The Federal Bureau of Investigation's Compliance
with the Attorney General's Investigative Guidelines

Special Report
September 2005
Office of the Inspector General

Chapter Seven:
FBI and DOJ Compliance Oversight and
Enforcement Mechanisms

The FBI relies upon various oversight and enforcement mechanisms to ensure compliance with the Attorney General Guidelines. These include two joint FBI-DOJ review committees that approve certain undercover operations and confidential informants, the FBI's Inspection Division, and the employee disciplinary process. In addition, certain FBI program offices conduct field evaluations to gauge the performance of FBI operations. The evaluative criteria employed in such reviews often include requirements that are based on the Attorney General Guidelines. Below we describe how each of these oversight and enforcement mechanisms functions and their respective roles in promoting the FBI's adherence to the investigative standards and authorities set forth in the Guidelines.

  1. FBI-DOJ Committees that Approve and Monitor Certain Undercover Operations and Confidential Informants
  2. We discuss below the committee with authority to approve, fund, modify, extend, or expand the focus of Group I undercover operations, and the committee with authority to approve certain categories of confidential informants.

    1. Criminal Undercover Operations Review Committee (CUORC)
    2. When the first Attorney General Guidelines on FBI undercover operations were issued in 1981, FBI field offices or Headquarters Divisions proposing to initiate certain types of high-risk undercover operations were required to secure the approval of FBI Headquarters and the FBI Director. Since 1978, Headquarters approval has included both the operational unit overseeing the operation (e.g., violent crimes, public corruption) and the Criminal Undercover Operations Review Committee (CUORC). The CUORC is one of the key internal controls employed by the FBI and DOJ to review, approve, modify, and monitor Group I undercover operations involving "sensitive circumstances." In 1979, three voting members from the DOJ were added to the Committee.331

      Under the May 2002 Guidelines, the CUORC is composed of FBI employees, designated by the FBI Director, and DOJ attorneys designated by the Assistant Attorney General in charge of the Criminal Division.332 The CUORC chair is a designee of the FBI Director.

      The CUORC's members are:

      1. the FBI's Deputy Assistant Director of the Criminal Investigative Division (Chairman);

      2. FBI Section Chiefs of the Technology Operations Section, Violent Crimes and Major Offenders Section, Counterterrorism Division, Operational Support Section, Cyber Division; Financial Crimes Section, Transnational Criminal Enterprise Section, Integrity in Government/Civil Rights Section, International Terrorism Operations Section 1, Americas Criminal Enterprise Section, and the Domestic Terrorism/Counterterrorism Planning Section;

      3. FBI Unit Chiefs of the National Backstopping/Safeguard Unit, Asset/Informant Unit, Confidential Services Unit, Undercover & Sensitive Operations Unit, Civil Litigation Unit, and the Investigative Law Unit, and the Assistant General Counsel, Civil Litigation Unit II;

      4. DOJ's Director of the Office of International Affairs; and

      5. DOJ Criminal Division Chiefs of the Narcotic and Dangerous Drug Section, Counter Espionage Section, Public Integrity Section, Fraud Section, Domestic Security Section, Organized Crime and Racketeering Section, Child Exploitation and Obscenity Section, Asset Forfeiture and Money Laundering Section, Counterterrorism Section, and Computer Crime and Intellectual Property Section.

      The CUORC meets bi-monthly. Its charge is to review, approve, and provide continuing oversight of certain criminal undercover operations conducted in the course of general crimes and criminal intelligence investigations. In particular, upon receipt of a field office's or Headquarters' recommendation, the Committee is responsible for assessing the risks and benefits of proposed criminal undercover operations involving "sensitive circumstances."333 These include investigations of public corruption or other criminal conduct by elected or appointed officials; operations with a substantial risk of violence, physical injury, or financial loss; activities having a significant effect on or constituting significant intrusion into the legitimate operation of a governmental entity; participation in communications between an individual and his or her lawyer, physician, or clergyman; and undercover operations in which undercover agents may participate in felonious activities.334 Such operations are referred to as "Group I Undercover Operations" or "Group 1 UCOs."335

      The following table illustrates the type of Group I UCOs approved by the CUORC:

      TABLE 7.1

      Group I Undercover Operations Approved
      During FY 2003

      Program Total
      Violent Crimes & Major Offenders [SENSITIVE INFORMATION REDACTED
      International Terrorism [SENSITIVE INFORMATION REDACTED

      1. The CUORC Review Process
      2. When an FBI field office or Headquarters Division seeks to initiate, extend, change the focus of, or request additional funding for a Group I UCO, the SAC of the field office must first submit a proposal to the FBI Headquarters' section handling the investigation.336 The proposal sets forth the specific details regarding the background, objectives, scenario, and justification of the investigation, the subjects of the undercover operation, the proposed use of informants, and the sensitive or fiscal circumstances involved. The application also contains information on the requested budget for the operation, the investigative team, and any requests for exemptions from the Guidelines (e.g., to lease space or establish a proprietary business). The application must be accompanied by a signed statement from the SAC, the office's Undercover Coordinator, and its Chief Division Counsel acknowledging that they have reviewed and support the proposal. The U.S. Attorney in the District where the operation will be conducted or a Section Chief in the Criminal Division of the DOJ must also submit a letter of support.

        FBI Headquarters has a specialized unit within the Operational Support Section of the Criminal Investigative Division (CID) that, among other duties, works with field offices and FBI Headquarters operational units on Group I proposals that are to be submitted to the CUORC for approval. The Undercover and Sensitive Operations Unit (USOU) addresses problems with the proposals and anticipates questions the CUORC may ask at its periodic meetings. It also publishes the Field Guide for Undercover and Sensitive Operations (Field Guide), which contains a step-by-step explanation of the documentation that must accompany applications for undercover operations, including the paperwork needed to administer and to close down an operation. The Field Guide was revised twice since the May 2002 Guidelines were issued, most recently in July 2003.

        We learned from our interviews of its managers that USOU has from time to time discovered and corrected Guidelines violations. These included, for example, an instance where a field division was operating an undercover operation as a Group II UCO, when it clearly should have been classified as a Group I UCO. In another instance, USOU identified a Guidelines violation when it reviewed an undercover operation that was targeting a terrorist group, a subject requiring CUORC approval as a Group I UCO.

        After approvals by the pertinent Headquarters' operational managers (Section Chief and Deputy Assistant Director) and the Section Chief of the Operational Support Section (which includes USOU), the application is sent to the CUORC for consideration. A representative from the FBI Headquarters' operational section typically presents the proposed undercover operation to the CUORC and answers questions posed by the Committee's members. The CUORC members may also consult with U.S. Attorneys, SACs, and other personnel when necessary. When the CUORC approves the proposal, the application is sent to the FBI Director or designated Assistant Director for final approval. Upon final approval, the USOU sends a letter to the field office informing it of the decision. If the CUORC is not satisfied with the proposal or is unwilling to approve it in the form originally submitted, stipulations may be attached to the application that will constrain various aspects of the undercover operation, including stipulations to reduce the risk of harm to persons or property and to minimize the risk of entrapment or other legal defenses in the event of a prosecution. Support personnel from USOU record the stipulations and minutes of all CUORC meetings.

        The DOJ CUORC members stated that since the May 2002 revisions, FBI Headquarters is doing a better and more proactive job in answering their questions both before and during the meetings. The DOJ members of the Committee told us they are not aware of any problems with the CUORC's operation and did not suggest any changes to the scope of the Committee's activities or the information provided to members prior to their meetings.

      3. The CUORC's Activities from October 2003 to March 2005
      4. We attended 18 CUORC meetings during the period October 2003 to March 2005. We observed that by the time the CUORC met on a particular undercover operation - whether in the context of a new proposal or a proposal to extend, expand, or change the focus or increase the budget of an existing undercover operation - the proposal usually had been well vetted. Members of the CUORC had already reviewed the paperwork and had discussed in advance any major issues concerning the proposal. The presenters from FBI Headquarters typically were very well prepared and knowledgeable about the details of the undercover operation and responded effectively to questions posed by committee members.

        We also reviewed the official minutes of CUORC meetings from May 2002 to March 2005. Issues and topics that frequently were discussed at CUORC meetings include:

        1. whether appropriate measures were being taken to ensure the safety of confidential informants and cooperating witnesses during undercover operations;

        2. whether appropriate steps had been taken to ensure that privileged informants [e.g., lawyers or clergy] used in the undercover operation were cognizant of the nature of the information gathered and would avoid the acquisition of privileged information;

        3. whether steps were being taken to reduce the likelihood of third party liability, including the addition of stipulations to operations that involved the purchase of property, the operation of a proprietary business, the targeting of products or substances that are subject to federal regulation for health and safety reasons, or the transfer of property in which members of the public could be affected;

        4. whether the procedures used to limit the possibility of violence in connection with an undercover operation were sufficient;

        5. whether the elements of the federal crimes being investigated were likely to be established by the undercover operation and encouraging close coordination with the pertinent U.S. Attorney's Office; and

        6. ensuring that operations that touch on First Amendment-protected activity were carefully vetted (such as operations involving legislation or other governmental processes).

        We also reviewed the CUORC's Annual Reports to the Attorney General and its reports to the Congress since 2002. The Reports reflect the variety of sensitive undercover operation matters the Committee reviewed. Cases reviewed by the CUORC during this period included:

        • a white collar crime investigation targeting health care fraud in which the CUORC strongly urged the SAC of the field office investigating the case to consult with the U.S. Attorney to ensure that anticipated criminal charges would merit prosecution. In the same matter, the CUORC was assured that the undercover employees would not be submitting false testimony or affidavits in court proceedings because all claims would be settled prior to that stage in the proceedings;

        • a Computer Crime-Intellectual Property Rights Program undercover operation targeting the purchase and sale of "gray" market computers in which the FBI instituted procedures at the suggestion of the CUORC to identify the manufacturer of stolen property. These steps were taken to allay concerns regarding potential third-party liability if the stolen property was passed through the undercover operation to subjects intending to sell the items to the general public (as opposed to being purchased by the undercover operation and held as evidence);

        • an Organized Crime undercover operation targeting operations in a large U.S. city in which the FBI addressed the CUORC's concerns about the undercover employee's expected involvement in a conspiracy to violate bribery, gambling, and prostitution laws. The CUORC ultimately concluded that the undercover employee's participation was necessary to obtain evidence to prosecute more serious crimes, and that the undercover employee had not and would not initiate any criminal activity, but would only monitor the criminal acts of others; and

        • a White Collar Crime-Health Care Fraud operation which was modified so that the undercover employee would not have access to confidential patient records and would not interview patients and physicians.

        We found in our review of CUORC records that nearly all undercover operations brought to the CUORC were approved, some with modifications. However, the CUORC rejected or tabled several proposals for undercover operations during fiscal years 2002 and 2003. These included a proposed undercover operation targeting illegal gambling that was turned down because of the Committee's concerns about the relationship of a cooperating witness with the FBI, the cooperating witness's intent to solicit others to commit criminal acts, and potential civil liability issues. The Committee also rejected a proposed undercover operation targeting a paramilitary operation due to questions relating to the predication of the subjects, the safety of the operation, potential liability issues, and an inadequate plan for the arrest of the subjects.

      5. FBI Undercover Coordinator Survey Responses
      6. We surveyed Undercover Coordinators regarding perceptions of the CUORC.337 Undercover Coordinators are well positioned to provide insights on the CUORC's effectiveness, at least with respect to the Group I UCOs that it sees. We received survey responses from 54 of the FBI's 56 Undercover Coordinators.

        Seventy-two percent of the Undercover Coordinators who responded to our survey said they believe that the CUORC is providing effective oversight of the approval and administration of undercover operations in their field offices.338 Only two Undercover Coordinators said they did not believe the CUORC provided effective oversight. The reasons Undercover Coordinators cited as to why the CUORC has provided effective oversight, or has not done so, are summarized in Diagram 7.1.

        DIAGRAM 7.1
        Undercover Coordinators' Views on the Effectiveness of CUORC Oversight of Undercover Operations: 72% - Effective; 24% - Not in a position to evaluate; 4% - Not effective. Why Is CUORC Effective? 79% of Undercover Coordinators who believe the CUORC's oversight is

      7. OIG Analysis and Recommendations
      8. We found that during the period of our review, the CUORC played a vital role in reviewing, approving, and monitoring the most sensitive FBI undercover operations. Its members fulfilled their responsibilities both through informal exchanges before undercover proposals were submitted for approval and in formal discussions at the Committee's bi-monthly meetings. Both the FBI and DOJ members of the Committee appeared to work well together, often collegially and by consensus, and we observed a full exchange of information when undercover proposals were presented for initial approval, extensions, budget enhancements, or changes in targeting or scope. When questions were asked about proposed or ongoing operations, FBI personnel provided responses at the CUORC meeting or promptly thereafter.

        From our observations of its meetings over an 18-month period, we believe that the CUORC is operating effectively in accordance with its mission to ensure undercover proposals adhere to the Undercover Guidelines, other legal mandates, and internal FBI mandates, and that those supervising the operations from Headquarters and in the field are promptly made aware of the Committee's concerns. It is also clear that the Committee has strong support in the field, as evidenced by the positive observations in response to our surveys of FBI Undercover Coordinators. We believe the CUORC's impact is attributable in part to the critical supporting role played by the Undercover and Sensitive Operations Unit at FBI Headquarters.

        However, we believe that CUORC members would be better informed and provide more effective oversight of undercover operations if they received additional pertinent information. As we discuss later in this chapter, the Inspection Division generates triennial Inspection reports that document the nature and extent of certain Guidelines violations. In addition, USOU conducts periodic on-site reviews of ongoing undercover operations that generate valuable information about the operational and administrative aspects of the operations. We believe the facts and insights contained in these reports concerning undercover operations and in the after-action reports for UCOs approved by the CUORC should be provided to members of the CUORC as they become available.

        We also believe the FBI could make more effective use of the extensive experience of the CUORC's members by periodically aggregating the "lessons learned" from CUORC reviews and making them available in training and in USOU's periodic publications.

        We therefore recommend that the FBI take the following steps.

        (28) Provide CUORC members, upon request, with access to copies of Inspection reports concerning undercover operations, the Undercover and Sensitive Operations Unit on-site reviews, and after-action reports of undercover operations.

        (29) Consider ways for the Undercover and Sensitive Operations Unit to develop more complete information for the CUORC and other FBI components, such as conducting a periodic analysis of the patterns and trends found in its on-site reports, informing the CUORC members of any persistent Guidelines violations, and providing copies of its semi-annual report to all FBI Headquarters' operating Divisions, the Office of the General Counsel, and the Training Division.

    3. Confidential Informant Review Committee (CIRC)
    4. One of the major changes introduced by the January 2001 revisions of the Confidential Informant Guidelines was the requirement that the FBI and other Department of Justice Law Enforcement Agencies (JLEAs) establish within 30 days a Confidential Informant Review Committee (CIRC).339 The CIRC was directed to review three major types of confidential informants:

      • Long Term Confidential Informants, defined as those who are registered with the JLEA for more than six consecutive years;

      • High-level Confidential Informants, defined as those who are part of the "senior partnership of an enterprise that (a) has (i) a national or international sphere of activities, or (ii) high significance to the JLEA's national objectives, even if the enterprise's sphere of activities is local or regional; and (b) engages in, or uses others to commit" certain enumerated acts including acts of violence, corrupt conduct, and drug trafficking; and

      • Privileged Confidential Informants, defined as those who are under the obligation of a legal privilege of confidentiality or are affiliated with the media. Individuals who are under the obligation of a legal privilege of confidentiality include attorneys, licensed physicians, and members of the clergy.

      The Confidential Informant Guidelines define the CIRC as "a committee, created for . . . purposes of reviewing certain decisions relating to the registration and utilization of CIs." The Guidelines specify that the chair of the CIRC should be a person at or above the level of an FBI Deputy Assistant Director. The Guidelines also provide that the CIRC's membership should include two representatives designated by the Assistant Attorney General in charge of the Criminal Division: a Deputy Assistant Attorney General for the Criminal Division and an Assistant U.S. Attorney.340

      The FBI Director designated the Deputy Assistant Director for the CID to serve as chair of the Committee. Other FBI members of the CIRC are the Unit Chief and a Supervisory Special Agent in the CID's Asset/Informant Unit (A/IU) (whose functions were transferred to the Human Intelligence Unit (HIU) as of November 2004), the Chief and Assistant Chief of the CID's Criminal Intelligence Section, and a representative from the Office of the General Counsel.

      The DOJ Criminal Division members of the CIRC are the Principal Deputy Assistant Attorney General, a Senior Litigation Counsel, and the Chief of the Organized Crime & Racketeering Section. In addition, a U.S. Attorney and an Assistant U.S. Attorney serve on the Committee.

      The three categories of confidential informants reviewed by the CIRC constitute only a small percentage of informants operated by the FBI. However, under the Guidelines these informants require scrutiny by the CIRC because they present greater risks of potential liability, intrusion into governmental processes, and other adverse consequences.

      1. The CIRC Review Process
      2. The CIRC generally meets monthly. From its inception in 2001 through September 2004, it has approved 391 confidential informants.341 Of this total, 333 were long term confidential informants; 48 were confidential informants under the obligation of a legal privilege of confidentiality; 3 were confidential informants affiliated with the news media; and 7 were high-level confidential informants.

        As soon as the CIRC was established, its charge to review all "long term" confidential informants created an immediate backlog. To deal with the backlog, beginning in 2003 the CIRC reviewed approximately 40 informants per meeting. Once the CIRC completed its review of the backlogged long term confidential informants, it reviewed an average of 10 - 20 informants per meeting.

        To evaluate whether to approve or disapprove a long term, high-level, privileged, or media-affiliated confidential informant, the CIRC uses a 6-page form called Initial (or Continuing) Confidential Informant Suitability Report and Recommendation (SR&R).342 Pursuant to Section II.A.1 of the Confidential Informant Guidelines, the field office or Headquarters' Division proposing use of such a confidential informant completes the Initial Suitability Report & Recommendation (ISR&R) form.343 If the CIRC authorizes use of the informant, the office or division handling the informant must complete a Continuing Suitability Report & Recommendation (CSR&R) form, usually annually or when changed circumstances warrant.344 By the time the CSR&R gets to the CIRC, the information contained in it has already been evaluated and approved by FBI field office management. The CIRC then reviews the information contained in the suitability reports to decide whether, and under what conditions, the person should be utilized as a confidential informant.

        If the source has been opened as a confidential informant for over a year, the case agent must complete and sign a CSR&R. In addition to the factors addressed in the ISR&R, the report must specify the length of time the person has been registered as a confidential informant and the length of time the person has been handled by the same agent or agents.345

        Approximately two weeks prior to each scheduled CIRC meeting, the A/IU sends a binder to each CIRC member. The binder includes the suitability report and a 6-page analysis of the confidential informant's suitability based on the sponsoring field office's responses to 26 questions asked by the A/IU.346 We found a considerable amount of communication about the proposed confidential informants prior to the CIRC meeting. Both the A/IU and DOJ members of the CIRC sometimes raise questions about the proposed informant based on information contained in the suitability reports. The Committee members' questions are forwarded by A/IU to the originating field office, and the answers are discussed at the CIRC meeting. After the Committee makes a decision, the A/IU sends a communication to the field advising the sponsoring agents that the requested action was approved, disapproved, or in some instances tabled until the next CIRC meeting because more information was needed about the proposed or already-registered informant.

      3. The CIRC's Activities from August 2003 to April 2005
      4. We attended 12 CIRC meetings from August 2003 to April 2005. Our review found that members of the CIRC invest a considerable amount of time and effort evaluating the benefits and risks of each confidential informant. The questions asked by the FBI and DOJ members addressed virtually all the factors in the Initial and Continuing Suitability Reports and Recommendations form. Some of the most frequently asked questions are below.

        1. How is the person in a position to obtain relevant information (Factors 4 and 9)?

        2. Have there been allegations that the person was engaged in any act of violence or crimes (Factor 13)?

        3. What type of crimes has the person committed and when (Factor 12)?

        4. How can a confidential informant associated with organized crime for the past 20 to 30 years not be involved with any illegal activity (Factor 12)?

        5. Has the information the person provided led to indictments or convictions (Factor 5)?

        6. What special reporting or control measures can be employed to minimize the risk of violent or serious crimes committed (Factor 16)?

        7. What is the specific nature of the person's assistance to the FBI (Factor 6)?

        As described below, the CIRC members also frequently inquired about informants' participation in otherwise illegal activity, the length of time agents have handled informants, and other topics relevant to the Guidelines. During our attendance at CIRC meetings, we observed that the DOJ CIRC members were very active in posing questions on a variety of topics.

        Otherwise Illegal Activity

        An important issue the CIRC members address in preparation for and during meetings is the subject of "otherwise illegal activity" (OIA). As we discussed in Chapter Three, authorization for OIA permits registered confidential informants to commit acts which would otherwise be considered prosecutable crimes.347 Authorization for OIA is broken down into two categories. Tier 1 OIA entails the most serious criminal activity, defined as any activity that 1) would constitute a misdemeanor or felony under federal, state, or local law if engaged by a person acting without authorization; and 2) involves the commission, or the significant risk of the commission, of certain specified conduct, including acts of violence or public corruption. Tier 2 OIA is any other activity that would constitute a misdemeanor or felony under federal, state, or local law if engaged in by a person acting without authorization.

        During the meetings we attended, the CIRC members often asked for additional information pertaining to the confidential informant's involvement in OIA. Their requests on this topic included inquiries about the period of authorization for OIA, the specific nature of the authorized illegal activities, and whether Tier 1 OIA was authorized by the U.S. Attorney.348 They also requested information necessary to distinguish Tier 1 from Tier 2 OIA and resolve apparent inconsistencies in an SR&R as to the informant's authorization to engage in otherwise illegal activity.

        Informant Handled by the Same Case Agent for Extensive Period

        The CIRC closely examines long term informants because this category of informants historically has generated problems during investigations and prosecutions. During some CIRC meetings we attended, questions focused on whether it was prudent to have the same FBI agent handle an informant for five years or more. At the suggestion of a DOJ CIRC member, the CIRC ultimately required the SACs in such cases to provide a written finding that in his or her judgment the agent should continue to handle the informant.

        Other Questions Raised at CIRC Meetings

        During meetings we observed, CIRC members also raised questions not specifically addressed in the suitability reports but which are nonetheless directly related to the Guidelines. Some of the common questions are below.

        • How much has the person been paid?

        • What is the person's legitimate source of income?

        • When the person testified, was the Assistant U.S. Attorney notified of the person's status as a confidential informant?

        • In cases where the confidential informant had recently been arrested, how did the field office reach its conclusion that the arrest does not adversely affect the confidential informant's suitability? Did any law enforcement official intercede on the confidential informant's behalf following the arrest?

        In addition to observing meetings of the CIRC, we interviewed 10 current or former members of the CIRC. All of the CIRC members we interviewed said that the scope, quality, and tenor of interaction within the Committee has evolved since its inception. According to the CIRC members we interviewed, in the first year of the CIRC the relationship between the FBI employees and DOJ members was contentious. The DOJ Committee members we interviewed attributed the early difficulties to three factors: a general wariness within the FBI about sharing highly sensitive information regarding confidential informants with non-FBI personnel; a belief that the January 2001 Attorney General Guidelines were an overreaction to the Bulger-Flemmi informant episode and other instances of errant informants; and, to some degree, the personalities of several of the initial CIRC members from both the FBI and DOJ. By all accounts, the level of confidence and interaction between A/IU and FBI field offices, on the one hand, and between the FBI and the DOJ members of the CIRC, on the other, has steadily improved since that first year.

        All of the FBI and DOJ members of the CIRC we interviewed said they believe that while field office supervisors are the critical personnel to enforce the Confidential Informant Guidelines, the CIRC serves as an important mechanism to promote adherence to the Guidelines. They also told us that the vast majority of the proposals presented to the Committee do not provoke special concerns or questions.

        Several DOJ members of the CIRC, however, voiced two major concerns. First, they said that although the information flow has improved since the CIRC began in 2001, the suitability reports provided in advance to the Committee members are still inadequate. For example, these members said that the standard question on the suitability report, "Is there any negative information about the CI?" has not produced a single affirmative response, even in circumstances where confidential informants have been arrested. The DOJ committee members also said they have repeatedly asked for the suitability evaluation that is required upon the occurrence of unauthorized illegal activity, such as an arrest or illegal activity unrelated to the investigation, yet they have received only oral responses instead of hard copies of the required evaluations.349 They also said that responses to other routine questions on the suitability reports tend to be unhelpful, rote answers that are used in every suitability form and are not tailored to the particular informant.

        Second, these DOJ members said that the FBI CIRC members and particularly the A/IU have been increasingly responsive and cooperative in answering questions that arise during CIRC meetings. They stated, however, that the need to ask the same types of routine but important questions about confidential informants at each meeting, such as those highlighted above concerning suitability, has slowed the process down. They commented that spending time on routine questions has prevented the committee members from focusing on more subtle and complex but potentially more important issues at its monthly meetings.

      5. OIG Survey of Confidential Informant Coordinators Regarding the CIRC
      6. As part of this review, we conducted a survey of Confidential Informant Coordinators in the FBI's 56 field offices. The survey asked a wide range of questions concerning training on the Attorney General Guidelines, evaluation of internal controls, recordkeeping and information technology issues, frequently asked questions regarding the Guidelines, impediments to compliance with the Guidelines, measures to promote compliance with the Guidelines, and special issues arising under the Guidelines. We obtained a 100 percent response rate to the survey.

        Several survey questions focused specifically on the operation of the CIRC. Informant Coordinators told us that 86 percent of FBI field offices have sought CIRC authority for long term confidential informants, and 52 percent have sought CIRC approval for high-level, privileged, or media-affiliated confidential informants. The key survey findings regarding the CIRC are illustrated in the following diagram.

        DIAGRAM 7.2
        Confidential Informant Coordinators' Views on the Effectiveness of CIRC Oversight of Confidential Informants: 46% - Effective; 38% - Not in a position to evaulate; 16% - Not effective. Why CIRC is Effective: 69% of Coordinators who responded

        As Diagram 7.2 depicts, almost half of the Informant Coordinators responded that they believe the CIRC has provided effective oversight over the administration of confidential informants in their field office.350 Sixteen percent of the respondents said they do not believe the CIRC provides effective oversight, while 38 percent said they were not in a position to evaluate the CIRC's effectiveness because either they had had little or no contact with the CIRC or had not served as Informant Coordinator long enough to make a judgment.

        Of the survey respondents who said they believe the CIRC's oversight is effective, 69 percent said they believe the CIRC process is reasonably efficient and does not cause serious delays in the approval or renewal of confidential informants. In addition, 46 percent said they believe the CIRC members have expertise that is needed in reviewing confidential informant issues, and that CIRC members ask questions that are not routinely addressed at the field office.

        Our survey also found that the most frequently asked questions of Informant Coordinators (or the agents they work with) by CIRC members include questions regarding the informant's suitability (57 percent), how the proposed CI will be in a position to provide relevant information (66 percent), and questions pertaining to notification or approval issues involving the USAOs (20 percent).

        Of the 16 percent of the survey respondents who said they believe the CIRC does not provide effective oversight of the Criminal Informant Program, 89 percent said that the CIRC does not provide feedback on individual applications in a way that is useful for future applications to the CIRC. Seventy-eight percent of these respondents commented that the questions raised by the CIRC were routinely addressed in the field and that the CIRC process is too slow and cumbersome.

    5. OIG Analysis and Recommendadtions
    6. Based on our review, we believe that although there has been some reluctance within the FBI to share information about its informants with anyone outside the FBI, the persistence of CIRC members, backed by support from senior management of the FBI and the DOJ, and effective supervisory personnel in A/IU, has made the CIRC a vital tool for promoting adherence to the Confidential Informant Guidelines. Over the last four years, the CIRC has provided meaningful oversight of many of the confidential informants who present the greatest risks and potential rewards for the FBI's top priorities, including counterterrorism, national and transnational criminal enterprises, public corruption, health care and other types of fraud, and white collar crime.

      However, we believe the effectiveness of the CIRC can be improved. As described above, some CIRC members expressed concerns regarding missing or incomplete information in the suitability reports, ranging from rote and unhelpful answers on some suitability forms to the failure to provide continuing suitability reports when an informant commits unauthorized illegal activities. These members stated that the need to pursue answers before or during CIRC meetings to questions that the proposing agents should already have provided slows down the functioning of the committee and prevents it from focusing on potentially more important issues. Similarly, our survey revealed that Informant Coordinators who are unsatisfied with the CIRC have criticized the process as being too slow.

      In addition, the principal complaint of Informant Coordinators who stated the CIRC is ineffective was that the CIRC does not provide feedback on individual applications in a way that is useful for future reference. We believe this is a valid observation. We found that the questions asked at CIRC meetings fall into familiar patterns based on the experience of the members in spotting circumstances that have proven over the years to be predictors of confidential informant problems. However, the insights from the CIRC's decisions are neither memorialized nor communicated to field personnel at FBI Headquarters or the DOJ.

      The purpose of the following recommendations is two-fold: 1) to make critical information about the confidential informants reviewed by the CIRC available to all members prior to their meetings, thereby reducing the need for time-consuming interaction between the field and the CIRC's members; and 2) to use the lessons learned from the CIRC to educate field personnel on a regular basis and to provide more focus to the training of case agents and supervisors about the Criminal Informant Program.351

      We therefore recommend that the FBI take the following steps.

      (30) To assist CIRC members in evaluating the confidential informants within its purview and assist field and Headquarters managers in their supervisory responsibilities in overseeing the Criminal Informant Program, require that the Initial and Continuing Suitability Reports and Recommendations contain more thorough answers to the suitability questions, such as:

      • a description of the confidential informants' legitimate source of income;

      • the confidential informants' statistical accomplishments, including the number of indictments, convictions, Title III wiretap applications, and other indicia of informants' contributions;

      • details on how confidential informants are in a position to obtain relevant information;

      • details on the nature of any unauthorized illegal activity committed by confidential informants, including informants' criminal history records and the continuing suitability reports required to be completed in accordance with Section II.A.2.b of the Confidential Informant Guidelines; and

      • the informant records of any confidential informants who have been previously deactivated for cause by the FBI, including the reasons for deactivation and the field division operating the informants.

      (31) Consider having the Human Intelligence Unit draft "lessons learned" from the CIRC's decisions, periodically communicate these lessons to field personnel, and incorporate them into training on the Confidential Informant Guidelines.

      (32) Make available to CIRC members, upon request, copies of the Inspection Division's audits of the Criminal Informant Program (including any reinspection reports) and evaluations performed by the Human Intelligence Unit of compliance with the Confidential Informant Guidelines.

  3. Inspection Division
  4. Of all the oversight and enforcement mechanisms employed by the FBI, the Inspection Division has the broadest mandate to investigate and evaluate Attorney General Guidelines compliance issues. According to the Inspection Division's 2004 Program Plan, "[the Inspection Division] has a vital role within the FBI providing the Director independent and thorough performance assessments of all aspects of FBI operations and ensuring that performance deficiencies are resolved in a timely manner."352 Our review, including an interview with the Director, confirmed the significance of the Inspection Division's work to the FBI's compliance with the Attorney General Guidelines.

    In this Section of the Report we examine: 1) the functions of the Inspection Division, including its mission, organization, and inspection procedures; 2) what Guidelines' provisions the Inspection Division examines and how this has changed since May 2002; 3) Inspection Division findings regarding the Guidelines' compliance; and 4) the OIG's analysis and recommendations regarding the inspection process.

    To conduct our review, we examined numerous Inspection Division documents, including inspection reports and supporting electronic communications for 41 FBI field offices from May 2002 to October 2004. We also interviewed Inspection Division personnel and senior FBI executives about the work of the Division and inspection procedures.

    1. Background on the Inspection Function
    2. Below we describe the organization of the Inspection Division, how inspections are performed, and the issues addressed during inspections, including those concerning the Attorney General Guidelines.

      1. Organization of the Inspection Division
      2. The Inspection Division divides its work among three main components: the Office of Inspections; the Audit, Evaluation, and Analysis Section; and the Internal Investigations Section. The Inspection Division reports directly to the Director and Deputy Director of the FBI and is not located within the Bureau's five directorates. The organizational chart below identifies the structure of the Inspection Division.

        DIAGRAM 7.3
        Top to Bottom: Dir. & Deputy Dir. of FBI; Inspection Division; Office of Inspections (OI), Audit, Evaluation, & Analysis Section (AEAS), and Internal Investigations Section (IIS).

        The Office of Inspections, which is the principal focus of this section of the report, is managed by a Chief Inspector and includes an inspection staff comprised of various inspectors, Inspectors-in-Place, Team Leaders, and Assistant Inspectors-in-Place. It has two units: the Inspection Management Unit and the Audit Unit.353 As of November 2004, the Office of Inspections had 8 Inspectors, 8 Assistant Inspectors, 12 Team Leaders, and approximately 80 Inspectors in Place and 300 Assistant Inspectors in Place, to perform its inspections.354 The Inspection Management Unit provides logistical assistance, pre-inspection analysis, and post-inspection compliance monitoring. The Audit Unit conducts financial and Information Systems audits.

      3. How Inspections Are Conducted
      4. The Inspection Division performs two kinds of evaluations: performance audits and on-site inspections.355 Performance audits evaluate particular programs across the FBI using audit standards such as the Government Accountability Office's Government Auditing Standards, 2003 Revision, and the Office of Management and Budget's Performance Assessment Rating Tool (PART). Inspections are conducted by the Office of Inspections at field offices, Headquarters, and Legal Attaché offices (Legats) on a rotating basis every three years. These inspections evaluate compliance with rules, regulations, policies, and procedures, as well as operational performance. In addition, in conjunction with FBI operational divisions, the Inspection Division has developed program reviews for use by field offices. Field offices conduct program reviews to examine whether field office goals and objectives are consistent with the FBI's national strategy and evaluate how well field offices are implementing the FBI's strategic plan. The results of these reviews are analyzed by program managers at FBI Headquarters.356

        1. The Inspection Process
        2. The Office of Inspections inspects each FBI field office, Headquarters Division, and Legat Office once every three years. These inspections have three distinct phases: pre-inspection, on-site inspection, and post-inspection.

          During the pre-inspection phase, personnel from the Office of Inspections collect data and information about the office to be inspected in preparation for on-site activity. Approximately 120 days prior to the on-site visit, the field office receives interrogatories requesting information on compliance, performance, and related administrative issues. Identification of Guidelines compliance deficiencies is requested in a limited number of program interrogatories, but is not requested in squad interrogatories. The Office of Inspections also solicits information from Headquarters Divisions and other FBI entities that have had contact with the office. After this information is collected, a pre-inspection analysis is prepared that summarizes statistical accomplishments, management data, program strengths and weaknesses, and prior inspections findings, including how those findings were resolved.

          The on-site inspection typically is conducted over a period of up to three weeks by a team of Inspectors, Inspectors in Place, and their assistants working under the supervision of an SES-level Inspector in Charge. For example, a recent inspection of the Miami Division involved approximately 75 FBI personnel. While on-site, the inspection team examines hundreds of paper files. Routing slips may be sent to agents requesting an explanation of any deficiencies identified in the files. More than 25 separate FBI programs are subject to "compliance audits" during inspections. These include the Criminal Informant Program, undercover operations, electronic surveillance activities, training matters, and the functioning of executive management.357 See Table 7.2. The Inspection Division has prepared detailed checklists for each type of audit to ensure consistency in the information that is collected in each office. In addition, the inspection team interviews FBI employees in the field office and representatives of agencies and organizations with which the office interacts, including other law enforcement agencies and the U.S. Attorney's Office.

          At the conclusion of the on-site inspection, the inspection team prepares a draft written report for review by the field office. In circumstances where 1) detailed data and information must be conveyed to support proposed corrective actions or 2) the findings in question must be disseminated to entities other than the office inspected, the inspection staff prepares a separate electronic communication or memorandum in addition to the findings contained in the written report. The draft report and electronic communication are then discussed at a closing conference held on the last day of the inspection with members of the inspection team and personnel from the field office.

          Inspection reports typically contain six substantive sections and two appendices that are presented in the following order: 1) an inspection summary; 2) background information about the office, its staff, and events that affected the office during the inspection period; 3) an evaluation of the performance of executive management; 4) a summary of the various compliance audits conducted; 5) a summary of the performance appraisals for the various investigative programs, squads, and other units evaluated; 6) an analysis of investigative support services; 7) an appendix of the inspection's findings; and 8) an abbreviation appendix. With respect to the third and fifth sections, the report will specify whether the entity inspected was "effective" and "efficient."358 Any deficiencies noted are followed by recommendations or instructions designed to eliminate the identified compliance deficiencies.

          Within 30 days from the close of the on-site inspection, the field office must furnish responses to the Office of Inspections for each finding, instruction, and recommendation contained in the draft report. The Office of Inspections finalizes the report during this period and distributes a summary to senior FBI management, including the Director, who reviews the inspection results with the senior executive manager of the office or division.

          After the inspected field office provides its written response to the inspection report, the Office of Inspections evaluates the submission and determines whether appropriate action has been taken to remedy the deficiencies identified in the report. The Inspection Management Unit is responsible for ensuring that the office complies with each instruction contained in the report. When a field office fails to respond adequately to a finding and instruction, the Inspection Management Unit prepares an electronic communication requesting additional information or action. The Office of Inspections considers findings resolved when the office has reported actions necessitated by the findings, which often occurs in the office's written response to the inspection report. When all findings have been resolved, usually within a few months from completion of the inspection, the Inspection Management Unit notifies the office by electronic communication. The Inspection Management Unit does not attempt to monitor implementation of remedies between on-site inspections. Recurring deficiencies identified in a subsequent inspection may lead to a finding directed to executive management in the office.

          In addition to the planned triennial inspections described above, the Office of Inspections has supervised field office "self-inspections" as well as "reinspections," both of which may examine Guidelines compliance issues. During a self-inspection, the Office of Inspections furnishes audit forms that are completed by the field office and then returned for examination by analysts in the Inspection Management Unit. The self-inspection allows the field office to identify and correct problems prior to its triennial inspection. If a self-inspection is completed for a particular audit (e.g., an audit of the Victim Witness Assistance Program), the Office of Inspections staff determines during the triennial on-site inspection if the audit was properly conducted. Prior to June 2004, self-inspections typically occurred at the midpoint of an office's regularly scheduled inspection cycle. Inspection Division management stated, however, that it has halted this practice and that future self-inspections likely will be conducted nationwide by program, not at the midpoint of an office's inspection cycle.

          In rare circumstances, the Inspection Division also has participated in "reinspections" of particular field offices or programs if the results of the regular inspection are unsatisfactory or if an event indicates that prompt intervention is necessary. According to the FBI's former Chief Inspector, Robert Grant, a program that receives anything less than an "Effective and Efficient" rating is at risk of being reinspected. The decision to conduct a reinspection is made by the Assistant Director of the Inspection Division in consultation with the Deputy Director and Director of the FBI. Depending on the nature of the deficiency, the reinspection may be conducted with a Headquarters program office working in conjunction with the Inspection Division.

        3. The Inspection Division's Efforts to Improve Inspection Procedures Through Technology and Reengineering Initiatives
        4. Our interviews with Inspection Division management and review of inspection files revealed that the Division is seeking to upgrade its use of technology and to reengineer many of its current procedures. As explained to the OIG, these initiatives are being undertaken to address weaknesses that hinder the Division's ability to provide timely and comprehensive compliance and performance information to FBI management, including Guidelines compliance issues.

          Our review found that the Inspection Division's use of information technology tools currently is quite limited. Much of the data collection, analysis, and reporting performed by the Office of Inspections is not collected or recorded electronically. For example, we learned during our review that when offices responded to inspection reports, the Office of Inspections collected the paper copy of the response to each finding, collated them with a paper copy of the inspection finding, and retained the information in a cardboard file. According to one former senior Inspection Division official, the Division is "nowhere near where we should be or need to be to make [the inspection process] efficient."

          The Inspection Division has identified the following problems resulting from the inadequate state of its technology:

          • delays in incorporating new performance measures and policies into the FBI's information systems;

          • long delays in the detection of deficiencies as a result of the inspection cycle;

          • an inadequate process to evaluate the appropriate operation and management of quality human sources; and

          • an inadequate system to identify individual component and nationwide compliance deficiencies between on-site inspections.359

      5. What is Inspected
      6. The Inspection Division's decisions concerning the extent of its compliance data gathering occur primarily in two ways: 1) by identifying the programs and initiatives that are subject to compliance audits; and 2) by specifying the particular kinds of information that will be collected during the audits.

        The Inspection Division's Inspections Guidebook (2000) identifies the various audits that are conducted during on-site inspections. These are set forth in the table below.

        TABLE 7.2

        Audits Conducted During Inspection Division
        On-Site Inspections

        Alias/False Identification (AFID)
        Automotive Fleet Management (AA)
        Community Outreach Program (COP)
        Criminal Informant Program (CIP)
        Communications Security (COMSEC)
        Drug Deterrence Program (DDP)
        Electronic Surveillance (ELSUR)
        Employee Assistance Program (EAP)
        Equal Employment Opportunity (EEO)
        Ethics Program (EPA)
        Evaluation of Internal Controls (EC-B)
        Evidence Program (EVP)
        Executive Management (EM)
        Financial Management (FM)
        Foreign Intelligence/Counterintelligence Audit FICA)
        Foreign Language Program (FL)
        Intelligence Oversight Board (IOB)
        Merit, Promotion & Placement Plan (MPPP)
        National Crime Information Center (NCIC)
        Program Administration and Agent Complement (PA/A)
        Public Affairs and Media (PM)
        Radio Maintenance (RM)
        Security Program Management (SPM)
        Support Services Section (SSS)
        Technically Trained Agents (TTA)
        Training Matters (TM)
        Undercover Operations (UCO)
        Utilization of Aircraft (UA)
        Victim Witness Assistance Program (VWAP)

        The types of audits that the Office of Inspections performs change over time. Over the last four years, the Division has added three audits to the list above (Computer Analysis Response Team Field Examiner Program, Information Systems, and Foreign Intelligence/Counterintelligence) and dropped one audit (Foreign Intelligence/Counterintelligence). In addition, the emphasis that the Inspection Division places on particular audits varies over time. For example, according to a former Chief Inspector, the importance of the Security Program audit increased dramatically after the espionage activities of former FBI agent Robert Hanssen were discovered.

        With respect to administrative compliance measures, Inspection Division management stated that the electronic surveillance, evidence, and Criminal Informant Programs currently are the most pressing priorities. We were told by a former Chief Inspector that the rationale for this emphasis is that these programs directly affect investigations and the testimony of FBI agents, and affect the reputation of the FBI with the U.S. Attorneys' Offices, the courts, and other law enforcement agencies.

        Of the audits identified in Table 7.2, four are pertinent to the Attorney General Guidelines: Criminal Informant Program, Electronic Surveillance, Undercover Operations, and Executive Management. The Inspections Guidebook also identifies procedures to evaluate the performance of investigative programs and squad/resident agencies, both of which are subject to requirements found in the Guidelines. Of the four Investigative Guidelines, we did not find comparable audit coverage of the core activities and authorities authorized pursuant to the General Crimes Guidelines. For example, we did not identify any audits that attempt to gauge the FBI's compliance with the new or expanded authorities of the General Crimes Guidelines that implicate civil rights and civil liberties concerns, such as how authorities to "surf" the Internet or visit public places and events were utilized, or how information gleaned from those activities is retained or disseminated.360

        In addition to selecting the kinds of audits it conducts, the Inspection Division defines the scope of its information gathering by identifying the particular data that is collected during audits. The Inspection Division has developed detailed checklists that inspection personnel use during audits to collect compliance data.361 These are updated by Inspection Management Unit personnel, who consult formally at least annually with FBI divisions concerning revisions. Each division in the FBI is assigned an Inspection Management Unit analyst to monitor policy changes.

        Despite this work, our review of the checklists and worksheets that relate to the Guidelines revealed that most are not comprehensive on Guidelines issues.362 For example, the checklists for investigative programs and squads/Resident Agencies contain little or no compliance information.363 Although the checklist for informants employed by the FBI during the period of our review (generally May 2002 to May 2004) states that its purpose is "to determine if an informant has been operated in compliance with current policy and instructions." it does not contain various items that are important to making such a determination, such as the following items required by the Confidential Informant Guidelines:

        • whether the continuing suitability report and recommendation was completed by the Special Agent;

        • whether indices checks were performed as required;

        • whether Tier 2 Otherwise Illegal Activity was properly characterized;364

        • whether proper informant deactivation procedures were followed; and

        • whether authorization was obtained for ongoing contacts with informants deactivated for cause.365

        In addition, our review of the inspection data collection materials revealed that they do not consistently seek information concerning the causes of the deficiencies that are found during the inspections. For example, the Criminal Informant Program checklist states that: "'No' answers [entered on the checklist] usually indicate non-compliance and may require further inquiry." In contrast, the undercover operation checklist provides: "'No' answers indicate non-compliance and require an explanation." Our review of the completed checklists that were used in the field offices with the worst Criminal Informant Program compliance records, for example, showed that inspectors rarely entered information setting forth the field office's explanation for the deficiencies. Instead, notations typically were made that allowed the inspector to verify the fact of the non-compliance. In some cases, inspectors sent routing slips to agents and others requesting confirmation of the deficiencies identified in the case files. While these generated important information concerning the circumstances surrounding the violation, the questions posed by the inspectors typically were not formulated to solicit information regarding the cause of the deficiency. Director Mueller stated during our interview of him that he believes the Inspection Division should collect information on the causes of identified deficiencies.

        The Inspection Division's written interview procedure does not remedy these shortcomings. Guidance provided to Division personnel does not expressly mention compliance performance as a topic of inquiry. Rather, the Inspections Guidebook recommends, for example, that Supervisory Special Agents (SSAs) be interviewed on "investigative responsibility, specific investigations, initiatives, special projects, investigative techniques, task forces, liaison, prevailing crime problems, goals and objectives, the IB [intelligence base], and accomplishments." Further, the Inspection Division's guidance does not require that interviews be conducted to isolate the causes of compliance deficiencies. We were advised by Inspection Division personnel, however, that information regarding the causes of deficiencies frequently is collected during inspections.

        We also noted that Inspection Division reports do not weight or categorize the seriousness of the deficiencies that are identified during inspections. Although a former Chief Inspector confirmed that the Office of Inspections historically has not undertaken this task, he explained that his office recently was attempting to institute changes that would characterize the gravity of any problems that the Inspection Division discovers. The current Assistant Director for the CID also noted this issue in his interview with the OIG. He stated that "[w]e count [the compliance deficiencies] all the same when we go out and do our audits. An error is an error is an error. We see these pretty high error rates when we do our compliance audits. Somehow we have to figure out a way to weight these things so that you get a real sense of where agents are [having problems]. . . . It doesn't stand the test of logic that we weight them all the same."

        Our examination of 41 final inspection reports issued between May 1, 2002, and October 31, 2004, found that their content typically reflected the limitations of the data collection practices described above. The reports tended to itemize the various violations with little or no analysis and did not include the views or explanations expressed by supervisors or executive management during the inspection concerning their compliance performance. See Case Study 7.1 below. The reports also did not attempt to compare the results/findings with the performance records of other offices. Moreover, non-compliance in the Criminal Informant Program typically was not explained with reference to supervision deficiencies identified in particular squads or by individual performance lapses.

        In contrast, during the recent informant reinspections conducted by the Inspection Division in conjunction with A/IU, the inspection team not only identified noncompliant conduct in their reports, it identified the squads and supervisory agents responsible for the conduct. As the case study below of one FBI Field Division shows, this degree of detail is not common in Inspection Division inspection reports.

        Case Study 7.1: FBI Inspection Division Audit
        of a Field Division's Criminal Informant Program

        In January 2004, the Inspection Division conducted an inspection of an FBI Field Division, including an audit of its Criminal Informant Program. The period under review was from September 2000 to January 2004. After completing the inspection, the Inspection Division prepared a separate electronic communication to the office and the Criminal Investigative Division at FBI Headquarters summarizing its findings. The electronic communication explained that the audit "included a review of pertinent documentation, interviews with appropriate management personnel, SAs, support personnel, as well as review of selected pending and closed informant files." According to the electronic communication, Inspection staff examined 29 percent of the Division's source files during the audit and found that 88 percent had errors and 65 percent had multiple errors. Of the 21 categories of errors identified, 9 were recurring deficiencies from the 2000 inspection and included the following: failure to advise the source of the Attorney General Guidelines; failure to obtain proper authorization prior to a source's participation in otherwise illegal activity failure to notify FBI Headquarters of a source's participation in criminal conduct; and failure to follow special provisions concerning the operation of sensitive sources.

        Inspection staff also identified in the electronic communication the managers of the Division's Criminal Informant Program and the duties of certain support staff. With respect to the Criminal Informant Program Coordinator, the electronic communication explained as follows:

        Review of confidential informants/cooperative witness/CSs files and records maintained by the Criminal Informant Program Coordinator determined [that he] utilized ticklers and e-mails to remind agents and supervisors of compliance issues. Furthermore, the Criminal Informant Program forms were made available on a shared drive for all agents and supervisors to access. [The Criminal Informant Program Coordinator] provided individual training session [sic] to SAs and regularly disseminated policy communications received from the Asset/Informant Unit.

        No information was included in the electronic communication concerning the action or inaction of other members of senior management, such as the ASACs who had supervised the program during the inspection period, or an explanation of their interpretation of why, given the apparent adequacy of the Criminal Informant Program Coordinator's efforts, this Division had one of the highest Criminal Informant Program non-compliance rates in the FBI. The electronic communication concluded without analysis that the Division's Criminal Informant Program was "in substantial non-compliance with Criminal Informant Program rules and procedures" and set forth the following instruction and recommendation: (1) the "SAC should ensure cited deficiencies are corrected, where possible, and administrative controls are strengthened to preclude recurrence of these deficiencies," and (2) the "SAC should ensure all compliance issues brought to the attention of squad/RA supervisors by the Criminal Informant Program Coordinator are promptly handled in an effort to minimize violations of policy and procedure." No explanation was provided concerning how this should be done or why the Inspection Division believed these general recommendations would eliminate the many recurring deficiencies that were subject to similar post-inspection remedies four years earlier.

    3. Changes in the Inspections Process After the May 2002 Revisions of the Attorney General Guidelines
    4. According to a former Chief Inspector, one of the major challenges facing the Inspection Division is keeping pace with FBI programmatic and policy changes as they occur. He explained that this task is difficult because of the volume of new policy and guidance that is generated at the FBI. To address this issue, the Inspection Division's 2004 Program Plan identified as an "action item" the establishment of a "system that ensures timely notification of the [Inspection Division] on program and policy changes." The Inspection Division's standard practice is for Inspection Management Unit personnel to consult in mid-summer with the various FBI divisions concerning needed revisions to the Division's inspection documents. We were informed, however, that not all Divisions adequately share information regarding changes to policy and procedures.

      Moreover, we found that changes in policies do not always result in timely changes to Inspection Division practices. For example, the modification of the Attorney General Guidelines in May 2002 did not prompt comprehensive revisions to the Inspection Division's checklists or interrogatories.366 Although written Continuing Suitability Reports and Recommendations have been required since 2001, Inspection Division checklists did not address this important requirement for three and a half years after the Guidelines revisions.367 According to the FBI's Chief Inspector in May 2002, consistent with its standard practice, during the summer of 2002, the Inspection Division solicited feedback from Headquarters divisions as well as the Criminal Informant Program concerning revisions to the Division's Criminal Informant Program checklists. Although the CID recommended a limited number of alterations to the confidential informant checklist, the one in use in 2003 contained the gaps described in Section I.A above.

    5. Inspection Division Findings Regarding Attorney General Guidelines Compliance
    6. Our review of 41 Inspection Division inspection reports and supporting documentation issued between May 1, 2002, and October 31, 2004, revealed that FBI inspectors often discovered Guidelines violations. However, the frequency of identification of these violations varied between programs and often was significantly less than what the OIG identified during its field work. While we identified few violations in the Inspection Division reports with regard to the Undercover Operations, General Crimes, and Consensual Monitoring Guidelines, violations in the Criminal Informant Program were commonplace. Although the Inspection Division identified many Guidelines violations in the administration of the Criminal Informant Program, it found violations related to the Confidential Informant Guidelines at less than half the rate identified during our visits to 12 FBI field offices. Below we summarize inspection report findings for each of the four Investigative Guidelines.

      1. Criminal Informant Program
      2. Between May 1, 2002, and October 31, 2004, the Inspection Division examined 3,434 Criminal Informant Program files in 41 of the FBI's 56 field divisions. Of the files examined, Inspection Division documentation shows that approximately 34 percent indicated a violation of the Confidential Informant Guidelines during the relevant inspection period. The table below ranks these 41 FBI field divisions according to the percentage of inspected Criminal Informant Program files that contained one or more compliance deficiencies (which include violations of MIOG requirements as well as of the Attorney General Guidelines). As shown below, nearly one in three field divisions identified in Table 7.3 had a file non-compliance rate at or above 40 percent and thus qualified for an additional inspection (a "reinspection") conducted by Inspection Division personnel in conjunction with the Headquarters-based Asset/Informant Unit.

        When the rates above are compared with those obtained during inspections before May 2002, we found that over the last two inspection cycles (1999 to present) non-compliance recurred in certain offices. Of the 13 field divisions identified above with a Criminal Informant Program non-compliance rate at 40 percent or more, 6 divisions had a non-compliance rate during the preceding inspection that exceeded 30 percent, along with a high number of recurring deficiencies. Other divisions had a significant worsening of compliance performance as measured by the Inspection Division. For example, the Albany Field Division's non-compliance rate rose from 11 percent in 2001 to 68 percent in 2004. In contrast, a number of field divisions maintained rates below 15 percent for the last two inspections, while others showed marked improvement. Table 7.4 presents these findings for select field divisions.

        TABLE 7.3

        Percentage of Criminal Informant Program Files with
        Compliance Deficiencies Identified by the Inspection Division
        (May 2002 - October 2004)

        Field Division Non-compliance
        Field Division Non-compliance
        Columbia, SC 88% Anchorage, AK 27%
        Buffalo, NY 85% Atlanta, GA 26%
        Albany, NY 68% Minneapolis, MN 25%
        Norfolk, VA 65% Denver, CO 25%
        Milwaukee, WI 63% Las Vegas, NV 24%
        St. Louis, MO 59% El Paso, TX 22%
        San Diego, CA 58% Charlotte, NC 21%
        Omaha, NE 56% Chicago, IL 21%
        Cleveland, OH 56% Memphis, TN 20%
        San Francisco, CA 56% Sacramento, CA 20%
        Jacksonville, FL 53% Oklahoma City, OK 19%
        Salt Lake City, UT 52% Springfield, IL 18%
        Mobile, AL 43% Albuquerque, NM 15%
        New Orleans, LA 39% Newark, NJ 14%
        Indianapolis, IN 37% Little Rock, AR 12%
        New York, NY 35% Seattle, WA 13%
        Dallas, TX 29% San Juan, PR 13%
        Baltimore, MD 29% Knoxville, TN 6%
        Pittsburgh, PA 28% Kansas City, MO 4%
        Miami, FL 27% Jackson, MS 0
        Louisville, KY 27%    
        Bold = Exceeds threshold for the Asset/Informant Unit reinspection

        TABLE 7.4

        Inspection Division Deficiency Data for
        Criminal Informant Program in Select Field Offices

        Field Division Non-compliance Rates Number of
          Persistend Non-compliance
        (consistently above 30%)
        Columbia, SC 47% 88% 9
        Milwaukee, WI 47% 63% 8
        St. Louis, MO 60% 59% 10
        San Francisco, CA 52% 56% 7
        Jacksonville, FL 31% 53% 5
        Salt Lake City, UT 32% 52% 6
          Worsening Non-compliance Rate
        (from below 30% to significantly above 30%)
        Buffalo, NY 29% 84% 7
        Albany, NY 11% 68% 3
        Norfolk, VA 25% 65% 3
        San Diego, CA 15% 58% 3
        Cleveland, OH 11% 56% 1
        Omaha, NE 25% 56% 2
        Mobile, AL 15% 43% 3
          Improved or Consistently Low
        Non-compliance Rate (below 15%)
        Jackson, MS * 0% 3
        Kansas City, MO 31% 4% 3
        Knoxville, TN 10% 6% 3
        Little Rock, AR 28% 12% 3
        San Juan, PR 16% 13% 2
        Seattle, WA Minor* 13% *
        Newark, NJ 10% 14% 2
        *Inspection Division report did not itemize deficiencies or report percentage error rate.

        Although each of the above field divisions that experienced persistent non-compliance received an instruction from the Inspection Division during the inspection preceding May 2002 to prevent the recurrence of Criminal Informant Program deficiencies, and each responded to the inspection report in a way that led the Division to close out its findings and terminate its oversight, the Criminal Informant Program compliance problems in these divisions persisted, and in some instances worsened substantially.

        When Criminal Informant Program problems are discovered, the Inspection Division typically requires that "internal controls be strengthened," which, according to a former Chief Inspector, is a directive targeted at the Confidential Informant Coordinator, the ASAC who supervises that person, and the SSAs. The former Chief Inspector explained that after issuing its Criminal Informant Program directives, the Inspection Division frequently finds that field offices adopt remedies that include reminding supervising agents of their responsibilities and providing FBI personnel with enhanced training opportunities. Our review of field division responses to Criminal Informant Program inspection findings confirmed this often occurred, and that generally the divisions responded in a detailed fashion describing their completed and proposed corrective actions. However, as evidenced by the field divisions identified in Table 7.4 with persistent Criminal Informant Program non-compliance, the practice of delivering reminders, creating training opportunities, and issuing directives to enhance administrative supervision was inadequate in some cases. See Case Study 7.2 below.

        Because Inspection Division oversight usually terminates shortly after the field division responds to the inspection report, field divisions that require greater supervision historically have been allowed to operate their Criminal Informant Programs in non-compliance until the next inspection three years later. For example, even though the Inspection Division's inspection of the St. Louis Field Division's Criminal Informant Program in 2001 identified 23 different types of non-compliance and an overall non-compliance rate of 60 percent, by 2004 the Program had improved its non-compliance rate by only 1 percent - to 59 percent.368

        The experience of the San Francisco Criminal Informant Program also illustrates the practice of allowing field divisions to operate their Criminal Informant Programs in violation of FBI and DOJ rules and regulations.

        Case Study 7.2: The San Francisco
        Criminal Informant Program

        Despite five inspections over the past decade [three triennial, a self-inspection, and a reinspection], the San Francisco Field Division consistently has maintained one of the worst Criminal Informant Program (CIP) compliance rates in the FBI. For the inspection period ending in 1996, the Inspection Division documented compliance errors in 58 percent of the CIP files examined. Compliance was little improved by 2000, with 52 percent of the CIP files failing to comply with FBI mandates. The Inspection Division's inspection in 2003 revealed a non-compliance rate of 56 percent, which followed a field office-initiated self-inspection of the CIP in 2002 that found an error rate of nearly 49 percent. The self-inspection had reported that "the Informant Program was in substantial compliance with regulations and Bureau policy."

        In light of its June 2003 findings, the Inspection Division and the Asset/Informant Unit (A/IU) conducted a reinspection in December 2003 of every pending CIP file in the San Francisco Field Division. Despite a recommendation from the Inspection Division that the "SAC, San Francisco ensure all pending confidential informants\CS\CW files are reviewed and brought into compliance prior to the A/IU on-site review," and approximately 6 months prior warning of the upcoming reinspection, the Inspection Division and the A/IU identified compliance errors in 70 files, or 22 percent of those inspected, with 19 of these having multiple errors. The reinspection analyzed compliance performance by squad and specifically noted that a lack of accountability among SSAs contributed to the Division's failings. The report explained:

        One contributing factor for a majority of the deficiencies identified during this re-inspection was the failure of the San Francisco SSAs to ensure personnel under their direct supervision were correcting identified CIP deficiencies. For example, the re-inspection determined that many of the errors cited in this report were the result of SSAs failing to follow-up on issues identified by the San Francisco CIC [Informant Coordinator]. This re-inspection reviewed numerous routing slips, e-mails, and reminders from the CIC which were placed in the confidential informant/CW/CS files to assist the SSAs and SAs with management of their files. In many instances these notations were ignored by the SSAs and SAs, resulting in compliance errors documented during this re-inspection. In some instances SSAs noted deficiencies on consecutive file reviews which were ignored by the SA with no follow-up by the SSA.

        The A/IU reinspection report also discussed several other factors that contributed to the Division's CIP problems, including lack of consistency in standardized forms and specific topics on which agents required training. The report concluded that the San Francisco CIP is "adequate," though "closer administrative oversight was needed."

        Our review also revealed that field divisions that experienced a substantial deterioration in their non-compliance rate often had a lack of continuity in the support provided by the Criminal Informant Program's management. For example, of the field divisions identified in Table 7.4 with worsening non-compliance rates, one had five different Confidential Informant Coordinators during the inspection period, not counting a seven-month period when the Confidential Informant Coordinator position was vacant. A second division had three different Criminal Informant Program managers in two and a half years. In another field division, the Inspection Division found that the Confidential Informant Coordinator had too many collateral duties, and in two other divisions the Confidential Informant Coordinator was found deficient in the performance of his duties, leading to the removal of one Coordinator.

        Our review of the written performance appraisals of the SSAs, ASACs, and SACs in divisions with Criminal Informant Programs that had significant compliance problems indicated that the appraisals did not reflect the deficient Criminal Informant Program compliance performance.269 This was in contrast to what the FBI Director and the Assistant Director for the CID told us should occur. Both of them stated that high rates of non-compliance in the Criminal Informant Program should be taken into account in the performance appraisals of field office managers.

        In contrast, our interviews with Confidential Informant Coordinators from field divisions that had consistently good or significantly improved Inspection Division inspection performances revealed that management of the Criminal Informant Program typically had less personnel turnover and employed a number of best practices that, in the opinion of the Coordinators, contributed to their divisions' favorable compliance record. These included the use of standardized forms, computer-generated reminders by the Confidential Informant Coordinators or confidential file room analysts to case agents to meet upcoming deadlines, intensive file reviews, compliance checklists for SSAs to assist them with their file reviews, and adequate training, especially for SSAs.370 Two Confidential Informant Coordinators we interviewed even developed a Criminal Informant Program handbook for use in educating agents.

        Moreover, support for the Criminal Informant Program by the Division's executive management in these offices also was described as very important. In one field division, executive management implemented an ad hoc "three strike policy" that required the informant file to be closed administratively if an agent received more than three notifications of compliance deficiencies on the same informant.

        In addition, our interviews with FBI personnel confirmed the impact that high-performing Criminal Informant Coordinators can have on the functioning of the Criminal Informant Program, an observation that we also found in Inspection Division inspection reports and Criminal Informant Program electronic communications. These described several instances where the performance of an individual, such as the Confidential Informant Coordinator, accounted for the rehabilitation of an otherwise deficient Criminal Informant Program. For example, the most recent inspection report for the Cleveland Field Division described the work of the Confidential Informant Coordinator as substantially improving the Program:

        Cleveland's Criminal Informant Program improved substantially during the second half of the inspection period. This coincided with the appointment of SA [name deleted] as the Criminal Informant Coordinator in February 2002. [The Criminal Informant Coordinator] implemented a 90-day compliancy review of the pending files and began reporting findings to the SSA responsible for conducting the file reviews. [The Criminal Informant Coordinator] conducted file reviews for all pending Cleveland Division confidential informants and cooperative witnesses prior to the scheduled SSA file reviews.

        Prior to the assignment of [the Criminal Informant Coordinator], the former coordinator had not implemented new policies regarding 137s [i.e., confidential informants] and a large number of files were delinquent regarding SI status and Attorney General Guidelines. [The Criminal Informant Coordinator] implemented most of the 137 procedures and made improvements to address delinquencies. Those improvements were apparent from the Criminal Informant Program Audit, as well as from a review [sic] the tracking systems in place in [the Criminal Informant Coordinator's] office. As of August 4, 2003 the pending files were almost 100 percent compliant in these areas.

        The Inspection Division's inspection of the Kansas City Criminal Informant Program also highlighted the positive work of the Criminal Informant Coordinator:

        This audit indicated that the management team closely monitored the Criminal Informant Program throughout this inspection period. They personally reviewed confidential informants/cooperative witness files on a regular basis and met frequently with SSAs and SAs regarding informant matters. . . . [The Criminal Informant Coordinator] was intimately involved in every aspect of the Criminal Informant Program and she personally reviewed all confidential informants/cooperative witness files on a semiannual basis. She coordinated directly and frequently with case agents regarding compliance issues and she operated a weekly tickler system to ensure timely response. [The Criminal Informant Coordinator] implemented an aggressive Criminal Informant Program training program for the division and regularly educated Kansas City personnel regarding policy and program changes in the Criminal Informant Program. Further, she implemented a comprehensive self-inspection program.

        The incidence of Criminal Informant Program deficiencies described above is not the only indicator of problems in the program. The nature of the violations that the Inspection Division identified also is highly significant. Table 7.5 summarizes the types of Criminal Informant Program non-compliance most commonly identified by the Inspection Division from May 2002 through October 2004, including the section of the Confidential Informant Guidelines violated, the number of files in which violations were found, and the share that each violation represents in relation to the Confidential Informant Guidelines deficiencies itemized below.371

        TABLE 7.5

        Types of Confidential Informant Guidelines Violations
        Identified by the Inspections Division (May 2002 - October 2004)

        Violations CI
        (Number of
        of all CI
        Failure to Timely Provide AGG Instructions CI AGG II.C 229 44%
        Failure to Include Photograph of CI in File CI AGG II.B 80 15%
        Failure to Convert CI to Operational Status Prior to Use, or to Extend or Close SI Period CI AGG II.B 58 11%
        Failure to Obtain Authorization of OIA CI AGG III.C 38 7%
        Failure to Document Background Information (e.g., criminal history) CI AGG II.A 34 7%
        Failure to Report Unauthorized Illegal Activity CI AGG IV.B 18 3%
        Failure to Obtain Authorization for Privileged or Sensitive Sources CI AGG II.D 15 3%
        Failure to Maintain Proper Payment Documentation CI AGG III.B 13 3%
        Failure to Follow Special Provisions When Operating Sensitive CIs/CWs CI AGG II.D 11 2%
        Failure to Notify FBI Headquarters of Conversion of Sensitive Source to Operational Status CI AGG II.D 8 2%
        Failure to Have Two Witnesses to Payment of CI CI AGG III.B 3 1%
        Maintaining Ongoing Contact with Closed Source CI AGG V.C 3 1%
        Failure to Prevent the Use of CI to Obtain Privileged Information CI AGG III.C 1 .2%
        Use of Faulty Instructions CI AGG II.C occurred NA
        Other Related Violations (non-AGG)     Share of All CIP
        Failure to Conduct Timely File Reviews MIOG 137-4 348 21%
        Failure to Document Upon Closing Whether Identity of CI was Revealed Outside the FBI MIOG 137-15 14 1%
        Failure to Obtain Proper Authorization to Disclose the Identity of the CI MIOG 137-9 13 1%

        As explained in Chapter Three of this report, these findings were comparable to the results of the OIG's field work with respect to those Guidelines violations that the Inspection Division evaluated.

      3. Inspection Division Audits of Undercover Operations and Consensual Monitoring
      4. In contrast to the high number of deficiencies that the Inspection Division identified with the Criminal Informant Program, its audits of undercover operations and consensual monitoring found few Guidelines violations. Of the four violations that the Inspection Division identified during its audits of undercover operations from May 2002 through October 2004, one involved a Group II UCO that continued for more than a year without Headquarters approval, while in another division, Headquarters was not properly notified after two undercover operations were initiated. The fourth violation involved a failure to present a fiscal circumstance to FBI Headquarters for review.372 The Inspection Division's inspection reports identified violations of the Consensual Monitoring Guidelines in six field divisions. In each case, proper authorization was not obtained and documented prior to the start of the monitoring, contrary to the Guidelines' requirement. By comparison, we found in our review approximately 10 percent of the undercover operations and consensual monitoring files contained authorization-related errors.

      5. General Crimes, REIs, and TEIs
      6. Although the Inspection Division's data collection instruments for the Criminal Informant Program, Undercover Operations, and electronic surveillance (ELSUR) audits address many key provisions of the Attorney General Guidelines, we did not find comparable coverage for the authorities contained in the General Crimes Guidelines. For example, Part VI of the General Crimes Guidelines constrains the expanded authorities to create information systems, "surf" the Internet, visit public places and attend public events, as well as instructions for complying with the Privacy Act. We were advised by the FBI, however, that the Inspection Division does not audit information pertaining to the FBI's attendance or monitoring of public events or its record retention practices relating to those activities. Despite the limited coverage of the authorities contained in the General Crimes Guidelines, our review of inspection reports issued since May 2002 identified a limited number of General Crime Guidelines' violations. These included the continuation of a preliminary inquiry for more than one year without obtaining proper authorization, and several instances of agents failing to provide the requisite notifications regarding the opening of investigations into sensitive criminal matters.

    7. OIG Analysis
    8. Inspection Division management and other FBI officials recognized the importance of the Inspection Division's role in ensuring compliance with the Attorney General Guidelines. For example, a former Inspection Division Assistant Director stated that "[the Director] depends on us to measure those things that matter most," and, "we are required to ensure that all Attorney General Guidelines are complied with. We cannot have an Attorney General Guidelines' violation." A former Chief Inspector also commented on the importance of perceptions regarding the Inspection Division's priorities to actions in the field, observing that the conduct of agents is heavily influenced by what the Division chooses to monitor.

      We concluded that the Inspection Division's efforts to assess performance of all investigative and support operations could be improved in three critical respects: 1) increasing the scope of inspections to better assess compliance with the Guidelines; 2) better promoting accountability for adherence to the Guidelines; and 3) shortening the time to detect violations and incorporating information technology tools to make its work more efficient and its findings more useful.373 With regard to the Inspection Division's substantive inspection findings, we found systemic Criminal Informant Program deficiencies, including widespread violation of certain Attorney General Guidelines' requirements and persistent non-compliance in some field divisions. The seriousness of these violations varies widely, from documentation errors to failing to report unauthorized illegal activities by confidential informants. This conclusion is consistent with the findings of our field work, which we described in Chapter Three.

      1. Scope of On-site Inspections
      2. Our analysis of the Inspection Division's inspection reports indicates that the Division should increase the scope of its audits to include more information concerning Guidelines compliance and implementation. We believe that both the types of audits performed by the Inspection Division during its on-site inspections as well as the information collected from the current audits should be expanded to provide better oversight of Guidelines issues. The Inspection Division also should focus its audits on areas that are deemed priorities or that have been identified as problems from prior inspections, and make its reporting more comprehensive by collecting reliable information on the causes of deficiencies and categorizing the gravity of deficiencies that are found.

        As explained above, several of the checklists used by the Inspection Division to collect data on topics addressed in the Attorney General Guidelines, including those for the Criminal Informant Program, squads, and programs are not sufficiently comprehensive. For example, we believe the Inspection Division's failure to include Continuing Suitability Report & Recommendations (CSR&R) preparation on the Criminal Informant Program checklist was a significant contributor to the high non-compliance rate we discovered for that requirement. At the time of our visits, two field divisions had not completed any CSR&Rs, even though the requirement to do so has plainly been set forth in the Confidential Informant Guidelines since 2001. As a former Chief Inspector observed, "people do what they are measured by."

        We also recommend adding an evaluation of the FBI's compliance with key provisions contained in Part VI of the General Crimes Guidelines. During our review we asked the FBI to provide us with information relating to its exercise of Part VI authorities and were advised by the Inspection Division that it was not practicable to locate the information since it was not separately retained in FBI files. Because we repeatedly have been told by field personnel that agents typically do not have time to visit public places and events due to the press of other business, we believe the burdens associated with the review and analysis of the information should not be great. Moreover, with respect to visiting public places and events, the FBI already has recommended documentation requirements. FBI OGC Guidance explains that "[a]ttendance by an agent under Part VI of the General Crimes Guidelines . . . should be documented in some retrievable fashion."374 We do not believe that the addition of Inspection Division oversight should add significantly to agent administrative burdens.

        Although we believe that the Inspection Division should expand its information collection in some areas, our review also revealed that the Division would benefit by targeting a greater proportion of its on-site inspection resources to priority and problem areas. Division management stated that its priority audits are the Criminal Informant Program, ELSUR, and Evidence. However, the Inspection Division does not identify these programs for more frequent on-site inspections or reinspections. Some programs may warrant inspection every four years of a relatively small sample of files; others may require inspection every year of every file. We believe the Inspection Division should focus its inspection resources on programs that are priorities or are identified with chronic or persistent problems, and should work with Headquarters program divisions to enhance inspection oversight in these areas. The Inspection Division also should continue to supplement its work with field-initiated self-inspections. Specifically, we believe it should initiate a simultaneous self-inspection or limited reinspection of the Criminal Informant Program for field divisions identified as having significant compliance problems.

        The scope of the Inspection Division inspection reports and supporting electronic communications should be expanded to include: 1) collection of data suggesting the causes of the identified compliance deficiencies and an analysis of the explanations provided by field personnel for the inspection results, and 2) an assessment of the gravity of the compliance deficiencies based on information gathered from revised checklists. Currently, the inspection reports itemize violations with little or no supporting analysis, and they do not address the field office's version of events. We believe this creates two problems.

        First, itemizing the violations and announcing a non-compliance percentage based on the number of files that contain one or more errors can mask important performance information and lead to the misallocation of reinspection resources. For example, a Criminal Informant Program in which agents failed to include a photograph of the confidential informant in the file due to lack of training might have a 100 percent non-compliance rate, while another Informant Program might have a much lower non-compliance rate but have more significant deficiencies associated with the commission of unauthorized illegal activity by informants whose handlers ignore Guidelines' requirements and the instructions of their SSAs and Confidential Informant Coordinator. Our review of the Inspection Division's inspection reports suggests that the latter circumstance would not receive the greater remedial attention it deserves. The causal factors associated with compliance performance and the field office's explanation of its performance should be more fully described in the reports. This should include providing information comparing an office's performance with other FBI components and specifically identifying deficiencies as Guidelines violations when they are found.

        These recommendations are especially relevant to the Criminal Informant Program. Before the suspension of reinspections in November 2004, the standard employed to trigger reinspection of noncompliant Criminal Informant Programs was based on Inspection Division findings concerning the percentage of informant files that contained one or more errors. Criminal Informant Programs with a file error rate that exceeded 40 percent were eligible for a reinspection by personnel from A/IU. However, the gravity of the violations found did not influence whether this percentage threshold was exceeded; it was a purely statistical computation. We believe that there are better ways for the Inspection Division to analyze and compare Criminal Informant Program compliance performance, and that the Inspection Division and HIU should work together to develop new measures that determine when inspection resources should be targeted on problems of special concern in the field. The Inspection Division Assistant Director agreed that the 40 percent threshold for reinspections should be replaced with a standard that accounts for the frequency and gravity of the violations found during inspections.

        Below we provide an example of how the FBI could assess field office compliance with key Informant Guidelines and MIOG requirements. To illustrate such an approach, we utilized a matrix that weights violations of these requirements and accounts for both the frequency and severity of Criminal Informant Program deficiencies identified during inspections. Application of such a matrix could also be used to develop a standard for conducting reinspections. We recommend that the FBI determine what considerations best capture noteworthy performance issues, how to weight various compliance deficiencies, and what should be reported by the Inspection Division.

        To demonstrate how use of a matrix can change the evaluation of the Criminal Informant Program, below are comparisons of Inspection Division non-compliance percentages and the scores generated for select field divisions from the matrix which we developed. Using this model, the deficiency score for San Diego is noteworthy because it is significantly lower than scores for divisions with comparable non-compliance percentages. The reason for this is straightforward: more than 80 percent of San Diego's deficiency points were generated from deficiencies such as failing to include a photograph of the CI in the informant file and failing to provide annual instructions to CIs, which are weighted as less severe in the matrix than deficiencies such as failing to obtain authorization for a source's participation in illegal activity and failing to notify FBI Headquarters of a source's participation in unauthorized illegal activity, which accounted for more of the compliance deficiencies found in other field offices.

        TABLE 7.6

        Comparison of Deficiency Measures for
        Select FBI Field Office Criminal Informant Programs

        Inspection Division
        San Diego58%11.8

        Besides masking important information about compliance performance, a second disadvantage of itemizing violations in the inspection reports with little or no qualitative assessment or supporting analysis concerning causation is that it makes it more difficult to evaluate the sufficiency of the remedies proposed by the field division in response to the report.375 Ideally, these remedies would address the causes of the deficiencies identified by the Inspection Division. Field divisions should explain in their responses how their remedies will effectively address the causes of the identified deficiencies.

      3. Promoting Accountability
      4. Our review indicates that the Inspection Division can and should do more to promote accountability for compliance performance. Too often we found in the inspection reports and their supporting electronic communications instances of recurring non-compliance with insufficient corrective response to the conduct of those who were responsible for it. We believe that if a particular squad or individual is responsible for a disproportionate share of a field division's compliance deficiencies, this fact should be stated explicitly in the inspection report. The reinspection reports generated by the Inspection Division and A/IU for the Columbia, Omaha, and San Francisco Criminal Informant Programs are examples of how accountability can better be reinforced through inspection findings. These reports analyze Criminal Informant Program compliance performance by squad.

        We believe that inspection findings should be accounted for in agent performance appraisals, which was not done, for example, in field offices with seriously noncompliant Criminal Informant Programs.376 The Inspection Division Assistant Director agreed that significant deficiencies noted during inspections should be accounted for in employee performance appraisals.

        The Inspection Division also should modify its squad and investigative program checklists to note areas where compliance performance is inadequate. Information collected from these documents can assist inspectors to better identify the causes of deficiencies. These checklists should include cross-references to the findings in other data collection instruments. For example, excessive deficiencies in a squad's Criminal Informant Program compliance performance should require examination of the findings from the squad/RA audit worksheet that address "Communication Capacity" and "Personnel Management and Administration," among other topics.

        In addition, we believe that the Inspection Division can better promote accountability and Guidelines compliance through more effective follow-up on inspection instructions, recommendations, and findings. At present, even in circumstances where serious deficiencies are found during an inspection, the Inspection Division's involvement rarely continues more than a few months beyond the period during which offices respond to the inspection report. In our view, this practice has allowed the persistent non-compliance identified in Table 7.4. When a program is identified as having a poor compliance record, the Inspection Division should evaluate the feasibility of sending at least one Assistant Inspector in Place back to the office at periodic intervals until the problem is resolved and compliance verified. Comprehensive reinspections by the relevant Headquarters program office can be a substitute for this process, as occurred in a limited number of field offices with deficient Criminal Informant Programs. We also suggest that the Inspection Division provide commentary on the findings and indicate whether further reinspection work is needed.

        We also recommend that where egregious non-compliance is discovered, the violation be elevated to a finding directed to executive management in the inspection report and not wait until a recurring deficiency is noted three years later during the next inspection cycle.377 In our view, the practice of deferring prompt elevation of serious problems has contributed to delays in remedying them.

      5. The Timing of Inspections and Better Use of Technology
      6. The amount of time it takes the Inspection Division to detect Guidelines violations is problematic. At present, the Inspection Division's standard practice is to conduct on-site inspections every three years. Reinspections are rare and self-inspections were cancelled as of June 2004, although we understand that the Inspection Division may reinstitute self-inspections in a different form in the future. We believe that investing resources to identify violations that occurred more than two to three years in the past is of limited utility, especially when technology is available that would allow the Inspection Division to identify violations with greater frequency and to monitor performance trends and indicators. With such a long delay between inspections, by the time inspectors arrive on-site the cause of the deficiencies identified during the inspection may have changed or ceased altogether. Moreover, problems may persist much longer than might be the case with a shorter period between inspections.

        Former Assistant Director Steve McCraw, former Chief Inspector Grant, and the former Deputy Assistant Director of the Inspection Division, Michael Clemens, all emphasized to us the importance of changing the focus of the Division from identifying past mistakes to improving future performance. To realize this goal, they, along with current Assistant Director Thornton, told the OIG that a key component in any reform of the inspection process must include automation of the collection of compliance data. A recent Inspection Division program plan identified the limited state of the Division's technology.378 In our view, shifting the orientation of the Inspection Division, and the associated resources, from compliance detection to compliance enforcement and assistance would enhance support for Guidelines compliance. The current inspection process and technology limitations, however, are obstacles to the implementation of such a shift in orientation.

        To more quickly and efficiently identify instances of Guidelines non-compliance, we believe that the FBI should seek to automate that part of the inspection process that involves the manual review of paper case files for compliance errors. We saw from our own experiences in extracting compliance information from the FBI's files that the methods currently available to obtain this information are inadequate. The FBI continues to rely too heavily on paper file reviews to document its compliance performance.

        We recognize that the completion of the work above is a long term goal that will take several years to achieve. However, with respect to monitoring of the Criminal Informant Program we believe a technology upgrade is necessary now and that an interim solution should be devised to assist with compliance oversight. Specifically, we believe the FBI should consider developing a standard Criminal Informant Program "tickler system" that can be deployed in all field divisions and that will enable A/IU (now the HIU) and the Inspection Division to monitor compliance trends. Depending on the conduct at issue, computer-generated notifications should be set for ASACs, SACs, HIU, and the Inspection Division. We were advised by an FBI supervisory agent with experience in creating computer databases that the software to complete this work is commercially available and can be operational within 12 months.

    9. Recommendations
    10. We recommend that the Inspection Division take the following steps.

      (33) Revise Inspection Division checklists and interrogatories to increase inspection coverage of Attorney General Guidelines-related issues.

      (34) As part of the Inspection Division's triennial inspections of field and Headquarters' divisions, establish an audit examining the collection of information obtained from exercise of counterterrorism authorities pursuant to Section VI.A.2 (Visiting Public Places and Events) of the General Crimes Guidelines.

      (35) Provide more thorough and timely reporting of Attorney General Guidelines' violations by identifying in inspection reports the causes and gravity of compliance deficiencies; developing summary statistics to assist in determining when reinspections are appropriate; and automating key components of the inspection process.

      (36) Increase inspections for the Criminal Informant Program and other programs that are priorities or experiencing significant problems by performing more frequent inspections at irregular intervals. The Inspection Division should also develop a standard for reinspections that accounts for the frequency and seriousness of the Attorney General Guidelines' deficiencies identified during the regular inspection and develop a standard for determining when reinspections should be conducted that accounts for both the number and gravity of the deficiencies found. The Inspection Division and the Human Intelligence Unit should reinstate its Criminal Informant Program reinspection process.

      (37) Address in employee performance appraisals the findings from Inspection Division inspections that identify either superior or deficient Attorney General Guidelines' compliance performance.

      (38) Elevate egregious non-compliance with Attorney General Guidelines to an executive management finding in the inspection report rather than deferring that action until the next three-year inspection contingent on the detection of recurring, serious deficiencies.

  5. On-site Reviews by Program Offices
  6. In addition to Inspection Division inspections, various program offices at FBI Headquarters participate in field office reviews of activities in their program specialty. In conjunction with the Inspection Division, the Asset/Informant Unit has conducted reinspections of Criminal Informant Programs with high non-compliance rates. Certain undercover operations also are evaluated by USOU with assistance from Headquarters operational program offices. Because the field evaluations performed by A/IU and USOU sometimes address Guidelines compliance issues, we studied these additional efforts to assess their role in promoting adherence to the Guidelines.

    1. Undercover & Sensitive Operations Unit On-site Reviews
    2. From May 2002 through October 2004, USOU conducted on-site reviews of 60 undercover operations, of which 59 were Group I operations. In accordance with procedures set forth in the FBI Field Guide for Undercover Operations, Group I UCOs receive an on-site review from FBI Headquarters during their initial stages, generally within the first year. The Field Guide explains that "[a]n on-site review is not considered an inspection; but, rather an oversight procedure designed to facilitate the implementation of the undercover operation in a minimum amount of time and in compliance with applicable FBI rules and regulations." Undercover operations that continue for more than one year after the initial USOU on-site may be reviewed periodically by the operational Headquarters section and USOU. According to the Unit Chief of USOU, the need for a second on-site review is rare because most undercover operations terminate before the need arises.

      Personnel participating in the on-site review include a supervisor from USOU, a Headquarters supervisor from the substantive program involved in the undercover operation, and an auditor from the Inspection Division. The on-site typically lasts two to three days, during which time the review team examines the following: 1) program and operational issues, such as investigative strategy, accomplishments, and evidence-handling; 2) compliance and safety issues; and 3) financial issues. The USOU supervisor is responsible for conducting the compliance and safety review, which, according to guidance prepared by USOU, includes an examination of the undercover operation's compliance with the Undercover Guidelines and CUORC stipulations.

      Unlike A/IU, USOU does not use Inspection Division checklists during its on-site visits. Instead, it has developed its own checklist which, as of December 2004, was being substantially revised. Our review of both the revised draft and preceding versions of USOU's checklist revealed that it does not seek information on several important Guideline issues, such as entrapment, OIA, and whether joint undercover operations are carried out in accordance with the Undercover Guidelines. For example, the checklist evaluates neither the authorization nor implementation of OIA.

      According to guidance prepared by USOU, Group II UCOs (which may be initiated without Headquarters approval) also are subject to on-site reviews under the following conditions: 1) the undercover operation has been extended beyond the initial six-month period of authority granted by a designated Assistant Director; 2) the undercover operation has expended more than $100,000 in operational expenses; or 3) circumstances requiring special attention arise during the conduct of the undercover operation. From May 2002 through October 2004, USOU inspected only a single Group II UCO.

      Once the results of the on-site visit are collected, the review team prepares an electronic communication that is formatted into the following sections: 1) synopsis of the undercover operation; 2) investigative achievements to date; 3) objectives of the undercover operation; 4) program and operational issues; 5) compliance and safety issues; and 6) audit and financial matters. The Headquarters operational unit supervisor is responsible for compiling the electronic communication, although both the operational unit and USOU supervisors are responsible for briefing the SAC or ASAC about the review's findings prior to the departure of the on-site team. As with inspection findings, the field division prepares a response to the electronic communication and explains how it will resolve any deficiencies noted during the review. A copy of the response is forwarded to USOU.

      Our review of the results of USOU's on-site visits revealed comparatively few violations of the Undercover Guidelines. As explained in Chapter Four, USOU identified the following deficiencies: 1) in seven undercover operations, agents failed to obtain proper authorization for undercover activity; 2) in two undercover operations, division management failed to meet with undercover employees, while in five other undercover operations, documentation of the meetings was lacking; and 3) in one undercover operation a financial transaction was not properly structured.379 None of the electronic communications identified these actions as Guidelines violations.

    3. Asset/Informant Unit Reinspections
    4. A/IU led reinspections of four FBI field office's Criminal Informant Programs during the period June 2003 through November 2004. A/IU's participation in the Criminal Informant Program reinspections was initiated only recently. The former Chief of the Criminal Intelligence Section, Criminal Investigative Division, told us that he initiated the practice in June 2003 following the Inspection Division's inspection of the San Francisco Division. The former Section Chief stated that he was the second-ranking Inspector for that inspection and was concerned by the high non-compliance rate for the Criminal Informant Program, a condition that had persisted for more than a decade. See discussion supra at Case Study 7.2 (describing San Francisco Criminal Informant Program). He said that after that inspection he advised FBI executive management in San Francisco that A/IU would return in six months to look at every confidential informant and cooperative witness file in the Division.

      The new reinspection policy, which was transmitted in an electronic communication to the Inspection Division, provided that if a Criminal Informant Program had a non-compliance rate of 40 percent or more, a reinspection by A/IU would be triggered. The Section Chief stated that his drive to institute reinspections for offices that exceeded a 40 percent non-compliance rate was based on the belief that "if [agents] don't follow the rules with the simple things, and there is not enough oversight, that is where we could have an unhealthy relationship."

      During reinspections, A/IU personnel work under the supervision of an Inspector in Place, typically an ASAC. ASACs serve as Inspectors in Place and are not assigned to the Inspection Division. Data is collected using the Inspection Division's Criminal Informant Program compliance checklist, and the findings are presented in a separate electronic communication. The reinspection electronic communications provide recommendations and instructions to the field division and are provided to the Inspection Management Unit for follow-up and resolution.

      As of December 2004, A/IU had completed four Criminal Informant Program reinspections. The table below presents the inspection and reinspection non-compliance rates, and the number of recurring deficiencies for these four field divisions.

      TABLE 7.7

      Inspection and Reinspection Non-compliance Rates
      for Select Criminal Informant Programs

      Field Division Inspection
      Non-compliance Rate
      Non-compliance Rate
      Number of
      Columbia 88% 38% 3
      San Diego 58% 51% 6
      Omaha 56% 33% 8
      San Francisco 56% 22% 12
      *Deficiencies of the same type identified during succeeding inspections.

      As shown above, by the time of the reinspection three of the four field divisions improved their non-compliance rates significantly, although the non-compliance rates generally remained high. Moreover, the reinspections revealed that several of the divisions had significant numbers of recurring deficiencies and that only one of the four divisions eliminated deficiencies related to two of the most critical Guidelines' provisions: the conduct of OIA and the handling of sensitive sources.

      In addition to identifying overall Criminal Informant Program non-compliance rates, reinspections also can illuminate problems with implementation practices and deficiencies in the remedies instituted by Informant Program management in response to adverse inspection findings. For example, the San Diego Criminal Informant Program reinspection report highlighted the following implementation problems:

      SAC [name omitted] took a number of strong steps to provide the necessary attention, emphasis, and support to the Criminal Informant Program since the November 2003 Inspection. . . . However, follow up to ensure the SAC's instructions were followed was not as strong. . . . An internal review of Criminal Informant Program files which was conducted by experienced supervisors failed to correct numerous deficiencies subsequently identified by the re-inspection team. . . . [T]he re-inspection uncovered numerous other deficiencies which were unambiguous by any standard. . . . The re-inspection for this period identified inadequate oversight to ensure the SAC's direction was followed as evidenced by a 51 percent error rate.380

      As of December 2004 the Inspection Division and A/IU halted all reinspections of Criminal Informant Programs pending completion of discussions over revised reinspection procedures. According to the FBI's Chief Inspector at the time, the Inspection Division and A/IU need to address resource issues and the standards that will guide future reinspection activity. In February 2005, the OIG was told by a representative from the newly formed Human Intelligence Unit that the Inspection Division was changing its Criminal Informant Program inspection procedures and that until that work is complete reinspections would not be conducted.

    5. OIG Analysis and Recommendations
    6. We believe that the reinspections should be an important part of the FBI's compliance enforcement efforts and the former CID Section Chief should be commended for his efforts to institute the program in the Criminal Informant Program. We believe, however, that the FBI should re-examine the criteria that it uses to determine when reinspections should be performed for this program. Under the terms of the reinspection electronic communication issued by A/IU in February 2004, "any field office with a compliance error rate in excess of 40 percent will undergo a comprehensive Criminal Informant Program audit within six months of its inspection." This language sweeps too broadly. In our view, which is shared by the current Assistant Director of the Inspection Division, both the number and seriousness of the violations detected during the regular Criminal Informant Program inspection should be considered when determining reinspection eligibility and priority. See discussion in the preceding section of this chapter regarding Criminal Informant Program deficiency matrix.

      In addition, we believe that the FBI should continue intensive monitoring of reinspected programs until satisfactory performance is demonstrated. Even though three of the four Criminal Informant Programs identified in Table 7.7 above showed some improvement in their non-compliance rates, the rates generally remained high, and several of the offices failed to eliminate problems with OIA and the handling of sensitive or privileged sources.

      As with A/IU's reinspections, we believe there is significant merit in the on-site reviews of undercover operations supervised by USOU. They highlight important compliance and performance issues that warrant enhanced scrutiny and face-to-face interaction with Headquarters personnel. Our review of USOU's on-site data collection instrument revealed, however, that certain critical compliance provisions, such as the conduct of OIA, were not addressed. Given that the opportunities to perform on-site reviews of individual undercover operations are limited, we believe that when they are conducted they should be as comprehensive as practicable.

      We recommend the following.

      (39) The Inspection Division and the Human Intelligence Unit should institute procedures that establish follow-up inspection measures to reinspections that indicate ongoing compliance problems, such as assigning a single Assistant Inspector in Place to conduct an additional inspection within the first six months following the reinspection.

      (40) Modify the Undercover and Sensitive Operations Unit's on-site review data collection instrument to better address Undercover Guidelines' compliance, including issues such as otherwise illegal activity, potential entrapment issues, and task force participation.

  7. FBI Disciplinary Process
  8. The FBI's disciplinary process also plays an important role in promoting compliance with the Attorney General Guidelines. Unlike the Inspection Division, A/IU, and USOU, which affirmatively seek out compliance deficiencies through planned inspections or on-site reviews, the FBI's internal investigation caseload is normally generated by referrals of alleged employee misconduct to the Internal Investigations Section (IIS) of the Inspection Division. The IIS maintains the responsibility to investigate the allegation and to refer its findings to the Office of Professional Responsibility (OPR). If the allegations of misconduct are sustained, OPR has authority to impose disciplinary sanctions.

    The following diagram shows the current structure of the FBI's disciplinary units.

    DIAGRAM 7.4

    Organization Chart: FBI Disciplinary Units


    [Not Available Electronically]


    1. Investigative Guidelines Issues Addressed by the FBI Disciplinary Process
    2. Below we describe how the FBI disciplinary process addresses the Attorney General's Investigative Guidelines through its categorization of misconduct offenses. We also summarize the OPR cases that have involved violations of the Guidelines during the last five years.

      1. Classification of Offenses
      2. The FBI evaluates allegations of misconduct according to a classification scheme that is based on a list of 63 offenses, known as "offense codes." Neither OPR nor the Units in the Internal Investigations Section (IIS) of the Inspection Division that investigate allegations of misconduct track as a discrete category violations of the Attorney General Guidelines. Two prior offense codes that recently were eliminated referred to the "AG Guidelines" in their titles: 18F - Informant/CW Matter - Violation of AG Guidelines; and 7F - Asset Matter - Violation of Executive Orders/AG Guidelines.381 However, our review of misconduct cases under these and other offense codes revealed that Attorney General Guidelines' violations concerning informants were not consistently captured by the 18F classification. Officials at OPR (prior to its restructuring in 2004) could not explain why the two codes above contained express references to the Guidelines.

        The FBI's new offense codes cover Attorney General Guidelines' violations in two ways: 1) by specifying types of conduct that are subject to the FBI disciplinary process; and 2) by identifying general categories of conduct standards the violation of which can result in disciplinary sanctions. With respect to the latter, three codes refer to operational guidelines such as the Attorney General Guidelines.382

      3. Investigative Guidelines Violations Adjudicated by OPR from 1999 to 2004
      4. We reviewed OPR cases adjudicated from November 1999 to November 2004 to identify violations of Attorney General Guidelines. Out of approximately 1,500 cases in which OPR imposed discipline, we identified 24 cases that involved violations of the Confidential Informant Guidelines, 7 cases where agents initiated unauthorized investigations in violation of the General Crimes Guidelines, and 1 case where authorization was not obtained for a consensual monitoring in violation of the Consensual Monitoring Guidelines. Although several cases discussed misconduct that occurred during undercover operations, none of the infractions cited in those cases was a violation of the Undercover Guidelines.

        With regard to violations of the Confidential Informant Guidelines, most of the cases involved multiple violations, including the following: improper personal relationship (10 cases); improper financial transactions (7 cases); wrongful disclosure of information (3 cases); failure to obtain proper authorization for otherwise illegal activity (3 cases); failure to obtain authorization for a privileged or sensitive source (2 cases); failure to witness confidential informant payments (2 cases); failure to conduct required background checks (2 cases); and failure to report unauthorized criminal activity (1 case). As explained in Section III above, the kinds of Guidelines violations adjudicated by OPR often are identified during Inspection Division inspections (and also were found in the OIG's review of FBI case files).

    3. OIG Analysis
    4. Our review identified several issues concerning Guidelines-related misconduct that we believe warrant careful evaluation by the FBI: 1) the lack of clear standards regarding what Guidelines-related conduct should be referred to FBI Headquarters for evaluation of possible misconduct; 2) the associated issue concerning the distinction between "performance" and "misconduct;" and 3) the potential for disparate disciplinary treatment of Guidelines violations due to inadequate information retention, information sharing, tracking procedures, and technical support. In addition, we believe that certain violations of the Guidelines involving the operation of human sources merit elevated attention due to the seriousness of the conduct and should therefore be identified as discrete OPR offense codes.

      1. Standards for Referral to the FBI Disciplinary Process
      2. Both the MIOG and Manual of Administrative Operations and Procedures require that allegations of "criminality or serious misconduct" be reported to FBI Headquarters.383 While Part 263 of the MIOG lists a number of offenses that are considered serious misconduct, it provides little additional guidance as to when referrals to FBI Headquarters are appropriate. Our review of OPR adjudications over the past five years, Inspection Division inspection findings, and our own field work revealed that some actions that have been treated as misconduct by OPR, such as operating a privileged source without proper authorization, have been viewed by the field and the Inspection Division as not warranting referral for possible discipline. For example, in 2002 OPR disciplined an agent for failing to obtain proper authorization for a confidential informant's participation in otherwise illegal activity and for failing to conduct proper background checks. However, the Inspection Division's review in 2004 of five source files during one inspection revealed that the responsible Special Agents failed to obtain approval for the source's participation in otherwise illegal activity and violated one or more Guidelines' or MIOG requirements while operating the sources. Unlike the 2002 case, none of these matters was referred to OPR.

        FBI managers recognize the need to ensure that the disciplinary process is both transparent and consistent. For example, the Chief of IIS told us that the MIOG and MAOP will be revised to include a reference to the FBI's forthcoming manual on the disciplinary process and will provide guidance regarding when it is appropriate for field and Headquarters divisions to notify the Initial Processing Unit (IPU) about actual or potential misconduct. An Inspection Division official told us that SACs and other managers will be encouraged to report everything that could be deemed misconduct, and that the IPU will ensure consistency in its determinations regarding what is appropriate for investigation through development of a precedent database. We believe that such actions are warranted and that this FBI initiative could promote greater consistency in how violations of the Guidelines are treated.

        "Performance" versus "Misconduct"

        An issue which creates uncertainty regarding which violations of the Attorney General Guidelines are subject to discipline is the distinction between "performance" and "misconduct." Without clear and well-understood principles to guide application of this distinction, the disciplinary process will be less effective in promoting compliance with the Attorney General Guidelines, and the FBI's disciplinary investigations and adjudications on this subject could produce inconsistent results.

        Several of the FBI's offense codes refer to conduct "which falls outside the parameters of performance." For example, code 5.23 makes eligible for discipline an employee's failure "to enforce or comply with an FBI, DOJ, Office of Personnel Management, or other federal administrative or operational guidelines or policy not specifically delineated in any offense code, which falls outside the parameters of performance." Given the broad reach of this offense code, the distinction between performance and misconduct is critical to determining what behavior, including violations of the Attorney General Guidelines, is subject to discipline at the FBI. We believe that consistency would be enhanced if those codes that include the "which falls outside the parameters of performance" language were supplemented with examples demonstrating the difference between behaviors that are performance-based and others that constitute misconduct. As one FBI electronic communication stated with regard to the offense codes, "[b]y having clearly defined elements, employees and investigators will know what actions constitute misconduct, and will make the entire disciplinary process more transparent."

      3. Additional Offense Codes
      4. We also recommend that several offense codes be added to the FBI's offense table to address conduct related to the operation of human sources that merits heightened scrutiny due to its seriousness and the frequency of deficiencies associated with them. These new codes would target misconduct related to informant participation in otherwise illegal activity and the authorization and operation of privileged or sensitive sources.

        Our field work and examination of the results of the Inspection Division's inspection findings revealed that the failure by case agents to obtain proper authorization for otherwise illegal activity and for the handling of confidential informants identified in Section II.D of the Confidential Informant Guidelines (sensitive and privileged confidential informants), occurred with significant frequency. For example, Inspection Division inspections covering the last inspection cycle from May 2002 to October 2004 identified 38 case files showing that case agents failed to obtain proper authorization for confidential informants to engage in otherwise illegal activity, and 15 cases where agents operated sensitive or privileged sources without necessary authorizations.384 We also identified cases where agents failed to follow special handling procedures related to the operation of privileged or sensitive sources.

        The FBI's current list of offense codes includes four conduct-based codes that reference human sources. These codes address the failure to report a source's criminal activity, engaging in improper personal or financial relationships with a source, and improperly intervening on behalf of a source with respect to law enforcement or legal obligations. The list does not include codes addressing the knowing or reckless (i) failure to obtain authorization for a source's participation in otherwise illegal activity; (ii) failure to obtain authorization for the operation of privileged or sensitive sources; and (iii) mishandling of privileged or sensitive sources.385 While such conduct may be covered by a standard-based offense code, such as 1.5 ("Asset/CW/Informant - Violation of Operational Guidelines and Policies, Other), creating separate conduct-based codes would highlight the importance of avoiding these types of Guidelines violations and make the conduct codes concerning human sources more complete. The Confidential Informant Guidelines devote special attention to otherwise illegal activity and the handling of privileged and sensitive sources (see §§ II.D - Special Approval Requirements, and III.C - Authorization of Otherwise Illegal Activity) because of the seriousness of the conduct, the risks to prosecutions of informants and others, and the risks of liability to the United States. This justifies separate offense codes for misconduct involving authorization to participate in otherwise illegal activity, authorization for the operation of privileged or sensitive sources, and for the mishandling of such sources.

      5. Technology and Information Dissemination
      6. We believe that the FBI's disciplinary units should develop electronic information retention, information sharing, and tracking procedures to ensure that disciplinary decisions, including those relating to Guidelines violations, are consistent and based on complete information. We learned that as of December 2004, adequate technology and support that would allow for the development and maintenance of upgraded precedent databases for Headquarters units involved in the FBI's disciplinary process were not in place, and it was unclear how case information was going to be shared and tracked. The FBI's Chief Information Officer (CIO) told us that, due to the antiquated nature of the computer system in use by OPR and IIS, it is very difficult and time-consuming to execute simple data manipulations, such as adding data fields.386 FBI Headquarters officials told us that since that time both OPR and IIS have started to use a database that was developed by an SSA in the Inspection Division.

        To ensure that information is not "stove-piped" in individual units involved in the FBI's disciplinary process, resulting in inconsistent treatment of factors such as Attorney General Guidelines violations, we believe that the FBI's internal discipline components should adopt procedures and shared technology that allow for retrieval of case information, precedents, and trend analyses.

    5. Recommendations
    6. To ensure appropriate and consistent treatment of the Attorney General Guidelines in the FBI's disciplinary process, we recommend the following.

      (41) Ensure that alleged Attorney General Guidelines' violations warranting potential discipline are referred to the FBI's Internal Investigations Section in a consistent fashion throughout the FBI.

      (42) Ensure that the Inspection Division's standards for referring misconduct involving Attorney General Guidelines' violations are consistent with practices adopted by the Internal Investigations Section.

      (43) Add separate offense codes for: (i) knowingly or recklessly failing to obtain proper authorization for a source's participation in otherwise illegal activity; (ii) knowingly or recklessly failing to obtain proper authorization to operate long term, high-level, privileged or media-affiliated confidential informants or other informants subject to special approval requirements; and (iii) knowingly or recklessly failing to operate long-term, high-level, privileged or media-affiliated confidential informants, or other informants subject to special approval requirements in accordance with the relevant Confidential Informant Guidelines and MIOG provisions.


  1. Initially called the Undercover Operation Review Committee when it was established in September 1978, the Committee consisted of seven voting members from FBI Headquarters. Three DOJ voting representatives were added in 1979 when DOJ attorneys voiced concerns about certain undercover operations and suggested forming a separate review committee from which the FBI's Undercover Operation Review Committee would need to secure approval. The DOJ members added to the CUORC at that time were the Chief of the DOJ Criminal Division's Public Integrity Section and the Assistant Chiefs of the Criminal Division's Organized Crime and Fraud Sections. A history of the early versions of the Undercover Guidelines and the Undercover Operation Review Committee can be found in the Final Report of the Select Committee to Study Undercover Activities of Components of the Department of Justice, 97th Cong. 49-55 (1982).

  2. Undercover Guidelines § IV.D.1 at B-46.

  3. FBI Headquarters must approval a second category of special circumstances in undercover operation proposals. These undercover operations involved "fiscal circumstances," defined in § IV.C.1 of the Undercover Guidelines, at B-43.

  4. Undercover Guidelines § IV.C.2 at B-44.

  5. Undercover operations that do not involve either sensitive or fiscal circumstances are called "Group II UCOs" and do not initially require FBI Headquarters approval. Undercover Guidelines § IV.B at B-41. Group II UCOs may be initiated and, within certain limitations, extended under the authority of the Special Agent in Charge (SAC). See Field Guide for Undercover and Sensitive Operations (FGUSO) § 2.1(1) (July 25, 2003). We learned that most field offices establish a field office-level review committee to evaluate all Group II proposals, although they are not required to do so.

  6. Undercover operations proposed as part of the programs supervised by CID must be approved by its Assistant Director. Undercover operations proposed as part of other programs must be approved by both the Executive Assistant Director of the particular program and the Assistant Director of CID. FGUSO § 4.3 (July 25, 2003).

  7. As we discuss in Chapter Four, Undercover Coordinators are the FBI Field Divisions' on-site experts concerning undercover matters.

  8. Twenty four percent said they were not in a position to answer the question. As we discuss later in this chapter, by comparison, only 46 percent of Confidential Informant Coordinators said they believe that the FBI-DOJ Confidential Informant Review Committee (CIRC) is providing effective oversight of the Criminal Informant Program.

  9. CI Guidelines § I.I.2 at B-13. There were no changes to the jurisdiction or membership of the CIRC when the Confidential Informant Guidelines were revised in May 2002. Prior to the January 2001 revisions, DOJ had no role in the initial approval of confidential informants.

  10. CI Guidelines § I.B.13 at B-11.

  11. FBI Asset/Informant Unit Statistics (Sept. 28, 2004).

  12. Suitability Reports and Recommendations are also used for field office approval of lower-level confidential informants who are not required to be approved by the CIRC. We discuss in Chapter Three our findings regarding the FBI's compliance with the key provisions of the Confidential Informant Guidelines.

  13. The Guidelines require the confidential informant's contact agent to address in the ISR&R such factors as the person's reliability and truthfulness; the investigative relevance of the information to be provided; the person's motivation for providing information; and complete information on the person's age, alien status, and criminal history, if any. A complete list of the suitability factors is provided in Chapter Three.

  14. CI Guidelines, § II.A.2 at B-15. As we discuss in Chapter Three, in the 12 FBI field offices we visited during this review, we found that 59 percent of the confidential informant files did not contain one or more of the required CSR&Rs.

  15. CI Guidelines § II.A.2.a at B-15.

  16. In October 2004, A/IU modified the suitability report to include two additional questions frequently posed by CIRC members regarding the relevance of the person's information and how the person is in a position to obtain relevant information.

  17. Under the Confidential Informant Guidelines, authority to engage in OIA is closely supervised by FBI field office and FBI Headquarters managers and U.S. Attorneys' Offices, in addition to the oversight provided by the CIRC for certain defined categories of confidential informants. Confidential informants who operate outside the limits imposed on their OIA are subject to prosecution.

    Otherwise illegal activity is distinguished from unauthorized illegal activity. The Guidelines impose special notice requirements on FBI personnel who have reason to believe that confidential informants have engaged in unauthorized illegal activity. See CI Guidelines § IV.B at B-31.

  18. Only Tier 1 OIA must be approved by the U.S. Attorney.

  19. CIRC members also told us that when the CIRC was formed, DOJ members did not always have clear and concise copies of the informants' criminal history checks when reviewing their SR&Rs. As a result, questions arose about the dates an informant committed crimes, the types of crimes, and the disposition of the charges. CIRC members said that in the last year, the FBI has distributed copies of the informants' criminal records in advance of CIRC meetings. CIRC members told us that this advance distribution has improved the situation but that some DOJ members of the Committee - all of whom are experienced prosecutors - sometimes have difficulty deciphering the federal or state or local law enforcement codes used to detail the informants' criminal histories.

  20. The 46 percent effective assessment for the CIRC compares to the Undercover Coordinators' 79 percent effective assessment of the CUORC, discussed earlier in this chapter.

  21. Effective November 15, 2004, the FBI Director moved the function of the Asset/Informant Unit in CID to the new Intelligence Directorate. We believe our recommendations are important no matter where the FBI Headquarters function for supervising confidential informants is located.

  22. Inspection Division Program Plan (2004) at 1.

  23. Inspectors in Place and Assistant Inspectors in Place are FBI Agents stationed outside the Inspection Division. Inspectors in Place typically are ASACs, who are assigned to field offices, or Section Chiefs, who are assigned to FBI Headquarters. Assistant Inspectors in Place have either served a minimum of two years as a field supervisor or one year as a field supervisor with at least two years prior service at FBI Headquarters.

  24. Inspections work is important to career advancement in the FBI. To become an Assistant Special Agent in Charge (ASAC), an agent must obtain inspection certification. This requires the agent to participate in at least five inspections and one OPR investigation.

  25. FBI Strategic Plan (2004-2009), App. C at 129, available at: at Reports and Publications.

  26. Program managers administer "substantive" offices (division, sections, units) at FBI Headquarters in areas such as cyber, criminal, and counterterrorism.

  27. According to the Inspections Guidebook, an important component of Inspection Division audits is to determine whether the inspected "entity has complied with significant laws and regulations applicable to the program." Inspections Guidebook at 20 (2000).

  28. According to the Inspections Guidebook, "effective" means "adequate to accomplish an intended purpose; producing the intended or expected result." "Efficient" means "performing or functioning in the best possible and least wasteful manner; having and using requisite, [sic] knowledge, skill, and industry; competent; capable." Inspections Guidebook at 44-45 (2000).

  29. Inspection Division Program Plan (2004) at 2.

  30. See General Crimes Guidelines § VI at B-83.

  31. The Inspection Division uses interrogatories and worksheets to collect information concerning investigative programs and squads/Resident Agencies.

  32. The exceptions to this finding are the checklists for undercover operations and electronic surveillance. We note, however, the checklist for undercover operations does not address whether the undercover operation complies with all applicable CUORC stipulations. We recommend that the Inspection Division consider adding this question to its undercover operation checklist. We also suggest that the Inspection Division include in its undercover operation checklist language comparable to the following from the Undercover and Sensitive Operation Unit's undercover operation checklist: "The Group II UCO does not fall into any of the sensitive circumstances, requiring FBIHQ approval, as delineated in Paragraphs A and B of the Attorney General Guidelines on FBI undercover operations. [AGG Section IV, Paragraph C] By my signature, this confirms that no sensitive circumstances exist in this UCO. _____________________ [Signature of USOU Representative]" (emphasis in original).

  33. For example, although each checklist includes sections on "Program Management," the squad/RA checklist only seeks compliance information concerning the supervisory file review required by the MIOG. As we noted in Chapter Three, FBI Headquarters and field officials we interviewed stated that first-line supervisors are uniquely positioned to ensure adherence to the Guidelines. Notwithstanding that widespread view, the Inspection Division squad/RA checklists do not currently capture compliance performance data regarding any of the Attorney General Guidelines.

  34. For example, the Confidential Informant Guidelines include "the commission, or the significant risk of the commission, of any act of violence by a person or persons other than the Confidential Informant" in the definition of Tier I activity. CI Guidelines § I.B.10 at B-9. Our review failed to ascertain any consistent standard by which the FBI was applying this definition, and the Criminal Informant Program checklist does not address this risk assessment.

  35. The Criminal Informant Program checklist was revised in August 2004 to address several issues identified by the OIG, although it was not employed consistently during the remainder of 2004. We found that while the updated checklist was used in an inspection of the Baltimore Field Office in September 2004, the May 2003 version was used in inspections of Sacramento, Boston, and Cincinnati in October and November 2004. We were advised by the Inspection Division that it was not until February 2005 that it began to use the revised checklist in all inspections.

  36. We are not suggesting that the nature of the Guidelines revisions alone necessitated extensive rewriting of the checklists. Rather, the changes to the Guidelines could have refocused attention on the content of the checklists and resulted in the filling of important information gaps that existed at the time.

  37. In the course of this review, A/IU generated a revised checklist for use by the Inspection Division that addresses the CSR&R requirement. As explained supra, it was not used consistently by the Inspection Division until February 2005.

  38. A self-inspection of the St. Louis Criminal Informant Program in 2003 found a non-compliance rate of 58 percent. The 2004 inspection revealed that during the 2001-04 inspection period, the St. Louis Criminal Informant Program had five different program managers and three different Informant Coordinators, the last of whom reported that he was only able to devote five percent of his time to the Program due to his extensive collateral duties.

  39. In response to a draft of this report, the FBI correctly noted that its performance appraisal process for Special Agents, SSAs, and ASACs does not allow for narrative evaluations and, according to the FBI, "[t]herefore, there is little ability by which to distinguish superior compliance performance in an employee's Performance Appraisal Report (PAR). . . . [D]eficient compliance performance would only be reflected if it was sufficiently significant to warrant a rating of 'Does Not Meet Expectations' for the critical element which pertains to compliance performance."

  40. For a description of the role of the confidential file room analyst, see discussion supra at n.200.

  41. The "frequency" of violations described here understates the actual number of violations contained in the files reviewed by the Inspection Division. In some cases, the Inspection Division did not identify in its report or supporting Criminal Informant Program electronic communication the number of files that contained deficiencies. For example, in the Cleveland Criminal Informant Program audit several categories of deficiencies were described as "inveterate," meaning they appeared in every applicable file reviewed. Such information is not captured in Table 7.5. In addition, the Inspection Division often reports that multiple errors are contained in a single file, which may include multiple errors of the same type. Table 7.5 represents these as a single file violation.

  42. Undercover operations that involve any of the "fiscal circumstances" enumerated at § IV.C.1 of the Undercover Guidelines require special approvals.

  43. Inspection Division Program Plan (2004) at 1.

  44. See Electronic Communication from the FBI General Counsel, March 19, 2004.

  45. It also makes it more difficult to determine whether the remedies should involve referral to the FBI's Internal Investigations Section. Without knowing the cause of a deficiency, it is not possible to evaluate whether it was performed knowingly or recklessly. See e.g., OPR offense codes 1.5 and 1.8 which address the knowing or reckless failure to abide by an FBI or DOJ operational guideline or policy.

  46. The Informant Guidelines require the FBI to establish procedures that ensure "that compliance with these Guidelines is considered in the annual performance appraisal of its agents." Informant Guidelines, § I.I. See also discussion supra Chapter Three describing the FBI's failure to account for compliance with the Informant Guidelines in these appraisals.

  47. Inspection reports contain a section that describes the inspection's findings concerning the performance of the field division's executive managers, including whether they are "effective" and "efficient."

  48. The Program Plan stated:

    The Division is sorely lacking advanced automation and information technologies. This has hampered its ability to efficiently perform inspections, audits, and evaluations. . . . Inasmuch as information is the primary product of the Division, automation and information technology is foremost to success.

    Inspection Division Program Plan (1999-2003) at 6-7.

  49. These seven undercover operations were in different field divisions.

  50. As explained supra at Case Study 7.2, the San Francisco Criminal Informant Program reinspection also noted problems with implementation of corrective action, most notably that the SSAs and agents often were ignoring requests from the Criminal Informant Coordinator.

  51. The 7F offense code addresses assets, or intelligence informants, rather than criminal informants. Assets are governed by another set of Attorney General Guidelines that were not examined in this review.

    The FBI revamped its offense codes in the course of implementing recommendations contained in the February 2004 Bell-Cowell Commission report on ways to improve the FBI's disciplinary process. In response to the Bell-Colwell Commission's recommendations, the FBI reengineered OPR's organizational structure and procedures including separating its investigative and adjudicative functions by moving OPR's intake and investigations units to the Inspection Division, relocating the Law Enforcement Ethics Unit in the Training Division, and creating a revised set of offense codes and a consolidated set of penalty guidelines (Penalty Guidelines).

  52. These codes are: 1.5 Asset/CW/ Informant (Source) - Violation of Operational Guidelines and Policies, Other; 1.8 Investigative Deficiency - Violation of Operational Guidelines and Policies, Other; and 5.23 Violation of Miscellaneous Rules/Regulations. The description of Code 1.8, for example, is "[k]nowingly or recklessly failing to enforce or comply with an FBI or Department of Justice (DOJ) operational guideline or policy, not specifically delineated in any other 'Investigative Deficiency' offense codes provided herein, which falls outside the parameters of performance."

  53. See MIOG § 263-2; MAOP I § 13-2.

  54. Because some Inspection Division inspection reports did not identify the case files where deficiencies were found, it is not possible to specify the total number of deficient files evaluated by the Inspection Division. For example, some inspection reports merely stated that a particular kind of deficiency occurred during the inspection period. In addition, even in those circumstances where the case files were identified, the report did not indicate the number of violations found in the files.

  55. We believe that the new offense codes relating to privileged or sensitive sources should be limited to circumstances where the source is providing information based upon his/her privileged or sensitive status. Accordingly, we do not believe that a case agent's mishandling of an attorney informant who was providing information unrelated to legal matters should be covered by the new offense codes.

  56. For example, the Office of the Chief Information Officer stated that it would take approximately two weeks to add a single data field to OPR's case management system. However, that function was completed in a matter of seconds in a demonstration of IIS's new database.

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