The Office of the Inspector General, Audit Division, completed an audit of the Services for Trafficking Victims Discretionary Grant Program, Cooperative Agreement 2003-VT-BX-K005, awarded by the U. S. Department of Justice, Office of Justice Programs, Office for Victims of Crime (OVC), to East Dallas Counseling Center, Inc., now known as Mosaic Family Services, Inc., (Mosaic) in Dallas, Texas.¹

The OVC is responsible for developing and administering the Services for Trafficking Victims Discretionary Grant Program (Program) that was created by the Trafficking Victims Protection Act of 2000 (P.L. 106-386). The money for this grant comes from the Crime Victims Fund; it is not derived from tax dollars but from fines, penalty assessments, and bond forfeitures of convicted federal criminal offenders.

The Program provides direct services, such as shelter, medical care, crisis counseling, legal assistance, and advocacy through grants to states, Indian tribes, units of local government, and nonprofit, nongovernmental victim services organizations to develop, expand, or strengthen victim service programs for victims of severe forms of trafficking.² It is also designed to create collaborative networks throughout the country to meet the multiple specialized needs of trafficking victims from the time they are identified to the time they are certified. The U.S. Department of State’s June 2003 Trafficking in Persons Report found that 18,000 to 20,000 people are trafficked in the United States each year. Trafficking victims usually come from economically disadvantaged and politically unstable countries. Victims may face abuses such as rape, starvation, beatings, and psychological threats to self and family.

In January 2003, Mosaic was awarded a discretionary grant cooperative agreement from the Office of Victims of Crime in the amount of $799,586, covering the period of January 1, 2003, through December 31, 2005. In January 2006, Mosaic received a supplemental award of $293,966 for a total award of $1,093,552. The supplemental award extended the original award period through June 30, 2007.

As part of the audit, we tested Mosaic’s compliance with essential grant conditions — reporting, grant drawdowns, budget management and control, matching program costs, grant expenditures, monitoring of subrecipients, and grant achievements. 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. Our audit objectives, scope, and methodology appear in Appendix I of this report. We found material weaknesses in three areas tested (grant drawdowns, grant expenditures, and monitoring of subrecipients) and are questioning $41,318 for unsupported grant expenditures.

1. All awards made under the OVC Services for Trafficking Victims Grant Program are discretionary cooperative agreements.

2. Severe forms of trafficking in persons means sex trafficking or the recruitment, harboring, transportation, provision, or obtaining of a person for labor or services through the use of force, fraud, or coercion for the purpose of subjection to involuntary servitude, peonage, debt bondage, or slavery.