SEC. 7. Proceedings for suspension, disbarment, and reinstatement.—(a) If an officer or employee of the Treasury Department has reason to believe that an enrolled attorney or agent has violated any provision of the laws or regulations governing practice before the Treasury Department, or if a complaint concerning any enrolled attorney or agent is made to any such officer or employee, he shall promptly make a written report thereof to the Attorney for the Government. If any other person has information of such violations, he may also make written report thereof to the said Attorney. The Attorney and the Committee will treat as strictly confidential the identity of the informant in any case in which the informant is other than an officer or employee of the Treasury Department, unless the informant in giving his information states that his identity and connection therewith are not confidential.

(b) The Attorney for the Government may, either on the basis of such information or upon his own motion where he has cause to believe that any enrolled attorney or agent has violated any provision of the laws or regulations governing practice before the Treasury Department, institute proceedings before the Committee for suspension or disbarment against any enrolled attorney or agent. Notice thereof, signed by the secretary or a member of the Committee, shall be served upon such attorney or agent, hereinafter called the respondent, in the following manner:

(1) By delivery to the respondent personally, or

(2) By registered mail, with demand for a return card signed by the respondent: Provided, That, if an enrolled attorney or agent shall have signed and filed with the Committee on Enrollment and Disbarment his written consent to be served in some other manner it shall be sufficient if service is made in that manner. Where the service is by registered mail, the receipt of the return card duly signed shall be satisfactory evidence of service.

The notice shall give the place and time within which the respondent shall file his answer, which time shall not be less than 20 days from the date of service of the notice, and shall contain or be accompanied by a statement of charges, which statement shall be signed by the Attorney for the Government, giving a plain and concise description of the facts which it is claimed constitute grounds for suspension or disbarment, without a detailed description of such facts. A statement of charges which fairly informs the respondent of the charges against him so that he is able to prepare his defense shall be deemed sufficient. Different means by which a purpose may have been accomplished or different intents with which acts may have been committed may be alleged in the statement of charges in a single count in the alternative. If, in order to prepare his defense, the respondent desires additional information as to the time and place of the alleged misconduct, or by the means by which it was committed, or any other more specific information concerning the alleged misconduct, he may present a motion in writing to the Committee asking that the statement of charges be made more specific, setting forth in such motion in specific manner in what respect the statement of charges leaves him in doubt and describing the particular language of the statement of charges as to which additional information is needed. If in the opinion of the Committee such information is reasonably necessary to enable the respondent to prepare his defense, the Committee shall direct the Attorney for the Govern

ment to furnish the respondent with an amended statement of charges giving the needed information.

The procedure in suspension and disbarment proceedings shall be governed by the following rules:

1. Service of papers other than the original notice and statement of charges.-Papers other than the original notice and statement of charges shall be served on the respondent as follows:

(a) By delivering the same to the respondent personally, or by registered mail; or

(b) By leaving them at his office with his clerk or with a person in charge thereof; or

(c) By depositing them in a United States post office or post office box, enclosed in a sealed envelope, plainly addressed to such respondent at the address under which he is enrolled or at his last address known to the Committee.

(d) When the respondent is represented by attorney, by service upon the attorney in the same manner as provided in paragraphs (a), (b), and (c) for service on the respondent.

2. The respondent's answer.-The respondent's answer shall be filed within the time specified in the original notice unless on application the time is extended by the Committee.

The Committee may in its discretion furnish a complaining witness with a copy of the answer if in its opinion such action will aid in ascertaining the truth or falsity of the charges. The term "complaining witness" for the purposes of this provision shall include any officer or employee of the Treasury Department or any enrolled attorney or agent who may have reported the alleged misconduct to the Attorney for the Government, or any other person upon whose information the Attorney for the Government has instituted the proceeding.

In his answer the respondent should specifically admit or deny every material allegation of fact in the statement of charges. Every allegation in the statement of charges not denied shall be deemed admitted, unless the respondent shall state in his answer that he has no knowledge thereof sufficient to form a belief, which statement shall be considered a denial. In answer to a statement of charges, no enrolled person shall deny a material allegation of fact which he knows to be true, or state in such answer that he is without sufficient information to form a belief when in fact he possesses such information.

In his answer the respondent may also state affirmatively special matters of defense, and shall not give in evidence any matters in avoidance or of defense, consistent with the truth of the allegations of the statement of charges, unless in his answer he states such matters specifically. All answers shall be sworn to before a notary public or other officer authorized to administer an oath and shall be filed in duplicate.

If it appears that a denial of a material allegation of fact in the statement of charges, or a statement that the respondent has no knowledge sufficient to form a belief, was made in bad faith in the answer; or that the respondent has knowingly introduced false testimony during

proceedings against him for suspension or disbarment, the Attorney for the Government may thereupon file supplemental charges, which charges may be tried with the other charges in the case, provided the respondent shall be given due notice thereof and afforded an opportunity for preparing a defense thereto.

3. Reply to answer. If the answer contains affirmative matter in avoidance, consistent with the truth of the material allegations in the statement of charges, a reply by the Attorney for the Government admitting or denying the new matter set forth in the answer shall be filed with the Committee and served upon the respondent in the manner provided for by the rules of the Committee for the service of all papers other than the original notice and statement of charges.

4. Failure of respondent to answer. If the respondent fails to file his answer in the form required by these rules and within the time specified in the notice, or that specified by the Committee where the time has been extended, the Committee may, upon written application, accompanied by a copy of the answer desired to be filed, allow the respondent to answer whenever in such application the respondent sets forth facts which in the opinion of the Committee constitute a sufficient excuse for the failure to answer within the time specified. All such written applications shall be filed in duplicate and under oath.

5. Notice of time and place of hearing.—Written notice of the time and place of all hearings shall be given the respondent in the manner provided in these rules for the service of papers. No hearing shall be held in less than 10 days from the date of service on the respondent of the notice of such hearing, except that the Committee may postpone or adjourn hearings when necessary or desirable, on notice to the respondent.

6. Testimony.-Testimony shall be taken as follows:

(a) Unless the Committee shall otherwise direct, the testimony of witnesses at all hearings will be taken under oath and stenographically recorded and transcribed.

(b) Depositions for use at a hearing may, with the written approval of the Committee, be taken by either the Attorney for the Government or the respondent, or their duly authorized representatives, upon oral or written interrogatories, before a member of the Committee, any officer duly authorized to administer an oath for general purposes, or an officer of the Internal Revenue Bureau authorized to administer an oath in internal revenue matters, upon not less than 10 days' written notice to the other party. Such notice shall state the names of the witnesses, and the time and place where such depositions are to be taken: Provided, That when depositions are taken as aforesaid, if both parties are present or represented at the time and place specified for the taking of the depositions, either party may, after the examination of the witnesses produced under the order of the Committee, be entitled to produce and examine other witnesses; but in such case one day's notice must be given to the other party or his duly authorized representative there present, unless such notice is waived; And provided further, That the parties or their duly authorized representatives may agree in writing upon a time when and place at which such depositions are to be taken, without formal notice. When a deposition is taken upon written interrogatories, any cross-examination shall be upon written interrogatories. Copies of such

written interrogatories shall be served with the notice, and copies of any written cross-interrogtaries shall be mailed or delivered to the opposing party or his duly authorized representative at least 5 days before the time of taking the depositions.

Whenever any book, document, or paper belonging to any individual, partnership, or corporation is introduced as an exhibit in a disbarment or suspension proceeding, the Committee may authorize, upon such conditions as it may deem proper, the withdrawal of such book, document, or paper upon the written request of the Attorney for the Government, or of the respondent or his attorney.

In the case of a variance between the allegations in the statement of charges and the evidence, the Committee shall have power to base its findings on any facts established by the evidence which are grounds for suspension or disbarment, and to order the amendment of the statement of charges to conform to the evidence: Provided, That the respondent has had or is given reasonable opportunity to present his defense to such amended charges, with such postponements of the hearing as may be reasonably necessary to permit the respondent to present such defense.

If the Committee or a majority thereof finds that a part of the charges in the statement of charges is not sufficiently proved but that the residue thereof is so proved, it may base its findings on any facts established by the evidence which are grounds for suspension or disbarment and which are substantially charged by the said residue of the statement of charges.

The Committee shall disregard an immaterial misnomer of a third person, an immaterial mistake in the description of any person, thing, or place or the ownership of any property, a failure to prove immaterial allegations in the description of the respondent's conduct, or any other immaterial mistake in the statement of charges.

Subject to these regulations, the Committee may determine the time, place, and manner in which hearings shall be conducted; the form in which evidence shall be received; and may adopt rules of procedure and modify the same from time to time as occasion requires for the orderly disposition of suspension, disbarment, and reinstatement cases.

The Committee shall pass upon the sufficiency of the answer and all other relevant papers filed by the respondent, and upon all issues of fact that may be raised. The respondent or his attorney may be heard upon the sufficiency of the answer filed by him whenever in the opinion of the Committee such a hearing is necessary or desirable.

All hearings shall be held at times and places fixed by the Committee, of which due notice shall be given the respondent in accordance with these regulations and the rules adopted by the Committee.

In making its findings of fact as to the truth of any charges which are duly put in issue by the papers in any case and upon which a hearing is had, the Committee shall be guided by a preponderance of the evidence. If at any hearing upon issues of fact raised by the papers in the case the respondent fails to put in any evidence, the Committee may base its findings upon the evidence submitted by the Attorney for the Government.

(c) In the event that depositions are introduced on behalf of the Government at the hearing or in the event that oral testimony in support of the charges is produced by the Government at the hearing, the Attorney for the Government, as soon as possible after the hearing, shall prepare and file with the Committee proposed findings of fact based upon all the evidence in the case. Upon receipt of such proposed findings of fact, the Committee shall forward to the respondent or his attorney a copy thereof together with a copy of the transcript of such oral testimony and depositions as may have been introduced. The respondent shall have not less than 10 days after receipt of such papers in which to submit in writing to the Committee his objections, if any, to such proposed findings of fact. Neither the respondent nor his attorney shall have the right to receive any copies of exhibits introduced at the hearing or at the taking of the depositions. The respondent or his attorney, however, shall have the right to examine all exhibits. Upon receipt of such objections, or after the time for filing such objections has expired if no such objections are filed, or after the hearing if no proposed findings of fact are required, the Committee shall make its findings of fact. The Committee shall have power to dismiss the charges when in its opinion such charges have not been proved. If, in the opinion of the Committee, suspension or disbarment should be recommended, it shall so report to the Secretary of the Treasury. Such report shall be signed by all members of the Committee agreeing thereto, and any member of the Committee dissenting therefrom shall submit a statement of his reasons for such dissent.

(d) Upon the approval of such recommendation by the Secretary of the Treasury and the issuance of his order of suspension or disbarment of an attorney or agent, notice thereof shall be given by the Committee to the heads of all interested bureaus, offices, and divisions of the Treasury Department and to other interested departments and agencies of the Government in such manner as the Committee may determine. Such persons will not thereafter be recognized during the period of suspension or disbarment as an attorney or agent in any matter before the Treasury Department. Notice in such manner as the Committee may determine may be given to the proper authorities in the State from which an enrolled attorney, certified public accountant, or public accountant derives his license to practice in the event that such attorney, certified public accountant, or public accountant is suspended or disbarred.

(e) Any attorney or agent who has been suspended or disbarred may make written application to the Committee to have the order of suspension or disbarment vacated or modified upon the ground (1) of newly discovered evidence, or (2) that important evidence is now available which the applicant was unable to produce at the original hearing by the exercise of due diligence. Every application for reinstatement shall be filed with the Committee in triplicate. Such application must set forth specifically the precise character of the evidence to be relied upon in its support and shall state the reasons why the applicant was unable to produce it when the original charges were heard. If the Committee after due consideration of the application shall deem it sufficiently meritorious to warrant a hearing, it shall set a time and place for such hearing and give due notice thereof to the applicant. Upon the conclusion of the hearing the Committee shall submit its recommendation to the Secretary of the Treasury for his approval or disapproval.