The Department of Justice (DOJ) describes human trafficking as a form of “modern-day slavery.” According to the DOJ, trafficking victims are predominantly women and children who are often lured into prostitution, domestic servitude, or other forms of exploitative labor in the United States by traffickers who promise the prospects of a better life.

In 2000, Congress enacted the Trafficking Victims Protection Act, which authorized the provision of a number of benefits and services now available to trafficking victims. Under this legislation, in fiscal year (FY) 2003, the Office for Victims of Crime (OVC) made its first grant award under the Services for Trafficking Victims Discretionary Grant Program (the Program). OVC awarded two types of cooperative agreements, comprehensive services and supplemental/specialized services, for victim services under the Program to complement and not duplicate one another. The Program’s goal is to develop, expand, or strengthen victim services during the precertification period for persons who have been identified by law enforcement as victims of severe forms of human trafficking.

The precertification period is the period after trafficking victims are initially identified by law enforcement and before the federal government officially certifies them as victims. OVC states that victims’ needs are acute and largely unmet prior to certification. Funding under this program is to meet victims’ precertification needs that may include housing, medical, legal, and social services. When trafficking victims receive certification, they become eligible to apply for a wider range of benefits the same as a refugee through federally funded programs generally administered by the United States Department of Health and Human Services, Office of Refugee Resettlement.

The Office of the Inspector General, Audit Division has completed an audit of a Cooperative Agreement Number 2003-VT-BX-K011, awarded by OVC to International Rescue Committee (IRC). A non-profit organization founded in 1933, IRC provides relief, protection, and resettlement services for refugees and victims. The IRC domestic headquarters is located in New York, New York. OJP awarded IRC three separate trafficking cooperative agreements and a sub-agreement; each agreement was administered by a different regional office throughout the United States.¹ We audited the cooperative agreement administered by IRC's regional office located in Miami, Florida, under the project name Florida Freedom Partnership (FFP), which was initially called the Florida Collaborative Network Against Trafficking.

The IRC New York headquarters staff was responsible for: (1) providing technical support on the FFP project development and management, (2) implementing procedures and financial controls to ensure efficient grant administration, and (3) overseeing, monitoring, and evaluating FFP. The IRC Miami staff was responsible for: (1) administering the Program; (2) ensuring compliance with grant requirements and guidelines; and (3) coordinating direct services, referrals, and client advocacy services among key partner agencies.

OJP awarded IRC a total of $2,026,660 for the Florida Freedom Partnership to provide comprehensive services and supplemental services for the period January 1, 2003, to June 30, 2007. The initial award of January 29, 2003, was for $1,731,660 to provide comprehensive services to 100 precertified trafficking victims over a 36-month period. The Program activities were to include case management, needs assessment, food, shelter, legal services, mental health services, public education, and a website with links to resources. The comprehensive services included a plan for 10 pro bono attorneys to obtain 80 T-Visas for the victims during the project period.² On December 25, 2005, OJP awarded IRC $295,000 as a supplemental services award to allow expansion of the victim service program for another 18 months.

On June 14, 2007, OJP awarded IRC a no-cost extension to January 31, 2008, so it could expend $220,766 of the remaining funds to:

• continue training and outreach to the general public;

• finalize an interactive website to provide information to the community, victims, service providers, and others;

• continue comprehensive services to clients identified until certification and/or referred to other mainstream providers;

• work more intensely with law enforcement, grass roots, and ethnic community organizations to identify trafficked persons; and

• complete a project evaluation by January 31, 2008.

We audited activities for the period January 1, 2003, to September 30, 2006. We tested compliance with essential grant conditions pertaining to grant goals and objectives, financial status and progress reporting, grant drawdowns, budget management and control, program income, local match, grant expenditures, and monitoring of subrecipients. In addition, we tested the accounting records to determine if reimbursements claimed for costs under the grants were allowable, supported, and in accordance with applicable laws, regulations, guidelines, and the terms and conditions of the grant. We found material weaknesses in all the areas except budget management and control and program income. OJP had reimbursed IRC $1,136,250 of the total grant amount of $2,026,660 during our audit period. We identified $487,702 in dollar-related findings.

As a special condition of the cooperative agreement, OJP required IRC to submit a Time Task Plan that outlined the following project objectives.

1. Outreach and Public Education: develop and implement a public education campaign that will deliver critical, accurate and balanced information, raising awareness at national, state, and local levels.

2. Needs Assessment: conduct needs assessment research to explore the social, emotional, health, and other needs of victims of trafficking and enable the design of a targeted program of services.

3. Social Services: develop and implement a 3-year program for 100 victims of trafficking that addresses both short and long term social service needs.

4. Protocol: research, design, and publish protocols on standards of care, and strategies for crisis intervention and emergency care.

5. Legal Services: provide comprehensive legal case-management and representation for identified victims of trafficking.

We determined that IRC was achieving the objectives related to outreach and public education, needs assessment, and developing protocols. IRC was not achieving the objectives pertaining to social services and legal services because it was not serving 100 victims, and did not obtain 80 T-Visas for victims of trafficking identified during the project period as budgeted.

As of September 30, 2006, 45 months since the inception of the grant, IRC reported it had served 40 victims and obtained 4 T-Visas. We asked IRC staff about how they projected the number of victims and T-Visas during the grant period. The IRC staff told us they estimated serving a progressively larger number of 20, 30, and 50 clients each year based on increased outreach to the community and training to law enforcement. The IRC staff also indicated that the Florida Immigrant Advocacy Center (FIAC), and reports issued by the United States Departments of State and Justice pertaining to trafficking helped them estimate they would serve 100 clients.

IRC acknowledged in its progress reports that the enrollment of 100 victims in the Program was a difficult challenge despite its media and training efforts. FIAC, the legal services partner for this project, also stated that it had been difficult to obtain documents needed to meet the evidentiary requirements for obtaining immigration remedies, such as T-Visas. As a result, we determined federal funds were obligated to IRC’s project that could have been obligated to other applicants and the effectiveness of the Services for Trafficking Victims Grant program was diminished.

We also found the following weaknesses in IRC’s administration of the project.

• IRC did not maintain supporting documentation for 8 of the clients enrolled to show how IRC staff determined the clients were eligible for the Program. We question $17,536 for direct assistance costs related to the same 8 clients as unsupported costs.

• IRC did not clearly identify the number of new clients in the program progress reports. Moreover, IRC did not clearly identify the status of each client’s legal achievement of obtaining a T-Visa or other appropriate forms of immigrant relief in the progress reports.

• IRC did not maintain sufficient records for an audit trail to trace the details of the reimbursement requests to the accounting records.

• IRC was unable to provide supporting documentation for client housing costs. We question $2,300 as unsupported costs that IRC claimed as direct costs for victim housing.

• IRC entered into agreements with other agencies (subrecipients), to provide housing, medical, and legal services, for which IRC paid them nearly the full amounts budgeted in the grant for these services, although the subrecipients provided services to fewer victims than the budget was established to support. We question $297,686 of these direct costs as unsupported costs.

• The above findings related to direct costs had an effect on the accuracy of the indirect costs as reported by IRC. The IRC staff told us that they calculated the indirect costs for reimbursement by using the base of direct costs times the approved indirect cost rate. Therefore, we question the accuracy of the calculation of the indirect costs by $6,843 as unsupported costs as well.

• The above findings related to direct costs also had an effect on the reporting accuracy of the local matching costs. Since we question client eligibility and costs paid to the subrecipients as unsupported, we question an equal portion of the related local match in the amount of $163,337.

• IRC did not monitor its subrecipients as recommended by OJP by not conducting periodic on-site visits that include both programmatic and financial review.

We made 17 recommendations to address the above findings.

Our audit objectives, scope, and methodology appear in Appendix I. We discussed the results of our audit with IRC officials and we have included their comments in the report as applicable.

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Footnotes

1. OJP awarded IRC three cooperative agreements under the Services for Human Trafficking Victims Program as follows: (1) Cooperative Agreement Number 2003-VT-BX-K011 awarded in the amount of $2,026,660 and is administered by the IRC regional office located in Miami, Florida; (2) Cooperative Agreement Number 2003-VT-BX-K010 awarded in the amount of $1,480,285 and is administered by the IRC regional office located in Phoenix, Arizona; and (3) Cooperative Agreement Number 2003-VT-BX-K007 awarded in the amount of $1,044,999 and is administered by the IRC regional office located in Seattle, Washington. IRC also served as a sub-recipient under this program to the recipient, Mosaic Family Services, Inc. formerly known as East Dallas Counseling Center. OJP awarded Mosaic the Cooperative Agreement Number 2003-VT-BX-005 for $1,093,552 and IRC was sub-awarded $144,000.

2. The T-Visa allows victims of severe forms of trafficking to remain in the United States and assist federal authorities in the investigation and prosecution of human trafficking cases.