Treasury Cancels $21M Booz Allen Contracts Over Trump Tax Return Leak

The U.S. Treasury Department has officially severed its ties with Booz Allen Hamilton, canceling $21 million in federal contracts. This decision follows revelations that a former employee leaked sensitive tax return information concerning President Donald Trump. The individual responsible, Charles Littlejohn, is currently serving a five-year prison sentence.

Treasury’s Decision Explained

Treasury Secretary Scott Bessent outlined the reasons for this cancellation. He indicated that Booz Allen failed to safeguard sensitive taxpayer information accessible through its contracts with the Internal Revenue Service (IRS). Bessent emphasized, “President Trump has entrusted his cabinet to root out waste, fraud, and abuse, and canceling these contracts is an essential step to increasing Americans’ trust in government.”

Booz Allen’s Response

A spokesperson for Booz Allen Hamilton contested the claims made by Bessent. They stated that the company aided the government in the investigation leading to Littlejohn’s prosecution. “Booz Allen fully supported the U.S. government in its investigation,” the spokesperson mentioned. They also clarified that Littlejohn’s actions took place on government systems, and Booz Allen does not store taxpayer data.

Details of the Leak

Charles Littlejohn pleaded guilty in 2023 for unauthorized disclosures of income tax returns. His actions, described by a judge as “the biggest heist in IRS history,” led to a significant data breach affecting over 400,000 taxpayers. The leaked information was published by the media, revealing that Trump had paid no federal income taxes for numerous years prior to his presidency.

Prosecution and Outcome

• Littlejohn is incarcerated in a medium-security federal prison located in southern Illinois.
• He is scheduled for release in October 2027.
• The Justice Department handled the case during the Biden administration.

Following the announcement of contract cancellations, Booz Allen’s stock (BAH) experienced a decline of approximately 10%. This development marks a significant turn for the consulting firm in the wake of the tax return leak saga.