I went to college at Dartmouth and went to Yale Law School. I was originally in the class of 1942 there. My law school work was interrupted when I went into the service. I was in the Army for 4 years. I went in as a private and graduated as a captain.

I then returned to law school for a semester, graduating in June of 1946. I came to Washington to be the law clerk to Mr. Justice Black. I served there for a year and was employed as an associate by the Washington office of the firm of Paul, Weiss, Wharton & Garrison. The senior partner located here was Randolph Paul. I worked there for about 311⁄2 years as an associate and was invited to come to the firm of Cox, Langford, Stoddard & Cutler as their tax man. I went there in 1951 and became a member of that firm in 1952, and was there until I was appointed to my present position.

Mr. ROONEY. So you have had at least 10 years of tax work?

Mr. OBERDORFER. Yes. My principal responsibility has been in the tax field. I have done other things, but that has been my job, really.

ADDITIONAL EMPLOYEES IN THE TAX DIVISION

Mr. ROONEY. Now would you direct yourself to this ambitious increase in the Tax Division, requiring 34 additional employees.

Mr. OBERDORFER. Yes, sir. As the chairman knows, this proposal was the proposal of my predecessor

Mr. ROONEY. Does that make it good or bad?

Mr. OBERDORFER. It makes it good. He was an experienced man, who was in this office for, I guess, a full 8 years, first as Assistant to the Assistant Attorney General and then himself as the responsible Assistant Attorney General. My impression of the office as I go into it-I have been there only about 3 weeks-is that he ran a tight ship and the morale of that office is high. I think those people are working hard. I think the budget which he prepared without knowing whether he would be there to do the job or not, reflects the best judg ment of an experienced and honorable man about how to get a very big job done to the best advantage.

I am very serious, Mr. Chairman. I say I have the impression that the lawyers in that office work very hard. As you know, tax work is very technical and very demanding, and the problems are complex. These lawyers go out into the field and are handling important cases. They come up against very experienced and very well prepared adversaries. The judges and the juries around the country, as well as the Congress and the public, expect them to perform according to very high professional standards of proficiency, accuracy, and fairness. When these fellows make a mistake, they make it right out in public and everybody knows about it. I think their mistakes are relatively few and far between.

It has been my impression that these lawyers carry a heavier load in terms of caseload than a private practitioner does ordinarily. We have figures here indicating that the lawyers in this Division, the lawyers out on the line, not the supervisory people, handled in the fiscal year ending June 30, 1960, an average of 95 cases, and that at the end of 1960 the average caseload on the desk of every lawyer was approximately 39 cases.

(Off the record.)

TAX DIVISION WORKLOAD

Mr. OBERDORFER. The workload of this Division, incidentally, Mr. Chairman, these 39 cases, have been pruned, as I understand it, by the formation a few years ago of the Litigation Controls Unit in the Tax Division. This section has taken over from the trial lawyers the cleaning-up process; getting checks to taxpayers, getting releases signed, and generally finishing up after the central work of trial and compromise has been completed. The result is, when you see an average of 39 cases, that is after the elimination of some 300 cases, which are no longer assigned to any particular trial lawyer and are being brought to completion by clerical people in the Litigation Control Unit.

I made an informal check just in preparation for this hearing. I cannot offer it as evidence, but I can tell the committee that I have checked with a few of the leading tax litigation law firms here in the city in order to compare the caseload that the individuals in those firms carry with the caseload that the attorneys on the line in the Tax Division carry.

Most of these practitioners say they never carry more than six cases actively in litigation at one time, and that more than that they would consider to be excessive and unfair to their clients and difficult for them physically to manage. One of these practitioners said he had as many as 18 cases in litigation at one time, but never more than six or eight active at once.

As the committee knows, the present caseload carried by the attorneys in the Tax Division is less than it was in 1954 and 1955. At the end of 1954, each attorney in the Tax Division had an average of 68 cases as of the end of that year, and handled an average of 107 cases. In the fiscal year ending June 30, 1955, each attorney had an average of 56 cases and handled 107. As I have indicated, this has been reduced.

With the help of this committee in giving the Division personnel and with the very great effort that my predecessors have made in reducing this workload, the workload per lawyer has come down, even though, as the record shows, the actual number of cases received has gone up enormously.

I understand that in 1955, the Division received in round figures, 4,500 cases; in 1956, it received 4,800 cases; and last year, in fiscal 1960, it received 6,500 cases. In 1961 it is estimated it will receive 6,800 cases. Our estimate assumes receipt in fiscal year 1962 of 7,150 cases. Mr. OBERDORFER. In this same period, focusing on the criminal cases in 1955

CRIMINAL CASELOAD

Mr. ROONEY. Excuse me. Is there any workload chart with regard to criminal cases?

Mr. TADLOCK. Not broken down.

Mr. ROONEY. Do you have any statement on that?

Mr. OBERDORFER. I have it here orally on my little notes.

Mr. TADLOCK. We have two statements here you have seen before that you might like to consider.

Mr. OBERDORFER. With the permission of the chairman, I could read orally this schedule.

Mr. ROONEY. Just let us look at it a moment. It would appear from one of these charts that your criminal cases have dropped. Is that correct?

Mr. OBERDORFER. I do not have the impression that the cases received have dropped, Mr. Chairman.

ACTION ON CRIMINAL TAX CASES

Mr. ROONEY. Let us take the chart entitled "Analysis of action on criminal tax cases." In 1955 you had 667 authorized and 151 declined. That compares with 657 authorized and 71 declined in 1960. Is that right?

Mr. OBERDORFER. This chart so indicates there is that difference between 1955 and 1960.

Mr. ROONEY. It would appear with regard to convictions and acquittals, as between 1955 and 1960, that you had 666 convictions in 1955 with 48 acquittals, 40 dismissals, two nolle prosequis for a total of 90, under "Other dispositions," to wit, 666 convictions plus 90 other dispositions, or 756 cases as compared in the past year with 473 convictions and 78 other dispositions including acquittals. That is a substantial difference, is it not?

Mr. OBERDORFER. Yes, sir. If the chairman will permit me, this chart from which the chairman is reading relates only to cases which have been sent out by the office to the U.S. attorneys. As the chairman knows, this office has the responsibility for processing cases and returning them to the Internal Revenue Service. I do not know where this discussion is leading me except I do have here the cases received. Mr. ROONEY. I am taking your own exhibits and figures, and I am trying to find out where you are trying to lead us.

Mr. OBERDORFER. Let me say that according to the figures I have before me here, the Division received from the Internal Revenue Service the chairman used the year 1955-the Division received 585 cases in 1955. Let us make sure we are reading on the same figures. Yes. In 1960, the most recent fiscal year, the Division received 686.

Mr. ROONEY. But, Mr. Attorney General, according to the same chart you are reading from, the Division handled 1,606 criminal cases in 1955 compared with but 1,191 in 1960.

Mr. OBERDORFER. We can chase each other around on this one. The handled figure is very difficult for me to handle.

Mr. ROONEY. How about the closing figures? In 1955 there were 818 cases closed as compared with 638 in 1960. I made a note a while ago while you were speaking, as to Criminal Division figures. I became suspicious immediately when I saw there were no workload figures on the Criminal Division in the justifications. I think it is the only area that there are not plenty of figures. Is that right? Mr. OBERDORFER. I do not know. I have some other figures. Mr. TADLOCK. Yes.

Mr. OBERDORFER. I would like to give you some other figures.

Mr. ROONEY. Up to that point, I had already made this memorandum.

Mr. OBERDORFER. We have projections here of cases received. We anticipate that in 1961 we will receive 755 cases and in 1962-this is not on any chart the chairman has-we will receive 830 cases. There is a reason for that.

As I understand it, and as the committee probably knows, the Internal Revenue Service has 2,000 more enforcement employees.

Mr. ROONEY. We fully realize that. That is the reason we have been building up over all the years the number of people in the Tax Division. Every year you get an increase. Is that not a fair statement?

Mr. TADLOCK. Almost every year.

Mr. ROONEY. Almost every year. Looking at your chart here, or graph, showing appropriations, they sure have risen between 1955 and 1961, the current year, and projected further upward in fiscal year 1962. There is a steady increase, as you will note, Mr. Oberdorfer. Mr. OBERDORFER. Yes, sir; that is very obvious.

Mr. ROONEY. We realize that, and we realize that the taxpayer gets return money as the result of the activities of the Division. This leads me to this next question. Where are your money figures? Mr. OBERDORFER. The collections?

TAX DIVISION APPROPRIATIONS AND EMPLOYEES, 1955-62

Mr. ROONEY. Yes. While we are on the subject of the graph, with regard to appropriations, will you please insert at this point in the record a chart showing the amount of appropriations, fiscal years 1955 to 1962, estimated 1961 and 1962, as well as the number of employees in each of those years.

(The information to be supplied follows:)

Appropriations and employees, 1955-62

Personnel.
Funds...

$1, 535, 445 $1,820, 530 $1,844, 000 $2,095, 519 $2, 262, 300 $2,350, 000 $2, 682, 500 $3,028,000

COLLECTION PROCEEDINGS

Mr. OBERDORFER. The figures which I think the chairman seeks are on page 13-16. The savings, as I understand it, achieved by the Division in the recent fiscal year were $120 million. That is, the taxpayers recovered $120 million less than they claimed. The Division, through its collection proceedings, recovered $19 million. So that the total benefit to the Treasury from the activities of the Division in that fiscal year was approximately $139 million.

The recovery against the Government amounted apparently to only about 12 percent of the amount claimed by taxpayers in refund suits, which is a substantially smaller percentage than had been achieved in the past, and it is quite an achievement.

HISTORICAL SUMMARY OF CRIMINAL CASES

Mr. ROONEY. It might be well if we inserted at this point in the record the chart with regard to criminal cases.

(The chart referred to follows:)

Mr. OBERDORFER. Would the chairman permit me to comment on

that for a moment?

Mr. ROONEY. Surely.

FUTURE CRIMINAL CASELOAD ESTIMATES

Mr. OBERDORFER. This chart which the chairman has just inserted in the record, of course, carries the actual caseload through fiscal year 1960. I am advised that there is anticipated for this fiscal year receipt of 755 criminal cases or 10 percent more than received in the fiscal year 1960, and that for 1962 fiscal year it is estimated that there will be 830.

Mr. ROONEY. You are talking of expert estimates, expert guesses, compared with actual figures which are on the chart which has just been inserted in the record?

Mr. OBERDORFER. Yes, sir. The thing that these gentlemen have emphasized to me is that there is a cyclical effect in receipts of criminal cases and that there was a trend down from 1956 through 1959, and 1960 is greater than 1959, by 18 percent, and there is a basis for anticipating that the trend would be upward both just on the cyclical basis and also on the basis of the evidence we have that the enforcement activities of the Internal Revenue Service will be increasedthey have these data processing machines now, which should detect more cases. We sincerely believe there will be a substantial increase in the receipts of criminal cases for which we should be prepared.

As a matter of fact, this is confirmed by our experience in the first 7 months of fiscal 1961. Comparing the first 7 months of fiscal 1961 to the first 7 months of fiscal 1960, we understand that our criminal receipts are up 13 percent. There were 350 criminal cases received in the first 7 months of 1960 fiscal year, and there have been in fact 395 criminal cases received in the first 7 months of fiscal 1961.

NEED FOR ADDITIONAL PERSONNEL

Still another factor in this connection, Mr. Chairman, if I may relate one element of my brief experience in this office: as the chairman knows, the U.S. attorneys are now being replaced and there are