Return to the USDOJ/OIG Home Page

Equitable Sharing Activities of the Marion County Justice Agency
Marion County, Indiana

Report No. GR-50-04-009
September 2004
Office of the Inspector General

Executive Summary

The U.S. Department of Justice (DOJ), Office of the Inspector General, Audit Division, has completed an audit of the DOJ equitable sharing activities at the Marion County, Indiana Justice Agency (MCJA). The audit was performed at the request of the DOJ Asset Forfeiture and Money Laundering Section to address internal control deficiencies cited by independent auditors since 1994 and an accounting error reported in 2002.

Equitable sharing revenues represent a share of the proceeds from the forfeiture of assets seized in the course of certain criminal investigations to the state and local law enforcement agencies that participate in the effort.1 In Marion County, Indiana, four law enforcement agencies are actively involved in the equitable sharing program.2 The MCJA is not a law enforcement agency; thus, it cannot participate directly in the program. The MCJA's involvement is limited to an administrative role and includes providing guidance to the participating agencies, ensuring equitable sharing receipts are forwarded to the appropriate city or county office for deposit, approving the participating agencies' request to spend equitably shared funds, and maintaining records and reporting on all equitably shared funds received and disbursed. Between January 1, 2002, and December 31, 2003, the MCJA processed $681,258 of equitable sharing receipts for its participating agencies and approved disbursements totaling $1,304,057.3

Based on our review, we determined that, in general, the MCJA adequately accounted for equitable sharing funds it received and disbursed and the $600,000 accounting error reported in 2002 did not affect the fund balances reported on the components' Annual Certification Reports. However, cash-handling and record-keeping duties at the MCJA were not adequately separated and its procedures for receipts, disbursements, record-keeping, and preparing reports were not formalized in writing. Further, through our observation and testing of the informal procedures, we determined that they do not ensure that: 1) the participating agencies promptly turn funds over to the MCJA for processing, 2) all sharing receipts are properly accounted for by the MCJA or deposited timely, and 3) required reports are accurate and submitted timely. Specifically, we found that:

  • As of March 18, 2004, there was no record that the participating agencies had forwarded 20 receipts, totaling $101,322, to the MCJA for recording and deposit, even though the agencies received the funds between October 1, 2002 and January 7, 2004. After we brought the missing receipts to their attention, MCJA officials followed-up and obtained 12 of the missing checks from one of the components in July 2004. However, eight checks totaling $76,948 were still unaccounted for as of August 17, 2004.

  • Eight additional checks totaling $50,726 were held by the participating agencies for 14 to 49 days before being turned over to the MCJA for processing.

  • The MCJA did not maintain a receipts log for equitable sharing funds turned over to them by the four participating agencies. As a result, we were unable to determine, in general, whether all funds received by the MCJA were deposited into the federal forfeiture account or, specifically, whether 81 receipts were deposited promptly.

  • A total of 56 receipts, amounting to $274,947, were held by the MCJA between 7 to 13 days before being forwarded to the proper city or county office for deposit.4

  • The 2002 Annual Certification Reports (one for each of the participating agencies) were not filed timely and did not include property awarded to the local participating agencies. In addition, one report was overstated by $15,395 because it included funds received from a non-DOJ source that had not been identified as such in the accounting records.

The results of our work are discussed in greater detail in the Findings and Recommendations section of the report. The audit objectives, scope, and methodology appear in Appendix I.


  1. The DOJ asset forfeiture program has three primary goals: 1) to punish and deter criminal activity by depriving criminals of property used or acquired through illegal activities; 2) to enhance cooperation among foreign, federal, state, and local law enforcement agencies through equitable sharing of assets recovered through this program; and, as a by-product, 3) to produce revenues to enhance forfeitures and strengthen law enforcement.

  2. These agencies are the Indianapolis, Indiana Police Department, the Marion County Sheriff's Department, the Marion County Prosecutor's Office, and the Metro Drug Task Force.

  3. Due to the nature of the program, equitably shared funds are not necessarily expended in the year they are received. Therefore, during any particular period, disbursements can exceed receipts.

  4. Although it did not maintain a receipts log, other documentation in the support files enabled us to determine the dates on which the MCJA received these checks.