The Intelligence Unit of the IRS was established in 1919 to clamp down on tax evasion and root out bribery inside the organization. Six U.S. Post Office inspectors became the original agents with Elmer Irey as head of this new intelligence unit. Between 1920 and 1927, investigations led by Irey and his T-Men as they were called resulted in firing more than 700 of the organizations’ employees and indictments of 256 others.
Word spread of the effectiveness of Irey and his T-Men, and the humble postal inspector rose to become the overall coordinator of the Treasury Department’s law enforcement agencies at the time: the Secret Service, the IRS Intelligence Unit, the U.S. Customs Service and the U.S. Coast Guard.
According to the Mob Museum, “Irey’s effectiveness in putting Mob bosses behind bars dwarfs that of all others, including contemporaries such as J. Edgar Hoover and Eliot Ness in the federal government.” They further state, “Nicknamed ‘Uncle Elmer’ by the mobsters who feared him, Irey led the Intelligence Unit at the Treasury Department that used the income tax codes to send a generation of high profile organized crime leaders to prison.” In 1939, two thirds of those incarcerated in the U.S. were placed there through Irey-led agencies.
Irey and his agents are also credited with playing a pivotal role in the capture and prosecution of Bruno Hauptmann who was convicted of the kidnapping and murder of aviator Charles Lindbergh’s son.
These men ultimately became known as the “Fathers of Forensic Accounting” – a term sometimes only attributed to one his employees, Frank J. Wilson. Because Irey cultivated a low profile for his agencies and his men, his accomplishments have never been widely known.