– Senate Judiciary Committee Chairman Chuck Grassley is seeking answers about
the use of secret, unauthorized funding mechanisms by Bureau of Alcohol,
Tobacco, Firearms, and Explosives (ATF) officials that undermine oversight and
potentially the integrity of investigations.
In his letter
, Grassley presses for information
citing concerns rising from a report
that confidential informants,
operating on behalf of the ATF, may have allegedly defrauded business partners
and used the profits to fund secret ATF accounts. The purpose and use of these
accounts remain unclear. Further, such accounts are in apparent violation of
Department of Justice rules requiring the segregation of funds obtained
illegally and those obtained through legitimate means.
Full text of the letter
June 6, 2017
VIA ELECTRONIC TRANSMISSION
Thomas E. Brandon
Bureau of Alcohol, Tobacco, Firearms, and Explosives
Washington, D.C. 20226
Dear Acting Director Brandon:
On February 22, 2017, the New York Times
piece that raised questions with the Bureau of Alcohol, Tobacco, Firearms, and
Explosives’ (ATF) use of confidential informants.
the story alleged informants were trafficking cigarettes and using profits to
fund a secret account that was then used to finance investigations and pay
informants without the usual “cumbersome paperwork and close oversight.”
Therefore, to better understand the circumstances
surrounding ATF’s generation and use of these secret funds, as soon as possible,
please produce the following:
All ATF rules and guidelines relating to the use
of so-called “management accounts” by the ATF’s agents or others when
investigating tobacco diversion.
ATF Order 3380.1, titled “Alcohol and Tobacco
Any memoranda accompanying ATF Order 3380.1,
including any memoranda issued in April 2011.
All documents relating to the facts and
investigation (the Investigation) giving rise to U.S. Tobacco Cooperative
Inc. v. Big South Wholesale of Va. LLC, No. 5:13-CV-00527-F (E.D.N.C.,
filed July 23, 2013), including:
The ATF’s investigative plan for the
The ATF’s Undercover Review Committee’s approval
of the investigative plan, as well as any written concurrence by the Department
of Justice for the Investigation;
All documents relating to deposits or
expenditures made into or from accounts to further the Investigation, including
any deposits into the “management fund”;
All approvals for any expenditures made from
accounts to further the Investigation, including any deposits into the
All Monitored Case Program reports relating to
the Investigation; and
Documents sufficient to show the identities of
any non-ATF employee who had approval to deposit or withdraw any funds from any
accounts related to the investigation.
All documents relating to any discipline,
reprimand, warning, or other employment action taken by the Department,
including the ATF, against any individuals related to the Investigation,
including Thomas Lesnak.
All documents and communications relating to the
OIG’s review of the Investigation.
The overall number of churning investigations
conducted by ATF from July 2011 – present, as well as:
The number of churning investigations reviewed
by the Department; and
The number reviewed by ATF’s Undercover Review
Committee prior to submission to the Department.
All audit reports for any ATF investigation
involving churning from January 1, 2009 – present.
All case-closing audit reports for any ATF
investigation involving churning from January 1, 2009 – present.
All policy guidance issued since the
Department’s OIG’s 2013 report on income-generating operations, including
relating to the following:
Monitored Case Program requirements;
Accounting of funds in investigations using
Confidentiality of informants and undercover
Thank you for your attention to this important matter.
Should you have any questions, please contact Katherine Nikas of my Committee
staff at 202-224-5225.
Charles E. Grassley
Committee on the
cc: The Honorable Dianne Feinstein
Committee on the Judiciary