2 More D.C. Tax Workers Removed

"Dr. Gandhi has a reputation that goes way beyond this," said council member Marion Barry (D-Ward 8). "If he had not had that reputation, he would have been out of here. . . . Had this been another CFO, he'd be gone."

Council member Phil Mendelson (D-At Large) agreed. "I don't think you take that all the way to the top" to Gandhi, he said. "My own view is that it is very unfortunate, but people steal."

Council member Yvette M. Alexander (D-Ward 7) said she expected managers under Gandhi to review checks and paperwork. "That's not his function," she said.

Gandhi, who has been chief financial officer since 2000, is credited with improving the city's finances. This year, the council approved increasing his salary to $279,000 from $186,600 to keep him from taking a job at Amtrak.

But even those council members who are supporting Gandhi said they need answers.

"It makes you wonder who's minding the store all the way up to Gandhi," said council member Carol Schwartz (R-At Large).

Authorities say Walters, a mid-level employee who earned $81,000 this year, allegedly wrote checks in the hundreds of thousands with the cooperation of lower-level employees to whom she had given gifts and who signed off on paperwork.

Council Chairman Vincent C. Gray (D) and council member Jack Evans (D-Ward 2), who heads the Committee on Finance and Revenue, will hold a hearing Thursday on the failings of the office.

Rep. Thomas M. Davis III (R-Va.), ranking minority member of the Committee on Oversight and Government Reform, which oversees D.C. affairs, has also called for the Government Accountability Office to conduct an audit of the District's tax department.

"We don't know how bad this is yet," Davis said. "You wonder how someone did not detect it."

Evans took offense at Davis's call for an investigation.

"Congress doesn't really have a role in this," he said. "In the scheme of the world, shouldn't they be investigating the hundreds of billions of dollars lost in Iraq?"

The independent chief financial officer position was created by Congress. Candidates are nominated by the mayor and approved by the council. The mayor may fire Gandhi only for cause.

Evans said the District has changed in the past decade, much to Gandhi's credit, and differs from the financially troubled city that was once under a financial control board appointed by Congress.

As the council member in charge of oversight of Gandhi's office, Evans said he never received any information that would indicate the current alleged wrongdoing.

"This is just another one of those things where people saw an opportunity," he said, "and they certainly went for it."

Staff writer Carol D. Leonnig contributed to this report.