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The ATF Loses 2.1 Million Cartons of Cigarettes and Other Wasteful Mistakes

Cigarettes

68-page audit of the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) released yesterday revealed some startling examples of wasteful spending and face-palm worthy screw-ups, like when federal agents misplaced 2.1 million cartons of cigarettes, with a retail of more than $127 million. Finders-keepers for some lucky smoker out there.

The audit specifically looked at 20 undercover operations into illegal cigarette smuggling conducted from 2006 to 2011. The missing cigarettes were purchased by the agency for these missions.

Michael E. Horowitz, the Justice Department Inspector General, wrote in the audit, “We found a significant lack of oversight and controls to ensure that cash, cigarettes, equipment and other assets used …were accurately tracked, properly safeguarded and protected from misuse.”

One notably wasteful misstep was when an informant was allowed to keep $4.9 million of the $5.2 million in profit he made while selling cigarettes undercover without having to document his expenses. 

Representative Darrell Issa (R-Calif.), chairman of the House Oversight and Government Reform Committee, responded to yesterday’s findings with criticism.

“The news that the agency somehow lost $127 million worth of cigarettes alone is unfathomable,” he said. “Today’s disappointing report reiterates what we already know — that ATF management continues to struggle with its day-to-day operations.”

The IG office also found that a committee who is supposed to approve operations didn’t meet at all between February 2005 and January 2012. ATF officials won’t cop up to that accusation, though. In an official response, ATF Director B. Todd Jones said, “under current policy, income-generating undercover operations are subject to detailed and rigorous application, review, approval and oversight mechanisms.”

That’s not the only thing the ATF says isn’t right. According to the bureau, there were only 447,218 cigarette cartons unaccounted for, not 2.1 million, but that’s still a lot of cigarettes.

Either way, this isn’t the first time ATF has gotten in trouble for mismanagement, Sari Horowitz from the Washington Post writes.

In its Phoenix-based “Fast and Furious” gun operation, ATF lost track of more than 2,000 guns that investigators were monitoring as they were sold to traffickers suspected of arming Mexican drug cartels. The operation to link guns to a cartel fell apart after some of those guns were found at the scene of a shootout that killed a U.S. Border Patrol agent. That led to an 18-month congressional investigation and a vote to hold Attorney General Eric H. Holder Jr. in contempt.

In May, POGO wrote about the previously mentioned “Fast and Furious” case, when a former top federal prosecutor leaked an internal memo to retaliate against the lead whistleblower in the scandal. 

Photo image by Nikita 2706, Wikimedia Commons.

By: Avery Kleinman
Beth Daley Impact Fellow, POGO

Avery Kleinman Avery Kleinman is the Beth Daley Impact Fellow for the Project On Government Oversight.

Topics: Government Accountability

Related Content: Inspector General Oversight

Authors: Avery Kleinman

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