Management of Seized Assets and Evidence by the
Bureau of Alcohol, Tobacco, Firearms and Explosives

Audit Report 06-37
September 2006
Office of the Inspector General

Objectives Our objectives were to:  (1) determine the status of ATF’s transition to DOJ’s system for managing seized assets; and (2) assess the adequacy of ATF’s accounting for, storing, safeguarding, and disposing of seized assets and evidence in its possession. Scope and Methodology The audit covered the period from January 24, 2003, to June 30, 2006. As part of the audit, we reviewed federal laws, regulations, and DOJ policies and procedures applicable to seized assets and evidence, as well as inspection reports from ATF’s Office of Field Operations for all 23 ATF field divisions. We reviewed the MOU between the Treasury and DOJ for the management and disposition of property seized for forfeiture by ATF. In addition, we reviewed the September 1990 memorandum from the Associate Deputy Attorney General, directing all DOJ organizations participating in the asset forfeiture program to develop plans for orderly transition to the new integrated asset forfeiture system. We also reviewed the non-profit corporation’s reports, CATS-FASTRAK Gap Analysis, June 2003; CATS‑FASTRAK Alternatives and Recommendations, July 2003; and ATF FASTRAK – Version 7.09/DOJ BBC Gap Analysis Summary, June 2005. We interviewed officials from ATF’s Asset Forfeiture and Seized Property Branch, Special Agents-in-Charge of field divisions, and Resident Agents‑in‑Charge of field offices where testing was conducted. We also interviewed contractor personnel responsible for securing items from ATF’s assets seized for forfeiture in the areas of the Gulf Coast region affected by Hurricane Katrina. We performed on-site audit work at the following locations: Office Location ATF Headquarters Washington, D.C. Houston field offices    Group I, II, III, IV, and V Houston, Texas Beaumont Field Office Beaumont, Texas San Antonio Field Office San Antonio, Texas New Orleans Field Offices    Group I, II, IV, and V Covington, Louisiana Biloxi Field Office Gulfport, Mississippi Mobile Field Office Mobile, Alabama United States Marshals Service    Asset Forfeiture Office Arlington, Virginia United States Marshals Service Dallas, Texas United States Attorneys’ Offices Dallas, Texas; New Orleans, Louisiana Justice Management Division    Asset Forfeiture Management Office Washington, D.C. On September 16, 2005, the ATF Assistant Director, Office of Professional Responsibility and Security Operations requested a 60-day suspension of our audit due to ATF’s involvement in responding to the Hurricane Katrina catastrophe. This request was granted. Analysis and Testing To determine the status of ATF’s transition to DOJ’s asset management system for managing seized assets, we: reviewed ATF Order 3400.1B, which addresses property taken into ATF’s custody; tested ATF’s compliance with applicable federal laws and regulations and DOJ policies and procedures that apply to seized assets and evidence; interviewed ATF Asset Forfeiture and Seized Property officials, Special Agents-in-Charge of selected ATF field divisions, and Resident Agents-in-Charge of selected ATF field offices regarding their knowledge of federal laws and regulations and DOJ policies and procedures that apply to seized assets and evidence; and interviewed Justice Management Division AFMS regarding the CATS system and ATF’s migration of forfeited asset data to the system. To assess the adequacy of ATF’s controls over accounting for, storing, safeguarding, and disposing of seized assets and evidence in its possession, we: obtained automated data from ATF; performed tests to ensure property items reported were appropriately accounted for and that property items in storage agreed with automated records; tested to determine if property items were stored in authorized and appropriate storage containers; analyzed whether property items were stored in facilities that met federal requirements and were appropriately safeguarded; performed tests to verify that items shown as disposed of in the automated system agreed with physical records; and tested physical disposal records to determine that required documentation was present to substantiate the final disposition of the property items.