Audit finds waste, law-breaking, little oversight in DEA informant program

By M.D. Kittle

Want to make some big-time cash?

Sign on as a confidential informant with the federal Drug Enforcement Administration and its War on Drugs.

A recent audit of the DEA’s controversial Confidential Source Program found significant concerns about oversight of a government effort that paid out $237 million to informants between Oct. 1, 2010, and Sept. 30, 2015.

One Wisconsin congressman in particular is appalled at not only the potential for waste, fraud and abuse, but by the constitutional questions the program raises.

“There are people getting more money from the federal government to inform on their coworkers than they are in their regular job, which is kind of outlandish,” U.S. Rep. Glenn Grothman, R-Glenbeulah, told Wisconsin Watchdog.  “Furthermore, in order to collect information that can be used, these people to a degree may be going through packages, mail, that sort of thing, something a federal employee can’t do.”

U.S. Department of Justice Inspector General Michael E. Horowitz and DEA Chief of Inspections Rob Patterson recently testified to Congress about the mismanagement of the DEA’s network of 18,000 confidential sources, more than 9,000 of those who pocketed a combined $237 million in payments for information or services they provided to DEA.

Grothman pointed to an incident in which a confidential source working in the parcel industry opened packages and alerted the DEA if they found cash.

“It seems a practical matter there — (the DEA is) giving payment, sometimes payments that are more than a person’s salary, to do something that would be unconstitutional if their own employees did it,” Grothman said during the House Oversight and Government Reform Committee hearing.

The audit found the DEA’s confidential source policies were not in full compliance with the Attorney General’s Guidelines Regarding the Use of Confidential Informants.

DEA headquarters do not provide comprehensive oversight of their field offices to make sure the use of confidential sources, and payments to them, is “appropriate, reasonable, and justified.”

“We found that the DEA did not adequately oversee payments to its sources, which exposes the DEA to an unacceptably increased potential for fraud, waste, and abuse, particularly given the frequency with which DEA offices utilize and pay confidential sources,” the audit states.

While DEA policy prohibits paying sources who have been deactivated because of arrest or warrant or for committing a serious offense, the audit found two “concerning instances” of payments to such sources.

In one case, the agency reactivated a confidential source who previously had provided false testimony in trials and depositions, according to the report.

“During the approximate 5-year period of reactivation, this source was used by 13 DEA field offices and paid $469,158,” the audit states. More than $61,000 of that was paid after the source was once again deactivated for making false statements to a prosecutor.

The Inspector General estimates the DEA may have paid approximately $9.4 million to more than 800 deactivated sources over the period. It appears that paying deactivated sources is common enough to “justify much closer managerial oversight and review of such payments.”

“Limited use sources” or “tipsters” took home stacks of taxpayer cash. These sources offer tips independently, without DEA direction. It’s a low-risk category, requiring limited supervision.

“Yet we found that Limited Use sources were some of the DEA’s highest paid sources,” the audit states, noting that 477 tipsters were paid a combined $26.8 million for informing on someone.

The program, according to the congressional committee, is rife with waste.

In one case, an Amtrak employee was paid more than $850,000 for information DEA could have obtained at no cost. In another, the agency paid $86 million to purchase and modify a surveillance airplane that will never fly its intended mission. That didn’t stop 14 senior managers from booking a combined $1 million in bonuses.

It arguably gets worse, according to media reports. An Atlanta-based DEA supervisor allegedly engaged in sexual relationships with two confidential sources, one of whom was paid $212,000. The source never entered into a written confidential source agreement.

“That source started receiving payments in 2011, including bonuses of $55,000 and $80,750, and monthly payments of $2,500, but claims that she does not know why she received the bonus payments,” wrote Sen. Chuck Grassley, R-Iowa, in a letter last month to Chuck Rosenberg, DEA acting administrator. “The monthly payments covered the source’s approximate rent costs for her new apartment located closer to the DEA supervisor’s home. Reportedly, the supervisor forced his subordinates to falsify DEA reports to validate the payments, even when the source did not provide new information.”

Grassley, chairman of the Senate Judiciary Committee, is seeking a “full understanding of the DEA’s response to this reported misconduct, and the DEA’s efforts to improve oversight and accountability within the Confidential Source Program.”

Perhaps most troubling, Grothman said, is that the problems plaguing the program have been going on for a very long time.

“Your September 2016 audit highlighted widespread issues with the DEA’s tracking and oversight payments,” Grothman said to the inspectors during the hearing. “A lot of these issues have been going back and are similar to those that are happening in a report issued in 2005. So, we’ve had an 11-year period here and we’re still finding the same issues.”

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