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Our Insurance Covers

Liability and legal defense for acts, errors & omissions of federal employees which are committed or arise out of the course and scope of employment including but not limited to:

  • Civil Lawsuits / Bivens Action
  • OIG Investigations
  • Whistleblower & Other OSC Investigations
  • Congressional Investigations
  • OPR Investigations
  • Management Directed Administrative Investigations
  • Disciplinary Actions at the Agency Level
  • Disciplinary Actions Requiring Appeal to the MSPB
  • Criminal Investigations
 
 
 
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IRS Managers and Employees Scenarios

The Administrative/Disciplinary Provision of the policy pays for legal defense up to $200,000 for any disciplinary or judicial sanction proceeding or administration investigations into alleged misconduct from any act, error, or omission committed by a federal employee while rendering a professional service.

Scenario 1

IRS employees responsible for contractual oversight of a system that a government contractor fails to deliver in a timely manner. The failure to deliver the system has a significant impact on the agency’s operations. As a result, the agency seeks to hold IRS managers responsible and accountable for the failure of the contractors alleging the managers lacked appropriate oversight and controls. The agency proposes several disciplinary actions against the employees involved to include removal from federal service. If you were a member of FEDS, you would be assigned an attorney to defend you throughout the agency administrative process, as well as any appeal to the Merit Systems Protection Board (MSPB).

Scenario 2

A new manager at an IRS processing center attempts to change the authorized reporting time and the process for alternate work schedules for her employees. Several employees who were upset about the change in their working conditions filed a complaint against the manager with the Office of Special Counsel (OSC) alleging whistleblower retaliation for their cooperation with a recent TIGTA investigation involving their office. If you were a member of FEDS, you would be assigned an attorney to defend you throughout the OSC investigation process, to include preparing you and attending the OSC investigative interview with you.

Scenario 3

A Special Agent in Charge (SAC) of an IRS Criminal Investigation’s office has an all hands meeting with his special agents in an effort to motivate them to conduct more criminal investigations. During the meeting, the SAC cited to the statistics of the average number of cases prosecuted by each agent and emphasized that there needs to be an increase in productivity. As a result of the meeting, a disgruntled employee files a complaint with TIGTA alleging a 1204 violation, (Note: Section 1204 of the IRS Restructuring Act contains a prohibition on using enforcement statistics to impose or suggest production quotas or goals for any employee or to evaluate an employee based on such statistics.), and TIGTA initiates an investigation. If you were a member of FEDS, you would be assigned an attorney to defend you throughout the TIGTA investigation and disciplinary process, to include preparing you and attending the investigative interview with you, and any resulting disciplinary action.

Scenario 4

An IRS manager trying to fill a critical vacancy was disappointed because after a long search and application process, his selection for the position was deemed unsuitable during the suitability inquiry because the applicant failed to file his tax returns for two filling years. Not wanting to have this same problem, before offering the position to another applicant, the manager asks another subordinate manager to check IDRS to make sure the new potential selectee had a clean tax record (Note: this is a technical violation of 1203 (UNAX violation) because the suitability/background investigation had not yet commenced). TIGTA initiates a 1203 investigation against both managers. If you were a member of FEDS, you would be assigned an attorney to defend you throughout the TIGTA investigation and disciplinary process, to include preparing you and attending the investigative interview with you, and any resulting disciplinary action.

Scenario 5

The same IRS manager in scenario 4 has an employee who was not selected for the position in question file an EEO complaint against him alleging gender discrimination. During the EEO investigation of that EEO complaint, the EEO investigator claims that the manager failed preserve all the relevant evidence and specifically destroyed evidence after being notified of the EEO investigation. The manager claims he simply threw out his personal notes of the application process after the selection was made. (Note: there is an issue as to when the material was disposed of—before or after the commencement of the EEO investigation). The EEO Office refers the matter to TIGTA for a potential 1203 investigation. TIGTA initiates a 1203 investigation against the manager. If you were a member of FEDS, you would be assigned an attorney to defend you throughout the TIGTA investigation and disciplinary process, to include preparing you and attending the investigative interview with you, and any resulting disciplinary action.

Also, as a FEDS policyholder, you would have been assigned an attorney to represent you in the underlying EEO investigation, which may have resulted in the prevention of the initiation of the TIGTA investigation in the first place.

The Criminal Provision of the policy pays for legal defense up to $100,000 for any criminal proceeding or investigation into any act, error, or omission committed by a federal employee while rendering a professional service.

Scenario 1

An IRS manager suspecting a fellow employee of some criminal wrongdoing accesses an IRS-registered Choice Point computer data base to obtain information about the colleague and potential criminal wrongdoing. The matter gets referred to TIGTA and TIGTA conducts a criminal investigation of the IRS manager under the Computer Fraud and Abuse Act. If you were a member of FEDS, you would be assigned a criminal defense attorney to represent you throughout the criminal investigation and any resulting prosecution.

Scenario 2

IRS manager makes an inadvertent disclosure of tax information and an overzealous TIGTA agent investigates it as a willful 6103 criminal disclosure. If you were a member of FEDS, you would be assigned a criminal defense attorney to represent you throughout the criminal investigation and any resulting prosecution.

The Civil Liability Provision of the policy pays up to $1,000,000 (or $2,000,000) of professional liability damages for federal employees who are sued for any act, error or omission which are committed or arise out of the course and scope of employment.

Several IRS-CID employees are personally sued for disclosing the names of subjects of criminal investigations to third party witness. In such cases, conflict of interest rules might prevent the DOJ from representing every individual defendant. Depending on the defenses available to the individual defendants, DOJ may exercise its broad discretion to deny you DOJ representation and, also decline to hire private counsel for you. As a FEDS policy holder, you would be provided with an attorney to defend you in the civil action.

Also, if there were a civil monetary judgment against you, your FEDS policy pays up to $1,000,000 (or $2,000,000) of the judgment in the event that the U.S. Government declines to indemnify you.

Being sued personally is not limited to law enforcement employees—it could happen to anyone—especially if you deal with the public or make decisions affecting the public. Other examples of personal lawsuits against federal officials consist of:

  • An attorney manager sued personally for allegedly retaliating against a subordinate attorney when he reported the subordinate to the state bar for ethics violation.
  • A manager sued personally for searching a subordinate employee’s desk drawer.
  • And any potential 6103 or other disclosure violations.
  • Purchase your professional liability protection from FEDS now online at or call us at 866-955-FEDS. You simply can’t afford not to have it!

    Benefits are secured by a U.S. based A.M. (Best) A+XV (Superior) Rated Insurance Company