The move follows improper access to confidential taxpayer information by consulting firm Booz Allen Hamilton, the department has said

The US Treasury has cancelled contracts with a consulting firm after a former contractor was charged and imprisoned for leaking confidential tax information, including that of President Donald Trump.

The department said on Monday it had ended all contracts with Booz Allen Hamilton, a major defense and national security technology firm, following a data breach involving a former employee that took place from 2018 to 2020. The move affects 31 active contracts valued at roughly $21 million in total.

The case centers on Charles Edward Littlejohn, a former US Internal Revenue Service (IRS) contractor who worked for Booz Allen Hamilton. In 2024, he was sentenced to five years in prison after pleading guilty to leaking tax information to news outlets, including records related to Trump and other wealthy individuals. Some of the documents later reached media outlets such as the New York Times, which published multiple stories based on those records in 2020 and 2021.

The leaks, described by prosecutors as "unparalleled in the IRS's history," were found to have affected roughly 406,000 taxpayers. The records spanned more than 15 years and included tax returns, investment holdings, stock trades, and other financial details. While high-profile billionaires were affected, some ordinary taxpayers connected to certain investment entities were also impacted.

Treasury Secretary Scott Bessent said Booz Allen failed to implement adequate safeguards to protect the data. "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," he stated.

The company said it does not store taxpayer data on its systems and cannot monitor government networks. A Booz Allen spokesperson told CNN the firm has consistently condemned Littlejohn's actions and maintains a zero-tolerance policy for legal violations. Booz Allen maintains contracts with other federal agencies, including the Defense Department, Homeland Security, and intelligence services.

The Treasury's move comes as the 2026 US tax filing season begins. Since the breach, federal data access requests, including from Elon Musk's now-defunct Department of Government Efficiency (DOGE), have raised questions about IRS privacy practices.

(RT.com)