#ButNothingsHappening
DEA busted for concealing undercover illegal activities from the AG & Congressional oversight...
DEA busted for concealing undercover illegal activities from the AG & Congressional oversight...
DEA was conducting money laundering & payments to drug cartels for the purpose of investigating those networks. Generating profits off of the illegal activities that were then to be used to fund further operations. 
This is a look at DEA activities in 2015-2017 & highlights how the program was not effectively managed or supervised to minimize 'risks' such as the risks that DEA people might become part of the networks they were supposed to be investigating.
Seems DEA failed to adequately pursue targets involved in the money laundering networks.
They also did not prevent the inappropriate use of funds...
They also did not prevent the inappropriate use of funds...
This audit covered fiscal years 2015-2017, so October 2014-Sept. 2017.
While the program made significant prosecutions, it seems to have let other investigative targets escape.
Sounds very Swampy, like working with some cartels to protect them while busting their competition...
While the program made significant prosecutions, it seems to have let other investigative targets escape.
Sounds very Swampy, like working with some cartels to protect them while busting their competition...
DEA was violating the law & oversight, even leading to DOJ falsely reporting to OIG that all DOJ undercover programs were in compliance with DOJ policies.
DEA would lump a bunch of separate operations under one AG's authorization making it impossible to conduct effective oversight over the individual operations to launder money for drug cartels...
I would not be surprised if these DEA undercover operations were reporting to the Organized Crime Drug Enforcement Task Force (OCDETF) headed by Associate Deputy Attorney General Bruce Ohr during the 2014-2017 timeframe...
He was relieved of those duties in December 2017...
He was relieved of those duties in December 2017...
These DEA undercover money laundering operations were given broad authorization & little to no oversight.
Including a case where it was expanded (without separate authority) to launder money for a narco-terrorist organization.
Including a case where it was expanded (without separate authority) to launder money for a narco-terrorist organization.
In some cases, the DEA ran these money laundering operations for years, without documented predicate for investigative actions & while failing to investigate the money laundering networks involved in the operations.
Then DEA just made up statistics to call the program a success...
DEA failed to coordinate it's activities with other states, feds & foreign law enforcement, making it's activities illegal in other nations too. It was especially lax in accountability of virtual currencies like Bitcoin & others. Allowing potential fraud & theft...
Seems DEA was laundering the money within DEA too, using their money laundering profits to pay for cases not legally authorized as part of the program.
Plus using it to pay for travel, expenses, & equipment without proper oversight.
Plus using it to pay for travel, expenses, & equipment without proper oversight.
DEA was laundering millions of dollars through these networks, but the totals are redacted...
As always the good stuff is redacted...
Details on the different types if undercover money laundering operations that should be approved by the Attorney General & be subjected to proper oversight.
Oh look, they are letting confidential human sources run some of the undercover money laundering operations...
Oh look, they are letting confidential human sources run some of the undercover money laundering operations...
From 2015-2017 DEA 'earned' $8.3M in profit on it's money laundering transactions, which must be a small fraction of the dollars laundered for the cartels & narco-terrorists.
I love footnotes...
So OIG is not vouching for any of these numbers. They are all provided by contracted accountants who work for the AGEO program...
Wonder how good those audits really are?
So OIG is not vouching for any of these numbers. They are all provided by contracted accountants who work for the AGEO program...
Wonder how good those audits really are?
Oh, this was not a complete audit of the program, this was 16 "judgementally selected" cases. Wonder who picked these 16 cases & what cases were not picked for OIG review!
They discuss previous OIG investigations of undercover operations including this one, where a DEA Special Agent extorted virtual currency while conducting a Dark Web undercover assignment & laundered it into his personal account.
There were also 2 prior investigations into a lack of accountability in the DEA confidential human source program & the money it was paying...
The Dark Web case was part of the Silk Road investigation which has lead to a variety of suspected crimes by feds involved in that case...
Still no identification who how the 16 cases were 'judgementally selected' for review. But they coered 31% of DEA's undercover money laundering activities.
Lots of minutia on the authorization processes & procedures. I found this very interesting, DEA has never complied with a requirement to report a financial audit of undercover operations within 180 days of closing to both the AG & Congress.
So why have a contracted auditor & then fail to report the results of audits?
Usually that means the auditing process is not as rigorous as required & just serves as a rubber stamp you can pull out for CYA if you ever get busted...
Usually that means the auditing process is not as rigorous as required & just serves as a rubber stamp you can pull out for CYA if you ever get busted...
The money laundering was allowed to continue for years even after the initial targets could have been disrupted, the DEA failed to investigate targets identified by the investigation & let it's CHS's conduct unvetted money laundering operations.
Here is an example where a case was authorized by the DAAG at DOJ in 2011, but instead of having the DAAG reauthorize every 6 months, they just kept expanding the operation without approval. Laundering $20M for cartels & narco-terrorists.
Another case from 2011, where the suspects were busted in 2013, but the DEA personnel added new targets to the AGEO so they could keep spending the profits from the first operation.
They found 2 cases where AGEOs were kept open from May 2006-August 2017 & April 2005-February 2015 for no legitimate purpose....
Overzealous pursuit in some cases, & just letting the money walk in other cases. Did corruption influence DOJ personnel or AUSAs to not follow the money or seize it in certain cases?
It looks like it is garbage in & garbage out for the DEA system tracking the money. As they allow case agents to input the date which is always inaccurate or incomplete...
DEA case agents tried to excuse not investigating the money laundering targets by saying they were laundering too much money to go after all of them! It would have been too much of a burden to bust them all... Wonder how they picked who to let go?
Wonder if it was the same entities that received a large portion of the laundered cash even though they were only a small percentage of the involved entities?
Did they also let money go to selected entities? And why?
Did they also let money go to selected entities? And why?
This is very interesting, DEA laundered money through 15 entities. Claimed they took down 9 of them but could only produce documents to support that actions were taken against 7. So 6-8 got away, must be the small players right? Wrong!
DEA often left the biggest players escape investigation & could produce no documentation or reasons that they let them get away.
Seems DEA was enabling the laundering of money to purchase aircraft without bothering to determine if they were aiding the cartels in smuggling with those aircraft.
In 2015, AUSA's at DOJ's SDNY approached DEA with their concerns that DEA was letting the largest money laundering entities escape investigation. DEA claimed it was only focused on individual cases, not total participation in money laundering...
In 2017, SDNY tried to target the money launderers that DEA was not investigating. To find DEA agents were failing to document the evidence needed to prove that the financial entities were connected to the drug trafficking operations.
By 2019 ONE DEA office was trying to do that!
By 2019 ONE DEA office was trying to do that!
Seems DEA agents were relying upon their drug profits money laundering human sources to pick the direction & targets of their investigations...
I'm sure that worked out well...
I'm sure that worked out well...
One DEA CHS was caught involved in illegal money laundering transactions related to someone who got busted. So DEA decided to use parallel construction to get evidence to prosecute without exposing the crimes of the their source.
Until 2018, DEA was not even conducting audits of their drug smuggling & money laundering confidential sources to identify what they were doing outside of their DEA operations.
DEA was of course putting together phony statistics to claim the AGEO program was a success.
The Shelf AGEO's are supposed to be small money laundering operations run for operations authorized by Special Agent's in Charge of local DEA offices. But these seem to be long running slush funds & out of compliance in many ways.
It also looks like DEA was keeping local US Attorney's in the dark about their undercover money laundering operations.
OIG checked for legal authorization & concurrence on 49 transnational money laundering cases. Finding only 1 case of documented concurrency by the foreign law enforcement agency involved. Essentially DEA was concealing their money laundering from other involved nations.
DEA's oversight on virtual currency is even worse, even 2 years after an agent was busted stealing $700k in bitcoin from the Silk Road case.
DEA has used the same independent contractor to audit the AGEO program for 20 years & the ones they reviewed did not find any missing money.
BUT the auditors were working off inadequate paper trails to determine how it was really spent. Audit data didn't match transactions...
BUT the auditors were working off inadequate paper trails to determine how it was really spent. Audit data didn't match transactions...
DEA 'manually' enters payments to CHS's in their system. OIG found an error rate of 50% in this process which under reported payments to CHSs, allowing them to be paid more than the $100k annual & $200k lifetime caps on CHS payments.
It looks like OIG selected the list of AGEO's to audit. Based upon reviews of DEA's Inspections Div. (internal affairs) & high risk factors.
DEA's response focuses on the fact they they began trying to fix the problem in 2017 (after 20 years of not fixing it). Remember this was spurred by SDNY investigation money laundering & is likely connected to a lot of the #ButNothingsHappening cases.
All in all a very interesting review, showing that DEA's undercover operations related to drug trafficking & money laundering missed significant opportunties to disrupt money laundering operations. Can't wait to learn more!
@threadreaderapp unroll
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