials processed 2,402 applications, have so many been received.

Meanwhile, Exempt Organizations Division staffing slid from 910 employees during fiscal year 2009 to 876 during fiscal year 2012, agency personnel documents indicate.

In 2010, IRS officials projected exempt division staffing at 942 employees. But IRS officials cut the number to 900 after the agency began slashing its budget in response to fiscal woes affecting most corners of the federal government.

The agency said this weekend that a heavy workload prompted bureaucrats to “centralize” the “influx of advocacy applications” and, in the name of efficiency, scrutinize groups that contained more common phrases such as “tea party” in them.

“That was wrong, that was absolutely incorrect, insensitive and inappropriate — that’s not how we go about selecting cases for further review,” Lois Lerner, IRS exempt organizations director, said Friday. “We don’t select for review because they have a particular name.”

Lerner, who denied the targeting was politically motivated, added that about 75 groups with words such as “tea party” or “patriot” received extra scrutiny but none had its tax-exempt status revoked.

The IRS could not be reached for comment Monday.

For Washington, D.C.,-based attorney Dan Backer, who represents two tea party-affiliated organizations, blaming such actions on staffing cuts and increased workload is a “lame excuse” that the IRS should stop using.

“They could have hired new employees, they could have reallocated employees, they could have done a lot of things, the not doing of which doesn't suddenly make it OK for them to engage in viewpoint discrimination,” said Backer, who said he is considering suing the IRS. “At worst, their staffing woes maybe justifies a growing backlog, not discriminating against those whose viewpoints they disagree with.”

IRS records show that applications of the most common nonprofit organizations — 501(c)(3) educational nonprofits, private foundations, charities and the like — have dropped this decade after reaching a high of more than 85,000 in fiscal 2007. Generally, this type of nonprofit entity must remain apolitical.

As for 501(c)(4) nonprofit organizations, such as the tea party groups in question, they may engage in politics so long as it isn’t their primary purpose.

During the 2012 election cycle, however, numerous 501(c)(4) organizations — most of them conservative, a few left-leaning and all endowed with new spending powers thanks to the Supreme Court’s 2010 Citizens United v. Federal Election Commission decision — together spent tens of millions of dollars overtly advocating for or against political candidates.

And unlike super PACs, which may also raise and spend unlimited amounts of money, they’re not required to reveal their donors.

Democrats primarily cried foul, accusing groups such as the Karl Rove-backed Crossroads GPS and Koch brothers-supported Americans for Prosperity of violating their tax-exempt status.

But the IRS has taken no definitive action against these or other nonprofit groups, and several campaign finance reform advocates have opined that this latest incident will further stymie their effort to convince the IRS to crack down on nonprofit groups they consider overridingly political.

As for tea party-named nonprofit groups, for all the attention now on them, they generally played bit roles during the 2012 election.

Of the more than 40 organizations that identified themselves as tea party-related in IRS documents, just one — the National Tea Party Group of California — reported assets of more than $100,000 in its most recent publicly available financial filing.

For now, Republicans and Democrats in Congress have called on the Obama administration to investigate the matter, and Obama himself described the IRS’ conduct as “outrageous.”

The Treasury Inspector General for Tax Administration is expected to release a full report on the matter later this week, and officials in the House and Senate are promising hearings.

Karen Gries, an appointee to the IRS Advisory Committee on Tax Exempt and Government Entities, says she expects her committee will discuss the matter when it meets later this year.

In the meantime, Gries praised the overall performance of Lerner, the exempt organizations director, while expressing concern about her department’s ability to do its job.

“They are asked to do more with less resources,” said Gries, a principal at with accounting firm CliftonLarsonAllen LLP. “The EO group operates very lean.”

The Center for Public Integrity is a nonprofit, non-partisan investigative news organization in Washington, D.C. For more of its stories on this to go publicintegrity.org.

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WASHINGTON -- The Justice Department used a secret subpoena to obtain two months of phone records for Associated Press reporters and editors without notifying the news organization, a senior department official tells NBC News, saying the step was necessary to avoid "a substantial threat to the integrity" of an ongoing leak investigation.

The seizure of the phone records, disclosed earlier Monday by AP President and CEO Gary Pruitt, is the latest move in a series of high profile and controversial investigations of leaks of classified information by the Justice Department. In a letter of protest to Attorney General Eric Holder, Pruitt said obtaining more than two months of AP phone records on 20 separate telephone lines without prior notice was a "massive and unprecedented intrusion" into news-gathering operations. 

It also drew a swift rebuke Monday from members of Congress and freedom of the press watchdogs, one of whom called the move "Nixonian."

Ronald C. Machen, Jr., the U.S. attorney in Washington, D.C., revealed in a letter to the AP on Friday that federal prosecutors obtained the records. The letter did not give a reason for obtaining the records, but Machen is conducting an investigation into the leak of classified information about a foiled terror plot in Yemen last year. An AP story last spring reported details of a CIA operation in Yemen that stopped an al Qaeda plot to detonate a bomb on an airplane bound for the United States.

In his letter to Holder, Pruitt said the seized phone records were from early 2012 and included phone lines for AP bureaus in New York, Washington DC, Hartford, Connecticut and the AP line at the House of Representatives. He said the records seized also included those from the home phones and cell phones of individual journalists.

"We regard this action by the Department of Justice as a serious interference with AP's constitutional rights to gather and report the news," Pruitt said.

Holder last June appointed Machen to conduct the investigation of the Yemen terror plot leak and Rod Rosenstein, the U.S. attorney in Maryland, to oversee a separate probe into the leak of U.S. government efforts to use the Stuxnet computer virus to thwart the Iranian nuclear program. In later Senate testimony, Holder said that he and FBI director Robert Mueller had both been interviewed by FBI agents as part of the investigations because they had prior knowledge of the information that was leaked. (Under Justice regulations, any subpoena for news media phone records requires the "express authorization" of the attorney general. But a Justice Department spokeswoman did not respond Monday night when asked whether the attorney general had recused himself in the investigation.)

As another sign of the sensitivity of the case, CIA Director John Brennan disclosed earlier this year that he also had been questioned by FBI agents as part of the Yemen probe, but said he was later notified that he was not a subject of the investigation.

Bill Miller, spokesman for Machen, said in an email that the subpoena for the records was done by the book.

"Consistent with DOJ regulations, the department provided notification to the Associated Press of the receipt of toll records in a letter dated May 10, 2013," He noted that Justice regulations "do not require notification to the media prior to the issuance of legal process to obtain toll records."

In a separate email, Miller wrote: "We take seriously our obligations to follow all applicable laws, federal regulations, and Department of Justice policies when issuing subpoenas for phone records of media organizations. Those regulations require us to make every reasonable effort to obtain information through alternative means before even considering a subpoena for the phone records of a member of the media. We must notify the media organization in advance unless doing so would pose a substantial threat to the integrity of the investigation.

"Because we value the freedom of the press, we are always careful and deliberative in seeking to strike the right balance between the public interest in the free flow of information and the public interest in the fair and effective administration of our criminal laws.”

The regulations cited by Miller state that subpoenas for the news media in criminal cases should be done only when there are “reasonable grounds to believe … that a crime has occurred” and that the records sought are “essential to a successful investigation.” They also state that subpoenas should, wherever possible, “be directed at material information regarding a limited subject matter and “should cover a reasonably limited period of time and … avoid requiring production of a large volume of unpublished material.”

Since President Barack Obama took office, the Justice Department has aggressively pursued leak investigation and brought more criminal prosecutions – six in five years – than any previous administration. Those cases, which also have been sharply criticized by press groups, have also targeted reporters’ phone records: James Risen, a national security reporter for the New York Times, had his phone, credit card and bank records subpoenaed as part of a Justice Department prosecution of a former CIA officer accused of leaking classified information on Iran’s nuclear program to him.

But critics say the extensive nature of the subpoena for the AP phone records goes far beyond what was seen in earlier cases.

Rep. Darrell Issa, R-Calif., and chairman of the House Oversight and Government Reform Committee, vowed to investigate.

"This is obviously disturbing," he said. Coming in the wake of other disclosures about the administration’s response to the attack on the U.S. consulate in Benghazi, Libya, and the IRS’s targeting of conservative nonprofit groups, he said it showed "top Obama administration officials increasingly see themselves as above the law and emboldened by the belief that they don't have to answer to anyone."

Sen. Patrick Leahy, D-Vt., and chairman of the Senate Judiciary Committee, said he wanted to know more about the justification for the secret subpoena.

"The burden is always on the government when they go after private information -- especially information regarding the press or its confidential sources,” he said. “… I am concerned that the government may not have met that burden. I am very troubled by these allegations and want to hear the government's explanation."

Anti-secrecy watchdogs also criticized the move.

"I've never heard of a dragnet collection effort against a media organization like this," said Stephen Aftergood, who tracks secrecy issues for the Federation of American Scientists. "This was not a targeted monitoring of an individual reporter. It's a sweeping collection of an entire bureau's communications."

"The Justice Department’s seizure of the Associated Press’ phone records is Nixonian," said Danielle Brian, executive director of the Project on Government Oversight, a group that advocates on behalf of whistleblowers. "The American public deserves a full accounting of why and how this could happen."

NBC News' Capitol Hill Correspondent Kelly O'Donnell contributed to this report.

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This story was originally published on Mon May 13, 2013 5:31 PM EDT

WASHINGTON - A senior Internal Revenue Service official knew in 2011 that IRS agents were giving extra scrutiny to conservative Tea Party groups, according to documents from a watchdog office obtained by Reuters on Saturday.

In a scandal that has already embarrassed the IRS and become a distraction for the Obama administration, a report from the Treasury Department's Inspector General For Tax Administration (TIGTA) was expected to be issued publicly next week on the IRS practice, who knew about it and when.

As more information emerged over the weekend, the White House said President Barack Obama was concerned about the conduct of a few IRS employees.

White House spokesman Jay Carney said: "If the inspector general finds that there were any rules broken or that conduct of government officials did not meet the standards required of them, the president expects that swift and appropriate steps will be taken to address any misconduct."

The TIGTA report finds that Lois Lerner, who heads the IRS's tax-exempt groups unit, knew of the extra scrutiny as early as June 2011.

On Friday, in remarks that triggered a storm of controversy, Lerner publicly apologized at a legal conference in Washington for what she termed "inappropriate" targeting by the IRS of conservative groups applying for tax-exempt status.

She said the practice was confined to an IRS office in Cincinnati and that it was "absolutely not" influenced by the Obama administration. She said none of the targeted groups was denied tax-free status.

The TIGTA report was requested last year by Republican Representative Darrell Issa, chairman of a congressional investigative panel, after he accused the IRS of targeting conservative groups.

TIGTA has found that the IRS singled out groups with the words "Tea Party" or "patriot" in their names for closer scrutiny, according to a TIGTA document.

IRS chief denied knowledge
In March 2012 in congressional testimony, then-IRS Commissioner Doug Shulman said the IRS was not making it harder for conservative groups to become tax-exempt.

Shulman stepped down at the end of 2012 when his term ended. Steven Miller was named acting head of the agency.

The IRS said in a statement on Saturday that the TIGTA report was correct. The statement said officials in the IRS exempt organizations division knew of the screening and that "IRS senior leadership did not have this level of detail."

The statement said that while "mistakes were made," there "were not partisan reasons behind this."

Although part of the executive branch, the IRS is considered an independent agency and officials try to stay out of politics.

According to the TIGTA document, the IRS was singling out the conservative groups as early as March 2010.

The document says managers in the "determinations unit" told specialists to be on the lookout for applications from organizations linked to the Tea Party, a political movement that favors smaller government and fewer and lower taxes.

Changing criteria
The IRS screening criteria were broadened in July 2011 to cover "organizations involved with political, lobbying or advocacy" seeking tax exemption, according to a TIGTA timeline of events.

Further broadening of the criteria occurred in January 2012 and again in May 2012, the document said.

Issa has vowed to investigate the matter and the House committee he chairs has the power to issue subpoenas. At least one other congressional panel intends to hold hearings, giving Republicans multiple opportunities to hammer the agency and the White House over the affair that had been brewing for months.

Lerner said IRS agents in Cincinnati targeted conservative groups "without talking to managers." The staffers were trying to deal with a crush of applications for tax-exempt status by using key words to get through the paperwork faster, she said.

About 300 applications were initially flagged for closer scrutiny. Of those, 75 were chosen for that treatment based on the presence of the key words in their names.

Thousands of applications
Each year the IRS reviews as many as 60,000 tax-exempt applications from groups ranging from charities to labor unions. Some are classified as 501(c)(4) groups after the section of the tax code that makes them tax-exempt. Such organizations can collect money from anonymous donors and spend it on advertising.

To get and keep their tax-exempt status, 501(c)(4) groups cannot endorse a political candidate or a political party.

The number of groups seeking 501(c)(4) status more than doubled from 2010 to 2012, coinciding in part with the surge of Tea Party enthusiasm. In 2010 the U.S. Supreme Court issued its "Citizens United" decision lifting government limits on corporate spending in federal elections.

Consumer groups have been pushing the IRS to clarify the standards for "social welfare organizations," as they are known in Section 501(c)(4) of the tax code, to ensure that they are not abusing their tax-exempt status.

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In the fall of 2011, a key Boston police counterterror intelligence unit -- funded with millions of dollars in U.S. homeland security grants -- was closely monitoring anti-Wall Street demonstrations, including tracking the Facebook pages and websites of the protesters and writing reports on the potential impact on "commercial and financial sector assets" in downtown areas, according to internal police documents.

The police monitoring of the activities of Occupy Boston -- an off-shoot of the Occupy Wall Street protests that swept the country in 2011 -- came during a period after the U.S. government received the second of two warnings from the Russian government about the radical Islamic ties of alleged Boston Marathon bomber Tamerlan Tsarnaev.

Boston Police Commissioner Ed Davis told a congressional panel Thursday that his department was never alerted by any federal agency to the information about Tsarnaev, but added that it was "hard to say" whether it would have made any difference in preventing the bombing. FBI  officials have insisted that the intelligence about Tsarnaev was vague and uncorroborated and that their own assessment at the time produced no "derogatory" information that justified opening a full-scale investigation.

But the internal Boston police documents, recently obtained by a civil liberties group, could raise fresh questions about the role of Homeland Security-funded "fusion centers" like the Boston Regional Intelligence Center, or BRIC, which conducted the monitoring. The Boston unit  is one of 72 such units set up to collect, analyze and share intelligence about potential terror threats. While  Homeland Security Secretary Janet Napolitano has called the units “one of the centerpieces” of the nation’s counterterrorism efforts, congressional critics have questioned their effectiveness and accused them in some cases of writing "useless" reports that infringed on civil liberties.

“They  were monitoring completely lawful activities,” said Mara Verheyden-Hilliard, executive director of the Partnership for Civil Justice, a civil liberties group that recently obtained the documents on the BRIC’s monitoring of Occupy Boston under the Freedom of Information Act. She said the BRIC monitoring was an example of the “vast expenditure of government money” to collect intelligence on activities unrelated to terrorism, in violation of First Amendment rights.

A Boston police spokeswoman said the department has changed its reporting procedures since the monitoring of the protests and emphasized that the BRIC is “about a lot more than terrorism.”

A Homeland Security official declined comment, saying the BRIC, like other fusion centers, was “locally owned and operated.” But the official noted that, just five days before the marathon bombing, the BRIC did produce an assessment for the event that, while concluding there was “no specific” or “credible” threat information, advised that “officials should be aware of a range of potential terrorist threats, from scattered unsophisticated attacks to dispersal of chemical or biological agents.” The assessment also identified the marathon finish line — where the bombing took place — as well as Fenway Park as “an area of increased vulnerability.”

The internal police documents about the activities of the BRIC show that on Sept. 30, 2011 — just two days after the second Russian warning about Tsarnaev was sent to the CIA — the Boston police unit was focused on an upcoming “Take Back Boston Rally” planned for the city’s Dewey Square.

“Approximately 100 people are listed as attending the Take Back Boston Rally on the event’s Facebook page and Occupy Boston organziers are encouraging people to attend it as well,” reads one BRIC report written by a U.S. homeland security official on Sept. 30, 2011. “The BRIC has received information that approximately 700 people will participate in the Take Back Boston march, with approximately 100 people staying to camp out as part of Occupy Boston.”

A follow-up report, three days days later, tracked the number of protesters, noting that “the size of the camp in Dewey Square has steadily grown over the weekend” and that “according to the group’s website” the demonstrators were planning two marches, including one to a “local media station, very likely to be Fox News Boston on Beacon Hill.”

Verheyden-Hilliard, whose group obtained the documents, said it was not surprising that the BRIC would be reporting such information since later documents appear to show Homeland Security officials requesting such data. In one “Daily Intelligence Briefing,” dated Oct. 21, 2011, the “Threat Management Division” of Homeland Security’s Federal Protective Service outlines a “template for creating the daily intelligence brief for your region” and then cites a “list of events we want to request” that officials submit “for daily briefing information.” Among the categories, in addition to reporting on domestic terrorist acts and “significant criminal activity” is one called “Peaceful Activist Demonstrations.”

NBC News

Boston Police Commissioner Ed Davis testifies Thursday before a House committee on the marathon bombings.

In his testimony Thursday, Commissioner Davis acknowledged to a House committee that his department, which runs the BRIC, was never provided any of the intelligence from the FBI and CIA that Tsarnaev, a resident of Cambridge, had been twice flagged by the Russians as an Islamic radical with ties to “underground” groups in that country.

“We were not aware of the two brothers,” Davis said in response to questioning by Rep. Mike McCaul of Texas, chairman of the House Homeland Security Committee. “We were not aware of Tamerlan’s activities.”

Davis acknowledged that police counterterrorism detectives were assigned to an FBI Joint Terrorism Task Force (JTTF) -- a separate unit from the Homeland Security fusion centers that serves as the government's primary investigative arm for probing terror threats. An FBI agent at the Boston JTTF conducted an “assessment” of Tsarnaev in 2011 after the first warning about his ties was sent by Russia’s FSB intelligence service. The assessment found no “derogatory” information about Tsarnaev that justified conducting a formal investigation. Later information about Tsarnaev included a second Russian warning to the CIA on Sept. 28, 2011.

But while Boston police had access to the JTTF’s classified database, Davis said that his own officers assigned to the task force were never  specifically alerted to any the information about Tsarnaev. “They tell me they received no word about that individual prior to the bombing.”

FBI spokesman Jason Pack said Thursday that state and local members of the JTTF are “responsible for maintaining awareness of possible threats” in their areas and could have performed “customized key word searches” of the FBI database that would have yielded the information about Tsarnaev.

NBC News researcher Taylor Sears contributed to this report.

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NEW YORK -- Federal prosecutors on Thursday revealed charges that accuse a Tunisian man who had lived in Canada with applying for a visa "to remain in the United States to facilitate an act of terrorism." 

The charges name Ahmed Abassi, a native of Tunisia who had been living in Canada.  Prosecutors say he came to New York in mid-March. 

Federal investigators say he met with the men involved in a plot -- first revealed in mid-April -- to attack an Amtrak passenger train from New York to Toronto.  They say the plotters discussed blowing up a bridge at Niagara Falls to cause the train to plunge into the gorge below. 

Canadian authorities announced in mid-April that the plot had been stopped. They disclosed then that they had arrested two men -- Chaieb Esseghaier of Montreal, a 30-year-old Tunisian graduate student who is reported to have guerrilla warfare training and is described as the ringleader, and Raed Jaser of Toronto, 35, a school bus driver.

Frank Gunn / AP

Chiheb Esseghaier, one of two suspects arrested last week in Canada in connection with the alleged terror plot to derail a passenger train near the U.S.-Canada border, arrives at Buttonville Airport outside Toronto on April 23.

Federal prosecutors from the Southern District of New York said Thursday that Abassi was arrested 17 days ago. The fact that word of his arrest was withheld indicates he was likely providing some information about the plot to investigators. 

He is charged with fraudulently applying for a work visa "in order to remain in the United States to facilitate an act of international terrorism," according to a statement from the Justice Department. 

Authorities in Canada said in April that an al Qaeda facilitator in Iran had worked with Esseghaier, and also that the train they intended to target was an Amtrak train originating in New York's Penn Station. 

"Esseghaier was simply a bad guy, and dangerous. This guy was purely evil," said one investigator, and had scientific training and the technical ability to make chemical bombs. 

Law enforcement officials say Esseghaier met Abassi during a trip to New York. But they say the meeting did not go well.  Abassi, they say, thought he should be the person in charge. As a result of the failure to get along, Abassi did not have a role in the derailment plot. Authorities did not spell out any further the basis for the visa fraud charge beyond saying it was to facilitate an “act of terror.” 

The FBI has covertly monitored the activities of the two Canadian men, their contact with overseas Al Qaeda facilitators and others, and their possible connection to others who could be linked to the plot. 

"What Mr. Abassi didn't know was that one of his associates, privy to the details of the plan, was an undercover FBI agent," said George Venizelos, the FBI Assistant Director in Charge of the New York office. 

The yearlong covert investigation involved electronic and physical surveillance. Authorities emphasize, however, that this was no sting operation.  It was, they say, a significant terror plot, once which failed to get more notice because of the Boston Marathon bombings. 

CTV News via Reuters

Raed Jaser is seen arriving at court in the back of a police car in Toronto on April 23.

Esseghaier and Jaser made their initial court appearances in Canada in April. They are charged with conspiracy to commit murder, conspiracy to interfere with transportation and participating in terrorist group activities. Esseghaier told the court that the Criminal Code of Canada “is not a holy book” and did not apply to him.

Richard Esposito is senior executive producer of the NBC News investigative unit; Jonathan Dienst is WNBC chief investigative reporter and NBC News contributing correspondent in New York City; Pete Williams is NBC News justice correspondent.

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Michael Conroy / AP file

This school bus crash on the southeast side of Indianapolis on March 12, 2012, killed the driver and a student.

For the first time in nearly a decade, the number of traffic deaths went up and a shift away from motorcycle helmet laws may be to blame, according to the National Highway Traffic Safety Administration (NHTSA) and helmet advocacy groups.

An improving economy, which leads to more discretionary driving, also played a role in the increase, according to NHTSA officials. “With a rebounding economy that there’s increased discretionary driving, which is clearly always the leader in terms of dangerous driving scenarios,” NHTSA Administrator David Strickland said.

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Last year was the first year that deaths rose since 2005 and it marked the highest number of people to die on U.S. roads since 2008. The total number of fatalities rose 5.3 percent to 34,080, according to the NHTSA estimate.

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The Governors Highway Safety Association (GHSA) is projecting that approximately 5,000 motorcyclists died in 2012: a 9 percent increase from 2011. This would represent 14.7 percent of overall traffic fatalities, the highest percentage ever.

Motorcycle deaths are up for several reasons: unseasonably warm winter weather early last year drew more riders out; high gas prices have led to an increase in motorcycle sales and more riders; and states continue to overturn laws that required helmet use.

“We’re seeing a really heightened number of motorcycle crashes and fatalities, which has really been driving the numbers in a lot of states,” Strickland said.

NHTSA said road deaths rose in all four quarters of 2012 and the fatality rate rose to 1.16 deaths per 100 million miles traveled, up from 1.10 in 2012 — and the highest fatality rate since 2008.

The rise follows a steady decline in road deaths since 2005, when 43,510 people died. Road deaths are down 26 percent since 2005. Road deaths in 2011 hit a 60-year-low, falling to 32,367.

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“After years of historic lows, any small uptick is going to look like a strong contrast,” Strickland said.

However, the focus on motorcycle fatalities is hard to escape in May, which is National Motorcycle Safety Awareness Month. Proponents of mandatory helmet laws point to the fact that motorcycle traffic fatalities went up in 34 states and decreased in 16 states.

Right now only 19 states require them of all riders, down from 26 states that did so in 1997. Several states repealed mandatory helmet laws in recent years, including Michigan, Pennsylvania.

Campaigns to repeal the laws are underway in some of the remaining states, and no state has enacted a universal helmet requirement since Louisiana did so in 2004.

Every region of the country saw motorcycle fatality numbers rise last year, including jumps of 32 percent in Oregon, 29 percent in Indiana, 18 percent in Michigan and 8 percent in Pennsylvania.

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However, opponents of mandatory helmet laws claim the rise in fatalities can't be attributed simply to riders not wearing helmets.

(Click here for more about the report on the rise in motorcycle fatalities.)

The Alliance of Bikers Aimed Toward Education (ABATE), a Pennsylvania-based organization that opposes helmet mandates, said fatality levels are influenced by several other factors, including an increase in motorcycle riding, alcohol impairment and road deterioration.

Charles Umbenhauer, ABATE’s lobbyist, said motorcycle registrations in his state increased from 286,531 to 404,409 last year. The fatality rate in the last full year of the state helmet mandate was 5.5 per 10,000 registrations, and 5.2 per 10,000 last year, the first year of the repeal.

“It’s common sense. If you put more motorcycles on the highway, you’re going to have more accidents and more fatalities,” he said.

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John Makely / NBC News

Fernando Colon was accused by Ariel Castro in 2004 of sexually assaulting the latter's daughters, Emily and Arlene, who also were his stepdaughters. He was initially charged with 28 counts, including rape and kidnapping, but was found guilty of five lesser offenses.

Nearly a decade before being charged with kidnapping, raping and torturing three Cleveland women, Ariel Castro was himself the accuser in a sexual assault case involving his daughters. The accusations, which resulted in the conviction of his ex-wife’s second husband, now offer a new window into Castro’s tangled family relationships. 

The case against Fernando Colon also raises questions about whether FBI agents squandered an opportunity to question Castro about the disappearance of two of the women in the months after their abductions.

John Gress / Reuters

Ariel Castro appears in court Thursday in Cleveland.

Castro made the accusations against Colon, 39, in July 2004, shortly after 14-year-old Georgina “Gina” DeJesus vanished on her way home from the west Cleveland middle school she attended. 

Colon, the husband of Ariel Castro’s ex-common-law wife, Grimilda “Nilda” Figueroa, says he told two FBI agents nine years ago to investigate Castro in connection with the disappearances of Amanda Berry and DeJesus, but that the agents seemed uninterested in his tip.

Castro has now been charged with four counts of kidnapping and three counts of rape for allegedly abducting DeJesus, Berry and Michelle Knight, and was arraigned on Thursday.

When DeJesus, a seventh-grader, disappeared on April 2, 2004, the FBI had reason to question Fernando Colon. Colon, was the stepfather of 13-year-old Arlene Castro, Ariel Castro’s daughter, who was DeJesus’ self-described best friend and had been with her right before she vanished. He also was the last adult known to have seen DeJesus before her disappearance. 

According to Chris Giannini, a private investigator who at the time was Colon’s boss, when school let out that day, Arlene Castro and DeJesus walked to Westown Square, the nearby shopping center where Colon worked as a security officer. Arlene asked Colon if Gina could come over and spend the night. 

When Colon said” no,” according to Giannini, the girls tried to get around Fernando “by checking with mom” via payphone. He said the girls got a second “no” from Figueroa.   

'The last one to see Gina'
After  Gina DeJesus disappeared, Arlene Castro told investigators that she and her friend went their separate ways when their sleepover was nixed. But according to a Cleveland police report issued Wednesday, Gina DeJesus has added a new detail. She says that before they separated, they also talked to Ariel Castro. After the girls split up, DeJesus now says, Ariel Castro returned and offered her a ride, which she accepted.

Soon after the disappearance, FBI agents contacted Giannini and said they wanted to question Colon “because he was the last one to see Gina,” according to Giannini. They searched the patrol car that Colon used to cruise the Westown parking lot to make sure Gina had not been in the car. According to Colon, FBI Agent Phil Torsney and another agent whose name he doesn’t recall then conducted a polygraph. 

“I guess I passed the polygraph,” recalled Colon. Having taken courses in policing, Colon said he understood why he had been questioned, but realized that there was someone else the FBI agents should contact. 

John Makely / Courtesy of Fernando Colon

Fernando Colon keeps this photo of Grimilda "Nilda" Figueroa in his Cleveland apartment.

According to Colon, Castro, who had not spent much time with the girls since splitting from their mother in 1995, and had contributed little to their financial support, had recently started spending more time with  them, driving them places and buying them cellphones. Colon said he told the agents that Castro also might have been acquainted with two of the missing girls -- in addition to Arlene’s close friendship with DeJesus, his older daughter, Emily, was friends with Amanda Berry, who had disappeared nearly a year earlier. 

“I said that if you’re talking to me because of my stepdaughters you should really be talking to Ariel Castro. He has more chance and opportunity than I do,” said Colon. “These girls are best friends with his daughters. (The agents) told me, ‘Well, we have to deal with you. Whatever arises in the case, we’ll take care of that.’” Colon does not know if they ever followed up and questioned Castro. 

Agent Torsney, who is now retired from the FBI and living in another state, did not immediately respond to a request for comment. At a press conference Wednesday, FBI Special Agent Stephen Anthony took issue with Colon’s version of events, telling reporters that his agency had "scrubbed" its records on  the case and had found no mention of Colon referring to Castro, and had “no reason to believe” he’d made the statement. 

Colon says he heard nothing more from law enforcement about the DeJesus case after the polygraph. Several months later, however, Colon found himself under investigation for a different crime. Ariel Castro and his daughters Emily, 16, and Arlene, 13, alleged that Colon had molested both girls between 1996 and 2001. 

Payback seen behind accusation
Colon maintains his innocence, and told NBC News that he thinks Ariel Castro made the accusations as a way of fulfilling a threat he’d made back in 1995, when his wife left him for Colon.

Grimilda Figueroa and Colon met when Colon was working at a local hospital, and Figueroa came in with injuries that she said were the result of abuse by Castro. She had accused Castro of domestic violence in 1993, but a grand jury declined to indict him. 

After she’d come to the hospital a few times, Colon said he offered her a way out of her relationship with Castro. “(Castro) had so much control over her,” Colon said. “He had her so wrapped up she had nobody to talk to. She told me his windows were tinted so nobody could see in and there were padlocks on the doors.  . .  I said, ‘If you were offered help to get out of the situation, would you take it?’ She said, ‘Yes.’” 

After the breakup, Figueroa and her four children by Ariel Castro – Anthony, Angie, Emily and Arlene  – went to live with Colon in 1995. According to Colon, Castro was furious, and after peppering the house with abusive phone calls, issued a threat to Colon. “He told me very clearly, ‘One day I’m going to get back at you and I’m going to ruin your life.’” Colon said that Castro waited for his moment “and then accused me of something that does the most damage to a person.” 

Castro made the molestation accusations in July 2004, two months after DeJesus vanished. “I think he did it to get police attention away from him,” said Colon. “By that point I think he already had all three (kidnapped) women under his roof.” 

NBCNews.com/Courtesy of Kayla Rogers

Arlene Castro poses for a picture in march of 2004.

Colon believes that his stepdaughters, Emily and Arlene, went along with their dad’s molestation charges because Castro had begun buying them things and doing them favors, even promising to get them a car, and because the girls resented Colon’s attempts to impose discipline. In court documents, he said that he had a “long history” with the two girls: “Defendant states that they are unruly and they don’t listen.” He also said that Emily was a drug user who at age 16 would stay away from the house for weeks at a time, according to court documents. 

Figueroa testified on Colon’s behalf at his 2005 bench trial. She said that Castro had started purchasing clothes for Arlene and had promised Emily an SUV. Figueroa also claimed that Castro, who had recently inherited some money, had promised her an expensive present as well. “Castro told me to go along with the complaints against Fernando Colon and he would buy me a new car,” said Figueroa in a pre-trial affidavit. “Castro was laughing and excited. … Castro believes that we will be together again.”

In the affidavit, she said that Arlene had “never discussed any inappropriate conduct between her and Fernando” and that as a stay-at-home mom, she had never witnessed any inappropriate sexual contact between Colon and his stepdaughters.

Arlene and Emily testified against Colon. But Anthony Castro, Ariel’s son, joined his mother in testifying on Colon’s behalf, saying he didn’t believe the charges of molestation.

Ex-wife sought restraining order
According to Chris Giannini, just before the trial began, Figueroa said that Ariel Castro had threatened to harm her if the girls did not testify at the trial. Arlene did not want to testify, said Giannini, and Emily was in Indiana with her adult boyfriend and didn’t want to return to Ohio. Figueroa sought a temporary restraining order, in which she inventoried years of alleged abuse at Castro’s hands: she alleged he had broken her nose twice, broken her ribs and caused a blood clot or tumor in her brain.

Giannini acted as an investigator for Colon in 2004 and 2005, helping his employee prepare his defense. At one point, he was able to arrange an interview with Castro to ask him about the allegations. Giannini said that Castro claimed that while he was driving Arlene and a friend around, the friend alleged that Fernando had stood over her while she was at a sleepover at Arlene’s house.

According to Giannini, Castro then claimed Arlene said that Colon had penetrated her digitally and demanded to know who she was having sex with.

“I had already heard somebody tell me the exact same story about Ariel,” said Giannini, who described the informant as “a family member.” “Right away I know what (Castro) is doing.  He’s projecting his own behavior on to Fernando.”

When the case against Colon went to trial at the end of August 2005, Ariel Castro took the stand to deny that he had ever abused Figueroa. Instead, he said, Figueroa had tried to get physical with him, once hitting her head on a door jamb in the process, which resulted in a trip to the hospital.

He also denied threatening Colon and Figueroa, and said he had gone to police immediately after hearing Arlene and her friend talking about Colon’s alleged inappropriate sexual behavior. When asked if anyone lived with him at his house on Seymour Avenue –  the address where police recovered Berry, DeJesus and Knight on Monday -- he said, “No.”

Kathleen DeMetz, Ariel Castro’s public defender in the kidnap and rape case, said she was unfamiliar with the Colon case and declined further comment.

The indictment of Colon originally contained 28 counts, including rape and kidnapping. On Sept. 6, 2005, the judge found Colon guilty on five counts of gross sexual imposition. He was sentenced to three years of probation, and is now a registered sex offender in Ohio.

“He hasn’t been able to get steady work in eight years,” said Giannini. “You can’t work in this field (security) with a felony on your record.” Colon also split up with Figueroa for good after the trial.

When news of Castro’s arrest broke, said Colon, his mother called him from Puerto Rico, sobbing. “She said, ‘I told you that all you had to do is have faith and something would come out,’” said Colon.

Now that Ariel Castro is in custody, said Colon, “I want my life back.” Colon and Giannini see an opportunity to challenge his conviction and repair his reputation. One of the first items on their agenda is speaking to Colon’s former stepdaughters to see if they will reconsider their testimony.

Talking to Emily Castro will require a trip to Indiana. Now 25, she’s currently serving a 25-year sentence in an Indiana state prison for the attempted murder of her daughter.

In April 2007, Emily slashed the then-11-month-old girl’s neck and then tried to slash her own wrists. At trial, defense attorneys argued that she was insane at the time of the attack. Nilda Figueroa appeared as a witness, testifying that Emily had struggled with depression for years and seemed paranoid since her daughter’s birth. She also said she had taken Emily to get mental help prior to the attempted murder.

Colon and Giannini also plan to contact Arlene, whose phone was not accepting calls on Wednesday.

Nilda Figueroa , however, can’t be enlisted in Colon’s bid for rehabilitation. She died in 2012 in Indiana at age 48.

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This story was originally published on Thu May 9, 2013 3:29 PM EDT