The Internal Revenue Service rehired employees who were previously involved in agency misconduct such as falsifying documents or having unauthorized access to sensitive taxpayer information, according to an audit from the Treasury Inspector General for Tax Administration.

Considering that identify theft is a major concern, auditors wanted to inspect the agency to ensure the individuals they hire are of high integrity in safeguarding sensitive taxpayer information.

The auditors found there were 200 employees who were rehired between January 2015 and March 2016 that were terminated or separated from the agency that were either under investigation or had some misconduct that caused them to leave.

These employees had conduct issues such as falsifying employment forms or documents, unauthorized use of taxpayer accounts, misuse of email or property, absence and leave issues, workplace disruption, failure to follow instructions, and violations of the Internal Revenue Code, to name a few.

"Two rehired employees had repetitively falsified employment forms by omitting prior convictions or terminations," the auditors said. "One rehired employee had several misdemeanors for theft and a felony for possession of a forgery device, and another rehired employee had threatened his or her co-workers."

"Three rehired employees had ‘excessive' absence without leave for more than 270, 150, and 140 hours respectively, and one rehired employee was cited for unprofessional conduct based on a verbal altercation with a security guard at an IRS facility," auditors said.

The report notes it is likely if an employee has had a previous misconduct issue, he is likely to do it again upon being rehired. Seven percent of employees in the sample that was evaluated had performance issues after one year of being rehired.

When the IRS makes a decision to hire a former employee, it does not have an effective way to evaluate past conduct. For example, an employee that abused leave policies had a "do not rehire" note on their personnel files, and the IRS rehired the employee anyway.

"Although the IRS follows specific criteria to disqualify applicants for employment, past IRS employment history is not provided to the selecting official for consideration when making a tentative hiring decision," the auditors said. "IRS officials stated that it would be cost prohibitive to review prior issues before a hiring decision and tentative offer has been made."

Auditors recommend that the agency have access to former employee conduct through the IRS human capital officer and document why they are rehiring the employee.

"The Internal Revenue Service agrees in principle with the recommendations, and will update current practices and policies to ensure ALERTS data reflecting prior performance and misconduct of a former employee is generated and utilized in the hiring process, and that any decision to hire former employees identified as having misconduct and performance issues is documented, articulating the basis for re-hire," said E. Faith Bell, the acting IRS Human Capital Officer.