Review Of The Drug Enforcement Administration's (DEA)
Control Of The Diversion Of Controlled Pharmaceuticals
Report Number I-2002-010
INSUFFICIENT ALLOCATION OF INVESTIGATIVE RESOURCES TO CONTROLLED PHARMACEUTICAL DIVERSION
Various studies have documented the prevalence of non-medical use of controlled pharmaceuticals. For example:
Despite the widespread misuse of controlled pharmaceuticals, field diversion investigators, whose goal is to prevent the diversion of controlled pharmaceuticals, constitute only 10 percent of the DEA's total field investigator positions. The chart below shows not only that this percentage has actually declined from a high of 13 percent in FY 1990, but also demonstrates the significant difference in the number of DEA diversion investigators compared to special agents over the past 12 years.
|Chart 2. Special Agent and Diversion Investigator Staffing, 1990-2001
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In FY 2001, at DEA domestic field offices, diversion investigators and DEA special agents spent approximately 187 investigator work years on criminal investigations and complaints related to controlled pharmaceuticals compared to over 2,229 work years on criminal investigations related to illicit drugs (excluding marijuana), such as heroin, cocaine, hallucinogens, and methamphetamine.7 This means that of the total 2,416 work years spent by DEA domestic field investigators (including both diversion investigators and special agents) on drug investigations (excluding marijuana), only 7.7 percent of the total time was spent on investigations related to controlled pharmaceuticals. In fact, as shown in Chart 3, since FY 1993 investigative resources allocated for investigations of controlled pharmaceuticals actually decreased.
|Chart 3. Work Years Spent on Illicit Drugs and Controlled Pharmaceuticals
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As previously noted, the 2000 NHSDA study found that 67 percent of the 13 million people who had used drugs other than marijuana in the past year were abusing controlled pharmaceuticals. Yet, in FY 2001, only 7.7 percent of DEA investigator time was spent on investigations relating to controlled pharmaceuticals.
In July 2002, the DEA Deputy Administrator, the OD Deputy Assistant Administrator, and the DEA Chief of Operations, told us that they recognized the need for additional diversion investigator positions. The OD Deputy Assistant Administrator cited DEA's FY 2003 budget request for an additional 75 diversion investigator positions, a 14 percent increase in authorized positions, as an indication of the DEA's intent to expand its diversion program.8 The DEA Deputy Administrator also cited the budget request as a positive step in addressing the imbalance in DEA resources allocated to investigations of illicit drugs versus the diversion of controlled pharmaceuticals.9
Recommendation 1: The DEA Administrator should increase investigative resources devoted to the controlled pharmaceutical diversion problem.
LACK OF LAW ENFORCEMENT AUTHORITY FOR DIVERSION INVESTIGATORS
In the early years of the OD, the focus of diversion investigators' work was on regulatory activities. Because the diversion of controlled pharmaceuticals has become more widespread, diversion investigators now spend the majority of their time on investigative activities. According to DEA's Work Hours Reporting System, from FY 1993 through FY 2001 diversion investigators spent from 64.8 percent to 74.5 percent of their time on controlled pharmaceutical and regulated chemical investigations. See Appendix 3 for details [Not available electronically].
The DEA periodically has reassessed the role of diversion investigators in conducting criminal investigations. According to the DEA, it has variously considered modifying the diversion investigator's role from conducting only regulatory activities to full conversion to special agents.
For example, in January 1977 the DEA Acting Deputy Administrator issued a memorandum clarifying DEA's policy relating to the duties of the diversion investigators (who were then classified as compliance investigators). This memorandum stated that diversion investigators were prohibited from making undercover purchases of evidence; directing, registering, and paying informants; conducting moving surveillance; conducting arrests; and executing search warrants. The memorandum also directed regional managers to ensure that DEA special agents were available to assist diversion investigators in these activities. However, according to DEA officials we interviewed, DEA managers at some field offices independently allowed diversion investigators to perform some surveillance, manage confidential informants, and participate in arrests.
The DEA considered providing diversion investigators with special agent authority in 1991. On December 23, 1991, the DEA Administrator issued a memorandum to the Assistant Administrator for Operational Support directing the DEA to create a new core series for diversion investigators to expand and enhance their responsibilities by empowering them to "carry firearms, make arrests, handle informants, conduct stationary and moving surveillances, and perform undercover work." The new series investigators would be responsible for conducting both criminal diversion investigations and cyclical investigations. The memorandum further stated that while current diversion investigators could choose to remain in their existing job series, all future investigators would be hired under the new core series.
DEA's Deputy Assistant Administrator for Personnel officially notified field diversion investigators of this change of policy on June 30, 1992. On October 2, 1992, DEA's Deputy Assistant Administrator for Operational Support prepared a written plan for converting the diversion positions. The cost to complete the conversion was estimated at $10 million. The DEA also estimated that only half of the 412 diversion investigators on board met the eligibility requirements for conversion to the new core series.
In November 1993, the Deputy Assistant Administrator for Operations sent a memorandum to the Acting Administrator requesting that he intervene with the DOJ to facilitate the diversion investigator conversion process. In November 1994, the Assistant Administrator for Operations sent a memorandum to diversion investigators querying them on their interest in converting to criminal investigators.
In August 1995, the newly appointed DEA Administrator sent a memorandum to diversion investigators stating that, based on conversations he had with numerous diversion investigators, he determined that the solution was not to convert diversion investigators to criminal investigators, but rather to develop a definable career ladder for diversion investigators. The Administrator said the diversion investigators to whom he had spoken were uninterested in a full-service law enforcement career and expressed concerns that requiring conversion would dilute the technical expertise of the OD. As a result, the previous plan to convert diversion investigators to law enforcement agents was never implemented.
Current DEA Policy Regarding the Role of the Diversion Investigator
In August 2001, the DEA's Operations Division issued a policy memorandum to DEA field offices reiterating the restrictions on the role of diversion investigators specified in the January 1977 memorandum. The August 2001 memorandum stated that diversion investigators were prohibited from:
The memorandum also directed DEA field offices to assign two special agents full time to each field diversion group to provide law enforcement assistance. The memorandum required "duty specific training" for each special agent assigned to diversion groups and specified that only special agents control the circumstances and advisability of undercover purchases. The memorandum also designated an Assistant Special-Agent-in-Charge (ASAC) at each field office to oversee the operational activities of the diversion control program. In addition, a supervisory special agent, not a diversion program manager, would supervise special agents assigned to the diversion group.
According to the OD Deputy Assistant Administrator, this memorandum was issued to standardize field diversion operations nationwide. She stated that over the years some field offices had permitted diversion investigators to perform activities ordinarily performed by special agents such as surveillance and managing confidential informants. She stated that she was concerned that diversion investigators were performing activities they were not properly trained for or authorized to perform. This led to a concern that some investigations could be successfully challenged in court.
The policy memorandum attempted to compensate for the continuing restrictions on diversion investigators by providing diversion investigators full-time access to two special agents at each field location. The policy memorandum also tried to address a common complaint of the diversion investigators - that the special agents assigned to diversion cases lacked the necessary expertise - by establishing specialized training for the special agents in diversion activities.
However, we found that although the DEA has enforced the restrictions on its diversion investigators, it did not provide the full-time special agents to the diversion investigators. At all four field offices we visited, full-time special agents had not been assigned to diversion investigations. The SACs at these locations cited a lack of manpower as the prevailing reason for noncompliance with the directive. Additionally, our survey of 11 diversion program managers found that only one division was in compliance with the August 2001 policy memorandum.
Because of the lack of special agent assistance, the difficulties that diversion investigators historically have had in obtaining investigative assistance continue. We found that out of necessity diversion investigators relied more on state and local law enforcement officers than on DEA special agents to assist them in their investigations. Based on estimates provided by DEA field officials, DEA special agents assisted diversion investigators, on average, in 44 percent of their criminal diversion investigations and state or local officers assisted diversion investigators in the other 56 percent of their cases.10
Nine of the 11 diversion program managers we surveyed cited the lack of law enforcement authority as the largest obstacle in conducting criminal diversion investigations, and 8 of the 11 stated that the August 2001 policy further inhibited their ability to conduct timely and effective investigations.
We also found that the training requirement specified in the August 2001 memorandum had not been implemented. According to training staff at the DEA training academy in Quantico, Virginia, a diversion training course for DEA special agents was never developed.
The August 2001 policy memorandum also greatly diminished the role of the diversion program manager. According to the memorandum, a supervisory special agent, not the diversion program manager, would be responsible for overseeing special agents assigned to the diversion group. This responsibility includes developing work-plans and preparing annual performance evaluations for both special agents and diversion investigators. TDS management was shifted from a diversion investigation supervisor to a supervisory special agent. According to the OD Deputy Assistant Administrator, the purpose of shifting the supervisory responsibility to a supervisory special agent was to facilitate the assignment of special agents to assist on diversion investigations.
Nearly all of the diversion investigators we interviewed expressed concern that the August 2001 policy diminished the effectiveness of diversion investigations. According to one diversion program manager, the August 2001 policy had an immediate and negative effect on diversion investigations in his field office. The SAC in this office interpreted the memorandum to mean diversion investigators were not to conduct any investigations of a criminal nature. Consequently, he issued a memorandum on September 12, 2001, directing diversion investigators to concentrate their efforts on registration activities. The diversion program manager stated that because the diversion investigators were pulled off open diversion cases and the field office lacked special agents to take over the cases, action on 20 diversion cases was delayed.
During an interview in July 2002, the OD Deputy Assistant Administrator acknowledged the requirements of the memorandum had not been fully met because the field offices did not assign and did not train special agents to work on diversion investigations. Similarly, the DEA Deputy Administrator also told the OIG in July 2002 that the DEA field offices did not assign special agents to assist in diversion investigations due to resource problems. He said that DEA field offices often do not have enough special agents to conduct illicit drug investigations and are reluctant to assign them to diversion cases. He added that the DEA is still trying to decide how best to provide investigative support for diversion investigations.
Apart from the August 2001 policy memorandum, we found that the DEA is beginning to address some OD personnel issues. The OD Deputy Assistant Administrator stated the DEA has established grade parity for diversion investigators with criminal investigators by establishing a journeyman GS-13 level for diversion investigators. She added that she is working with DEA's Division of Personnel Management to determine whether the grade level for diversion program manager positions could be raised to GS-15.
Effect on the Quality of Diversion Investigations
The four AUSAs we interviewed who worked with the DEA on diversion prosecutions cited the need for investigators who are familiar with and experienced in conducting diversion investigations. They stated that cases involving controlled pharmaceuticals are more difficult to prosecute because of the need to prove a subject's intent to use the drug illicitly. For example, in a case involving a doctor, prosecutors must clearly demonstrate the doctor purposefully diverted a controlled pharmaceutical, as opposed to making a medical misjudgment. Therefore, they believed it is important that the investigator developing the case possesses a comprehensive knowledge of diversion issues. They said special agents usually lack the experience required for diversion investigations. In contrast, the AUSAs stated diversion investigators usually produce high quality cases for prosecution.
We found that significant problems have occurred in cases where diversion investigators had to rely on local or state law enforcement officers for criminal investigative assistance. One case file we reviewed showed that excessive delays occurred due to constant reassignment of officers, which necessitated additional briefings and training. In addition, the law enforcement officers' unfamiliarity with the nuances of conducting controlled pharmaceutical buys resulted in several buys having to be repeated because they did not conform with diversion program policies. According to the case file, local law enforcement officers spent seven months preparing a search warrant. The AUSA assigned to the case ultimately decided the undercover work performed by the local law enforcement officers was not sufficient to establish criminal intent and requested that a DEA special agent gather the evidence.
Effect on the Timeliness of Diversion Investigations
Lack of available special agents also impeded diversion investigations by causing excessive delays. The AUSAs we spoke to cited frequent case delays due to the need for the diversion investigator who was developing the case to wait for assistance from DEA special agents to perform undercover work, surveillance, or other investigative activities. Often, special agents were unavailable or lacked diversion investigation expertise. One AUSA stated that all of the diversion cases he was involved with had been delayed due to the unavailability of DEA special agents. A case we reviewed that was already delayed nine months due to problems related to the quality of local law enforcement support was delayed an additional four months until a DEA special agent was available to assist in substantiating the evidence.
State and local officials we spoke to who work with diversion investigators agreed with the AUSAs' assessment that the lack of DEA special agent assistance delayed investigations.11 Most police officers said they were surprised to discover the restrictions on diversion investigators. They commended the expertise of DEA diversion investigators and believed they should be empowered to use all routine law enforcement investigative tools.
Improving Investigative Capability
Because the diversion of controlled pharmaceuticals is widespread, it is important that the DEA dedicates a sufficient number of qualified personnel to investigating these cases. It is particularly important that diversion investigators have appropriate investigative support. We found that the lack of timely and effective support has hurt the effectiveness of diversion investigations. While the DEA has considered solutions to this problem over the years, the problem has not yet been resolved. We believe the DEA has several options to improve the quality and timeliness of diversion control investigations. These include:
Most of the diversion investigators we spoke with believed that, at a minimum, diversion investigators need the investigative tools authorized in the past, such as the ability to conduct stationary surveillance and manage confidential informants. However, they believed the most effective solution would be to create a new occupational category exclusive to the OD that would grant diversion investigators full law enforcement powers.
We found divergent opinions among the SACs and ASACs during our site visits as to whether diversion investigators should be given law enforcement authorities. Of the two SACs and two ASACs we interviewed, two were in favor and two were not. The two individuals in favor of the proposal stressed the benefits of having a single individual conduct an investigation from beginning to end. The two individuals not in favor of the proposal believed that diversion investigators should exclusively focus on regulatory activities.
The OD Deputy Assistant Administrator said she is preparing a proposal with the three options referenced above, along with a fourth option that would restrict the field diversion units solely to performing regulatory activities. She stated that she will present the proposal to the DEA Administrator within the next few months for a decision.
The OD Deputy Assistant Administrator told us that conversion of diversion investigators to full agent status has both positive and negative aspects. On the positive side, full conversion would make the diversion investigators more autonomous and would increase their effectiveness. On the negative side, the OD Deputy Assistant Administrator was concerned that the regulatory functions of the program would be neglected in favor of criminal investigations. She also cited the costs involved and the problem of some current diversion investigators' ability to meet the stricter qualification standards to be special agents. She said that the diversion investigator positions were initially created because special agents were not interested in performing regulatory work. She noted that she had been approached by some diversion investigators who indicated that they did not want to become special agents.
The DEA Deputy Administrator acknowledged the need for diversion investigators to have criminal investigative support in conducting diversion investigations. During his interview with the OIG, he reiterated the positive and negative aspects noted by the OD Deputy Assistant Administrator of providing diversion investigators with law enforcement authorities. He stated that although the DEA has grappled with this issue for decades, it has been unable to come up with a solution.
We believe that the DEA needs to make a definitive decision on how diversion investigators will obtain the investigative support they need to effectively accomplish their duties and mission. We favor establishing a limited number of criminal investigative positions, dedicated to diversion investigations, within the field diversion groups and funding these positions out of the diversion fee account. Since two of the three primary functions of diversion control are regulatory, it does not seem cost-effective to fully staff the OD with criminal investigators. We also believe that it is important for DEA special agents to be knowledgeable about diversion investigation procedures. This can be accomplished by incorporating diversion investigation training into the current DEA special agent training program.
Recommendation 2: The DEA Administrator should clarify the roles, responsibilities, and law enforcement authorities of diversion investigators.
Recommendation 3: The DEA Administrator should ensure adequate training for DEA special agents in diversion investigation procedures.
INSUFFICIENT INTELLIGENCE SUPPORT
We found that the intelligence support provided by the DEA to diversion investigators is minimal. The Operations Planning and Support Unit in the OD provides a twice-yearly national summary report on drug diversion activity compiled from DEA field office reports. The only other resource available to diversion investigators is the quarterly reports provided by DEA's controlled pharmaceutical tracking system, the Automation of Reports and Consolidated Orders System (ARCOS).12
ARCOS was not intended to be an intelligence system and the ARCOS reports are not intelligence products. Rather, they are historical, non-analytical reports that do not identify future trends, methods of operations, or emerging diversion enforcement problems. Further, the ARCOS reports are not coordinated or integrated with other DEA intelligence efforts to identify potential trends or linkages between controlled pharmaceutical diversion and illicit drug trafficking.
The diversion investigators we spoke to commented on the limitations of the ARCOS reports as intelligence resources, citing the lack of analysis, completeness, accuracy, and timeliness of the data. OD officials told us they do not have the resources to analyze the ARCOS data to develop intelligence products that could depict future trends, methods of operations, or emerging diversion enforcement problems. The diversion investigators also told us they do not have the time to fully analyze the ARCOS reports and develop their own intelligence products.
The diversion investigators stated the ARCOS reports can be used only as a starting point for an investigation or as a means to help support a criminal case. The reports can identify "spikes" or other unusual purchasing or distribution patterns of controlled pharmaceuticals, which may require further investigation for potential illegal activity. However, the diversion investigators told us these potential leads often turn into "blind alleys" because the data is unanalyzed, inaccurate, or a logical explanation exists for what first appears as unusual activity.
Further, we found the process of collecting ARCOS data and disseminating reports results in the field receiving ARCOS reports that are four to six months old. ARCOS reports are constructed from data received from individual registrants and it takes the registrant time to collect the data and report it to the DEA. The data must be collated and reviewed at DEA headquarters. If the review process detects problems with the quality of the data, the registrant must be contacted to resolve the issue. The data is manually entered into the ARCOS system. Finally, the ARCOS reports are generated and distributed to the field divisions.
Another significant limitation of ARCOS as an intelligence tool is the system does not track controlled pharmaceutical transactions at the retail level. ARCOS does not track transactions between pharmacies, doctors, and hospitals and their respective patients. Under the CSA, the DEA only has the authority to regulate transactions of manufacturers and wholesale distributors. This regulatory limitation creates a gap in the capability of ARCOS as an effective intelligence tool since much of the diversion of controlled pharmaceuticals occurs at the retail level.
Despite the limitations of ARCOS as an intelligence resource, we found that the ARCOS reports are regularly used by field diversion investigators. The ARCOS reports can be useful in providing statistics to build cases for prosecution. Specifically, ARCOS data is used as evidence that a specific pharmacy is buying more of a particular type of drug than other pharmacies in a geographic region. In addition, the ARCOS reports are used to support routine cyclical investigations of registrants.13 While improvements probably could be made to improve the timeliness and accuracy of ARCOS reports, we would not suggest that ARCOS be modified to perform an intelligence function. Rather, we believe additional intelligence resources should be allocated to the OD.
The DEA is in the process of increasing its intelligence support to the field diversion investigators. The use of the Internet to market controlled pharmaceuticals has brought a new dimension to the diversion problem. In the past, diversion investigators conducted their own Internet searches for suspicious controlled pharmaceutical marketing practices. In FY 2001, the OD's Operations Planning and Support Unit began developing the Internet Online Investigations Project to provide assistance to field diversion investigators in identifying pharmacies, bulk chemical retailers, doctors, and other individuals or businesses conducting illegal transactions via the Internet. Although many pharmacies and chemical retailers legitimately use the Internet to conduct business, the Internet has been used improperly to sell controlled pharmaceuticals and regulated chemicals to individuals lacking a valid pharmaceutical or chemical certification, and to sell substances that are not legal in the United States.
The DEA's Internet Online Investigations Project involves developing a computer program to search the Internet, using key words or phrases to identify web sites possibly involved in the diversion of controlled substances. Once these web sites are identified, diversion investigators located at headquarters will manually review these web sites for probable criminal diversion and will refer any viable leads to the applicable diversion field office (i.e., the region in which the site originated). The DEA anticipates this project will be implemented by the end of calendar year 2002. DEA's FY 2003 budget request includes the addition of 25 field positions that would be responsible for managing the leads referred to the field.
Finally, the DEA Chief of Intelligence told us the DEA was in the process of establishing a diversion intelligence group to provide intelligence support to the OD. The group will consist of five or six intelligence analysts who will produce intelligence products on specific topics. He said he expected the diversion intelligence group to be operational by the end of FY 2002.
Recommendation 4: The DEA Administrator should fully implement the Online Investigations Project and the diversion intelligence group to provide effective intelligence support to the OD. Also, the DEA should continue to explore additional intelligence capabilities to support the diversion investigators.
The ARCOS reports provide information on controlled pharmaceutical purchases by region, by company, and by category of controlled pharmaceutical. Three types of reports are provided: the largest purchasers of controlled pharmaceuticals by state, the top 100 manufacturers and distributors by state, and the top 13 controlled pharmaceuticals purchased by state.