ATF’s 5,000 employees perform the dual responsibilities of enforcing federal criminal laws and regulating the firearms and explosives industries. ATF investigates violent crimes involving firearms and explosives, acts of arson, and illegal trafficking of alcohol and tobacco products. ATF also provides training and support to its federal, state, local, and international law enforcement partners and works in 25 field divisions with representation throughout the United States, Puerto Rico, U.S. Virgin Islands, and Guam. Foreign offices are located in Mexico, Canada, Colombia, and representatives in France.

Reports Issued

ATF’s Controls Over its Weapons, Laptop Computers, and Other Sensitive Property

The OIG’s Audit Division examined ATF’s controls over its weapons, laptop computers, ammunition, and explosives. We concluded that ATF had adequate controls over its explosives, but serious weaknesses existed in its controls over weapons, laptop computers, and ammunition.

Our audit found that 76 ATF weapons and 418 laptop computers were lost, stolen, or missing during a 5-year period from 2002 through 2007. We determined that since a 2002 audit by the Department of Treasury OIG (when ATF was part of Treasury), ATF’s rate of weapons loss per month has nearly tripled, and its rate of loss per month for laptop computers has increased significantly. We found that 40 (53 percent) of the 76 weapons that were lost, stolen, or missing during this review period appeared to have resulted from employees’ carelessness or failure to follow ATF policy. For laptop computers, 50 of the 418 were stolen; 274 were identified as missing during an inventory; and 94 were lost during shipping, left in a public place, or were unexplainably lost. ATF’s rate for lost, stolen, or missing weapons was nearly double those of the FBI (0.29) and the DEA (0.28). In addition, ATF’s loss of laptop computers was significantly higher than the FBI and DEA, at nearly 3 per 1,000 agents compared to less than 1 per 1,000 for FBI or DEA agents.

We also found that ATF staff did not report many of the lost, stolen, or missing weapons and laptop computers to ATF’s Internal Affairs Division, as required by ATF policies. In addition, ATF could not determine what information was on its lost, stolen, or missing laptop computers, and ATF was unable to provide assurance that 398 of the 418 lost, stolen, or missing laptop computers did not contain sensitive or personally identifiable information. Moreover, few of the laptop computers lost, stolen, or missing during our review period were protected by encryption software because ATF did not begin installing such software on its laptops until May 2007.

With regard to explosives, our audit concluded that ATF had adequate controls over the explosives in its possession and had proper physical security over its ammunition. However, we identified weaknesses in ATF’s accountability and controls over ammunition. Of the 20 ATF field offices we tested during the audit, only 11 performed required inventory recordkeeping for ammunition. ATF could not provide documentation that any of its field offices had submitted annual ammunition inventories to ATF headquarters, as required by ATF policy.

Our report made 14 recommendations, including that ATF report all lost, stolen, or missing weapons, laptop computers, and ammunition losses to its Internal Affairs Division; install encryption software on all laptop computers; maintain accurate and complete records in its property management system; follow recordkeeping requirements for ammunition; and determine whether lost, stolen, or missing laptop computers contain sensitive or personally identifiable information. ATF agreed with most of the recommendations.

Investigations

During this reporting period, the OIG received 188 complaints involving ATF. The most common allegations made against ATF employees were waste, misuse of government property, and theft. The OIG opened three cases and referred other allegations to ATF’s Office of Professional Responsibility for review.

At the close of the reporting period, the OIG had six open criminal or administrative investigations of alleged misconduct against ATF employees. The criminal investigations include d release of information, denial of rights or due process, and fraud. The administrative investigations involved serious allegations of misconduct. The following is an example of a case involving ATF that the OIG’s Investigations Division handled during this reporting period:

• A joint investigation by the OIG’s Chicago Field Office and the FBI led to the arrest and guilty plea of an Indianapolis police officer, assigned by ATF as a deputized task force officer, to charges of disclosing the existence of federal wiretaps. The investigation determined that the police officer, while assigned to a joint federal and state drug task force, disclosed the existence of 14 wiretaps to his girlfriend’s nephew. The nephew in turn told two of the targets of the task force investigation of the existence of the wiretaps. When law enforcement officials attempted to arrest the 36 targets of the investigation, 15 of them had fled because of the task force officer’s disclosure and, as of this date, two of them remain fugitives. The task force officer was sentenced in the Southern District of Indiana to 4 months’ confinement in a community corrections facility and 6 months’ confinement at home. He also was fined $1,000 and ordered to complete 180 hours of community service.

Ongoing Work

ATF’s Alcohol and Tobacco Diversion Program

The OIG is reviewing ATF activities that address the domestic and international diversion of alcohol and tobacco products from legitimate commerce. We are examining how ATF has implemented its diversion program and whether it is sufficient to identify and disrupt illegal trafficking of alcohol and tobacco products.