Investigation of Misconduct and Mismanagement at ICITAP, OPDAT and Crminal Division's Office of Administration

SPEAKERS       CONTENTS       INSERTS

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67–329

2000
INVESTIGATION OF MISCONDUCT AND
MISMANAGEMENT AT ICITAP, OPDAT AND
CRIMINAL DIVISION'S OFFICE OF ADMINISTRATION

HEARING

BEFORE THE

COMMITTEE ON THE JUDICIARY
HOUSE OF REPRESENTATIVES

ONE HUNDRED SIXTH CONGRESS

SECOND SESSION

SEPTEMBER 21, 2000

Serial No. 128

Printed for the use of the Committee on the Judiciary

For sale by the U.S. Government Printing Office

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Superintendent of Documents, Congressional Sales Office, Washington, DC 20402

COMMITTEE ON THE JUDICIARY
HENRY J. HYDE, Illinois, Chairman
F. JAMES SENSENBRENNER, Jr., Wisconsin
BILL McCOLLUM, Florida
GEORGE W. GEKAS, Pennsylvania
HOWARD COBLE, North Carolina
LAMAR S. SMITH, Texas
ELTON GALLEGLY, California
CHARLES T. CANADY, Florida
BOB GOODLATTE, Virginia
STEVE CHABOT, Ohio
BOB BARR, Georgia
WILLIAM L. JENKINS, Tennessee
ASA HUTCHINSON, Arkansas
EDWARD A. PEASE, Indiana
CHRIS CANNON, Utah
JAMES E. ROGAN, California
LINDSEY O. GRAHAM, South Carolina
MARY BONO, California
SPENCER BACHUS, Alabama
JOE SCARBOROUGH, Florida
DAVID VITTER, Louisiana

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JOHN CONYERS, Jr., Michigan
BARNEY FRANK, Massachusetts
HOWARD L. BERMAN, California
RICK BOUCHER, Virginia
JERROLD NADLER, New York
ROBERT C. SCOTT, Virginia
MELVIN L. WATT, North Carolina
ZOE LOFGREN, California
SHEILA JACKSON LEE, Texas
MAXINE WATERS, California
MARTIN T. MEEHAN, Massachusetts
WILLIAM D. DELAHUNT, Massachusetts
ROBERT WEXLER, Florida
STEVEN R. ROTHMAN, New Jersey
TAMMY BALDWIN, Wisconsin
ANTHONY D. WEINER, New York

THOMAS E. MOONEY, SR., General Counsel-Chief of Staff
JULIAN EPSTEIN, Minority Chief Counsel and Staff Director

C O N T E N T S

HEARING DATE
September 21, 2000

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OPENING STATEMENT

    Hyde, Hon. Henry J., a Representative in Congress From the State of Illinois, and chairman, Committee on the Judiciary

WITNESSES

    Fine, Glenn, Acting Inspector General, Office of Inspector General, United States Department of Justice

    Holder, Eric, Deputy Attorney General, United States Department of Justice

LETTERS, STATEMENTS, ETC., SUBMITTED FOR THE HEARING

    Fine, Glenn, Acting Inspector General, Office of Inspector General, United States Department of Justice: Prepared statement

    Holder, Eric, Deputy Attorney General, United States Department of Justice: Prepared statement

    Jackson Lee, Hon. Sheila, a Representative in Congress From the State of Texas: Prepared statement

APPENDIX

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    Material submitted for the record

INVESTIGATION OF MISCONDUCT AND MISMANAGEMENT AT ICITAP, OPDAT AND CRIMINAL DIVISION'S OFFICE OF ADMINISTRATION

THURSDAY, SEPTEMBER 21, 2000

House of Representatives,
Committee on the Judiciary,
Washington, DC.

    The committee met, pursuant to call, at 10:05 a.m., in Room 2141, Rayburn House Office Building, Hon. Henry J. Hyde (chairman of the committee) presiding.

    Present: Representatives Henry J. Hyde, F. James Sensenbrenner, Jr., George W. Gekas, Howard Coble, Bob Barr, Asa Hutchinson, Edward A. Pease, Chris Cannon, Joe Scarborough, John Conyers, Jr., Howard L. Berman, Zoe Lofgren, Sheila Jackson Lee, Maxine Waters, and William D. Delahunt.

    Staff present: Daniel M. Freeman, parliamentarian-counsel; Joseph Gibson, chief counsel; William Moschella, chief investigative counsel; Kirsti Garlock, counsel; Steve Pinkos, counsel; Sheila F. Klein, executive assistant to general counsel; Amy Rutkowski, staff assistant; James B. Farr, financial clerk; Sharon L. Hammersla, information resources manager; Blaine Aaron, professional staff member; Perry Apelbaum, minority general counsel; Ted Kalo, minority counsel; and Mathew Nosanchuk, minority special counsel.

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OPENING STATEMENT OF CHAIRMAN HYDE

    Mr. HYDE. The committee will come to order.

    A quorum being present, not quite, I shouldn't say a quorum being present, but this is a quorum for a hearing. Mr. Gekas serves as a quorum, among other things.

    The Committee on the Judiciary will come to order. Today we hold an oversight hearing on the recently released Justice Department Office of Inspector General report entitled ''An Investigation of Misconduct and Mismanagement at ICITAP, OPDAT and the Criminal Division's Office of Administration.''

    We have several distinguished witnesses here to assist the committee in understanding how the problems uncovered by the Office of Inspector General occurred, why the warning signs were ignored or dismissed, and what will be done to correct these egregious findings of misconduct and mismanagement.

    The 415-page report is troubling. Senior managers at the Department of Justice, the folks who wear the white hats, engaged in potentially criminal misconduct and serious mismanagement, and other senior managers paid no attention to the problems. According to this report, security violations, visa fraud, financial mismanagement, abuse of the travel rules and regulations for self-aggrandizement, preselection and favoritism for some employees, were the norm in the Criminal Division's international criminal investigative training assistance program and Office of Overseas Prosecutorial Development, Assistance and Training.

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    The facts and findings described by the Inspector General make ICITAP sound more like a daytime soap opera than an office in the vaunted Criminal Division. It is truly ironic that a program intended to foster human rights and professionalism by training foreign police agencies in new and emerging democracies was rife with mismanagement, corruption and disregard for department rules and regulations.

    I won't summarize the findings of the report now. That will be done by our witnesses, but I want to highlight the problems of security for a moment.

    The IG's investigation reveals long-standing and extensive security violations at ICITAP. The IG found a pattern and practice of improper disclosure handling and storage of classified documents. In fact, many of these problems were known after security reviews in 1994 and 1996. The IG identified numerous disclosures of classified materials to individuals not cleared to receive them. The IG found abundant evidence of improper handling and storage of classified materials at ICITAP's Headquarters.

    For example, classified documents were filed in unclassified files in unsecured locations. The ICITAP secure room, which was oftentimes left open, contained open safes that stored classified materials. I am shocked that security procedures were so sloppy. Who knew about the earlier security warnings? What was done to correct the problems? Why did the situation only get worse? What assurances can the Department give this committee that this type of reckless disregard for security will not be tolerated and that the same types of problems do not exist elsewhere in the Department?

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    Someone was asleep at the switch on the issues of security, and it is this committee's job to demand accountability and corrective action from the Department's senior officials.

    The OIG report does a fine job laying out the facts. However, it does not answer the basic questions that will help fix the long-standing problems at ICITAP. The report does not answer the question why and how security problems went unaddressed for years. It does not explain why or how Bob Bratt, the executive officer in the Criminal Division, was able to authorize his own travel, preselect employees from a bar he and other ICITAP managers apparently frequented, or why contractors were given free reign within ICITAP. Why did the Justice Management Division miss problems that they are charged with the responsibility of overseeing?

    The report lays out the facts, but does not answer those essential questions and others that we will seek answers to today.

    I want to say a word about the whistleblowers who had the courage to come forward and tell the Inspector General what they knew. But for their courage, the Inspector General would not have uncovered the problems that we will review today. I believe they deserve our thanks. I can tell you that they felt intimidated and scared over the last several years. A couple of the whistleblowers have cases pending before the Office of Special Counsel. I trust the Department will do the right thing with regard to the whistleblowers whose allegations have been largely substantiated by the Office of Inspector General.

    I now turn to Mr. Conyers for his opening statement.

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    Mr. CONYERS. Good morning, Mr. Chairman. Good morning, members of the Department of Justice, the Inspector General. We have got everybody here but Ms. Reno.

    This is apparently a pretty large issue that is before us, and I am glad the chairman and I are concerned enough to pursue it to see where this leads.

    Now, we have troubling allegations in the Inspector General's report, and it appears some people in the Department of Justice abused their positions as Government employees and there was a breakdown in following the established Government policies. But there should be some credit given institutionally to the Department of Justice, which has responded, and that those, as I understand it, who have engaged in wrongdoing are being appropriately sanctioned seriously.

    Indeed, this report that is before us is the product of the Department of Justice's ability to oversee itself and discipline its own where it is appropriate.

    Now, the Department of Justice, like every other employer, from time to time, has a few employees who commit wrongdoing. When the Department learned about the bad apples, it took steps to deal with the problem. This may not be Monday morning quarterbacking, but these essential facts will not change.

    So I, as do other members, value oversight activity, but that is about all we did on the Government Operations Committee, which I chaired for 6 years, and I take a back seat to no one in vigorous oversight of the executive branch, regardless of party.

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    Now, in another administration, we found the Department of Energy was the Nation's worst polluter, the savings and loan bailouts could have cost one-third less than the billions of tax money that were used, and we uncovered examples of billions of dollars of waste, fraud and abuse. That is appropriate oversight function.

    My concern this morning, though, may be centered around the fact that oversight seems to have descended into the trivial at the expense of far more legislative items that might otherwise be on this very important committee's agenda.

    I am reminded that Chairman Hyde said at one time earlier that he was going to take apart the Justice Department, and he used some words that were from A to Z. I don't know if that is what we are doing this morning, but this does not seem to be the largest subject matter we could be looking at.

    Meanwhile, we ignore some very, very large issues that are waiting. The shooting spree, for example, I remind the committee, by white supremacist, Benjamin Smith, in the Midwest, and the horrific deaths of Billy Jack Gaither in Alabama earlier this year and the 1998 deaths of James Byrd in Texas and Matthew Shepard in Wyoming, serve as painful reminders of the numerous acts of violent hate that coarsen our culture and poison our society. So I am urging that we go into the closet of our committee and get the hate crimes legislation that is still waiting at this late hour to be dealt with; a hearing, maybe, moving it out of the committee.

    Countless African Americans and other minorities, on another issue, are stopped on the Nation's roads and highways and wrongfully harassed by law enforcement simply because of the color of their skin. So my racial profiling legislation affects people from all walks of life, teenagers, lawyers, doctors, celebrities, blue-collar workers. But although we have sent it out of the committee, we have never had a vote on this bill in the House of Representatives.

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    Across the country, many hard working citizens are denied job opportunities, fired or otherwise discriminated against, for reasons that have nothing to do with their performance or abilities. Employment discrimination based on sexual orientation, whether it is real or perceived, effectively denies qualified individuals equality and opportunity in the workplace. Those who experience this form of discrimination have no recourse under current Federal law or under the Constitution as it has been interpreted by our courts. Yet, this committee has refused to even give so much as a hearing on the Employment Nondiscrimination Act.

    Firestone tires have caused a number of deaths and injuries and the toll keeps climbing. So rather than exploring ways to make the courts more accessible to those injured consumers and families who have lost loved ones because of apparent corporate wrongdoing, the majority here has pursued an agenda of capping the compensation available to consumers. This committee has sought to immunize some of these wrongdoers from responsibility for their actions.

    Last item, the thousands of people who reach our shores every year seeking refuge from persecution and brutality abroad. What happens? Well, under the 1996 immigration law, judicial review of immigration decisions, a cornerstone of our democratic society, was eliminated. The committee, however, has refused to even have hearings, which might hopefully be followed with a markup, but none on the immigration fairness issues and the fix the '96 immigration legislation. It is still pending.

    So my dear chairman and colleagues, it appears the Department of Justice employees investigated by the Inspector General selfishly used their government authority for their personal gain. But with so much of our work left undone, I have to ask, does this really warrant one of our last full committee hearings? It may be the last one in the 106th Congress.

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    I thank the chairman for his indulgence.

    Mr. HYDE. Well, I thank the ranking member for his comments.

    Mr. GEKAS. Mr. Chairman?

    Mr. HYDE. Yes, just a minute. By way of response, I think this report of the Inspector General, 415 pages relating gross mismanagement, visa fraud, national security leaks, is worth our time. Now, the gentleman from Michigan has another agenda, I understand that. I have always understood that. And when he becomes chairman, notice I said when he becomes chairman, his agenda will prevail.

    Meanwhile——

    Mr. CONYERS. Thank you, Mr. Chairman.

    Mr. HYDE. You bet. I look forward to that. We are going to pursue the Inspector General's report. We think these are serious matters, not trivial.

    Mr. CONYERS. Mr. Chairman, could you just yield briefly?

    Mr. HYDE. Surely.

    Mr. CONYERS. I don't mean to get in any kind of contest with you. I don't present my issues to the Judiciary Committee based on me being chairman or not. I bring them forward as one of the 30-some odd members on the committee. I hope that no matter who is the chairman, and I respect and have worked very closely with you——

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    Mr. HYDE. You have indeed.

    Mr. CONYERS. [continuing.] Across the several years, but this is not meant to suggest that we should not hold this hearing. I would just like to bring forward that we could also be doing some of these things, which I don't think you are opposed to or are being held back deliberately.

    Mr. HYDE. Not at all. We just ran out of time.

    Mr. CONYERS. Well, that was the nature of my comments, about which things deserve consideration when you run out of time, and it is your last hearing, sir.

    Mr. HYDE. All right, I thank you.

    The gentleman from Pennsylvania.

    Mr. GEKAS. Yes. Although the chairman usually in these types of settings does not accord opening statements to members, and I understand that, and that is proper, I too am a little bit miffed by the gentleman from Detroit who insists, it seems to me, on casting appall over this hearing. This is an important oversight hearing. Yet what he tries to do is to divert attention and say this is meaningless, what are we wasting time for with this oversight hearing when we have so many other problems that he sees need attention.

    I have 100 other issues myself that I think are important and should be looked at generously by this committee, but we find that the minority many times poses obstacles to even that. So let us do what we are set out to do here, check the oversight responsibilities with respect to the issue at hand, and relegate the concerns of the gentleman from Michigan to another time and another forum.

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    Mr. HYDE. All right, I will recognize the gentleman from Michigan for, as they say on the talk shows, the last word.

    Mr. CONYERS. Well, thank you, Mr. Chairman. I was going to ask Mr. Gekas to yield to me.

    I don't see the Judiciary Committee as functioning as either-or. I don't see the Chair, regardless of whatever political affiliation, putting only his measures before the committee, especially if we are in one of the last hearings, if not the last hearing.

    I thought, and this is the way it happened in the only committee I have ever chaired, that we worked together on this. This is not a Republican Judiciary Committee or a next semester Democratic Judiciary Committee, it is a committee for everybody. It is a committee for all the members, particularly the ranking member and the chairman, to bring their concerns to each other.

    Now, if we pick what we think is important and you pick what you think is important, well, fine, let us have at it, and this is the last one, and that was why I would use this opportunity on the last hearing to point out the way I thought it might have been more collegially run in the committee, that we shared these responsibilities. It is not an all-Republican committee because there are three more Republicans than Democrats.

    I thank you again for the last word.

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    Mr. HYDE. Well, thank you Mr. Conyers. I just hope to enhance the collegiality, such as remains up here, before we do close the door and turn out the lights.

    Mr. CONYERS. Okay.

    Mr. HYDE. All right. We are very fortunate to have Mr. Glenn Fine with us today. Mr. Fine has worked for the Department of Justice office of Inspector General for more than 5 years. First as a special investigative counsel, and then for 4 years as director of the Office of Special Investigations and review unit. Since August of this year, he is acting Inspector General.

    Prior to his work at the Office of the Inspector General, Mr. Fine served for 3 1/2 years as an Assistant United States Attorney in Washington, DC where he handled numerous criminal prosecutions, grand jury investigations and appeals.

    He also worked for 5 years as an attorney in a private law firm in Washington. He is a graduate from Harvard College magna cum laude with an AB degree in economics. At Harvard College, Mr. Fine was captain of the Harvard basketball team and was drafted by the San Antonio Spurs of the National Basketball Association. He earned BA and MA degrees from Oxford University where he was a Rhodes Scholar. He received his law degree magna cum laude from Harvard Law School.

    We also have with us today Mr. Eric Holder. He currently is the Deputy Attorney General for the United States Department of Justice and served in this capacity since he was sworn in July 18, 1997. As Deputy Attorney General, Mr. Holder is responsible for the supervision of the day-to-day operations of the Justice Department. Prior to holding this position, Mr. Holder was the United States Attorney for the District of Columbia for 4 years, nearly 4 years. Before that, he served as an associate judge of the Superior Court of the District of Columbia, where Judge Holder presided over hundreds of criminal trials.

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    Mr. Holder graduated from Columbia College in 1973 and Columbia Law School in 1976. After his graduation, he joined the Department of Justice as part of the honors program and worked in the public integrity section. He remained at Justice until his appointment as an associate judge.

    James K. Robinson is currently Assistant Attorney General for the Justice Department's Criminal Division, a position he has held since his appointment in June of 1998. Mr. Robinson received his juris doctor degree magna cum laude from Wayne State University Law School in 1968, where he was editor in chief of the Wayne Law Review. He has been a member of the Michigan Bar since 1968, clerked for the United States Court of Appeals for the 6th Circuit, practiced law for many years and was the United States Attorney for the Eastern Districts of Michigan from 1997 to 1980. During 1990 and 1991, Mr. Robinson served as president of the State Bar of Michigan, and from 1993 to 1998 he served as a member of the Committee on Rules of Evidence of the United States Judicial Conference by appointment of Chief Justice Rehnquist.

    Just prior to coming to the Department of Justice, Mr. Robinson was dean and professor of law at Wayne State University law school during which time he coauthored a treatise and courtroom handbook on the Michigan Rules of Evidence.

    Steven R. Colgate is the Assistant Attorney General for Administration, and as such, is the head of the Justice Management Division. In this position, he is responsible for virtually all administrative and management programs within the Department. Prior to this position, Mr. Colgate was Deputy Assistant Attorney General for personnel and administration. During his career at Justice, he served the Department in numerous director or management capacities. He graduated with distinction from the University of Arizona in 1975 and obtained a masters degree in public administration from American University in 1976.

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    Mr. Colgate has received numerous awards for his service to the Department, including exceptional service awards, Attorney General's distinguished service awards and meritorious executive and distinguished executive presidential rank awards.

    Mr. John C. Keeney is currently the Deputy Assistant Attorney General in the Department of Justice's Criminal Division. He joined the Department in 1951 after serving in the United States Army Air Force as a navigator and graduating from the University of Scranton with a bachelor of science degree and the Dickinson School of Law with an LLB. He received his LLM from the George Washington School of Law in 1953, and prior to serving in his present capacity as Deputy Assistant Attorney General since 1973, he served as head of the Smith Act Unit of the Internal Security division, the deputy chief of the organized crime and racketeering section of the Criminal Division, chief of the fraud section of the Criminal Division, and an acting Assistant Attorney General for extended periods of time.

    Mr. Keeney additionally served as the Justice Department's representative in negotiations on the treaty on mutual assistance in criminal matters in Switzerland. Mr. Keeney is a member of the Pennsylvania and the District of Columbia Bars, is married and has five children.

    On behalf of the entire Judiciary Committee, I would like to thank you all for being here today so that we can get to the bottom of these very important issues as raised in the Inspector general's report.

    With that, I now turn to acting Inspector General Fine, and then we will hear from Deputy Attorney General Holder.

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    Mr. HYDE. Mr. Fine.

STATEMENT OF GLENN FINE, ACTING INSPECTOR GENERAL, OFFICE OF INSPECTOR GENERAL, UNITED STATES DEPARTMENT OF JUSTICE

    Mr. FINE. Mr. Chairman, Congressman Conyers, members of the Committee on the Judiciary.

    Thank you for inviting me to appear before the committee to discuss the Office of the Inspector General's investigation into allegations of misconduct and mismanagement at three offices in the Department of Justice's Criminal Division.

    Because my written statement will be in the record, I will try to summarize the full statement and the OIG report in the 15 minutes that have been allotted to me.

    In the OIG's investigation, we examined activities in ICITAP, known formally as the International Criminal Investigative Training Assistance Program, which provides training for foreign police agencies in emerging democracies.

    We also examined the activities of OPDAT, the Office of Overseas Prosecutorial Development, Assistance and Training, whose mission is to coordinate the training of prosecutors and judges in certain foreign countries. In addition, we examined the activities of the Criminal Division's Office of Administration, which handles the administrative functions for the Criminal Division, including personnel, budget, information technology, and procurement matters. Although ICITAP and OPDAT are part of the Department of Justice, their programs are funded by the Department of State.

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    ICITAP has had a history of turmoil. In 1994, the supervision of ICITAP was transferred from the Deputy Attorney General's office to the Criminal Division. In 1994, the OIG conducted two reviews into allegations of misconduct at ICITAP. These reviews found some wasteful and questionable practices and weaknesses in planning and communications, but not misconduct. Between 1994 and 1997, four different individuals served as ICITAP's director or acting director.

    The OIG investigation that forms the basis of this report began when an OPDAT employee reported to the Department's security staff in 1997 that a senior manager at ICITAP had provided classified documents to persons who did not have security clearances. The Department's security staff and the OIG confirmed the allegation.

    We continued our investigation to determine the extent of security problems at ICITAP, and we later received numerous allegations regarding failures to follow or enforce government rules on ethics, security, travel and contracts at ICITAP, OPDAT and the Office of Administration.

    Many of the allegations we investigated concerned the actions of Bob Bratt, a senior department official who was the Criminal Division's Executive Officer in charge of its Office of Administration. At different times between 1995 and 1997, Mr. Bratt served as the acting director of ICITAP or the coordinator of both ICITAP and OPDAT.

    During the course of our investigation, we interviewed several hundred witnesses, most in Washington, DC, but some in Haiti and Russia. In addition, the OIG team reviewed thousands of pages of documents. In light of this overview, I will now summarize the major findings of our 415-page report.

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    We investigated an allegation that Mr. Bratt and Joseph Lake, the Criminal Division's former associate executive officer, improperly used their government positions to obtain visas for two Russian women who Bratt met on his government trips to Moscow and with whom Bratt developed a social relationship. The women received visas to visit the United States because Lake submitted their applications using the ''referral process'' available only to embassy officials and only if the visas directly support United States national interests.

    We determined that the submitted visa referral form contained false and misleading statements. The form was signed ''Joseph Lake for BB'' and listed Bratt's Department of Justice telephone number. It stated that the women ''have worked with the executive officer of the Criminal Division in support of administrative functions.'' That was false. Neither woman had ever worked for the Criminal Division or Bratt.

    Based on our investigation, we concluded that Bratt and Lake used the visa referral process even though they were aware that it required a government interest in the women's visit and that no such government interest existed. Although Bratt and Lake both denied knowingly misusing the visa process, we did not find their explanations and denials credible. We concluded that both committed egregious misconduct in obtaining visas for the two women.

    In March 1998, after Bratt had refused to answer further questions from the OIG, we referred the visa matter to the United States Attorney's Office for the District of Columbia for a prosecutive decision. That office declined prosecution and Bratt was compelled to provide further answers to our questions. We thereafter continued to pursue this matter administratively.

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    Our report also addresses the security implication raised by Bratt's involvement with the Russian women. Mr. Bratt held a high level security clearance. Despite knowing little about the Russian women, he socialized with them, developed a relationship with one that he later admitted was intimate, invited them to visit him in the United States, and improperly helped them obtain visas, even after he had been told one of them had been denied a visa on a prior occasion. He also did not report his conduct with the women to the Department of Justice's security office in a timely fashion as required by department policy, and when he did report it, he failed to fully describe the relationship. We concluded that Mr. Bratt's actions in this matter left him vulnerable to blackmail and represented a security concern.

    We also investigated ICITAP's security practices. The security problems we found were pervasive, recurrent and persistent. For example, we found that senior ICITAP managers provided or attempted to provide classified documents to uncleared ICITAP consultants or other staff. ICITAP employees, including senior managers, routinely left classified documents unsecured in or on their desks, even when they were away from their offices on travel. We found one instance where classified information was sent over an unsecured e-mail system.

    ICITAP managers also improperly took classified documents home to review. Highly classified documents containing sensitive compartmented information, or ''code word'' information, were brought to the ICITAP offices, even though ICITAP did not have the type of secure facility required to read or store such material.

    In our report, we also detail the troubling history of ICITAP associate director Joseph Trincellito's handling of classified information. We found that his violations were repeated and flagrant and that ICITAP managers failed to take sufficient action, such as initiating discipline to ensure that he complied with the security regulations.

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    We concluded that ICITAP managers' own violations of the security rules and their tolerance of known violations sent a message that security of classified documents was not important at ICITAP. In addition, we concluded that the Criminal Division had not adequately monitored ICITAP's security program, even though security reviews conducted by both the Department and the Criminal Division beginning in 1994 showed a pattern of security violations.

    We found that Bratt and other ICITAP and OPDAT managers violated government travel regulations in a variety of ways, including by flying business class without authorization and by using frequent flier miles accrued on government travel for personal purposes. We also found that the Justice Management Division, which is responsible for auditing travel vouchers, did not question the use of business class travel by Bratt or other managers who accompanied him, even when the lack of authorization for business travel was apparent on the face of the travel documents.

    Our report also discusses Joseph Lake's March 1997 retirement from the Justice Department after he received a $25,000 bonus to retire as part of a government wide buyout program. The day he retired, Mr. Lake was in Moscow on OPDAT business. The following day, he began working for OPDAT as a consultant. He also worked as a consultant to the INS beginning in May 1997. We concluded that at OPDAT and INS after his retirement, Mr. Lake performed personal services for the government in violation of the buyout program. We concluded that he should be required to repay his $25,000 bonus payment.

    We also examined a contract OPDAT used to hire Jo Ann Harris, the former head of the Criminal Division, to organize, moderate and evaluate three conferences that OPDAT was planning to hold in Budapest, Hungary, and to develop curriculum for OPDAT training programs. We concluded that Bratt's hiring of Harris to work on the conference did not violate ethical rules. However, we believe that hiring her for curriculum development on a sole-source basis created the appearance of favoritism.

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    We also concluded that the way OPDAT handled her hiring created the appearance of favoritism. We concluded that the lack of a clear record setting forth the basis of her fee raised the appearance that she was given preferential treatment by her former subordinates.

    In the areas of personnel and financial management, we found that ICITAP and OPDAT managers failed to adequately distinguish between government employees and contractor personnel, and at times misused contractors. For example, ICITAP and OPDAT used contractors as managers, directed its contractors to hire specific persons, and often allowed consultants to begin work at ICITAP before their statements of work were issued. We found that ICITAP did not pay sufficient attention to the services its contractors provided and left itself vulnerable to overcharges.

    In one instance, a contractor notified ICITAP that it was unilaterally raising one of its fees, an action not permitted by the contract. Despite this notice, ICITAP did nothing for 2 years, until a Justice Management Division contracting officer noticed the overcharge.

    In another case, ICITAP's lack of planning led to a $16,000 translation budget for an OPDAT conference to balloon to more than $120,000 in costs because of unnecessary and expedited requests for translation services.

    We carefully examined one contractor hired by the Criminal Division in 1991 and 1996 to provide computer support services. We found that Criminal Division managers failed to adequately supervise these contracts and that the contractor overcharged the government more than $1 million for the services of personnel who were unqualified under the terms of the contract.

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    We did not substantiate several other miscellaneous allegations we received. These included allegations raised by four employees that ICITAP, OPDAT or Criminal Division managers retaliated against them because they complained about actions taken by managers, or because they provided information to the OIG during this investigation.

    Our report offers a series of recommendations to the Department, including that certain employees receive discipline and that the Department seek repayment from employees and former employees who improperly received money or benefits from the Department.

    Mr. Bratt retired from the Department effective August 1, 2000, and therefore is not subject to discipline. We recommend that the Department recover the costs of his improper use of business travel and frequent flier miles which we estimate at more than $11,000. Similarly, Mr. Lake is no longer employed by the Department and is not subject to discipline. We recommend that the Department recover his $25,000 buyout bonus.

    We also recommend discipline ranging from reprimand to suspension for three current Department employees and repayment of money for travel abuses.

    In addition, we recommend that the Department's security staff and other agencies responsible for issuing security clearances carefully consider the findings and conclusions set forth in this report before issuing security clearances to the individuals involved in the security breaches.

    With respect to systemic improvements, we make several recommendations relating to oversight of ICITAP and OPDAT, security, travel, training, performance evaluations, and early retirement programs.

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    For example, we recommend that the Department continue high level supervisory meetings between the Department of Justice and Department of State to coordinate and monitor the work of ICITAP and OPDAT. We believe, however, that this oversight should be in addition to and not a substitute for rigorous oversight of ICITAP and OPDAT by the Criminal Division.

    We also recommend that the Department continue to monitor ICITAP's progress in addressing security issues and provide training to both new and experienced staff who handle classified information.

    We recommend that the Department review the procedures for auditing travel vouchers and provide additional training on travel regulations to employees who travel and to staff who process travel-related paperwork.

    In conclusion, we found that at various periods between 1995 and 1997, none of the Criminal Division managers with the closest connection to ICITAP believed they were responsible for supervising ICITAP. We also found that, to some extent, staff at ICITAP and OPDAT believed their offices were somehow different or exempt from the rules that applied to employees in the rest of the Department of Justice.

    ICITAP now has a new director and there is a new coordinator for ICITAP and OPDAT. Because our investigation primarily concerns allegations of improprieties and mismanagement that occurred from 1995 through early 1998, we have not reviewed the changes made by the current management. Our sense, however, is that improvements have been made in several areas, including security. But we believe that attitudes and practices that have been ingrained for years are not likely to disappear simply with the introduction of a few new managers. Consequently, we believe that the leadership of ICITAP and OPDAT and their supervisors in the Criminal Division must be vigilant to ensure that staff at ICITAP and OPDAT adhere to department rules and standards.

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    A final lesson to be taken by our investigation is the ease with which managers and employees can slip from carelessness to misconduct. In this investigation, we found that some employees rationalized their conduct by noting they worked hard, they were focusing on other issues, they deserved certain benefits, or that the regulations they operated under were burdensome. We found during this investigation that the occasional bending of rules became a way of doing business by some employees at ICITAP, OPDAT and the Office of Administration. We believe that department managers need to be vigilant to avoid these attitudes, which can easily lead to the problems we found during the course of this investigation.

    That concludes my oral statement, Mr. Chairman. I would be glad to answer any questions.

    Mr. HYDE. Thank you, Mr. Fine.

    [The prepared statement of Mr. Fine follows:]

PREPARED STATEMENT OF GLENN FINE, ACTING INSPECTOR GENERAL, OFFICE OF INSPECTOR GENERAL, UNITED STATES DEPARTMENT OF JUSTICE

    Mr. Chairman, Congressman Conyers, and Members of the Committee on the Judiciary:

I. Introduction and Background

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    Thank you for inviting me to appear before the Committee to discuss the Office of the Inspector General's (OIG) investigation into allegations of misconduct and mismanagement at three offices in the Department of Justice's Criminal Division. In this review, the OIG examined activities in ICITAP (known formally as the International Criminal Investigative Training Assistance Program, an office that provides training for foreign police agencies in new and emerging democracies), OPDAT (the Office of Overseas Prosecutorial Development, Assistance and Training that trains prosecutors and judges in foreign countries in coordination with United States Embassies and other government agencies), and the Criminal Division's Office of Administration.

    ICITAP was created in 1986 and although it is part of the Department of Justice, the Department of State funds its programs. OPDAT, created in 1991, is similarly funded. Both ICITAP and OPDAT are headed by Directors, with a Coordinator overseeing the management of both organizations. The Criminal Division's Office of Administration handles the administrative functions for the Criminal Division, including personnel, budget, information technology, and procurement matters. The Executive Officer heads the Office of Administration.

    ICITAP had a history of turmoil even prior to the time period we examined in this review. Four different individuals served as Director or Acting Director between 1994 and 1997. During that period, the OIG conducted two reviews into allegations of misconduct and the Criminal Division examined ICITAP's organizational structure and financial systems. The OIG's 1994 reports found some wasteful and questionable practices and weaknesses in planning and communications, but not misconduct.

    The OIG investigation that formed the basis of this report began in 1997 when an OPDAT employee reported to the Department's security staff that an ICITAP senior manager had provided classified documents to persons who did not have security clearances. The Department's security staff and the OIG confirmed the allegation. The OIG continued the investigation to determine the extent of security problems at ICITAP and later broadened the investigation after receiving numerous allegations regarding failure to follow or enforce government rules on ethics, security, travel, and contracts at ICITAP, OPDAT, and the Office of Administration.

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    Many of the allegations concerned the actions of Robert K. Bratt, a senior Department official who was the Criminal Division Executive Officer in charge of the Office of Administration. At different times between 1995 and 1997, Bratt served as the Acting Director of ICITAP and the Coordinator of both ICITAP and OPDAT before he was detailed to the Immigration and Naturalization Service (INS) in April 1997.

    The OIG investigative team was led by an Assistant United States Attorney from the Eastern District of Pennsylvania on detail to the OIG and composed of OIG investigators, auditors, an inspector, and a program analyst. In addition, an employee from the Department of Justice security office and a special agent from the Department of State assisted with certain aspects of the investigation.

    We interviewed several hundred witnesses in the course of this investigation, most in Washington, D.C. but also in other cities in the United States and abroad. In order to fully investigate several of the more serious allegations, OIG investigators traveled to Haiti and Russia to interview witnesses. In addition, the OIG team reviewed thousands of pages of documents.

    We found that Bratt and other managers committed serious misconduct. As a result of our substantiating many of the allegations, we recommend discipline or repayment of funds for six employees or former employees. We also recommend that the Department of Justice consider systemic improvements to enhance the performance of other managers, employees, and offices.

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    Our complete 415-page report contains 11 chapters and several exhibits. In this written statement, I will summarize our major findings.

II. Issuance of Visas to Russian Women

    Bratt made four trips to Russia in late 1996 and 1997 in conjunction with his duties as Coordinator of ICITAP and OPDAT. We received several allegations of impropriety relating to these trips, the most serious being that Bratt and Criminal Division Associate Executive Officer Joseph R. Lake, Jr. improperly used their government positions to obtain visas for two Russian women.

    Russians seeking to visit the United States in 1997 had two methods of obtaining visas from the American Embassy in Moscow: the standard process and the ''referral'' process. The standard process could be used by any Russian seeking to visit the United States and required applicants to wait in long lines at the American Embassy in Moscow to submit their applications. In addition, the process included an interview by an American Embassy official who could deny the application if, among other reasons, the official did not believe the applicant had established that he or she would return to Russia.

    The referral process could be used in much more limited circumstances and required that the applicant's visit be supported by a humanitarian basis or a United States government interest. In the referral process, the visa application was submitted by an Embassy official who completed a form approved by an Embassy Section Chief setting forth the United States government interest in the applicant's visit. No interview was required, and the use of the referral process generally ensured that the applicant would receive a visa.

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    Two Russian citizens who Bratt met on his second trip to Moscow and with whom he thereafter socialized extensively—Elena Koreneva and Ludmilla Bolgak—received visas on April 7, 1997, to visit the United States. They received the visas because Lake submitted their applications using the referral process and purported that a government interest existed for their visit to the United States. Lake wrote on the referral form that

''[a]pplicants have worked with the Executive Officer (EO) Criminal Division in support of administrative functions, Moscow Office. EO feels thatfor [sic] the above persons to visit HQs, Wash., D.C. and metropolitan area would broaden appreciation of Div's national and international functions, and to acquaint them with out [sic] Govt. institutions, economy, culture, and lifestyle. Such experience and familarization [sic] can only have positive impact on their return.''

    He signed it ''Joe Lake for BB.'' In addition to being the ICITAP and OPDAT Coordinator, Bratt retained the title and many of the responsibilities of the Executive Officer.

    We determined that neither woman had ever worked for Bratt or the Criminal Division and that the United States government had no official interest in the women's visit. Therefore, the statement on the referral form was false.

    Based on our investigation, we concluded that Bratt and Lake used the referral process even though they were aware that it required a government interest in the women's visit and that no such government interest existed. Although they both denied knowingly misusing the visa process, we did not find their explanations or denials credible. We concluded that both Bratt and Lake committed egregious misconduct in obtaining visas for the two women in this fashion.(see footnote 1)

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    The OIG report also addresses the security implications raised by Bratt's involvement with Koreneva. Bratt held a high-level security clearance and had access to highly classified documents. Despite knowing little about the Russian women, he socialized with them, developed an intimate relationship with one, invited them to visit him in the United States, and improperly helped them obtain visas even after he was told that one of them had been denied a visa on a prior occasion. He did not report his contacts with the women to the Department of Justice's security office in a timely fashion (as required by Department policy), and when he did he failed to fully describe his relationship with Koreneva. We concluded that Bratt's intimate involvement with a Russian citizen about whom he knew very little, his invitation to her to visit the United States, his help in obtaining visas for them, and his attempt to conceal the true nature of his relationship with Koreneva left him vulnerable to blackmail and represented a security concern.

III. Security Failures at ICITAP

    On April 14, 1997, the Department of Justice Security and Emergency Planning Staff (SEPS) conducted an unannounced, after-hours sweep of the ICITAP offices after receiving an allegation that an ICITAP manager had improperly given classified documents to ICITAP staff who did not have security clearances. During that sweep and a follow-up review conducted by the Criminal Division Security Staff, 156 classified documents were found unsecured in the office of ICITAP Associate Director Joseph Trincellito. The OIG and SEPS probed further to determine the extent of ICITAP's security problems and ICITAP management's responsibility for the security failures.

    The OIG found that the problems discovered in the 1997 security reviews had existed for many years. Evidence showed that senior managers provided or attempted to provide classified documents to uncleared consultants or other staff. ICITAP employees, including senior managers, routinely left classified documents unsecured on desks, including when individuals were away from their offices on travel. We found one instance where classified information was sent over an unsecure e-mail system. ICITAP managers also improperly took classified documents home. Highly classified documents containing Sensitive Compartmented Information (SCI), or ''codeword'' information, were brought to the ICITAP offices even though ICITAP did not have the type of secure facility (a Sensitive Compartmented Information Facility or ''SCIF'') required to read or store such material. The evidence also showed that ICITAP inaccurately certified to United States Embassies that individuals had security clearances when they did not.

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    As an example of the inattention ICITAP managers gave to security, our report sets forth the troubling history of ICITAP Associate Director Trincellito's handling of classified information. From 1995 through early 1997, ICITAP's security officers repeatedly found classified documents left unattended in Trincellito's office and warned him that he was violating security rules. They also notified other ICITAP managers about the problem. One security officer, after becoming aware of repeated violations, documented the violations in writing and recommended discipline for Trincellito although none was ever imposed. The ICITAP Director on occasion spoke to Trincellito about his violations and attempted to make it easier for him to comply with security rules by putting a safe in his office. However, in the face of repeated violations, we found that senior ICITAP managers failed to take sufficient action, such as initiating discipline, to ensure that Trincellito complied with security regulations.

    We concluded that ICITAP managers' own violations of the security rules and their tolerance of known violations sent a message that security of classified documents was not important at ICITAP. We also found that the Criminal Division did not adequately supervise ICITAP's security program even though security reviews conducted by both SEPS and the Criminal Division beginning in 1994 showed a pattern of security violations.

IV. Travel Abuses

    Bratt and other ICITAP and OPDAT managers violated government travel regulations by flying business class without authorization and by using frequent flyer miles accrued on government travel for personal purposes, among other violations. Government and Department of Justice travel regulations restrict the use of business class by government travelers. Even in circumstances when business class may be used, it must be authorized by the traveler's supervisor. On none of these trips was Bratt's use of business class authorized. On one trip, we found that ICITAP and OPDAT managers made travel decisions for personal reasons, such as where to spend the weekend and what airline to use, that unnecessarily increased the cost of the trip. On three trips, we found that Bratt and other travelers improperly invoked the ''14-hour rule'' that allows authorized travelers to fly business class when a flight, including layovers, is longer than 14 hours. One these trips, the Department's travel agency had suggested an alternative itinerary that would have saved the government substantial money. However, in each case the less expensive itinerary was rejected.

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    We found that Bratt, contrary to travel regulations, repeatedly approved his own travel requests or had subordinates approve them. In addition, the majority of travel vouchers Bratt submitted for reimbursement were either signed by Bratt, his subordinates, or someone at the same rank as Bratt—again, a violation of travel regulations that require approval of all government travel by an official occupying a higher rank than the traveler.

    We found that the Justice Management Division (JMD), which is responsible for auditing foreign travel vouchers, did not question the use of business class travel by Bratt or the other managers who accompanied him even when a lack of authorization was apparent on the face of the travel documents.

    During the course of the investigation we also found that ICITAP, OPDAT, and Office of Administration managers violated other government travel regulations, including those involving the use of frequent flyer benefits. For example, we concluded that Bratt and others used government-earned frequent flyer miles for personal use in violation of Department regulations.

V. Lake Buyout

    Lake retired from the federal government on March 31, 1997, after receiving $25,000 as part of a government-wide buyout program to encourage eligible federal employees to retire. At the time of his retirement, Lake was in Moscow for OPDAT preparing for an OPDAT conference. The following day, Lake began working for OPDAT as a consultant and continued his OPDAT work in Moscow. Lake also worked as a consultant to the INS at Bratt's request beginning in May 1997 after Bratt began work there.

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    The buyout program prohibited former federal employees from returning to government service as either employees or as contractors working under a ''personal services'' contract for five years after their retirement. (A personal services contract is defined by federal regulations as ''a contract that, by its express terms or as administered, makes the contractor personnel appear, in effect, [to be] Government employees.'') Violation of the prohibition requires repayment of the incentive bonus.

    We found that while at OPDAT and INS after his retirement, Lake was performing personal services in violation of the buyout program requirements.

VI. Harris Contract

    Jo Ann Harris resigned as Assistant Attorney General for the Criminal Division in August 1995. In December 1996, Harris was hired as an OPDAT consultant to organize, moderate, and evaluate three conferences that OPDAT was planning to hold at the International Law Enforcement Academy (ILEA) in Budapest, Hungary, and to develop curriculum for other OPDAT training programs. The OIG investigated allegations that the award of this contract to Harris violated ethical rules that prohibit contracting with former government officials on a preferential basis.

    Because no competition was involved in awarding Harris' contract, we evaluated its propriety under the rules pertaining to sole-source contracts. Sole-source contracts, which do not require the solicitation of competing bids, may be awarded when the exigencies of time or the consultant's expertise justify the waiver of the competitive process. We concluded that OPDAT could have awarded a sole-source contract to Harris for her work on the ILEA conferences given her extensive experience and the short time frame that existed to prepare for the conference. However, we concluded that Bratt's decision to hire Harris for curriculum development was not similarly justified and created the appearance of favoritism. We found that Bratt discussed with Harris what projects she could perform and the contract's ''Statement of Work'' was written to fit those projects. We concluded that the process OPDAT used to develop Harris' contract violated the principle that the task to be accomplished should drive the development of a contract rather than the desire to hire a particular consultant.

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    We disproved an allegation that had appeared in the press that Harris was paid $65,000 for eight days work. She was paid approximately $27,000 for 42 days work on two ILEA conferences. However, we found that she received a higher rate of pay than generally provided to consultants by the Department of State, ICITAP, and OPDAT. We concluded that the lack of a clear record setting forth the basis for the fee raised the appearance that Harris was given preferential treatment by her former subordinates.

VII. Personnel and Financial Management

    Federal regulations prohibit contractor personnel from directing federal employees or exercising managerial oversight. Yet, we found that ICITAP and OPDAT managers did not adequately distinguish between government employees and contractor personnel and at times used contractors as managers. In addition, consultants often began work at ICITAP or OPDAT before the Statement of Work was issued to the prime contractor. This practice required the paperwork to be backdated or ratified in order for the consultant to be paid. We also found that consultants who were later hired as federal employees made decisions affecting their former contractor employer.

    We found that Bratt violated government regulations requiring open competition for federal positions when he authorized the hiring of a temporary employee for a permanent position at ICITAP before a vacancy had even been announced. We also found that ICITAP Director Janice Stromsem hired as a consultant to ICITAP an individual with whom she had family connections. Stromsem then selected the individual for a term position as a federal employee even though other managers thought the individual was unqualified. Our review also examined allegations that Bratt gave favored treatment to a select group of staff.

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    With respect to financial management, we found that ICITAP did not pay sufficient attention to the services its contractors provided and left itself vulnerable to overcharges. In one instance, a contractor notified ICITAP that it was unilaterally raising one of its fees, an action not permitted by the contract. Despite this notice, ICITAP did nothing for two years until a JMD contracting officer noticed the overcharge. Subsequent negotiations with the contractor resulted in reimbursement to ICITAP of some of the money.

    In 1991, the Criminal Division hired a contractor to provide computer support services and subsequently renewed the contract in 1996. We found that some contractor employees worked in the Criminal Division's correspondence unit responding to correspondence. The contractor also provided staff who worked as writers, planned conferences, published reports, and organized parties—all activities that were outside the scope of the contracts.(see footnote 2)

    We also found that Criminal Division managers failed to adequately supervise these contracts and that the contractor charged the government for the services of personnel who were unqualified under the terms of the contract. The contract set out very specific labor categories, such as Senior Programmer Analyst, and set forth the tasks to be accomplished and the qualifications for each labor category. We found problems with 25 out of 56 of the contractor's personnel under the first contract and 19 of 54 of the contractor's personnel under the second contract. We concluded that at a minimum the contractor overcharged the government in excess of one million dollars.

    In another case, ICITAP's lack of planning led the $16,000 translation budget for the first ILEA conference to balloon to more than $120,000. Lake delegated much of the responsibility for coordinating the ILEA conference to his assistant, a contractor, who ordered large amounts of material to be translated on an expedited basis without adequately determining the cost of the translations or the need for the materials. We concluded that Lake delegated responsibility to someone who was not qualified to manage the task and then failed to adequately supervise her.

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    Finally, in response to allegations of mismanagement in ICITAP's Haiti program, we tracked 131 expensive items to examine whether ICITAP could account for the goods it ordered for use there. Our investigation showed that the contractor responsible for providing goods and services to ICITAP in Haiti had in place an effective inventory control system and that ICITAP could account for all but one of the selected items.

VII. Miscellaneous Allegations

    We investigated allegations raised by four employees that ICITAP, OPDAT, or Criminal Division managers had retaliated against them either because they complained about actions taken by managers or because they provided information to the OIG during this investigation. We did not substantiate these claims of retaliation. In addition, we investigated a series of miscellaneous allegations, including that Bratt and another supervisor in the Office of Administration donated excess government computers to schools at which they had personal connections.

IX. Recommendations

    Our report offers a series of recommendations to the Department, including that certain employees receive discipline and that the Department seek compensation from employees and former employees who improperly received money or benefits from the Department. We also make a number of recommendations concerning systemic improvements in the areas of travel, ethics, and training.

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    Bratt retired from the Department effective August 1, 2000, and therefore is not subject to discipline. We recommend that the Department recover the costs of his improper use of business class travel and frequent flyer miles, which we estimate at more than $11,000.

    Similarly, Lake is not employed by the Department any longer and is not subject to discipline. We recommend that the Department recover the $25,000 buyout bonus and approximately $3,000 for travel expenses that Lake improperly charged the government. For both Bratt and Lake, we recommend that the Department's security office incorporate into their security files the findings of this investigation and provide them to the Defense Investigative Service Clearance Office, the entity that performs background investigations of government contractors.

    We recommend discipline ranging from reprimand to suspension for three current Department employees and repayment of money for travel abuses. We also recommend that SEPS and other agencies responsible for issuing security clearances carefully consider the findings and conclusions set forth in this report before issuing a security clearance to the individuals most involved in the security breaches.

    With respect to systemic improvements, we make several recommendations relating to oversight of ICITAP and OPDAT, security, investigative follow-up, travel, training, performance evaluations, and early retirement programs. For example, we recommend that the Department:

continue high-level supervisory meetings between Department of Justice and Department of State to coordinate and monitor the work of ICITAP and OPDAT. We believe, however, that this oversight should be in addition to, and not a substitute for, adequate oversight of ICITAP and OPDAT by the Criminal Division;

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ensure that the recommendations made in this and previous reviews are implemented or carefully considered;

continue to monitor ICITAP's progress in addressing security issues and provide training to both new and experienced staff who handle classified information;

review the procedures for auditing travel vouchers and provide additional training on travel regulations to employees who travel and to staff who process travel-related paperwork;

revise its ethical training for staff to include issues that raise situations involving the appearance of a conflict of interest;

provide training to administrative officers on any restrictions on employees' ability to return to government service or work as contractors under various retirement programs.

X. Conclusions

We found that at various periods between 1995 and 1997 none of the Criminal Division's managers with the closest connection to ICITAP believed that they were responsible for supervising ICITAP. In fact, ICITAP's Director at the time told us that she did not understand to whom she was to report. We also found that, to some extent, staff in ICITAP and OPDAT believed that their offices were somehow different and exempt from the rules that applied to employees in the rest of the Department of Justice.

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    ICITAP and OPDAT have new management now and our sense is that improvements have been made in several areas, including security. However, because our investigation primarily concerns allegations of improprieties and mismanagement that occurred from 1995 through early 1998, we have not reviewed changes made by the current management. Moreover, we believe that it still may be too soon to tell whether ICITAP has moved away from its previous attitude that it was ''different'' and that the rules applicable to all other Department employees do not apply to it. Attitudes and practices that have been engrained for years are not likely to disappear merely with the introduction of a few new managers. Consequently, we believe that the leadership at ICITAP and OPDAT and their supervisors in the Criminal Division must be vigilant to ensure that staff at ICITAP and OPDAT adhere to Department rules and standards.

    A final lesson to be taken from this investigation is the ease with which managers can slip from carelessness to misconduct. In this investigation as in others we have done, we found that some employees rationalized their conduct by noting that they worked hard, they were focusing on other issues, they deserved certain benefits, or that the regulations they operated under were burdensome. We found during this investigation that the occasional ''bending of the rules' became a way of doing business by some employees at ICITAP, OPDAT, and the Office of Administration. We believe that Department managers need to be vigilant to avoid the attitudes that can easily lead to the problems we encountered during the course of this investigation.

    Mr. HYDE. Next we will hear from Mr. Holder, who will present a statement. Then the rest of the panel will be available to answer questions.

    Mr. Holder.

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STATEMENT OF ERIC HOLDER, DEPUTY ATTORNEY GENERAL, UNITED STATES DEPARTMENT OF JUSTICE

    Mr. HOLDER. Good morning, Mr. Chairman, Mr. Conyers and members of the committee. I am here today with other officials from the Justice Department to testify about the Department's response to the Inspector General's report on misconduct and mismanagement in the Department's ICITAP program, and also with regard to OPDAT and the Criminal Division's Office of Administration, which was issued about a week or so ago.

    I want to begin by thanking Mr. Fine and the Inspector General's Office for all their hard work in investigating these allegations and in preparing such an informative report. I also will not be challenging him any time soon to a basketball game. I was not aware of that part of his background until you relayed that, Mr. Chairman.

    It is commendable that the report does not limit itself to making findings about individual misconduct, but also contains numerous constructive, forward-looking suggestions for how the Department can strengthen the management and integrity of its overseas training programs. The report, which is over 400 pages and is appropriately detailed, remains under review by several department components with responsibility for addressing the problems it identifies.

    While this review of the report will continue in the coming weeks, the Department has already begun to respond to some of its findings and some of its recommendations. Last week, I asked one of the Department's most senior and respected career managers, Kathleen Hawk Sawyer, the director of the Bureau of Prisons, to be the deciding official for all disciplinary and remedial matters arising out of the report. Ms. Sawyer's knowledge and managerial experience will help ensure that all decisions about employee discipline and debt collection are made fairly and consistently. We will assure, I will assure, that Ms. Sawyer is fully supported in carrying out these responsibilities.

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    Because the disciplinary and remedial matters are pending, we are limited, as I am sure the committee understands, in what we can say about them. These processes are governed by Federal personnel law. The Department will need to review the full record, which includes, in addition to the Inspector General's report, all the relevant witness interviews and underlying documents, the responses of the employees and their history as employees.

    In the event of substantial disciplinary action, the employee would have a right of appeal to the merit systems protection board. I do not want to say things today that could prejudice individual rights or the process itself or otherwise create a perception that these administrative matters are being improperly influenced.

    The report concludes that a number of systemic weaknesses may have contributed to the individual misconducts and management breakdowns. The Attorney General and I have asked the Criminal Division be the Justice Management Division to do an immediate and thorough review of the report's recommendations for systemic improvements and determine what institutional changes need to be made.

    Among the matters that we will be looking at are security issues, personnel management within the Criminal Division, the selection and management of contractors, and travel management, including enhanced auditing of travel vouchers.

    It is important to emphasize, however, that the Department had taken substantial steps to address a number of systemic problems, even before the report was issued. For example, with respect to security problems, many of the violations were uncovered prior to the Inspector General's investigation during the course of security reviews conducted by the Department's Security and Planning Staff, as well as security reviews by the Criminal Division's own security staff. In April of 1997, SEPS conducted an unannounced sweep of ICITAP's offices and found that despite follow-up on the prior security reviews, there were still serious security problems.

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    The Department took a number of steps in the aftermath of the April 1997 sweep that have dramatically improved ICITAP's security practices. For instance, shortly after the SEPS security sweep in April 1997, the Department suspended the security clearances of several senior ICITAP managers and brought in Mary Ellen Warlow, a senior counsel to the Assistant Attorney General in the Criminal Division, to replace Robert Bratt as the ICITAP and OPDAT coordinator.

    The Criminal Division security staff worked with ICITAP to implement new, improved security procedures, including color-coded security badges which show clearance levels. All ICITAP employees now wear these badges. ICITAP also conducted a systematic review of unsecured files, which were purged of any classified information. All classified materials in the office were relocated to safes in a secured room. The practice of circulating classified information from office to office was halted. The Criminal Division also established new rules addressing contractor and subcontractor security.

    The effect of these changes was quickly apparent. When the Criminal Division conducted subsequent sweeps of both ICITAP and OPDAT later that year, no unsecured classified documents or other security violations were discovered. Similarly, a subsequent compliance review of ICITAP offices found no security violations.

    Additional management and organizational changes were made in 1998 after Jim Robinson became Assistant Attorney General. In 1998, the Criminal Division hired Joseph Jones, a partner with the Washington, DC law firm of Schwalb, Donnenfeld & Silbert, and the former director of the American Bar Association's Central and East European Law Initiative, to be the new permanent chief of both OPDAT and ICITAP. Assistant Attorney General Robinson also had his Chief of Staff personally supervise the two programs for over a year before reassigning supervision to a career Deputy Assistant Attorney General.

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    In February of this year, the Criminal Division hired Rick Lang, a former senior manager and special agent with the Federal Bureau of Investigation, to be the director of ICITAP. Substantial changes in the responsibilities of personnel at lower levels have also been made.

    This past spring, SEPS conducted another unannounced review of ICITAP, which, according to the Inspector General's report, ''continued to show ICITAP's heightened security awareness and compliance with the rules.''

    Although the Criminal Division has vastly improved the level of security at ICITAP over the past 3 years, we intend to use the IG's report to look for ways to further strengthen our security practices.

    These are just a few of the systemic changes that ICITAP and the Criminal Division have already made in advance of receiving the IG's report. By pointing out that the Department has already begun addressing many of the problems discussed in the report, I do not mean to suggest that we have solved all of the problems or that there is not room for further improvement. The IG's report details some very serious problems and makes a number of thoughtful recommendations for improvement. It will surely be a valuable guide for senior management as we move forward to reinforce and enhance the security and the integrity of our overseas training programs.

    At this point we would be happy to answer any questions from the committee.

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    Mr. HYDE. Thank you very much, Mr. Holder.

    [The prepared statement of Mr. Holder follows:]

PREPARED STATEMENT OF ERIC HOLDER, DEPUTY ATTORNEY GENERAL, UNITED STATES DEPARTMENT OF JUSTICE

    Good Morning Mr. Chairman and Members of the Committee. I am here today with other officials from the Justice Department to testify about the Department's response to the Inspector General's Report on misconduct and mismanagement in the Department's International Criminal Investigative Training Assistance Progam (ICITAP), its Office of Overseas Prosecutorial Development, Assistance and Training (OPDAT), and the Criminal Division's Office of Administration, which was issued a week ago.

    I want to begin by thanking Mr. Fine and the Inspector General's Office for all their hard work in investigating these allegations and in preparing such an informative Report. It is commendable that the Report does not limit itself to making findings about individual misconduct, but also contains numerous constructive, forward-looking suggestions for how the Department can strengthen the management and integrity of its overseas training programs. The Report, which is over 400 pages and appropriately detailed, remains under review by several Department components with responsibility for addressing the problems it identifies.

    While this review of the Report will continue in the coming weeks, the Department has already begun to respond to some of its findings and recommendations. Last week, I asked one of the Department's most senior and respected career managers, Kathleen Hawk Sawyer, the Director of the Bureau of Prisons, to be the deciding official for all disciplinary and remedial matters arising out of the Report. Ms. Sawyer's knowledge and managerial experience will help ensure that all decisions about employee discipline and debt collection are made fairly and consistently. We will assure that Ms. Sawyer is fully supported in carrying out these responsibilities.

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    Because the disciplinary and remedial matters are pending, we are limited, as I'm sure the Committee understands, in what we can say about them. These processes are governed by federal personnel law. The Department will need to review the full record, which includes, in addition to the Inspector General's Report, all the relevant witness interviews and underlying documents, the responses of the employees and their history as employees. In the event of substantial disciplinary action, the employee would have a right of appeal to the Merit Systems Protection Board. I do not want to say things today that could prejudice individual rights or the process itself, or otherwise create a perception that these administrative matters are being improperly influenced.

    The Report concludes that a number of systemic weaknesses may have contributed to the individual misconduct and management breakdowns. The Attorney General and I have asked the Criminal Division and the Justice Management Division to do an immediate and thorough review of the Report's recommendations for systemic improvements and determine what institutional changes need to be made. Among the matters that we will be looking at are security issues, personnel management within the Criminal Division, the selection and management of contractors, and travel management, including enhanced auditing of travel vouchers.

    It is important to emphasize, however, that the Department had taken substantial steps to address a number of systemic problems even before the Report was issued. For example, with respect to security problems, many of the violations were uncovered prior to the Inspector General's investigation during the course of security reviews conducted by the Department's Security and Planning Staff (SEPS), as well as security reviews by the Criminal Division's own Security Staff. In April 1997, SEPS conducted an unannounced sweep of ICITAP's offices and found that despite follow-up on the prior security reviews, there were still serious security problems.

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    The Department took a number of steps in the aftermath of the April 1997 sweep that have dramatically improved ICITAP's security practices. For instance, shortly after the SEPS security sweep in April 1997, the Department suspended the security clearances of several senior ICITAP managers, and brought in Mary Ellen Warlow, a Senior Counsel to the Assistant Attorney General in the Criminal Division, to replace Robert Bratt as the ICITAP and OPDAT Coordinator. The Criminal Division Security Staff worked with ICITAP to implement new, improved security procedures, including color-coded security badges which show clearance levels. All ICITAP employees now wear these badges. ICITAP also conducted a systematic review of unsecured files, which were purged of any classified information. All classified materials in the office were relocated to safes in a secured room. The practice of circulating classified information from office to office was halted. The Criminal Division also established new rules addressing contractor and subcontractor security.

    The effect of these changes was quickly apparent. When the Criminal Division conducted subsequent sweeps of both ICITAP and OPDAT later that year no unsecured classified documents or other security violations were discovered. Similarly, a subsequent compliance review of ICITAP offices found no security violations.

    Additional management and organizational changes were made in 1998 after Jim Robinson became Assistant Attorney General. In 1998, the Criminal Division hired Joseph Jones, a partner with the Washington, D.C., law firm of Schwalb, Donnenfeld & Silbert, and the former Director of the American Bar Association's Central and East European Law Initiative, to be the new permanent Chief of both OPDAT and ICITAP. Assistant Attorney General Robinson also had his chief of staff personally supervise the two programs for over a year before reassigning supervision to a career Deputy Assistant Attorney General. In February 2000, the Criminal Division hired Rick Lang, a former senior manager and special agent with the Federal Bureau of Investigation, to be the Director of ICITAP. Substantial changes in the responsibilities of personnel at lower levels have also been made. This past spring, SEPS conducted another unannounced review of ICITAP, which according to the Inspector General's Report ''continued to show ICITAP's heightened security awareness and compliance with the rules.''

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    Although the Criminal Division has vastly improved the level of security at ICITAP over the past three years, we intend to use the IG's Report to look for ways to further strengthen our security practices.

    In addition to addressing security practices, ICITAP and OPDAT have also already taken steps to address a number of the financial management problems detailed in the Report. For instance, ICITAP's contractors are now required by contract to provide detailed invoice documentation. This required billing data makes it possible to track expenses by region or by country. It also facilitates the detection of improper contractor mark-ups, such as occurred in connection with the Interlog contract in 1996.

    ICITAP has also centralized and substantially enhanced its computer systems. Under the old system, which was criticized by the IG, there were often discrepancies between computer records in the field and those in Headquarters. Data had to be transferred within the system by sending computer disks through the mail. Under the new system, all billing information is centralized at Headquarters. The new system also has the capacity to electronically import data directly from contractors' computers. The new system also has additional internal controls, including a feature that prevents a user from issuing delivery orders that over-commit the available funds in the task order, which had been a problem under the old system.

    These are just a few of the systemic changes that ICITAP and the Criminal Division have already made in advance of receiving the IG's Report. By pointing out that the Department has already begun addressing many of the problems discussed in the Report, I do not mean to suggest that we have solved all the problems or that there is not room for further improvement. The IG's Report details some very serious problems and makes a number of thoughtful recommendations for improvement. It will surely be a valuable guide for senior management as we move forward to reinforce and enhance the security and integrity of our overseas training programs.

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    At this point, we would be happy to answer questions from the Committee.

    Mr. HYDE. Mr. Berman, do you have any questions?

    Mr. BERMAN. With respect to the portions of the report dealing with Mr. Bratt, the summary is pretty damning. I am told that the information was presented both to the public integrity section of the Justice Department and the U.S. Attorney's Office, and both of those agencies decided not to prosecute.

    While I can understand why there is a place for internal review, investigation, reporting and possibly discipline when appropriate, it doesn't rise to the level of a criminal matter. I am curious what was in the mind of the Inspector General's office in proceeding with this in the context of those decisions?

    Mr. FINE. Mr. Berman, in March of 1998, we presented our work and our findings to the Public Integrity Section initially, and then after a short time, we decided it would be better to take those findings and what we had to the U.S. Attorney's Office for a prosecutive decision. We did that at that time because Mr. Bratt at that time would not answer further questions from us absent immunity.

    We, therefore, had to take it to the U.S. Attorney's office, and we did. They looked at it, and based on the state of the evidence, they concluded that the evidence did not rise to the level of proof beyond a reasonable doubt that they could prove the violation or that it warranted criminal prosecution.

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    At that time, we continued our investigation and continued it administratively. There is a different standard also for a criminal prosecution and an administrative investigation, and we felt obligated and believed it appropriate to continue pursuing this matter and present the findings and our conclusions. We believed that the record, including the evidence we found after that, fully supports the findings that we made, that Mr. Bratt and others committed serious administrative misconduct.

    Mr. BERMAN. I am told that the investigators involved in this investigation disagreed with the tactics of the investigation, expressed that disagreement, and resigned from the investigation. Is that an accurate portrayal?

    Mr. FINE. I don't believe so, Mr. Berman. We have had a number of investigators on this project, it has taken a significant time. Some investigators have left the Office of the Inspector General for other jobs. It has not been told to me, and my team has not said that any of them disagreed with the conclusions that we reached, and in fact, none of them have even read the report or disagreed with the conclusions.

    So, to my knowledge, there is not a difference between those investigators' beliefs and anything we have concluded in our report.

    Mr. BERMAN. You have heard nothing that would indicate that there were people engaged in this investigation who were critical of the tactics of the investigation or the manner in which the investigation was being conducted, and therefore withdrew from or were reassigned from the investigation? You have heard nothing at all about that?

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    Mr. FINE. Well, in any investigation, as in this one, there are always differences about how the investigation should be conducted amongst team members, amongst the supervisors of the team and others, and there surely was——

    Mr. BERMAN. I am not talking about that. I am not talking about whether we pursue it this way or that way, and they discuss and resolve it and somebody makes a decision and they go about it. I am talking about things where people were specifically objecting to the tactics of the investigation, the subject matter, the inquiry, and clearly registered their feeling that those were improper, and by virtue of that, either resigned from the investigation or were reassigned from the investigation.

    Mr. FINE. I don't believe that any of them stated that they believed that the tactics were improper and therefore wanted to resign as a result of that. As I stated, there were disagreements to some extent with some of the steps that were taken, and that, in my view, is normal, in a detailed and lengthy investigation such as this. I am not aware that they resigned because of any disagreements.

    Mr. HYDE. The Chair will say the gentleman's time has expired. I will give you more time, but let us recess and vote, and then return. There is a vote pending.

    There is a vote pending now, and then there will be another one in 45 minutes. Let's go to this vote and come right back. If you will stay in the holding pattern, we will hurry back. Thank you.

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    [Recess.]

    Mr. HYDE. Mr. Berman, would you like additional time?

    Mr. BERMAN. I would.

    Mr. HYDE. How much time would you like?

    Mr. BERMAN. May I get 3 additional minutes?

    Mr. HYDE. Without objection, so ordered. The committee will come to order. Mr. Berman is recognized for 3 additional minutes.

    Mr. BERMAN. I was wondering if anyone else on the panel had heard reports that investigators were either removed or resigned because of their feeling about the tactics being utilized in the investigation?

    Mr. KEENEY. Mr. Berman, some of our people in the Criminal Division came to me and complained of intimidative tactics on behalf of the IG staff. I met with the Inspector General at that time, Mr. Bromwich, and he addressed the problem.

    Mr. BERMAN. In other words, Justice Department employees, either the subject of or having heard of—how did you——

    Mr. KEENEY. They were witnesses that were interviewed, Mr. Berman, and they believed——

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    Mr. BERMAN. Witnesses that were interviewed, okay.

    Mr. KEENEY. They believed that they were being subject to intimidative conduct in the course of the interrogation and they complained about it, and I brought that to the attention of Mr. Bromwich, who was then the IG, and he addressed the problem.

    Mr. BERMAN. What does ''address the problem'' mean?

    Mr. KEENEY. My understanding is that one person was dropped from the team and that he talked to the others about the conduct——

    Mr. BERMAN. Cleaning up their tactics, their approach, dropping things which came off as intimidating?

    Mr. KEENEY. Yes. Now, he didn't report back to me except in very general terms that he was concerned about the allegations, he looked into them, and he took limited action.

    Mr. BERMAN. Mr. Fine, were you aware of this?

    Mr. FINE. Mr. Berman, I am aware of that situation. The situation was that there was a member of our team who met with a witness and gave the witness a gold necklace. Mr. Bromwich was apprised of that, and that person was leaving the OIG and Mr. Bromwich removed her from the investigation. So it was not because she had expressed any concern about the tactics, it was Mr. Bromwich's concern about what she had done with regard to one witness.

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    Mr. BERMAN. The investigator went to question a witness and brought her a gold necklace?

    Mr. FINE. I believe it was afterwards, but at some point had given her a gold necklace, that is right.

    Mr. BERMAN. Not a horse's head, a gold necklace.

    Mr. FINE. We believe that was inappropriate, you should not be giving anything to a witness, we found it out, and Mr. Bromwich addressed it.

    Mr. BERMAN. Other than that, are you aware of any other issues such as the ones Mr. Keeney raised regarding intimidating tactics and people being removed or told to change the tactics as a result of these complaints?

    Mr. FINE. I am aware that several of the subjects of our investigation have complained about that, have made those allegations. I am not aware that any—in response to your question—that any of our investigators brought concerns about others to the attention of senior management, and as a result, they decided to resign from the investigation.

    Mr. BERMAN. In other words, Mr. Keeney is referring to something that seems different. It seems like it is a case where witnesses, subjects of interviews, complained. Mr. Keeney passed on the complaints to the Inspector General. The Inspector General heard the complaints that his people were using intimidating tactics, one person was removed from the investigation, I guess, and others were told to change their approach.

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    Mr. FINE. I am not aware of that.

    Mr. BERMAN. Is this in writing? Is this documented? Is there a way of independently trying to figure out what happened here?

    Mr. FINE. With that inspector——

    Mr. BERMAN. And the issues raised by Mr. Keeney, is there a memo that summarizes the discussions in the Inspector General's office or in your office, Mr. Keeney?

    Mr. KEENEY. Not that I am aware of. Mr. Berman, I want to make it clear. Our people who were interviewed complained about the tactics. I brought it to the attention of Mr. Bromwich. Mr. Bromwich generally told me that he had addressed the issue, which meant that he talked to his people about it. I learned that one person left. That may be the same person that Mr. Fine is referring to. I have no idea.

    Mr. FINE. Mr. Berman, I could check on whether there is a memo of that sort and get back to you.

    Mr. BERMAN. If there is anything in writing that would shed light on these reports.

    Mr. FINE. Why don't I do that, and try to get back to you.

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    Mr. BERMAN. I may have questions.

    Ms. JACKSON LEE. Would the gentleman yield?

    Mr. BERMAN. Yes.

    Ms. JACKSON LEE. I think the light is still on. Would the gentleman yield?

    Mr. HYDE. The gentleman's time has long since expired.

    Ms. JACKSON LEE. I thought the green light is still on. I am sorry.

    Mr. HYDE. It is still on. It shows a certain lack of coordination between the chairman and the light. But whatever time the gentleman requires, I will be happy to give him. Do you want more time? Leave Jackson Lee, I would appreciate it——

    Mr. BERMAN. I would ask——

    Mr. HYDE. [continuing.] An additional 3 minutes.

    Mr. BERMAN. I yield to the gentlelady.

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    Ms. JACKSON LEE. Let me beg the pardon of the chairman and ranking member. I am in a hearing upstairs, conducting it with Chairman Smith. I just simply want to ask that my statement be unanimously submitted in the record, Mr. Chairman, and pose a question.

    I realize that the report came out about a week ago, and I know we are having a hearing. My concern is whether the Department of Justice has had an opportunity to vet this report, and as well, whether or not we might consider a pause to allow the Department of Justice to vet this report. As I read the summary, there is no criticism of the work product, the work that is done in the countries to enhance democracy. It is an operational criticism.

    Mr. Holder, if you would, my concern about your opportunity to vet the report and as well what suggestions might you have that we respond to this in a fair and bipartisan way to get to the solution. Certainly I know this committee does not engage in partisan politics. Would you answer the question for me. Thank you.

    Mr. HOLDER. The report is 400 pages long or so, and we only received it last week, so we are still in the process of digesting it. As I indicated in my opening statement, there are steps that we have taken in response to the report, there are steps that we took before the report was issued to deal with some of the problems that have been identified by the Inspector General.

    We will be able to talk about today, in some way, interim responses. The reality is we have ongoing measures that we put in place, as I indicated previously. I asked Kathleen Hawk Sawyer to look at the report and figure out exactly what recoupment we should get in terms of monies, what other discipline, what discipline ought to be imposed as a result of the report and the things that we will find using the report that Mr. Fine has prepared.

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    Ms. JACKSON LEE. My final question, and I will yield to the gentleman, there were three investigators that resigned during the process of this effort based upon their sense of how the investigation was going. Maybe it was exploitative, maybe it was not evenhanded. Have you spoken to them? I would say to the chairman, I would certainly like to have their comments or letters presented to this committee. Has the Justice Department spoken to the resigned investigators who criticized the approach?

    Mr. HOLDER. Until the hearing, I was not aware there was any concern on the part of any of the investigators or the witnesses. I heard that for the first time here today.

    Ms. JACKSON LEE. I will raise that and would like to get a response back. I would be happy to yield back to the gentleman from California.

    Mr. BERMAN. I have no more questions. I just want to make sure we summarize the issue. Ms. Jackson Lee raised the issue, I raised it earlier. We are hearing from the Inspector General that as far as he is concerned, no one, to his knowledge, was reassigned from this investigation because they complained or expressed disagreements with the tactics of this investigation.

    Mr. FINE. To my knowledge, that is correct. No one was reassigned because they expressed——

    Mr. BERMAN. To the extent you pursue this after this hearing and find differently, I assume you would let us know.

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    Mr. FINE. I certainly will.

    Mr. HYDE. The gentleman from Pennsylvania, Mr. Gekas.

    Mr. GEKAS. Thank you, Mr. Chairman. My chief concern that emanates from the report and from the testimony is security risks. What immediately comes to mind, the Matta Hara syndrome that might be inherent in the two Russian women and their entry into the United States.

    Were they part of the interrogees, the people interrogated, of the 100-some witnesses that were subjected to examination, Mr. Fine?

    Mr. FINE. Yes. We interviewed them. We interviewed them in Moscow. Several of our investigators went to Moscow and spoke to them.

    Mr. GEKAS. Was there anything in their testimony that led you to believe that further investigation should be conducted with respect to any breaches of security?

    Mr. FINE. Nothing that they told us indicated that there had been a breach of security.

    Mr. GEKAS. Were there collateral reviews of their contacts, et cetera, to see if security risks were inherent? That is, people with whom they talked, other than Mr. Bratt? Did they come to the United States?

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    Mr. FINE. No, they never used the visas. Although the visas were given, they did not eventually use them.

    Mr. GEKAS. Were there other people in Moscow, United States agents, who talked with them or socialized with them, other than Mr. Bratt? Do we know that?

    Mr. FINE. Well, when Mr. Bratt was there, along with other employees of OPDAT and ICITAP, they did socialize together, although Mr. Bratt was the main person who developed a relationship with them. They had dinners together with other people as well. According to what they said and Mr. Bratt said, they did not discuss any work.

    Mr. GEKAS. You do not know if that is the truth, is that correct?

    Mr. FINE. We know what they have told us, that is correct.

    Mr. GEKAS. So that the investigation, the witness probing that you did, did not include trying to track down what, if anything, did transpire that might be a security risk from the actions and words of the two Russian women to others?

    Mr. FINE. That is correct. We didn't do that kind of assessment.

    Mr. GEKAS. Mr. Holder mentioned that after 1997, Ms. Warlow was assigned to head that particular project, is that correct?

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    Mr. HOLDER. Yes, on an interim basis, on an acting basis.

    Mr. GEKAS. I suppose then that was to replace the last one, where Mr. Fine said that between 1994 and 1997, 4 different directors were in charge; is that correct?

    Mr. FINE. Between 1994 and 1997, four directors or acting directors were in charge of ICITAP. My understanding is Ms. Warlow was made the coordinator, which is a higher level position that coordinated the work of both ICITAP and OPDAT. She did that for a period of time.

    Mr. GEKAS. But the four that served between 1994 and 1997 had to serve like 6 months apiece or less or somewhat more. Who appointed the first one in 1994? Who was that?

    Mr. FINE. The first one in '94 had been appointed when ICITAP reported to the Deputy Attorney General's office. It was then transferred to the Criminal Division. At that point, the Assistant Attorney General had responsibility for appointing the director, or acting director of ICITAP. So the final three were appointed by the Assistant Attorney General in charge of the Criminal Division, or the acting Assistant Attorney General.

    Mr. GEKAS. Do you have any information regarding why four had to be appointed in succeeding years?

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    Mr. FINE. There were concerns about the actions of one of them, then an acting director was appointed for a short period of time, and then eventually a permanent director. So it was a number of appointments made before a permanent director eventually settled in.

    Mr. GEKAS. Were these, Mr. Holder, subject to the approval of the Attorney General herself?

    Mr. HOLDER. I don't believe the Attorney General was involved in the selection process. A lot of this is historical and occurred before I became Deputy Attorney General, and I am not totally aware of the process that was involved, but I can tell you in the selection process that has happened, while I was there and with what I am familiar, I don't think the Attorney General was involved.

    Mr. GEKAS. I would like to know definitively how they came to be directors, why there were 4 within 3 years, and who is responsible for naming them or then displacing them within that short period of time. I think that is important to recognize the flaws that existed in that system. So, Mr. Fine and Mr. Holder, I would like to have members have a briefing, a memo on that, if you don't mind.

    The other remaining questions, Mr. Chairman, if I have a few minutes left, have to do with, Mr. Fine says, that he recommended that Mr. Bratt be surcharged or charged with the excesses, that they be collected, and Mr. Holder says that somebody was put in charge of debt collection, meaning some of those overspendings. Do we have any report at all? Did anybody repay any money at any time up until now? Mr. Holder? Mr. Fine?

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    Mr. FINE. We made that recommendation in our report. Our report was issued last week. My understanding is the Department has set up a process by which discipline or repayment can occur. It is too early in the process for a decision.

    Mr. GEKAS. I will accept that. I will await further revelations on that point.

    Mr. HYDE. The gentleman's time has expired. Does the gentleman wish additional time?

    Mr. GEKAS. Let me think about that. No, thank you, Mr. Chairman.

    Mr. HYDE. The gentleman from Michigan, Mr. Conyers.

    Mr. CONYERS. Thank you, Mr. Chairman. Excuse my in-and-out business today. I have got several hearings going on at once.

    Mr. Fine, my understanding is that this investigation began in April 1997, and took 3 1/2 years for the IG to complete. I am sure you must have explained this maybe once at least, but could you do it one more time for me, why?

    Mr. FINE. That is the first time the question was asked, so I will explain it now. It was a comprehensive investigation. It dealt with a lot of issues. As you can see from the report, there is not simply one allegation, but many different allegations. So at the first level it is a wide ranging number of allegations and a wide ranging report.

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    Second, the second issue I would like to raise is our resources are not great. We have had some problems with resources. We had to bring in a leader of the investigation, an Assistant U.S. Attorney, from the Eastern District of Pennsylvania, so it took us some time to get going.

    Another issue is that we were constantly faced with witnesses who didn't remember things, where there were documents we would have to go and search and go back to witnesses, so there was a constant process of dealing with memories that made the investigation difficult.

    So those are some of the explanations. But in response to your question, it did take a long time, and I think that in the future we would try to narrow the scope of our investigation a little more and get it done more quickly. We recognize the importance of doing an investigation thoroughly and expeditiously, and we intend to do that.

    Mr. CONYERS. Thank you. Now, were you with the IG in the Department of Justice before you became the acting IG?

    Mr. FINE. Yes, I was.

    Mr. CONYERS. So this is unusual. There are not a lot of 3 1/2 year reports laying around, are there? Or has this happened before, for matters of this dimension?

    Mr. FINE. It has happened occasionally. There have been a couple. Normally our reports are narrower and get done more quickly than 3 1/2 years.

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    Mr. CONYERS. Now, just to get a sense of relationship here between what we are doing here and what has been going on, have there been more serious, more demanding, more important kinds of investigations than the one that has brought you to the Judiciary Committee today?

    Mr. FINE. Well, it is hard to compare one investigation and the importance of one investigation against another. We have done, as you probably know, some very important investigations. We have done investigations of the FBI laboratory for faulty forensic science: We recently did an investigation of Citizenship USA. That actually was a long-term investigation. We have done investigations of how the INS deceived a congressional delegation that went down to Miami. So there have been a number of these investigations. I can't really say that one is more important than the other, but we believe they are all very important.

    Mr. CONYERS. Okay. Now, what about a 1-week turnaround for release? How many of those have been released publicly and put on the Internet all within the space of one week?

    In other words, what I am suggesting is that all of this doesn't quite add up to me in the course of investigations. I was on the Committee on Government Operations and I talked to—we did more than talk, we had hearings that involved many, if not most of the inspector generals.

    But, you know, a week turnaround, who brought that about? How did this get out so quickly?

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    Mr. FINE. Well, when we finished our report, we provided it to the Department, we provided it to the committee, and——

    Mr. CONYERS. Somebody put it out?

    Mr. FINE. We provided it to oversight committees who had requested it from us.

    Mr. CONYERS. But who released it to the Internet? The committee? The Judiciary Committee here released it inside of a week, and there was privacy material involved, sensitive information?

    Mr. FINE. There was information in it that we——

    Mr. CONYERS. That was protected by the Privacy Act.

    Mr. FINE. That was protected by the Privacy Act, yes.

    Mr. CONYERS. Do we know if any consideration was given in connection with that material? Were there any redactions?

    Mr. FINE. We didn't redact it. We provided it as we are required to by the Congress.

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    Mr. CONYERS. Well, I see that the tracks of leading back to 2141, the Committee on the Judiciary. Do you know if the committee asked the Department if it could be put up on the Web site?

    Mr. FINE. I am not aware that it was asked.

    Mr. CONYERS. No permission was sought. Certainly no letters that would have come to your attention.

    Well, is that normal?

    Mr. FINE. I am not sure whether it is normal. I do know that committees have released reports of ours. Actually often we release reports directly. For example, we released the FBI laboratory report as soon as it was done.

    Mr. CONYERS. Yes, but I am talking about within a week. 3 years on a report, it gets released in a week, the Department tells us they are still going over the materials, there is sensitive information that was not redacted, and this doesn't strike you—this is the way it happens nowadays? It didn't used to be this way. This seems unusual to me, and that is all I am trying to do, trying to make sense of what makes this so long in some places, then it gets truncated in other places, then we put it out on the Web and hold hearings immediately thereafter.

    Do you have any reason to know why the committee would have released this report on the Internet? Did somebody call you up and tell you this is going to happen, that we decided to do this?

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    Mr. FINE. I don't believe we received advance notice that it was going to be on the Internet. I do believe we knew that it was going to be the subject of this hearing and released as part of the record of the hearing.

    Mr. CONYERS. Well, did this even burden you in terms of getting ready for this hearing one week after the release?

    Mr. FINE. Well, we try to be prepared as quick as we can.

    Mr. CONYERS. Well, hasn't it been the—in your experience, has it been the practice of the committee to respect the Privacy Act? I think that may be one of the laws that came out of this committee.

    Mr. FINE. I don't know how wide my experience is in this regard. I do know that the Privacy Act does not apply to Congress, and Congress makes decisions on its own what to release.

    Mr. CONYERS. Well, even the laws we write that don't apply to us, which we exclude ourselves from, we respect. We give them general credence anyway as a matter of course.

    Well, thank you, Mr. Chairman. Those were the points I did want to raise.

    Mr. HYDE. Sure——

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    Mr. CONYERS. Could I ask unanimous consent to put in the statement of the gentlelady from Texas?

    Mr. HYDE. Without objection.

    [The prepared statement of Ms. Jackson Lee follows:]

PREPARED STATEMENT OF HON. SHEILA JACKSON LEE, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF TEXAS

    Thank-you Mr. Chairman. The headline in the September 13, 2000 Washington Post, and the accompanying article describing the Justice Department's mishandling of the Wen Ho Lee case should be disturbing to all Americans. Judge Parker's conclusion that the handling of the case ''embarrassed the entire nation'' points out the dangers of rushing to judgment.

    On September 12, 2000, the United States Senate published in the Congressional Record the full text of an executive summary of a recent Justice Department Inspector General Investigation. As with Lee and Jewell cases, and several others in recent years, there is a great danger in assuming guilt, especially when based upon an Inspector General report that has not been closely reviewed by the Justice Department and has not withstood the rigors of examination and rebuttal by those under investigation.

    In fact, it is my under-standing Mr. Chairman that much of the factual basis of the report has been questioned and that the Inspector General was provided with extensive documentation of factual errors in the report: that were neither appended to the report, nor transmitted to Congress. Given the recent cases of overzealous investigations and prosecutions, Congress should be very circumspect about making assumptions based on an ex parte report.

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    As we saw in the Lee case, Congressional pressure can result in scapegoating of individuals for political purposes. In this election year, we must also be particularly careful that we do not turn what should be fair and impartial process into a process of political expediency. If there is a role for Congress in this matter, it is within the scope of our oversight responsibilities to ensure that the Inspector General process functions in accordance with the standards that Congress has established.

    We should keep a vigilant watchful eye that the Inspector General's office of the Department of Justice does not turn into a congressional witchhunt.

    Thank-you Mr. Chairman.

    Mr. HYDE. The Chair would announce or would remark that we routinely release Inspector General reports, commission reports, committee reports. We feel that when they are publicly released, the public has paid for them, they are entitled to know what is in them. We know of no law or regulation that was violated in putting this material on the Internet. Again, it is the people's right to know.

    Sometimes examinations, investigations, take a hellishly long time when you run into witnesses who aren't exactly enthusiastic about cooperating and who have memory problems. I think there is a word of art called stone-walling. But anyway, Mr. Coble.

    Mr. COBLE. Thank you, Mr. Chairman. In this probably most political town in the country, maybe in the world, I am surprised how sometimes when Democrats question Republicans or Republicans question Democrats, oh, my gosh, they are being partisan. Well, sometimes you have to be partisan. If this comes across as overly partisan, Mr. Chairman, I apologize. No, I will stand by it.

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    You have heard the old adage, Mr. Chairman, about the fox guarding the hen house, when you have the fear that security may be breached? I have had the fear for some time that the fox may be guarding the hen house down at Justice, and that fear has been reinforced this morning. I am not appointing any accusatory fingers at any one, but I am glad you had this hearing, Mr. Chairman, because if, in fact, security has been compromised, I think it needs to be addressed, and I think this is the appropriate committee to address it.

    Mr. Bratt's name has been mentioned from time to time. Mr. Keeney, let me put this question to you.

    Mr. Bratt was the top manager at ICITAP, and I am told that he received $31,500 worth of performance awards in addition to his salary, while at the same time these security violations were ongoing.

    Can you comment or illuminate on this matter for me?

    Mr. KEENEY. I will try, sir. Mr. Bratt has a reputation of being a very outstanding administrator. He has received awards over the years consistently because of that recognition.

    We put, and I was responsible for this, we put Mr. Bratt in charge, overall charge of ICITAP and OPDAT for the purpose of trying to address some of the problems that were extant there. He accomplished a great deal. Unfortunately, as the report suggests, he made some mistakes.

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    Now, at some point, I am addressing now Mr. Gekas' point, why there were so many people.

    The Attorney General wanted to put Mr. Bratt in charge of the INS project, so because of that, he was taken off, and a career lawyer in the Department of—in the criminal justice was put in charge of that. That individual served for a considerable period of time. Then, because of some personal reasons that had nothing to do with ability or performance—he did an outstanding job—she was replaced by another career lawyer, and that was the situation until the person was appointed permanently to the position of coordinator by Mr. Robinson. That is Joe Jones.

    I hope that straightens out the confusion with Mr. Gekas. I had to sit down while we were talking here and make some notes to try to reconstruct the sequence about the changes. I hope it clarifies that.

    Mr. COBLE. Thank you, sir. I am just confused, he would be rewarded on the one hand while simultaneously, it appears violations may be occurring. But I thank you for the answer.

    Mr. KEENEY. He was rewarded for past performances. He was not rewarded for his performance, the current performance that you are addressing.

    Mr. COBLE. Thank you.

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    Mr. Holder, July of this year, the 10th, I think, the OIG permitted Mr. Bratt to review and comment on the draft of its report and then about a week later, Mr. Bratt applied for early retirement. I think his salary at that time was $130,200. Who approved of his early retirement and when, if you remember?

    Mr. HOLDER. Well, I think the early retirement was made available to Criminal Division employees generally who fit certain criteria. I would have to defer to my other colleagues on the panel who might be able to explain how that might have affected Mr. Bratt in particular.

    Mr. COBLE. If you don't know that, if you can get it to us.

    Mr. ROBINSON. Let me say generally, and we can provide more specifics, but as a result of significant budgetary problems in the Criminal Division that required us to substantially reduce our expenditures during this fiscal year, among the various measures, including a hiring freeze which substantially reduced the number of people working in the Criminal Division, an additional item in an effort to get our budget where it needed to be was this early-out option that was made available to all employees within the Criminal Division who were eligible, as an additional measure, to reduce our budget to meet with the resources that are available.

    So Mr. Bratt was not awarded any special arrangements. He took advantage of an early out that was taken advantage of by several other people in an effort to bring our budget within the limitations that are available to us provided by Congress.

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    Mr. BARR. If the gentleman from North Carolina will yield for just a moment, could you explain to me why you were taking these steps for so-called budgetary reasons, even while he was getting substantial sums and other Department employees were getting huge sums of money for so-called bonuses and extra pay and while this Congress has doubled the budget for the Department of Justice during this administration and you are trying to blame this on budgetary cutbacks?

    Mr. ROBINSON. I am just telling you——

    Mr. BARR. Why don't you just tell us why the Department was approving huge and consistent bonuses for these people and other people to the tune of hundreds of millions of dollars, and then you are telling us you had to cut back on security procedures and let people go with pay?

    Mr. ROBINSON. I didn't say we cut down on any security procedures. I said for this fiscal year, because of the budgetary limitations, we have done a whole host of things to reduce our expenditures.

    Mr. BARR. Like cutting back on the bonuses?

    Mr. ROBINSON. It is normal bonuses that are available provided by the Congress, that the funds are there for, obviously, we administer them.

    Mr. BARR. You think that in terms of your prioritization of the funds that are made available to you, that providing for bonuses for these people is more important than these other priorities? Because that is what you all were spending the money on.

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    Mr. ROBINSON. No. All I am suggesting is the whole host of things, including deferring expenditures for equipment, reducing employees, looking for ways to reduce our budgets, including deferring all kinds of activities. We are talking about this fiscal year, when this administration——

    Mr. BARR. You didn't defer the bonuses.

    Mr. COBLE. Let me reclaim my time. I want to put one more question. My time is about to expire.

    Mr. Fine, you have heard the old adage, I am here from the government I am going to help you, and the fear becomes rampant. I know lots of people respond to you that way. Oh, gosh, here comes the Inspector General smoking me around. I don't want any part of him. You probably have a thankless job. But nothing bothers me more, Mr. Chairman, than breaches of security. As my grandma used to say, it makes my coffee taste bad every morning. I think if there had been security breaches, I think we would need to resolve them, and it appears that you came in with that in mind, to do a good job, and I commend you for that.

    I thank you, Mr. Chairman.

    Mr. HYDE. The gentleman from Georgia, Mr. Barr.

    Mr. BARR. Thank you, Mr. Chairman.

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    Mr. Holder, you stated in your written remarks in talking about disciplinary and remedial matters that ''these processes are governed by Federal personnel law.'' what about Federal criminal law? Are these actions by Mr. Bratt, for example, governed by Federal criminal law?

    Mr. HOLDER. Sure. I think we provided to the committee a copy of that.

    Mr. BARR. Does that take precedence? In other words, if the Department uncovers what it believes are violations of Federal criminal law regarding an employee or former employee, is that not the most important thing, and personnel protection comes second to that?

    Mr. HOLDER. Yes. Which is why, as Mr. Fine indicated, there was a criminal determination made before the administrative procedures were allowed to proceed. The U.S. Attorney's Office in DC decided to decline prosecution. I think we provided a copy of that declaration memo to the committee.

    Mr. BARR. Did you review that?

    Mr. HOLDER. I looked at that in the last week.

    Mr. BARR. Do you concur with it?

    Mr. HOLDER. I think it is a pretty good document.

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    Mr. BARR. Maybe you could explain to us what the criteria is. We have before us a report, and I presume there is a lot more documentation available to you all, not less, but more than this report, yet this report lays out very, very clearly that Mr. Bratt violated procedures, failed to notify the Department of what was going on, responded in an untruthful manner to legitimate inquiries; he attempted to conceal the true nature of his relationship with these women; he didn't answer questions posed by OIG; he committed serious misconduct; he ''knowingly and intentionally violated the government's travel regulations.''

    If all of those things don't at least warrant criminal processes beginning, what in heaven's name is the criteria that the Department uses? You have an OIG report here that says he knowingly and intentionally violated Federal procedures and laws. What else do you all need?

    Mr. HOLDER. Well, as you know, you are——

    Mr. BARR. I do know.

    Mr. HOLDER. As you know, you are a former United States Attorney, to get to a jury you have to go beyond a reasonable doubt. It is one thing to say one thing in an Inspector General's report. It is another thing to go before 12 citizens and convince them that somebody has broken specific Federal laws. If you look at the declination memo, there were potential problems with——

    Mr. BARR. Was 18 USC 1001 looked at?

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    Mr. HOLDER. I don't remember what particular statutes were examined there, but I know they identified potential witness problems, that Mr. Lake, for instance, indicated that he did what he did without getting specific direction from Mr. Bratt, which made a prosecution on that basis problematic.

    It is not that there was not a desire to prosecute, if that was appropriate. I think the people in the U.S. Attorney's Office in DC did a good job looking at it and made a reasonable determination there was not a basis for criminal prosecution.

    Mr. BARR. Apparently, Mr. Keeney, all you think Mr. Bratt did was make some mistakes. That is what you said before.

    Mr. KEENEY. I didn't want to characterize them further.

    Mr. BARR. How about characterizing it further? Do you think this is a case that involves more than just making some mistakes?

    Mr. KEENEY. Well, he made mistakes, there is no question about it. His conduct was not commendable. I agree with that, Mr. Barr.

    Mr. BARR. Do you agree that he knowingly and intentionally violated laws and regulations of the U.S. Government?

    Mr. KEENEY. Well, the only referral, the only criminal referral on that score was with respect to the visa, and the United States Attorney's Office in DC concluded they couldn't prove intent to deceive beyond a reasonable doubt.

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    Mr. BARR. I guess, Mr. Holder, do you think that one of the problems that the government would face if it brought a prosecution would be all of these glowing recommendations, promotions and bonuses to this man, that when that became known to a jury, they would be less likely to convict? In other words, the government might have prejudiced its own case here by saying this guy is the greatest thing since sliced bread and giving him thousands and thousands of dollars to show that?

    Mr. HOLDER. I think, as Mr. Keeney indicated, the bonuses were based on past performance and are not related to the subject matter of this hearing.

    Mr. BARR. Some of them were recommended and awarded after this guy had his security clearance revoked because of misconduct, because he had proved himself untrustworthy. Then the Department of Justice turns right around and starts awarding him more bonuses. As a prosecutor, wouldn't that be something that would trouble you in trying to prove the Government's case, that the defense would come in and say, well, you know, he got bonuses, let's see here, he got bonuses on September 1997, May 1997, September 1996, March 1996, September 1995, April 1995, September 1994. He was recommended for an additional $5,000 bonus in November of last year. I mean, if a defense attorney that he would hire came in and showed all of that, don't you think that would make the Government's case more difficult?

    Mr. HOLDER. It might make it more difficult. In a lot of ways, this is in the nature of almost character testimony, I suppose, in some ways. Whether or not it would be admissible, but let's assume it was, I am not at all certain that would be something that would be a major impediment to winning a case, if there were a basis to proceed. Mr. Keeney apparently has some things that he wanted to say about when these bonuses were given?

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    Mr. KEENEY. Mr. Barr, these bonuses were for performances prior to his getting into difficulties.

    Mr. BARR. One of them here is recommended in November 1999.

    Mr. KEENEY. Well, Mr. Colgate tells me that was not approved.

    Mr. BARR. There was one in September 1997, for $12,000 that was approved.

    Mr. KEENEY. That was for conduct that took place prior to his——

    Mr. BARR. So the Department, let me get this straight now, the Department of Justice, they have an employee who is being investigated for serious security violations, and they move forward and think it is entirely appropriate to continue to grant this man bonuses simply because in some other technical work that he is doing, he does a great job? Is the Department that compartmentalized?

    Mr. KEENEY. No, sir. I am trying to make the point, Mr. Barr, that he was given awards for performances prior to his being involved in the activities which we are discussing today.

    Mr. BARR. He received them after that.

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    Mr. KEENEY. He may have received them after that. I don't know that. But what he got them for was performances prior to that point. He may have received one after he was under investigation, I would have to check that. But it was all for work that he had done previously.

    Mr. BARR. Let's say hypothetically, there is a gentleman, let's say hypothetically his name is Aldrich Ames, and let's say he did some great work for a hypothetical agency called the CIA. Let's say hypothetically he made some mistakes and got caught spying and went to jail. Well, it just so happened at the time he went to jail, there was pending an award or a bonus for some great technical work that he had done before.

    Are you telling me that there is no way that our Government can stop that sort of thing from moving forward simply because, gee, somebody says that before they got in trouble, or before they made some mistakes, they did great work? Doesn't that bother you?

    Mr. KEENEY. Mr. Barr, I can't address the hypothetical you are giving, because I don't know the answer to that. But I know that Barr was compensated——

    Mr. BARR. Bratt.

    Mr. KEENEY. [continuing.] For performances prior to his getting into difficulty and prior to our knowing he was in difficulty.

    Let me just finish one more thing. You know, this report that we have here that we are all addressing, the Criminal Division was unaware of the content of that report until last week.

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    Mr. BARR. You were advised of the sweep in April of 1999. You knew this was going on.

    Mr. KEENEY. We knew there were problems, and we tried to address those problems, and one way we tried to address them is by putting Mr. Barr——

    Mr. BARR. Bratt.

    Mr. KEENEY. I am sorry, Congressman, Mr. Bratt in charge.

    Mr. BARR. Putting him where?

    Mr. KEENEY. We put him in charge.

    Mr. BARR. That is a great way to deal with somebody who is under investigation.

    Mr. KEENEY. No, we are getting all mixed up on the time sequence. Maybe it is my fault. I am sorry if it is. But what I am trying to make clear is that we never knowingly compensated him for anything related to his performance with ICITAP and OPDAT.

    Mr. BARR. He was given a salary increase in January 1999. That is after his security clearance was suspended.

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    Mr. KEENEY. That is automatic. Are you talking I think about an automatic step increase?

    Mr. BARR. That makes the American people feel a lot better.

    Mr. KEENEY. We can't change the rules, Mr. Barr.

    Mr. BARR. Somebody is under investigation. There is substantial evidence that they are committing serious breaches of security, and you are saying that the system runs on automatic to the extent that these people keep getting increases and bonuses?

    Mr. KEENEY. You are talking about allegations. All we had, Mr. Barr, until last week were allegations.

    Mr. BARR. That is absolutely not true. His security clearance was suspended. They don't suspend security clearances unless it has changed dramatically since I was in intelligence, based on allegations. They do it based on evidence. They have to.

    Mr. HYDE. The gentleman's time has expired. Does the gentleman desire additional time?

    Mr. BARR. I would ask for additional time.

    Mr. HYDE. How much?

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    Mr. BARR. 5 minutes.

    Mr. HYDE. The gentleman is recognized.

    Mr. KEENEY. He did get an award in 1997 partially based upon ICITAP, but it was not—I will stick to this. We did not have the basis that we presently have with respect to his conduct. I hope that clarifies it.

    Mr. BARR. I am sorry, what?

    Mr. KEENEY. I am amending myself to say he did get an award in 1997 based in part for his performance with ICITAP. But, again, I repeat, it was given at a time that we did not have the benefit of this report, which we received last week.

    Mr. BARR. Yes, but you all knew what was going on. You all knew there was serious evidence this man committed serious breaches of security and procedure.

    Mr. KEENEY. We knew there were problems in ICITAP for years. One of the reasons we put Bratt in there was to try to address those. But we didn't tie Bratt to those violations at the time.

    Mr. BARR. Who do you tie allegations involving an individual to, if not that individual?

    Mr. KEENEY. You can only hold an individual responsible for conduct that took place under his stay.

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    Mr. BARR. His security clearance was suspended, not because of some general prior problems at ICITAP. At least I hope not. It is my impression that his security clearance was suspended for good and valid reasons based on evidence that he was doing some wrong things.

    Mr. KEENEY. At ICITAP?

    Mr. BARR. Wherever. And then he was given salary increases and bonus recommendations, even after that.

    Mr. KEENEY. One bonus recommendation I referred to. The other was an automatic step in grade increase.

    Mr. BARR. He was given a security bonus in September 1997. That was after the sweep and after the evidence was accumulated.

    Mr. FINE. Mr. Barr, maybe I——

    Mr. KEENEY. May I just clarify. His security clearance was given in 1998, that is what they told me.

    Mr. BARR. It was suspended.

    Mr. KEENEY. His security clearance was suspended.

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    Mr. BARR. Yes, in March of 1998.

    Mr. KEENEY. March of 1998. We are dealing with a bonus given in 1997.

    Mr. BARR. While he was under investigation.

    Mr. KEENEY. Well——

    Mr. BARR. Wasn't there a red flag, wasn't there something in your mind that set off a red flag, a red light, about this guy?

    Mr. KEENEY. There was no red flag until we got the information stating that the IG was conducting an investigation.

    Mr. BARR. Is this fellow an attorney?

    Mr. KEENEY. No.

    Mr. BARR. How come everybody speaks of him as an attorney and some of his performance appraisals talk about him as an attorney?

    Mr. KEENEY. If they do, it is in error. To my knowledge, he is not an attorney. He is a very skilled administrator, Mr. Barr.

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    Mr. BARR. Apparently, whoever does his performance ratings isn't, because they don't even know he is not an attorney. It is like a Chinese fire drill.

    Mr. KEENEY. If that is a fact, it is in error. If, in fact, the recommendation says that, it is in error.

    Mr. BARR. One of many. Clearly, since Mr. Bratt is no longer an employee of the U.S. Government, he is not subject to disciplinary action. He is still, though, subject to criminal investigation, is he not, Mr. Fine? I am not asking you to comment on whether he is under investigation. He is still subject to that. Simply because somebody leaves the Government, it doesn't immunize them from potential criminal liability, does it?

    Mr. FINE. No, it doesn't.

    Mr. HYDE. I am going to have to terminate your time, Mr. Barr. We have to get on to Mr. Hutchinson.

    Mr. Hutchinson.

    Mr. HUTCHINSON. Thank you, Mr. Chairman. Let me come to Mr. Holder and follow up on the questions that were just asked. You heard the sequence. It is my understanding it is fairly clear that the Department of Justice knew about the concerns on Mr. Bratt and his activities prior to the awarding of a number of different bonuses; is that correct?

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    Mr. HOLDER. I don't know. I was not involved in that process.

    Mr. HUTCHINSON. The reason I ask, I know you weren't involved in the process, but certainly this is an important issue to the administration and the Department of Justice and you reviewed this carefully. I reviewed the report and the information and it seems very clear to me that the Department was aware there was a referral to the public integrity section in March of 1997. Then there is a $12,000 bonus given in September of 1997, then there were public accounts of concerns, and there were security clearance concerns at that time.

    In your review of that, did you not ultimately come to the conclusion that the Department officials who awarded these bonuses knew of some problem with Mr. Bratt at the time the bonuses were awarded?

    Mr. HOLDER. They knew of problems. I would assume that people knew of the referral and the concerns generated by the existence of the investigation, but we didn't know exactly what happened with regard to the investigation until last week.

    Mr. HUTCHINSON. Okay. So you knew that there were some allegations that were made that were of a serious nature against Mr. Bratt. The conclusions had not all been completed because we had not received the OIG report. But in light of that, does the policy and what has been expressed by Mr. Keeney cause you any problem? This approach to the administration, that we award bonuses on past behavior, even though there are serious concerns about their present conduct and that they might be subject to disciplinary action?

    Mr. HOLDER. I am sure that in making the determination as to who ought to get bonuses, you take into consideration a range of things, not only past performance, but I think you would take into consideration the extent of a person's involvement in ongoing investigations and then make an appropriate determination.

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    Mr. HUTCHINSON. You believe the bonuses were appropriately awarded by the Department of Justice?

    Mr. HOLDER. I would have to—to be honest, I would have to read this report a little more than I have had a chance to do. I would have to become more familiar with the case before I would be able to express an opinion one way or the other on that. I have only had this for a week.

    Mr. HUTCHINSON. Mr. Robinson, do you believe, after hearing this and your review of the report, that the bonuses were appropriately awarded?

    Mr. ROBINSON. I haven't had an opportunity to examine whether it was or wasn't appropriate. It is a question I could examine and take a look at it. I obviously wasn't here at the time, and we ought to—I hear your questions, and Congressman Barr's questions, and we can certainly take a look at that issue.

    Mr. HUTCHINSON. Let me go on. Mr. Colgate, in the September 21, 1998, edition of the Legal Times, you are quoted as saying, ''Believe me, when the dust settles, Bratt will be vindicated.'' You also refer to the allegation made by the whistleblowers as ''an outrage. An absolute outrage.''

    Were these accurate quotes?

    Mr. COLGATE. The quote was accurate. The context was not fully accurate.

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    Mr. HUTCHINSON. Mr. Holder, several whistleblowers——

    Mr. COLGATE. Excuse me, one thing I want to point out, in full disclosure to the committee, is I am a close personal friend of Bob Bratt. That is why I have sat here quietly. I recused myself on that. When I gave that interview, I was recused and I was speaking to the character of somebody who was a very good friend of mine.

    Mr. HUTCHINSON. Well, you are also speaking to the character of some other individuals who were doing what they believe were an appropriate public service by blowing the whistle on this activity, and you called that ''an outrage, an absolute outrage.'' That is an accurate quotation?

    Mr. COLGATE. The quotation is accurate. But the question posed to me, because I remember it, because I was so outraged by the question that was asked was, the allegation was that Mr. Bratt was going to S&M bars in Russia and dealing with prostitutes. I just thought that that was just such an outrageous—that was the question. You never saw it in the article, but that was the question posed to me.

    Mr. HUTCHINSON. Mr. Holder, several whistleblowers have told us that the comments made by Mr. Colgate to the Legal Times intimidated them. They were scared and they feared for their livelihoods because the official in charge of management, personnel and security had publicly stated, in effect, ''I support my friend Bob Bratt, and not you whistleblowers.''

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    Can you understand how Mr. Colgate's comments can be perceived to be intimidating and do you believe those comments are proper?

    Mr. HOLDER. I tell you, I have had experience with the press similar to I guess what Mr. Colgate has indicated. If I were reading something in the press along those lines and was seriously concerned about something that existed in my agency, that would not prevent me from bringing that information to the attention of the appropriate people.

    Mr. HUTCHINSON. I am not sure I understood that completely. Is it the policy of the Department of Justice to comment on pending inspections or general investigations?

    Mr. HOLDER. No, it is not the policy of the Department to do that, no.

    Mr. HUTCHINSON. That is what happened in this case. Mr. Colgate was commenting to the press on the Inspector General's investigation, is that not correct?

    Mr. HOLDER. Well, he certainly made comments and expressed a personal opinion, I guess, about how he thought the investigation was going to turn out.

    Mr. HUTCHINSON. Did that violate your policy?

    Mr. HOLDER. I am not sure there is a policy we have. I think we tend to follow a rule, we don't comment about ongoing investigations.

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    Mr. HUTCHINSON. Well, if the whistleblowers were in here today and those who had cooperated with the IG were here in this room, what would you say to them?

    Mr. HOLDER. Well, I mean, I think, you know, it is an interesting part of your question. You say they ultimately cooperated with the Inspector General. I don't know the people who you refer to, I don't know how they individually would react to things that they read in the press. But I do know that ultimately the information apparently that they had was conveyed to the Inspector General, who did a good report, and we are trying to digest that report now.

    Mr. HUTCHINSON. Mr. Robinson, I have in front of me the visa referral application dated April 3, 1997, in which it was represented to the counselor for Consular Affairs that two Russian ladies have worked with the executive officer, Criminal Division, in support of administrative functions, Moscow office. It goes on and describes that and requests a visa.

    Those statements have been acknowledged to be false. There was no official relationship; it was a personal relationship, if not an intimate relationship, by Mr. Bratt with these two Russian women.

    This was referred by the IG to the U.S. Attorney's Office, or was it the Department of Justice?

    Mr. FINE. We initially consulted with the Public Integrity Section. But before there was a prosecutive opinion by the Public Integrity Section, we decided that because of the Public Integrity Section's connection to the Criminal Division, it would be better to send this matter to the U.S. Attorney's Office. It was then sent to the U.S. Attorney's Office. They reviewed it and gave the prosecutive opinion independently.

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    Mr. HUTCHINSON. Mr. Robinson, this is a public integrity matter, is it not? You are talking about a Department of Justice official and possible criminal wrongdoing.

    Mr. ROBINSON. I think so, yes.

    Mr. HUTCHINSON. That could be handled by the local U.S. Attorney's Office or handled by main Justice?

    Mr. ROBINSON. It could. To the extent it involved Criminal Division employees, it would be the normal and appropriate thing to do to not have the Criminal Division be involved in an investigation of a fellow employee within the division. I think in part that was the reason, if not in whole, that was the reason why the Inspector General went to the U.S. Attorney's Office so that they would be dealing with an office that was not in the Criminal Division. I think that—I wasn't here at the time, but I think that is the appropriate thing for them to have done, is go outside the Criminal Division.

    Mr. HUTCHINSON. That certainly does make it problematic, and I agree there would be difficulty making that decision within the Criminal Division. I concede that point. But I look at this as someone who has prosecuted cases, and particularly with the public's frustration, and with the importance of the Department of Justice setting a good example, I read this declination memo, and it is just difficult to understand why such a case as this, should not be pursued criminally. So because you viewed it yourself as a conflict in the Criminal Division, there was no review of what the U.S. Attorney decided in this case?

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    Mr. ROBINSON. It is my understanding there wasn't, and there wouldn't have been in a situation—this happens in districts around the country, as you know, when there are recusals. But my understanding is that this was a decision that was in the U.S. Attorney's Office, and no prosecutive input was made by the Criminal Division, and that would have been, in my view, appropriate, that there not have been involvement by the division with regard to a high ranking official within the Criminal Division.

    Mr. HUTCHINSON. Let me just say that Mr. Lake, who filled out this form, acknowledges that it is false, and acknowledges he had different information from Mr. Bratt. He is basically trying to take the fall for this and they are getting by with it. It is problematic to me that one, you have the bonuses, and two, you have the view this is not a prosecutable case in what I think is a very, very serious matter to the public.

    Mr. Chairman, with that, I yield back.

    Mr. HYDE. I thank the gentleman. Mr. Keeney wishes to say something?

    Mr. KEENEY. Yes, I would, sir. There is a great deal of confusion about this bonus bit. The last bonus that he got was approved and recommended by me. At that time I had no substantial indication of his being involved in improper—any improper and certainly not any criminal conduct. I would not have approved it had I been aware of it. We rewarded him for what he had done up to that point. We are not rewarding him for any period during which he engaged in misconduct.

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    Mr. HYDE. Thank you. Mr. Barr wanted to comment?

    Mr. BARR. Thank you, Mr. Chairman. It is my understanding, Mr. Keeney, that you did know that there were serious problems with this man. Were you not briefed right after, within a day or so, after the sweep was conducted, in April to be specific, April 16, 1997, when more classified documents were found improperly at ICITAP? Didn't you know in April 1997, that there were serious problems with Mr. Bratt? That is when you were briefed on the sweeps?

    Mr. KEENEY. We knew there were serious problems in ICITAP being addressed. I did not directly implicate Mr. Bratt in any personal involvement in that. There was no personal involvement.

    Mr. BARR. You are telling this committee you had no idea whatsoever throughout all of 1997, throughout all of 1998, that——

    Mr. KEENEY. 1998 I did.

    Mr. BARR. Finally 1998 you did?

    Mr. KEENEY. We gave this in 1997, for performance as of that date. At that time, Mr. Barr, I had no substantial evidence he was engaged in improper activity.

    Mr. BARR. Who approved the request for an award of $5,000 for him in November 1999?

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    Mr. KEENEY. I am not aware that there was one, any award in November of 1999.

    Mr. BARR. Could we have this document distributed to the witness?

    This is a document dated November 2, 1999. ''Jo Ann: Using whatever means you think most appropriate, would you please have the staff turn this into a recommendation for a $5,000 special act or service award for Bratt. There is one caveat in that Colgate's name should not appear in the paperwork, either as recommending official or as SERB member. He has recused himself from issues related to Bob because of their personal friendship. Thanks, John.''

    Mr. KEENEY. I didn't approve a bonus in that time period.

    Mr. BARR. Who did approve this?

    Mr. KEENEY. I am not aware it was approved.

    Mr. BARR. I understand, Mr. Colgate, it was not approved ultimately. I am trying to get at where did this come from, who was recommending him in November 1999, for an additional bonus, even if we concede that nobody knew anything about what was going on with this guy?

    Mr. COLGATE. As you stated, I was recused. My deputy, Janis Sposato, is sitting right behind here and could maybe address your procedural question, if that is okay with the committee.

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    Mr. BARR. I defer to the Chairman.

    Mr. HYDE. Surely.

    Ms. SPOSATO. During 1999, Mr. Bratt was detailed to the Justice Management Division and he was working in the Justice Management Division in the IRM area, and he was evaluated, he had a performance appraisal during that period that was—and it was an outstanding performance appraisal. It was given by Linda Burick, the Deputy Assistant Attorney General in JMD for IRM.

    In connection with that, she came to me, because Mr. Colgate was recused from personnel matters relating to Mr. Bratt, and recommended him for a bonus. In the normal course when we have an outstanding performance evaluation and a bonus recommendation in JMD, we put the person up for consideration in our bonus pool. But Mr. Bratt was not a JMD employee, was simply detailed to JMD. So we forwarded that recommendation, and that is under my signature, to the Criminal Division, because that is where he was employed.

    The Criminal Division elected not to give Mr. Bratt a bonus that year.

    Mr. BARR. This memo, November 2, 1999, is from a fellow named John. Who is that?

    Ms. SPOSATO. That is my colleague, John Vale, also in the Justice Management Division.

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    Mr. BARR. That is Mr. Colgate's deputy?

    Ms. SPOSATO. For human resources, that is correct. I believe when he learned, or when we all learned that Criminal Division had not elected to give a bonus in the SES bonus pool, he prepared that so that consideration could be given for a more narrow bonus based upon simply the work done in JMD. I am not sure though that that recommendation ever went forward.

    Mr. BARR. But there was a recommendation from Mr. Colgate's deputy in November 1999 for an additional bonus for Mr. Bratt.

    Ms. SPOSATO. That is correct. Based upon the work that was done in the Justice Management Division.

    Mr. BARR. Thank you. Thank you, Mr. Chairman.

    Mr. HYDE. Thank you. Just a few questions.

    I want to understand this. Even after Mr. Bratt's security clearance was stripped from him, he was then appointed acting director of JMD's information management narrow band communications wireless office; is that correct?

    Ms. SPOSATO. That is correct.

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    Mr. HYDE. That is correct?

    Ms. SPOSATO. That is a position that did not require a security clearance.

    Mr. HYDE. Was it a promotion?

    Ms. SPOSATO. Not in the sense—no, not in the sense that there was any change in status or pay. People might have their own opinions whether it was better than his previous job or not, but it did not affect his status in any way.

    Mr. HYDE. Okay. It is just a little curious to have someone lose their security clearance and not have it impact their job.

    A couple of people, John Shannonhouse was ICITAP's security director from August of 1995 to August of 1996, and as far as we know, was diligent in his attempts to enforce security standards and procedures. The Inspector General was told by ICITAP staff that Shannonhouse ''got flak for pushing security issues and was removed from his position as ICITAP's security director because he was overzealous. The Inspector General was also told that Mr. Shannonhouse was removed because ICITAP associate Deputy Director Joseph Trincellito complained to ICITAP director Janice Stromsem about Mr. Shannonhouse's persistent efforts to get Mr. Trincellito to abide by security regulations.

    Interestingly, however, the OIG was unable to find any manager who acknowledged making its decision to remove Shannonhouse and who would state the basis for that decision. Somebody had to remove Mr. Shannonhouse from his security post. Can anybody tell me who did so and why?

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    Mr. KEENEY. I know nothing about it. All I know about it is what you just read, and that I read in the report, Mr. Chairman.

    Mr. HYDE. Then we have a Mr. Paul Fary, who was also removed from his position as security officer without a really clear explanation. Mr. Fary also brought Mr. Trincellito's disregard of security regulations to the attention of ICITAP managers. Obviously a suicidal move. The Inspector General concluded that the clear message the managers sent was it didn't pay to be diligent as a security officer.

    This security business, if anything is trivialized, it seems to me a concern about security is. You have the Energy Department with a sieve in terms of classified information, you have the CIA, a former director having his own library at home, you have these questions here at the Justice Department, and security is way down on the list of serious concerns. Yet we spend billions of dollars developing things and developing information, and then somehow they get handed over to the other side.

    Now, Mr. Bratt—Mr. Fine, I direct this at you—effectively took the 5th amendment when he refused to answer your questions in February 1998, isn't that so?

    Mr. FINE. Yes, he declined to cooperate further unless he was compelled to testify, in effect invoking his 5th amendment rights, and we had to compel him after the prosecutive decision to testify. As a result, he got limited immunity for the statements he gave us in the compelled examination.

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    Mr. HYDE. Are there other examples of high ranking Justice Department officials who failed to cooperate with Inspector General investigations?

    Mr. FINE. In this one?

    Mr. HYDE. In general.

    Mr. FINE. Let me say, it is a rare event. It is a very rare event that high ranking Department of Justice officials need to be compelled.

    Mr. HYDE. Mr. Holder, you testified the Department had already begun to respond to some of the Inspector General's findings and recommendations by asking Bureau of Prison Director Kathleen Hawk Sawyer to be the deciding official for all disciplinary and remedial matters arising out of the report. You said by having her involved, it will help ensure that all decisions about employee discipline and debt collection are made fairly and consistently.

    I don't know, I feel you could make those decisions, Mr. Holder, fairly and consistently. Don't you think a matter of gross mismanagement and national security implications are significant enough to demand your attention? You manage the day-to-day operations of the Department and responsibility for disciplinary measures and debt recovery and collection are very important. Why do we have to bring in an outsider to do what would seem to me to be within your job specification?

    Mr. HOLDER. Well, I wouldn't call Kathy Hawk Sawyer an outsider. I mean, she is an integral part of our management team, a very respected person within the Justice Department, and the senior most career person in the Department of Justice, I guess, after Steve Colgate. She is seen as an exemplary planner. As I understand the process, she would be in a position to make its initial determinations as to what monies ought to be recouped, what discipline ought to be imposed. I would still remain in the chain serving, I suppose, for lack of a better term, as appellate court, if there were one—I am sorry, she makes the final decision apparently.

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    Mr. HYDE. You just lost your appellate function.

    Mr. HOLDER. The appellate function is apparently done by the merit system protection board.

    Mr. HYDE. Mr. Coble, do you have any more questions?

    Mr. COBLE. No more questions.

    Mr. HYDE. Mr. Barr, do you have any more questions?

    Mr. BARR. I do. Thank you, Mr. Chairman.

    Mr. HYDE. Did you say no?

    Mr. BARR. I do, Mr. Chairman.

    Mr. HYDE. There is Mr. Cannon. We will save him some time. Go ahead, Mr. Barr.

    Mr. BARR. Thank you, Mr. Chairman. You stated, Mr. Holder, that the director of the Bureau of Prisons would be deciding—would be the deciding official for all disciplinary and remedial matters. What disciplinary or remedial matters regarding Mr. Bratt could be taken? There aren't any disciplinary or remedial matters that would be taken against him at this point, are there?

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    Mr. HOLDER. Remedial, there is the recommendation in the report about recoupment of money related to the travel. I guess the use of business class and also the use of the frequent flier miles. So monies could be recouped from him.

    Mr. BARR. Who is in charge of looking at possible criminal steps, criminal procedure steps that could be taken against him? Will Ms. Kathleen Hawk Sawyer be in charge of making those recommendations?

    Mr. HOLDER. A referral was made to the U.S. Attorney in DY——

    Mr. BARR. The Department has closed its book on Mr. Bratt in terms of any prosecution? He is home free?

    Mr. HOLDER. I would not say he is home free. During the course of Ms. Hawk Sawyer's examination of this, if there was new evidence or a new basis to consider criminal matters, assuming that the statute of limitations had not run, there would be that possibility.

    Mr. BARR. Why would the head of the Bureau of Prisons be the one making that determination for any recommendations?

    Mr. HOLDER. Well, I am not saying that is her primary responsibility.

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    Mr. BARR. That is what I am wondering. Who is, if anybody, primarily responsible in the U.S. Department of Justice for looking to see if any criminal charges ought to be brought against Mr. Bratt?

    Mr. HOLDER. In this instance, it was the United States Attorney for the District of Columbia. I am saying, however, that on the basis of if there were newly discovered evidence, if in her examination of this, we would not be foreclosed from having the U.S. attorney in DC perhaps reconsider this matter.

    Mr. FINE. Mr. Barr, I should also say we have provided our report to the U.S. Attorney's Office, to the office that handled the initial prosecutive opinion.

    Mr. BARR. Well, okay, then I am somewhat confused here. Maybe you all can clear this up. Is the decision, any decision whether or not to prosecute Mr. Bratt for violations of the Federal criminal law during the time he was employed at the Department of Justice still open?

    Mr. FINE. I believe that report has been sent to the U.S. Attorney's Office. If the U.S. Attorney's Office, in its review of it, believes——

    Mr. BARR. You all don't send reports just to send reports, right?

    Mr. FINE. We send the report so they can have the information.

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    Mr. HYDE. Would the gentleman yield briefly? It is my understanding the referral, the criminal referral, was only on visa fraud to the U.S. Attorney. It wasn't for security or any other aspects of complaints against Mr. Bratt, and this wasn't a link between Mr. Bratt and the visa fraud. I mean, that fell apart because Mr. Lake apparently filled out the visa applications. This would make a great soap opera here, there were phone calls from Moscow to Mr. Bratt's home at midnight when the visa was turned in at the embassy in Moscow. But there were other issues that might be subject to a referral, and Mr. Fine has sent his report, which includes these issues, to the U.S. Attorney's Office; is that correct?

    Mr. FINE. That is correct. We have sent our full report to the U.S. Attorney's Office, to the office that initially gave the prosecutive opinion on the visas.

    Mr. HYDE. Okay. Thank you.

    Mr. BARR. Are there any decisions still open with regard to possible charges of 18 U.S. 1001, false and misleading statements, 18 USC 1505, or other sections in Chapter 73, obstruction of justice? These are some of the things that concern us. Your report clearly lays out that these statutes were violated, that there was evidence that they were violated. Are those matters closed or are they still open?

    Mr. FINE. I can't speak for the U.S. Attorney's Office, Mr. Barr. I can say that I have provided the report to the U.S. Attorney's Office.

    Mr. BARR. Are those matters still open or are they closed?

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    Mr. HYDE. I would suggest Mr. Fine has done his job, and now it is up to the U.S. Attorney or the Department of Justice, to take action on the report insofar as they see fit to do so, and it is our job to watch and see what happens.

    Now, if I may, Mr. Cannon.

    Mr. CANNON. Thank you, Mr. Chairman.

    Mr. Fine, according to the most recent IG annual report, your office interviewed more than 400 people, some of them in foreign countries, and reviewed more than 50,000 documents for this investigation over the last several years. The OIG has lost over 100 people and your office was the only one that did not have a performance award program in 1999. This investigation clearly took a lot of time and people. Does the Office of the Inspector General have adequate resources to meet its many obligations?

    Mr. FINE. Mr. Cannon, I don't believe so. We have suffered, over the last several years, a decline in numbers of staff. We have lost 100 people. We have had to cut down on our travel, we have had to cut down on a number of things in response to our budget problems.

    If you look at our office compared to the Department, where we were in 1993 and where the Department was in 1993, the Department has grown by leaps and bounds in the last 7 years, more than 25,000 employees, more than 90 percent in funding. We have stagnated. We have a flat line, they have an increased line.

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    We believe that we should keep pace with the growth of the Department and that oversight is an important function, and that we need the resources to do all the investigations and audits and inspections and evaluations that we are charged to do. This did take a lot of resources, and we believe that we are understaffed and underresourced.

    Mr. CANNON. Thank you. I am a firm believer in oversight resources. It is much better to have people understand that they will be caught if they do something wrong than have people press the limit on that. So we will see what we can do.

    Let me ask a general question of the panel. We understand Mr. Bratt is employed at SAIC, which is a government contractor. Did anyone on the panel communicate to any SAIC official about employing Mr. Bratt? Let me start with Mr. Holder? Are you aware?

    Mr. HOLDER. No, I did not. I am not aware of anybody else who did. I don't know.

    Mr. ROBINSON. I certainly didn't.

    Mr. FINE. No, we didn't.

    Mr. COLGATE. I am not aware of it, no.

    Mr. KEENEY. I am not aware of it.

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    Mr. CANNON. Mr. Colgate, if I could just follow up with a question for you. Has the Department, since 1994, audited the ICITAP, OPDAT or any of its contractors, such as EBON, SAIC or Interlog? If so, what were the finding of those audits, and could you provide copies to the committee?

    Mr. COLGATE. I will check into it and we will provide copies to the committee.

    Mr. CANNON. Do you have any awareness right now of any audits?

    Mr. COLGATE. No, sir, but we will check and get back to you.

    Mr. CANNON. Mr. Holder, one final question for you. Did you, Attorney General Reno, Jim Robinson, Jack Keeney, Stephen Colgate, Mark Richard or your offices ever receive any communication, including e-mail, memoranda or letters, suggesting that these problems identified by the OIG existed at ICITAP, OPDAT, and, if so, could you provide copies of those communications to the committee and explain what was communicated to you and what action was taken in response?

    Mr. HOLDER. Yes. I have a vague memory that I—and I'm not sure, we will have to check this to make sure, that we did get, or I got some e-mails that I referred to other people to look into. But we will search, we will get on the computer and reproduce those, and if they exist, we will provide them.

    Mr. CANNON. Thank you very much. Mr. Chairman, I yield back.

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    Mr. HYDE. I thank the gentleman. Mr. Conyers would like another 5 minutes, and he is certainly recognized.

    Mr. CONYERS. Thank you, very much. It is about time for lunch, and we normally treat witnesses a little better than this. You know, from 10 to a quarter to 1 but this is an important matter.

    Let's take a look, Mr. Keeney, at—Mr. Barr and Mr. Hutchinson seem to have suggested that bonuses continue to be awarded to Mr. Bratt and that these awards were improper.

    What is your view? Do you think the Department's awards of bonuses was improper or based on improper considerations?

    Mr. KEENEY. No, Mr. Conyers. The awards that I am aware of and the awards that I approved were based upon merit and exceptional service, and they were made at a time that I had no substantial evidence that he was engaged in any improper conduct.

    Mr. CONYERS. All right. Mr. Fine, did the IG investigate the award of bonuses to Mr. Bratt, and is this an allegation addressed in the report?

    Mr. FINE. No, we did not, and it is not addressed in the report.

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    Mr. CONYERS. To Mr. Holder, Deputy Attorney General, why are we still talking about bonuses to Bratt when this—I shouldn't be asking you why we are still talking about that. I mean, you don't control the questions in this setting.

    Okay, let me ask you this, Mr. Holder. The Inspector General's report clearly concludes that a small group of employees within one program of the Department of Justice violated department policies and possibly committed criminal violations. However, the findings of the Inspector General's investigation suggest to me that the Justice Department was an internal mechanism for rooting out cases such as these, and in this case the self-regulating process worked.

    Is that too rosy a picture of what has been happening, or what?

    Mr. HOLDER. No, I don't think so. I mean, I think that we have been lucky to have a serious of good inspectors general. Mike Bromwich did a great job for us, his successor, Mr. Ashbaugh, now we have Glenn Fine. Properly staffed, properly funded, and we have fought for that, our Inspector General is, I think, probably the most capable of all of the inspectors general that exist. I think that mechanism worked here. They did a good report, they uncovered wrongdoing, and we are in the process of trying to digest that report and we will take the appropriate steps.

    Mr. CONYERS. Right. Which not only include discipline where warranted, but a study of the process to make sure that you can intervene in this kind of misconduct at the earliest possible point.

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    Mr. HOLDER. That is correct. It is not only a question of what individuals did, but they have identified systemic weaknesses as well that we are going to address, and have been addressing.

    Mr. CONYERS. Well, that satisfies the questions I had, Chairman Hyde. I thank you.

    Mr. HYDE. Thank you very much. I want to thank this panel for your tremendous contribution. I just would say parenthetically, the fact is Mr. Bratt was given $31,500 in bonuses on top of his $120,000 salary, while and when these abuses happened. So he was either rewarded for bad behavior, which I doubt, or someone was asleep at the switch or not supervising. Often the left hand doesn't know what the right hand is doing, and it seems to me this situation is one of those situations.

    In any event——

    Mr. HOLDER. Just for one thing, Mr. Chairman, in regard to the last bonus, in terms of the right hand not knowing what the left hand is doing, the decision not to go ahead with the bonus was made by career people in the Deputy Attorney General's office who ultimately turned it down.

    Mr. HYDE. That is good. In any event, thank you. I would like you folks to agree if we have other questions, to submit them in writing and you will answer them.

    Mr. HOLDER. We will certainly do that.

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    Mr. HYDE. Thank you. Mr. Fine, you have got the toughest job—one of the toughest jobs—in America. Thank you very much.

    The committee stands adjourned.

    [The information referred to follows:]

Churchton, MD, September 20, 2000.

Hon. HENRY J. HYDE, Chairman,
Committee on the Judiciary,
House of Representatives, Washington, DC.

DEAR CHAIRMAN HYDE: I would like to thank you and the Committee for your careful oversight in this latest Department of Justice scandal, which unfortunately appears to reach into the highest levels of the federal service. I also wish to thank you and your staff for allowing me the opportunity to address, through this letter, some of the history concerning this shameful episode and the Department's apparent decision to remain in a state of denial rather than to address the causes at the root of the problems uncovered.

The Inspector General's (IG) report released last week said that the Justice Department's latest national security scandal ''should have been apparent to any taking the time to look.'' It said that the ''disturbing history'' of senior Department officials' some close advisors to Attorney General Janet Reno, others recent recipients of hefty cash awards from her—had allowed Criminal Division employees to become ''cynical about the ethics of the department as a whole.'' The IG report noted that their three-year investigation was the result of disclosures that I had made in April 1997 concerning illegal and unethical conduct in the Department's international training programs. Unfortunately, in what has become a pattern for Inspector Generals' reports—the case of Fred Whitehurst and the FBI crime lab was one of the most notorious examples—the IG has engaged in a practice of bashing the whistleblowers even as it seeks to take credit for our work.

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    This hearing comes at an interesting time. Earlier this week, Rep. Christopher Cox laid bare the failing U.S.-Russian relationship, including a searing indictment of the lost opportunities to fight international crime under the Clinton-Gore administration. Not surprisingly, much of the blame lands squarely on Janet Reno's scandal-racked Justice Department. ''The lion's share of our aid was aimed at shoring up'' the corrupt government of then-President Boris Yeltsin, Cox reported, while U.S. aid programs for the rule of law ''were just a tiny fraction of our attention.''

    It didn't have to be that way. In the early 1990s, when I worked on the Senate Foreign Relations Committee for Sen. Alan Cranston (D.-Calif.), we worked closely with the office of then-Attorney General Richard Thornburgh to provide such assistance to the newly emerging democracies of Eastern Europe and the former Soviet Union. It was a heady time, when both political parties embraced a dream of a ''new world order'' that would be ushered in with the fall of the Berlin Wall. As you know, U.S. security interests abroad are best protected when the United States speaks with one, bi-partisan voice, and at the time it looked like we were on our way to breaking down our own ''wall—that of unnecessary and messy wrangling over foreign policy.

    Under Sen. Cranston's direction, I co-founded a Congressional staff working group set up by the Center for Strategic and International Studies (CSIS) in order to draw attention to the law enforcement needs of the formerly communist region. Sen. Cranston pushed hard for the establishment of FBI legal attache offices to be established east of Vienna, an initiative fought behind the scenes by a turf-conscious CIA. We also sought to loosen restrictions on foreign police training, a controversial effort among our liberal Democratic friends, who constantly decried efforts they saw as ''getting us back into the torture business.''

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    U.S. foreign police training efforts had been curtailed in the mid-1970s due to concern about intelligence agency infiltration in such programs and documented allegations that U.S. support was being given to forces that routinely tortured and killed political opponents. The argument squarely meshed with the Cold War divide between ''hawks'' and ''doves,'' and effectively immobilized the marshaling of U.S. expertise to help developing countries create better legal systems.

    With the fall of communism, however, a strong case could be made that the development of professional civilian police forces could not only effectively fight common crime and drugs, but also be enlisted in the struggle to secure human rights. In Latin America, there was another argument in favor of professional and humane police training—military coups were virtually impossible when the police remained loyal to civilian government.

    I had some personal experience in democratic development that I thought would be of service in helping to implement these new policies that we had played a role in crafting. In the 1980s, I had served in as a special correspondent for Newsweek and the Washington Post in Buenos Aires, where I covered the 1985 ''dirty war'' trials of the former military juntas. (In 1993, a book I published on the subject was called a ''tour de force'' by The New York Times.) From 1987 to 1990, I served as director for Latin American programs and the civil-military project of the National Democratic Institute for International Affairs (NDI) headed by former Vice President Walter Mondale.

    In the months before the IG began its investigation, I was optimistic about my future at the Justice Department. In 1996, I received an ''outstanding'' annual performance evaluation. Thomas Snow, acting director of the Office of Prosecutorial Development and Training (OPDAT), wrote that ''I learned very early during my tenure to rely heavily on the talent and enthusiasm of my OPDAT colleague, Mick Andersen.''; Division ethics officer James Silverwood praised my ''excellent professional skills.'' My letters of recommendation from supervisors and co-workers attest to the fact that I was a ''team player.'' Even Vice President Al Gore's brother-in-law, then Assistant Attorney General for the Civil Division, Frank Hunger, invited me to lunch in the Department cafeteria to discuss how to set up international programs under his direction (Please see attached documents.)

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    I found that my optimism was misplaced. Before the IG investigation began I had complained to Division Executive Officer Robert Bratt about high-level leaks of highly classified documents to uncleared contractors. I and a co-worker had brought to Silverwood's attention a lucrative no-bid contract awarded to Bratt's former superior, Assistant Attorney General for the Criminal Division, Jo Ann Harris. A co-worker and I stopped a translation service overrun, at the hands of a Bratt lieutenant, that cost more than $100,000, from more than doubling. Bratt did nothing, and my personal situation soon began to worsen.

    The Criminal Division's security office was increasingly perceived to be ''in the tank'' with Mr. Bratt and other senior officials whom the IG found responsible for ''egregious misconduct.'' So in April 1997 I took my concerns about leaks of CIA documents to the main Justice security office headed by Jerry Rubino. Despite Rubino's promise of confidentiality, I later found that I had been fingered to Bratt by Rubino's office as the person whose disclosures sparked the IG's investigation.

    As you will note in the IG report, a great deal of my disclosures concerning wrongdoing were upheld and even expanded upon during the subsequent more than three-year long criminal investigation. In addition to the security leaks, the unbid contracts, and the waste of hundreds of thousands of taxpayer dollars, I provided the IG with a number of other investigative leads that were found to have merit. For example, I complained about Bratt giving a career federal service position to a former girlfriend who had been a waitress at Lulu's bar on M Street. I also told the IG that Bratt subordinates helped him repair his beachfront home in Delaware. I provided all the documentation necessary for the IG to find that Bratt's replacement as Criminal Division Executive Officer, Sandie Bright, had arranged for Department of Justice computers to be ''donated'' to her husband's school district, creating a glaring appearance of favoritism and impropriety. I also was the person who referred a senior Division lawyer to IG investigors after he told me he had evidence that Bratt and his chief assistant Joseph Lake had committed visa fraud.

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At the same time, I was disappointed that the IG did not address other, equally relevant, issues concerning the Harris contract and allegations from ICITAP co-workers that I had brought to their attention concerning Department of Justice contractors'' sexual relationships with adolescent girls in Haiti. I was also concerned that left unmentioned were several serious security flaws that I had reported to the IG about the Office of International Affairs, at the time headed by Fran Fragos-Townsend. When I arrived at OIA I found that uncleared college interns were allowed to eat their lunches unsupervised in the room where highly-classified information concerning international criminal matters was stored. (Ms. Fragos-Townsend is now Ms. Reno's senior advisor on intelligence issues.)

My disclosures did not help me however; I soon found that my professional life was in shambles. I was stripped of the interim secret security clearance I held for 18 months. The only explanation was to rewrite history and claim I never had one, although I had received written notice of the interim clearance and regularly been reviewing classified records since being hired. I was removed from the OPDAT office and reassigned to Bratt's Administrative offices—at a time Bratt said my performance was again under review. Stripped of my duties and absent a security clearance, I was for a time warehoused in an office used to store ''burn boxes'' full of classified information. The absurdity of this situation was underlined when Bratt also asked me to stay late to help draft a memorandum on highly-sensitive immigration issues that he was to present the next morning to Attorney General Reno. I also was banned from the OPDAT office where I continued to file my time and attendance sheets, and was spit on and screamed at a zealous former co-worker who apparently was eager to be seen as carrying out management's vendetta against me. The fact I no longer had a security clearance was used as a justification for my dismissal from service on September 3, 1997.

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The IG's office could have protected me. It did not. In the summer of 1997, two of its investigators used the same phrase at different times: ''Do what you need to do to save yourself.'' When the IG later found I had gone to Congress and the press to do just that, they started warning colleagues who had remained friends to stay away from me. (A senior ICITAP manager who had remained my friend, a person of normally unflappable and sunny disposition, said the pressure brought to bear was so blatant that he ended up telling the investigators to ''go (expletive deleted) themselves.'' According to this friend, one senior investigator even suggested I had engaged in whistleblowing ''for the money.'' (There was no potential money to be made. Federal Whistleblowers are limited to actual, not punitive, damages.)

When I was dismissed from federal service, Frank Hunger—the Vice President's brother- in-law and my one-time lunch companion—failed to stop the Civil Division reprisal against me, despite brother-in-law Al's ''personal guarantee'' given in 1993 to USA Today that punitive actions against whistleblowers would end. (Ironically, I had supported Gore for president in 1988 and had worked as unpaid issues staff in the Clinton-Gore campaign of 1992.) In a May 25, 1993 cover story, in which the Vice President was interviewed about ''reinventing government,'' it was reported that:

In fact, the primary focus is on changing the culture at federal offices . . . Gore said the (ReGo effort) will produce . . . a reduction in fear. Gore emphasizes that federal workers who report waste or abuse will not be punished. ''I give my personal guarantee that an employee of the federal government who assists us will not suffer retribution,'' the vice president said.

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    I should also mention that in 1997, before my disclosures became widely known, the Vice President's office had recommended me for a political appointment.

    In 1998, the powerful Assistant Attorney General for Administration, Bratt's friend and mentor Steve Colgate, announced to the prestigious Legal Times that Bratt would be fully vindicated. At this point it appeared that the system was truly broken. It was quite apparent that there was no controlling legal authority at Reno's Justice Department.

    My case points to a glaring loophole in free speech protection for whistleblowers. The Whistleblower Protection Act of 1989 does not cover those who engage in protected speech—making complaints about official misconduct, waste, fraud and abuse—and who suffer reprisal through removal of their security clearances. Even supervisors guilty of grave mishandling of national security information have it in their power to strike back at those who bring these serious breaches of public trust to the authorities by stripping them of their ability to work with classified information. The result is often a loss of duties, which is then used to get rid of the offending employee.

    Although I was completely vindicated by the Inspector General's report for my whistleblowing disclosures, three years after I was released from federal service I am still is awaiting vindication for my claims of reprisal for daring to ''commit the truth.'' Several other courageous Department whistleblowers are also the possible victims of reprisal by the Department of Justice. The following paragraphs briefly detail their allegations:

VALLEREY VANDEGRIFT, TRIAL ATTORNEY, AVIATION AND ADMIRALTY SECTION

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    Ms. Vandegrift worked in the ''crash and splash'' unit at DOJ, which defends US with respect to air and sea disasters, e.g., a plane crashes and survivors sue FAA. When Ms. Vandergrift worked with senior attorney on two cases, she noted excessive settlements in both. In one, a plaintiff's attorney allegedly tried to bribe attorneys in a case that eventually settled for $33 million with U.S. paying approximately $28 million (only 6-7 plaintiffs). After Ms. Vandergrift complained, she was given unsatisfactory performance evaluation and asked to leave DOJ or else could never practice law again. Both the fraud and the retaliation occurred while Vice President Gore's brother-in-law, Frank Hunger, was AAG for Civil Division. Ms. Vandegrift's husband elevated the matter to Mr. Hunger, Ms. Reno and Mr. Gore—to no avail. Ms. Vandegrist became severely depressed and has sought treatment for stress

GREGORY C. SASSE, ASSISTANT UNITED STATES ATTORNEY

    ''I reported important cases being compromised and I reported harassment and reprisals against me personally in connection with my environmental prosecutions and my efforts to form and promote an environmental crimes task force in northern Ohio.

    ''The retaliation consisted of systematic efforts to create a completely hostile work environment, including verbal abuse, a more than double caseload;. . .; no training or seminars; interference with important, complex cases; downgrades in performance based upon pretexts; arbitrary, hidden deadlines; and adverse work standards.

    ''My environmental discrimination/WBer lawsuit will have a pre-conference hearing on October 3, 2000. I just won a decision from the administrative board of review of the Department of Labor denying DOJ's motion to dismiss for lack of jurisdiction.''

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DANIEL JACOBS, TRIAL ATTORNEY

    ''After I made disclosures of government wrongdoing, [AAG] Lois Schiffer issued orders prohibiting me from speaking to my own lawyers, under threat of disciplinary action. . . . DOJ also made veiled threats of criminal prosecution were I to show copies of documents to them.

    ''In Jacobs v. Schiffer, 47 F. Supp 2d 16 (D.D.C. 1999), Judge Thomas Penfield Jackson issued a published decision enjoining the prohibition, and in Jacobs v. Schiffer, 204 F.3d 259, 265 (D.C. Cir. 2000), the Court of Appeals unanimously awarded me attorneys fees, finding DOJ's posiiton to have been inexplicable. DOJ has yet to address how it intends to reedy the negative impact on my exemplary 16-year career at the Department.''

SUSAN SWIFT, ATTORNEY ADVISOR

    Among other things, Ms. Swift reported the alleged misconduct of OLC's Executive Officer, who she said, used her official position for the private gain of herself and others on a regular basis, and violated anti-discrimination laws. Ms. Swift alleges that the Justice Department official submitted fraudulent time sheets and leave slips for herself and others and encouraged other OLC employees to do same thing; used government vehicles for personal errands; used government personnel for personal errands (e.g., sent an employees to buy ''ice cream''—her code word for beer—as if he were her personal lackey; unfairly harrassed an African American female paralegal through ostracization and bad performance evaluations), and exhibited blatant racism by saying ''I'm glad I don't work in the Civil Rights Division anymore because they were all black there.''

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    According to Ms. Swift, as a result of reporting wrongdoing, the OLC Executive Officer and a Deputy Assistant Attorney General who allegedly had participated in the time sheet fraud surreptitiously broke into Ms. Swift's office computer, had OPR investigate her in an unheard of 30-day expedited inquiry; proposed that she be fired; kept her on administrative leave for over 3 years; urged a DC SWAT team to storm her apartment when she became depressed and suicidal, and then contrived reasons to have her arrested by the FBI in an apparent effort to push her over the edge; and forced her into a psychiatric ward. Ms. Swift developed post traumatic stress disorder and—while facing possible criminal charges—was allegedly sexually exploited by an OPR attorney. When Ms. Swift resisted the pressure to resign, she was suspended for 2 weeks and transferred to a litigating division even though she does not know how to litigate. DOJ eventually revoked the suspension, and Ms. Swift obtained an order expunging her arrest records which the US Attorney's Office failed to honor. The alleged misconduct by senior Justice officials was reported to Reno, Holder, current OPR management, former OLC AAG Walter Dellinger, and current OLC AAG Randy Moss. The failure to expunge has been reported to OPR. DOJ officials have done nothing.

    Mr. Chairman, Schopenhauer once wrote that ''every truth passes through three stages before it is recognized. In the first, it is ridiculed. In the second, it is opposed. In the third, it is regarded as self-evident.

    In the case of federal whistleblowers, we are well familiar with all three steps. We suffer the first two; finally, when a truth'' like the findings of the Inspector General's report—becomes self-evident, most people seem uncomfortable with those of us who helped bring the truth to light.

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    Doing the right thing has not been easy. Until my alimony payments ended a few months ago, 60 percent of my after-tax income went to alimony and support for my two children. Both they and my parents have lived many anxious and unhappy days as a result of the retaliation I have suffered—not only by those who I accused—rightly—of wrongdoing, but also at the hands of the Inspector General.

    As you will note in the IG report, I am faulted on two occasions. Once, as a contractor, I took home a classified document that had been buried in a pile of papers I was given by ICITAP management to work with. As the IG report itself noted, in a profile of the security situation in the office I worked:

After the SEPS sweep in April 1997, ICITAP conducted a search of its unsecured files for classified documents. Classified documents were found mixed in with unclassified documents in the ''central country files,'' which were stored in unlocked file cabinets in hallways and accessible to anyone walking through ICITAP.

    In using the mound of papers I brought home, I did not find the classified document and only discovered it about six months later, when I was cleaning my apartment. I should mention that just a few weeks earlier, I had incurred the wrath of senior ICITAP management for challenging violations of EEO and security rules by them. I could have destroyed the document (I had not signed out for it; I could not even be held responsible for having it as it was given to me as a contractor.) However, I returned it to the same people about whom I had complained. The difference, which the IG did not bother to note, is that rather than evade responsibility, I accepted it, even when it meant going back to people who clearly had their knives out for me.

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In the second case, the IG muttered darkly in print about a relationship I had with a Russian woman. However, they again shaded facts that would have placed my actions in a more correct light. The woman I was dating for approximately two months already had been screened and selected by the Department's National Institute of Justice (NIJ) as an academic fellow. The Justice Department also provided her with a pass which allowed her free access to numerous offices, including areas of OPDAT where I did not work. She worked closely with a U.S. Agency for International Development grantee working on anti-organized crime issues in the former Soviet Union. She was also the close friend of the son of a former senior official of the CIA who later went on to be ambassador of an important Asian country. I should also point out that what she characterized as joking requests for classified information were repeated twice, not three times, as the IG reports. The first time, I ended the banter firmly by telling her never, ever to joke about such matters. The second time, I ended the relationship within 24 hours.

The IG faults me because I did not report the incidents for several weeks. However, the IG did not report that I felt uncomfortable about making an accusation that might be unfair—given the circumstances—and end up smearing her to no purpose. It also failed to say that when I did report the incident, it came after learning that another Russian national on a visitors program was believed to be an intelligence agent. It neglected to say, however, that the two FBI agents who interviewed me about her told me, and told a fellow worker, not to worry, as I had done the right thing. It also did not report that, according to FBI sources, the woman was ''cleared.'' The IG also did not say that, had I never reported the incident, no one would have been the wiser; I did so out of concern that, the possibility, however remote, that the woman was a spy needed to be dealt with. Nor did they note that the I had never received from the Department the security briefing required of all personnel handling classified information; I only found out that the Department was required to offer such training a year later.

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    In addition, in the footnotes the IG includes comments from ICITAP management which are patently false, particularly given the time frames in which they allegedly occurred; probably originated from the gang that was found to have committed egregious faults, and about which I was never able to respond.

    Given the IG's shabby treatment of Fred Whitehurst, its shocking disclosure of the confidential complaint about whistleblower reprisal filed by a co-worker and friend, and their own treatment of me, the appeal made in the report that those aware of wrongdoing should go to the IG and report it is a mockery. Anyone who does so is likely to be investigated and later defamed, and possibly destroyed, by the same people who smilingly tell us that they are open for business. And what about the wise injunction of committee minority staff director Julian Epstein, who just a few weeks ago declared on national television, apropos of another Clinton- era situation, to the effect that if you are cleared you shouldn't be smeared?

    Mr. Chairman, such dereliction shows that then it comes to whistleblowers, the only thing they can count on from the IG is that they can't count by them. Going to the IG for protection against retaliation is an exercise in futility. The country and western song, ''Stand by your man,'' should be adopted as an anthem by the IG as 'stand by your witness.'' Unfortunately, my own example at the hands of the IG serves as a powerful disincentive for people to come forward and do the right thing. I think it is necessary to note that, like all other components of the Justice Department, the IG's office space and other perks are doled out by Mr. Colgate, Mr. Bratt's useful friend and, at the same time, head of the Justice Management Division.

    On a personal note, I would like to ask how am I supposed to account for the two years I spent at the Justice Department? I am now faced with seeking employment in a company town whose company—the federal government—has shown me the door. In job interviews, I will likely have to explain what happened. I hope that they will listen to me, about my accomplishments, and why making waves was the right thing to do. Washington is a busy town, however, and who is going to take the time to check out the facts—particularly when most people think, reasonably, that the Justice Department is in the business of dispensing justice, and its Criminal Division is free of criminals? I am not optimistic I will get a fair hearing.

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People have a right to expect that their tax dollars are spent wisely . . . and impartially. The lot of a whistleblower may be that of a lonely sentinel, but he or she is really accompanied by millions of Americans who are willing to pay for government services—but also who expect that public officials serve, not take. It is a modest pretention. So, too, is the expectation that people who take risks to protect the common interest are themselves not exposed to unnecessary harm.

Again, I very much appreciate the opportunity you have afford me, and the work that you are doing to ensure that the Department gets back on the right track.

Sincerely,

Martin Edwin Andersen.

Enclousers (3)

U.S. Department of Justice,

Criminal Division,

Washington, DC, April 9, 1997.

re: Martin E. Andersen

TO WHOM IT MAY CONCERN: From September 30, 1996 until April 4, 1997, I served as the Acting Director of the Office of Professional Development and Training (OPDAT) in the Criminal Division of the U.S. Department of Justice. This period proved to be one of significant reorganization and expansion for OPDAT. Fortunately, I learned very early during my tenure to rely heavily on the talent and enthusiasm of my OPDAT colleague, Mick Andersen.

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    Mr. Andersen demonstrated a combination of long term vision and practical day to day problem solving. In a time devoted to instituting management reforms and creating standard operating procedures, Mick was a never ending source of new ideas and suggestions. For example, he assisted me in establishing standardized bi-weekly reporting from our overseas resident legal advisors (RLAs), made very useful contributions to the design of our improved office management information system, and drafted a comprehensive plan to regularize the smooth deployment of new RLAs.

    Of Mick's many strengths, the one I most often drew upon was his gift as a writer. Whether assigned a lengthy policy piece, or a short, pithy paragraph for submission to the Attorney General's weekly report, the result was always clear, accessible, and analytically sound. Moreover, he consistently turned out a superb written product on very short deadline—a talent both valuable and rare.

    Both I and the entire Office benefited from the fact that Mr. Andersen is a team player. He routinely sought out additional responsibility, and gladly took on the additional work which accompanies such responsibility. He also often volunteered to help busy OPDAT colleagues complete their assigned duties—and did so without seeking credit or recognition. I was particularly gratified by his unsolicited creation of a morale boosting, Wednesday lunch group for all interested OPDAT staff.

    In short, I would gladly recommend Mr. Andersen for any position which requires outstanding communication skills, insightful analysis, and a strong sense of mission.

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Sincerely,

Thomas G. Snow, Deputy Director,

Office of International Affairs.

U.S. Department of Justice,

Criminal Division,

Washington, DC, April 11, 1997.

    TO WHOM IT MAY CONCERN: This is to recommend Martin Andersen. Since approximately 1996, I have worked with Mr. Andersen in the Criminal Division's Office of Professional Development and Training. My working experience with him has been very positive.

    Mr. Andersen's contributions to the office have been marked by innovation and enthusiasm. He has displayed exceptional writing and research skills. His good judgement and excellent communications skills have served this office well. At all time he has been willing to assume responsibilities beyond his own and his work product has been first rate.

    Beyond his excellent professional skills, I have found that Mr. Andersen has been a ''team player'' and supportive of the mission of the office. It has been a pleasure working with Mr. Andersen and I believe that he will make a positive contribution as he assumes his new assignments.

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Sincerely,

James R. Silverwood, Acting Director,

Office of Professional Development and Training.

U.S. Department of Justice,

Criminal Division,

Washington, DC, June 13, 1997.

TO WHOM IT MAY CONCERN: I am writing to offer my highest recommendation to Martin ''Mick'' Andersen, who served for nearly 18 months as the senior advisor for policy planning at the Overseas Prosecutorial Development and Training (OPDAT) program of the Criminal Division of the Department of Justice. I first began working with Mick in my capacity as program director for anti-organized crime assistance in Eastern Europe and the former Soviet Union (NIS). Then as now, I have thoroughly enjoyed my association with him.

During his time at OPDAT Mick has received accolades for his many important contributions to the work of the Justice Department overseas. Whether dealing with Latin America, Haiti, Eastern Europe or the NIS, Mick has shown keen insight into the peoples and problems of the countries where we have worked. In particular, his work was key to establishing OPDAT policies regarding the scope and quality of its work. Also, Mick worked with me in the development of the strike force assistance program in the NIS. He has prodigious research and writing skills, and a strong sense of teamwork and fair play.

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During our year-and-a-half-long association, Mick has become more than just a valued co- worker, but a trusted friend as well. Beyond his professional skills, Mick has shown he is a person of integrity and honesty and someone who gets along well with others. As I move on to my new position as a naval officer stationed in the Far East, I will miss his wise counsel and sound policy judgement. I recommend him without hesitation.

Sincerely,

Michael Gray.

[Whereupon, at 12:50 p.m., the committee was adjourned.]

A P P E N D I X

Material Submitted for the Hearing Record

U.S. Department of Justice,

Washington, DC, September 28, 2000.

Hon. HENRY J. HYDE, Chairman,
Committee on the Judiciary,
House of Representatives, Washington, DC.

DEAR MR. CHAIRMAN: On September 21, 2000, I testified before the House Judiciary Committee along with several other Department of Justice officials concerning the Department of Justice Inspector General's findings of misconduct at the International Criminal Investigative Training Assistant Program. One of those employees, Robert K. Bratt, is a close and personal friend of mine. I advised the committee of this fact as well as my recusal from the Inspector General's investigation as it related to Mr. Bratt.

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    During the hearing, Congressman Cannon asked whether anyone communicated to any SAIC official about employing Mr. Bratt. I replied that I was not aware of it, because I knew that I had not initiated any calls on behalf of Mr. Bratt.

    Upon reflection, I do recall receiving a phone call regarding a routine reference check on Mr. Bratt by a person I believed to be a Human Resources official some time before his departure from the Department of Justice. I do not recall whether the call was from SAIC or one of the other firms that was interested in hiring Mr. Bratt, but it may have been SAIC. I gave a positive assessment of Mr. Bratt's work in the Justice Management Division in the Wireless Management Office, his work in the INS and his establishment of the Japanese Reparation Payment Program.

    In an abundance of caution I felt that I should advise the committee of my recollection of this telephone conversation. I hope this additional information is helpful and I would be glad to answer any additional questions you or your staff may have.

Sincerely,

Stephen R. Colgate, Assistant Attorney General for Administration.

cc:

The Honorable John Conyers, Jr., Ranking Minority Member

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AN INVESTIGATION OF MISCONDUCT AND MISMANGEMENT AT ICITP, OPDAT, AND THE CRIMINAL DIVISION'S OF ADMISTRATION.

    The International Criminal Investigative Training Assistance Program (ICITAP) is an office within the Criminal Division of the Department of Justice that provides training for foreign police agencies in new and emerging democracies and assists in the development of police forces relating to international peacekeeping operations. The Criminal Division's Office of Overseas Prosecutorial Development, Assistance and Training (OPDAT) trains prosecutors and judges in foreign countries in coordination with United States Embassies and other government agencies. The Criminal Division's Office of Administration serves the Criminal Division's administrative needs. This report details the results of an investigation by the Office of the Inspector General (OIG) into allegations that managers in ICITAP, OPDAT, and the Office of Administration committed misconduct or other improprieties.

    The allegations raised a wide variety of issues including managers' improper use of their government positions to obtain visas for foreign citizens, widespread violations of the rules governing the handling and storage of classified documents, managers' use of business class travel without authorization, managers' use of frequent flyer miles earned on government travel for personal use, violations of contractual rules and regulations, failure to supervise contracts leading to substantial cost overruns and overcharges by contractors, and favoritism in the hiring and promotion of certain employees. Many of the allegations concerned the actions of Robert K. ''Bobby'' Bratt, a senior Department official who became the Criminal Division Executive Officer in charge of the Office of Administration in 1992. At varying times during the years 1995–1997, Bratt also was the Acting Director of ICITAP and the Coordinator of both ICITAP and OPDAT.

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    We substantiated many of the allegations and found that individual managers, including Bratt, committed serious misconduct. We also concluded that managers in ICITAP, OPDAT, and the Office of Administration failed to follow or enforce government regulations regarding ethics, security, travel, and contracts. As a result of our investigation, we recommended discipline for three employees. We would have recommended significant discipline for Bratt, including possible termination, but for Bratt's retirement effective August 1, 2000. We also found that some of the problems revealed by this investigation go beyond holding individual managers accountable for their actions and that the Department can make changes to enhance the performance of other managers, employees, and offices. Therefore, we made nine recommendations concerning systemic improvements for the Department to consider.

    The report is divided into chapters addressing the major allegations. In this Executive Summary, we summarize the background of the investigation and the allegations, the investigative findings, and the OIG conclusions with respect to each chapter.

I. BACKGROUND OF THE INVESTIGATION

    ICITAP was created in 1986 and although it is part of the Department of Justice, its programs are funded by the Department of State. OPDAT, created in 1991, is similarly funded. Both ICITAP and OPDAT are headed by Directors, with a Coordinator responsible for overseeing the management of both organizations. The Office of Administration handles the administrative functions for the Criminal Division, including personnel, budget, information technology, and procurement matters. The Executive Officer heads the Office of Administration.

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    Bratt became the Executive Officer for the Criminal Division in 1992. He was appointed the Acting Director of ICITAP in March 1995 following the dismissal of the previous Director. After Janice Stromsem was selected as ICITAP Director and assumed the post in August 1995, Bratt resumed his duties as Executive Officer. Bratt was appointed to the newly created post of Coordinator in September 1996 where he remained until being detailed to the Immigration and Naturalization Service (INS) in April 1997 at the request of the Attorney General.

    ICITAP has had a long history of turmoil. Between 1994 and 1997, four different individuals assumed the responsibility of Director or Acting Director. During that period, there were two different investigations into allegations of misconduct as well as reviews of ICITAP's organizational structure and financial systems. In 1994, at the request of the Criminal Division Assistant Attorney General, the OIG completed two investigations of ICITAP that examined allegations of favoritism in selecting consultants, misconduct in travel reimbursements, poor quality of ICITAP's work products, waste and inefficiency in program and contract expenditures, and management of foreign programs. The OIG did not substantiate the allegations of misconduct but did find that ICITAP did not plan its programs carefully. The OIG also made recommendations to improve ICITAP's financial management. In January 1995, Bratt examined a proposed ICITAP reorganization plan and conducted an investigation following additional allegations of misconduct that were made to the Criminal Division, allegations that Bratt substantiated.

    This OIG investigation began in April 1997 when an ICITAP employee reported to the Department's security staff that an ICITAP senior manager had provided classified documents to persons who did not have a security clearance. The Department's security staff and the OIG investigated the allegation and confirmed it. The OIG continued the investigation to determine the extent of security problems at ICITAP. While this investigation was ongoing, the OIG received numerous allegations of misconduct and mismanagement at ICITAP and OPDAT, and we broadened our investigation to encompass these new allegations.

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II. INVESTIGATION OF ALLEGATIONS

A. Issuance of Visas to Russian Women

Bratt made four trips to Russia in late 1996 and 1997 in conjunction with his duties as ICITAP and OPDAT Coordinator. We received several allegations of impropriety relating to these trips. The most serious allegation was that Bratt and Criminal Division Associate Executive Officer Joseph R. Lake, Jr. improperly used Bratt's government position to obtain visas for two Russian women, one or both of whom it was alleged were Bratt's ''Russian girlfriends.''

Our review determined that in 1997 Russians seeking to visit the United States had two methods of obtaining visas from the American Embassy in Moscow: the standard process and the ''referral'' process. The standard process could be used by any Russian seeking to visit the United States. Russians applying through the standard process were required to wait in long lines at the American Embassy in Moscow to submit their applications, and the process included an interview by an American Embassy official. The Embassy official could deny the application if, among other reasons, the official did not believe the applicant had established that he or she would return to Russia. The ''referral'' process could be used in much more limited circumstances. The referral process required that United States government interests be supported by the applicant's visit to the United States or that a humanitarian basis existed for the visit. In the referral process, the visa application was submitted by an Embassy official who completed a form approved by an Embassy Section Chief setting forth the United States government interest in or the humanitarian basis for the applicant's visit. No interview was required, and the use of the referral process generally ensured that the applicant would receive a visa.

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    Two Russian citizens, Elena Koreneva and Ludmilla Bolgak, received on April 7, 1997, visas to visit the United States. They received the visas because Lake submitted their applications using the referral process and purported that a government interest existed for their visit to the United States. On the referral form Lake wrote that ''[a]pplicants have worked with the Executive Officer (EO) Criminal Division in support of administrative functions, Moscow Office.'' He signed it ''Joe Lake for BB.'' In addition to being the ICITAP and OPDAT Coordinator, Bratt retained the title and many of the responsibilities of the Executive Officer.

    We determined that neither woman had ever worked for Bratt or the Criminal Division. Both women socialized extensively with Bratt during his visits to Moscow, but Bratt did not have a professional relationship with them. We concluded that the statement written on the referral form was false.

    We found that Bratt first visited Moscow in November 1996 during which he received a tour of various tourist sites from a Russian interpreter. According to the interpreter, during the tour she told Bratt that she also worked for a Russian ''match-making'' agency. She said that in response, Bratt told her he would like to meet a single Russian woman. The interpreter contacted a business associate, Bolgak, who had a friend who was single, Koreneva. Bratt met Koreneva and Bolgak on his next trip to Moscow, in January 1997. On this trip, as well as his later trips to Moscow, Bratt socialized extensively with Koreneva and Bolgak, usually meeting them for dinner or drinks.

    During the January trip, Bratt invited the women to come to the United States to visit him. Koreneva told Bratt that she had previously been denied a visa to visit the United States. Between the January trip and his next trip to Moscow in March 1997, Bratt investigated how Russians could obtain visas to visit the United States. He made inquiries of a personal friend who worked for the State Department and also of Cary Hoover, the Special Assistant to the ICITAP Director. Bratt learned that Russians applied for visas at the American Embassy in Moscow, that they were interviewed by Embassy officials, and that the Embassy made a determination as to whether the applicant would return to Russia. Bratt also asked Hoover specifically for information about the referral process.

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    In March 1997 Bratt and Hoover returned to Moscow on business. During this trip Bratt and Hoover met with an unidentified Embassy official to learn more about the visa process. The evidence showed that Bratt, Hoover, and the Embassy official discussed the likelihood of Koreneva being denied a visa. During the meeting Bratt told the official that one or both of the women might work for the Department of Justice in the future. We concluded that Bratt learned through these various inquiries that Koreneva would likely be denied a visa again if she used the standard application process.

    Although Bratt and Lake deny it, the evidence showed that Bratt returned to the Embassy again during this March trip, this time accompanied by Lake who was also in Moscow, and met with Donald Wells, the head of the Embassy office responsible for issuing visas through the referral process. Bratt and Lake told Wells that they wished to bring two women with whom they had a professional relationship to the United States for consultations. Wells told the men that the referral process could only be used if there was a government interest in the women's visit to the United States.

    We also learned that within a few days of the meeting with Wells, Lake obtained a visa referral form from the Embassy. The evidence showed that Lake called Bratt, who had returned to the United States, to discuss the form. Lake submitted the women's applications and the visa referral form containing the false statement about the women having worked for the Executive Officer to the Embassy. The visas were issued shortly thereafter although they were never used by the women. Although he initially falsely claimed to the OIG that he was just friends with Koreneva, Bratt later admitted to the OIG that he had an intimate relationship with her.

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    We concluded that Bratt and Lake knowingly used the referral process even though they were aware that it required a government interest in the women's visit and that no such government interest existed. We also found that Bratt's and Lake's explanations of their conduct, as well as their denials that certain events happened, were not credible. We concluded that Bratt and Lake committed egregious misconduct.

B. Security Failures at ICITAP

    In April 1997 the Department of Justice Security and Emergency Planning Staff (SEPS) received an allegation from an OPDAT employee that Special Assistant to the ICITAP Director Hoover had improperly given classified documents to individuals who worked at ICITAP and who did not have security clearances. SEPS and the OIG confirmed the allegation. SEPS then conducted an unannounced, after-hours sweep of the ICITAP offices on April 14, 1997, to further assess ICITAP's compliance with security rules and regulations. During that sweep and a follow-up review conducted by the Criminal Division Security Staff, 156 classified documents were found unsecured in the office of Joseph Trincellito, ICITAP Associate Director. The OIG and SEPS conducted further investigation to determine the extent of ICITAP's security problems and ICITAP management's responsibility for the failures.

    The OIG found that the problems discovered in the 1997 security reviews had existed for many years. Evidence showed that senior managers provided or attempted to provide classified documents to uncleared consultants or other staff. Staff, including senior managers, routinely left classified documents unsecured on desks, including when individuals were away from their offices on travel. Stromsem, Hoover, and Trincellito improperly took classified documents home. Highly classified documents containing Sensitive Compartmented Information (SCI), or ''codeword'' information, were brought to the ICITAP offices even though ICITAP did not have the type of secure facility (a Sensitive Compartmented Information Facility or ''SCIF'') required to store SCI. The evidence showed that ICITAP inaccurately certified to United States Embassies that individuals had security clearances when they did not. We also found one instance where classified information was sent over an unsecure e-mail system.

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    As an example of the inattention ICITAP managers gave to security, we set forth the troubling history of ICITAP Associate Director Trincellito's handling of classified information. From 1995 through early 1997, ICITAP's security officers repeatedly found classified documents left unattended in Trincellito's office. The security officers warned Trincellito that he was violating security rules, and they also notified other ICITAP managers about the problem. One security officer, after becoming aware of repeated violations, documented the violations in writing and recommended discipline for Trincellito. ICITAP Director Stromsem on occasion spoke to Trincellito about his violations and attempted to make it easier for him to comply with rules by putting a safe in his office. However, in the face of repeated violations indicating that Trincellito refused to comply with security regulations, Stromsem and other senior ICITAP managers failed to take sufficient action, such as initiating discipline, to ensure that Trincellito complied with security regulations.

    We found that ICITAP managers' own violations of the security rules, their tolerance of Trincellito's known violations, and the removal of the security officers who attempted to enforce the rules sent a message that security was not important at ICITAP. We also found that the Criminal Division did not adequately supervise ICITAP's security program even though security reviews conducted by both SEPS and the Criminal Division beginning in 1994 showed a pattern of security violations.

    In this chapter we also discuss the security implications raised by Bratt's involvement with Koreneva. Bratt held a high-level security clearance and had access to highly classified documents. We concluded that Bratt's intimate involvement with a Russian citizen about whom he knew very little, his invitation to her to visit the United States and his office, his improper use of his government position to obtain a visa for Koreneva and Bolgak, and his attempt to conceal the true nature of the relationship left him vulnerable to blackmail and represented a security concern.

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    We found that the actions of another ICITAP employee who was intimately involved with a Russian national also represented a security concern.

C. Business Class Travel

    We found that Bratt and other ICITAP and OPDAT managers improperly flew business class when traveling to and from Moscow in 1996 and 1997. Government and Department Travel Regulations restrict the use of business class by government travelers. Even in circumstances when business class may be used, it must be authorized by the traveler's supervisor. We found that Bratt instigated and approved a scheme to improperly manipulate his flight schedules in order to qualify for business class travel. We concluded that Bratt's and the other managers' use of business class was not authorized and violated the rules limiting the use of business class travel.

    On one trip, in November 1996 Bratt, Lake, and Thomas Snow, the Acting Director of OPDAT, traveled to Moscow and several other European cities using business class on at least one leg of the trip. Business class was arranged by the Department's travel agency because the method used by the airlines to calculate the cost of trips with several stops made the use of business class less expensive than coach class. However, we found that a weekend stop in Frankfurt, Germany, violated the Travel Regulations and that the stop should not have been used as a basis to obtain business class accommodations. We also found that the Department's travel agency had suggested an alternative itinerary for this trip that would have saved the government substantial money but that the itinerary was improperly rejected by Lake.

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    On a second trip, in January 1997 Bratt and Hoover flew business class to Moscow purportedly pursuant to the ''14-hour'' rule. If authorized by a supervisor, government regulations permit travelers to fly business class when a flight, including layovers to catch a connecting flight, is longer than 14 hours. For this trip, Bratt requested that his Executive Assistant determine whether the flight proposed by the travel agency qualified for business class under the 14-hour rule. His Executive Assistant checked with three different individuals and based on the information she received, she told Bratt that he did not qualify for business class because both legs of the flight took less than the requisite time.

    Nonetheless, according to Bratt's Executive Assistant, Bratt told her to ''do what you can to get me on business class.'' As a result, Bratt's Executive Assistant arranged with the Department's travel agency to lengthen Bratt's flight for the purpose of obtaining a flight long enough to qualify for business class travel. Even with the manipulations, however, the flight from the United States to Moscow was still less than 14 hours. We concluded that Bratt and Hoover did not qualify for the use of business class and that they were not authorized to use that class of service.

    In March 1997, on a third trip, Bratt, Hoover, and Stromsem flew business class from Moscow to the United States even though there were economy flights available that would have fit the business needs of the travelers. Although Hoover and Stromsem were originally scheduled to fly on an economy class flight, Bratt directed that their flights be changed to avoid the disparity between his subordinates traveling economy while he traveled on business class. We held Bratt accountable for all the excess costs of the March trip. On his fourth trip, in June 1997 Bratt flew business class on both legs of his trip to and from Moscow. Contemporaneous documents show that the choice of flights for both of these trips was dictated by Bratt's desire to use business class rather than for business reasons. In one facsimile to the travel agency concerning the June 1997 trip, Bratt's Executive Assistant asked, ''Can you rebook him [Bratt] with a slightly longer layover in Amsterdam. . . . So that at least two extra hours is added onto the trip? . . .'' In addition, the travelers were not authorized to travel on business class for either the March or June trip.

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    In sum, we found that Bratt pressured his staff to obtain business class travel and approved a scheme to lengthen his travel time solely for the purpose of obtaining flights that would qualify for business class travel under the 14-hour rule. We concluded that Bratt's manipulation of flight schedules to qualify for business class travel violated the Travel Regulations and was improper. The government spent at least $13,459.56 more than it should have for these four trips.

    We also found that the Justice Management Division (JMD), which is responsible for auditing foreign travel vouchers, did not question the use of business class travel by Bratt or the other managers who accompanied him even when the lack of authorization was apparent on the face of the travel documents that the travelers submitted to be reimbursed for their expenses.

    In this chapter we also detail a conversation between Bratt and his Executive Assistant that led her to believe that Bratt was coaching her how to answer OIG questions. Through a series of rhetorical questions that falsely suggested that Bratt was not involved in making decisions regarding his use of business class, Bratt tried to shift to his Executive Assistant the responsibility for the decisions leading to Bratt's business class travel. Bratt also told her that she should not report their conversation to anyone. For some time after that conversation, Bratt continued to contact her asking whether she had been interviewed by the OIG and what she had said. Despite OIG requests to Bratt that he not discuss the subject of our interviews with individuals other than his attorney, we found that Bratt discussed topics that were the subject of the investigation with individuals who would be interviewed by the OIG. Bratt also called individuals, such as the two Russian women for whom he had improperly obtained visas, to alert them that the OIG would be seeking to interview them.

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D. Failure to Follow Travel Regulations

    During the course of the investigation, we found that ICITAP, OPDAT, and Office of Administration managers violated government Travel Regulations with respect to the use of frequent flyer benefits. Government regulations state that all frequent flyer miles accrued on government travel belong to the government. Because airlines generally do not permit government travelers to keep separate accounts for business and personal travel, travelers may ''commingle'' miles earned from business and personal travel in one account. However, the Travel Regulations are explicit that it is the responsibility of the traveler to keep records adequate to verify that any benefits the traveler uses for personal travel were accrued from personal travel.

    We found that between 1989 and 1998 Bratt used 380,000 miles for personal travel. Bratt told the OIG that while he had no records to verify how many miles he had accrued from his personal travel, he believed that he had collected at lease 150,000 miles from personal travel as well as miles from the use of a personal credit card. Even giving Bratt the benefit of his recollection, we concluded that Bratt improperly used between 156,000 and 230,000 miles earned from government travel for his personal benefit.

    We found that Hoover also used frequent flyer miles accrued from government travel to purchase airline tickets and other benefits for personal travel for himself and a family member. Stromsem used miles accrued on government travel to upgrade her class of travel in violation of government rules.

    The investigation revealed that managers violated other Travel Regulations as well. Lake was inappropriately reimbursed by the government for some of the travel expenses associated with weekends that he spent in Frankfurt, Germany, when he was on personal travel. In violation of the regulations requiring a traveler's supervisor to authorize travel and approve travel expenses, Bratt repeatedly either authorized his own travel or had subordinates sign his travel requests. Both Bratt and Stromsem routinely had subordinates approve their travel expenses.

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    We received an allegation that Stromsem took a business trip to Lyons, France, as a pretext that allowed her to visit her daughter who was in Tours, France. Although Stromsem did not list a business purpose on her travel paperwork for her stop in Lyons, we did not conclude that her trip to Lyons was pretextual.

    We also received an allegation that Bratt's trips to Moscow in 1997 were for the purpose of furthering his romantic relationship with a Russian woman. We found that the lack of advance planning for the trips, the fact that most of his meetings in Moscow were with his own staff rather than Russians, and his romantic relationship with a Russian woman strongly suggested that the trips to Moscow were not necessary or were unnecessarily extended for personal rather than government reasons.

E. Lake Buyout

    On March 31, 1997, Lake retired from the federal government after receiving $25,000 as part of a government-wide buyout program (the Buyout Program) to encourage eligible federal employees to retire. The following day Lake began working for OPDAT as a consultant. Lake worked as a subcontractor to a company that had been awarded a contract to provide various support services to ICITAP. In May 1997 at Bratt's request, Lake worked as a consultant to the Immigration and Naturalization Service (INS) after Bratt was detailed there.

    The Buyout Program prohibited former federal employees from returning to government service as either employees or as contractors working under a ''personal services'' contract for five years after their retirement. A personal services contract is defined by federal regulations as ''a contract that, by its express terms or as administered, makes the contractor personnel appear, in effect, [to be] Government employees.'' Violation of the prohibition requires repayment of the incentive bonus.

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    We found that while at OPDAT and INS after his retirement Lake reported to and was supervised by Bratt, that Lake supervised and gave directions to federal employees or other contractors, that he used government equipment, and that other staff were often unaware that Lake was not a federal employee. The evidence showed that Lake essentially did the same job as an OPDAT consultant that he had performed while a government employee. We concluded that Lake worked at OPDAT and the INS under a personal services contract in violation of the Buyout Program requirements.

    The evidence showed that Lake planned for several months to return to work for the Department as a consultant. Both Bratt and Lake were warned by officials in JMD and the Criminal Division Office of Administration that Lake's return as a consultant could constitute a personal services contract. We concluded that Bratt and Lake improperly failed to ensure that Lake's work met the requirements of the Buyout Program.

    After allegations were raised in the media that Lake had received Buy out money and then improperly returned to work for the Department, Bratt asked JMD for an opinion as to whether Lake should repay the Buy out bonus. A JMD official concluded that Lake was not obligated to pay back the money based upon a ''good faith'' exception to the rule requiring repayment. We determined that there is no ''good faith'' exception to the requirement that a person who violates the Buyout Program prohibition against performing personal services must repay the bonus. We also concluded that even if a good faith exception existed in the law it would not apply in this case as Lake was aware of the prohibition against personal services and was warned that his return as a consultant might constitute the performance of personal services.

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    We also found that JMD permitted Lake to work at INS without a contract for several months. In addition, while JMD issued a purchase order for Lake's INS work in July 1997, senior JMD procurement officials later expressed concerns that the purchase order that had been issued by their office was a personal services contract. We also found that hiring Lake as a subcontractor to a third party contractor added unnecessary costs to the contract.

F. Harris Contract

    Jo Ann Harris was the Assistant Attorney General for the Criminal Division from November 1993 until August 1995, when she left the federal government. Under federal regulations, Harris was barred from contracting with the government for one year after her government service. In December 1996 Harris agreed to become an OPDAT consultant to organize, moderate, and evaluate three conferences that OPDAT was planning to hold at the International Law Enforcement Academy (ILEA) in Budapest, Hungary, and to assist OPDAT in developing curriculum for other OPDAT training programs. The OIG investigated allegations that the award of this contract to Harris violated ethical rules that prohibit contracting with former government officials on a preferential basis. We found that OPDAT's award of a contract to Harris to develop curriculum for OPDAT programs and the processes used to develop the contract, to determine Harris' fee, and to modify her contract raised the appearance of favoritism.

    In September 1996 Harris had discussions with Criminal Division managers, including Bratt, about the possibility of her assisting OPDAT as a consultant. In November 1996 Harris discussed on the phone with Bratt specific projects that she could work on such as the ILEA conferences and curriculum development. At Bratt's direction, an OPDAT official called Harris in early December 1996 and had a similar conversation with Harris during which she reiterated her interest in working on OPDAT projects. On December 12, 1996, Bratt, Harris, and Lake met in Harris' former office at the Department of Justice, and Harris agreed to Bratt's proposal that she work as a consultant on OPDAT projects. The Statement of Work, a contract document that set out the tasks that OPDAT was seeking from a consultant, was issued on January 23, 1997. The tasks included preparing for the FLEA conferences, acting as the conference moderator, and developing curricula for other OPDAT programs.

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Because no competition was involved in awarding Harris' contract, we evaluated the propriety of OPDAT's award of her contract under the rules pertaining to the award of sole-source contracts. Sole-source contracts, which do not require the solicitation of competing bids, may be awarded when the exigencies of time or the consultant's expertise justify the waiver of the competitive process. We concluded that OPDAT could have awarded a sole-source contract for her work on the ILEA conference given her extensive experience and the short time frame that existed to prepare for the conference. However, we concluded that Bratt's decision to hire Harris to develop curricula for OPDAT projects other than the ILEA conferences created the appearance of favoritism. We also found that Bratt discussed with Harris what projects she could perform and the Statement of Work was written to fit those projects. We concluded that the process OPDAT used to develop Harris' contract violated the principle that the task to be accomplished should drive the development of a contract rather than the desire to hire a particular consultant.

We disproved the allegation that Harris was paid $65,000 for eight days work. She was paid approximately $27,000 for 42 days work on two ILEA conferences. However, we found that Harris' rate of pay was not the result of an ''arms length'' negotiation. Harris told Bratt, her former subordinate, to set the fee and to ''scrub it'' because she did not want to read about the fee in the newspaper. She agreed to accept $650 per day although her contract was later modified to permit her to be paid based on an hourly rather than a daily rate. We were unable to determine the basis for the $650 per day fee or find any evidence that Bratt and Lake used any comparable consultant fee arrangement as the basis for setting Harris' rate. Evidence showed that the Department of State, ICITAP, and OPDAT generally set the fees for their consultants at a lower rate. We concluded that the lack of a clear record setting forth the basis for the fee raised the appearance that Harris was given preferential treatment by her former subordinates.

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    We also found that OPDAT hired Harris to perform work outside the scope of the contract, which only authorized services to ICITAP not OPDAT.

G. Improper Personnel Practices

    The OIG received various allegations relating to ICITAP's and OPDAT's hiring and management of personnel. The evidence showed that ICITAP and OPDAT managers misused contractor personnel. Federal regulations prohibit contractor personnel from directing federal employees or exercising managerial oversight. Yet, ICITAP and OPDAT managers did not distinguish between employees and contractor personnel and often failed to identify personnel working for contractors as such. As a result, ICITAP and OPDAT staff were often confused about consultant's roles and the scope of their authority.

    We found that contractor personnel were used as managers. For example, one of ICITAP's Deputy Directors was a subcontractor employed by a contractor that provided a variety of services to ICITAP. After ICITAP Director Stromsem was advised by an administrative official that there were limits to the authority of personnel employed by contractors, Stromsem cautioned the Deputy Director about the limitations. However, Stromsem did not notify other staff about the Deputy Director's status as a subcontractor, and he remained in the position of Deputy Director until he became a federal employee six months later.

    We found other problems with the use of contractor personnel including ICITAP's selection of particular consultants to be hired by its service contractors. This left ICITAP vulnerable to claims that it was violating the rules restricting personal services contracts. The practice of directing the hiring of consultants wasted money because ICITAP was performing the administrative work associated with hiring consultants at the same time that it was paying its service contractors administrative fees. In addition, consultants often began work before the Statement of Work was issued to the prime contractor. This practice required the paperwork to be backdated or ratified in order for the consultant to be paid. We also found that consultants were hired as federal employees and then made decisions affecting their former contractor employer in violation of ethical regulations. This practice was stopped by Mary Ellen Warlow, who became the Coordinator for ICITAP and OPDAT in 1997 after Bratt left for the INS.

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    We investigated allegations that ICITAP managers engaged in favoritism in the hiring of staff. Federal employees are hired after a competitive process that begins with the public issuance of a vacancy announcement that describes the application process and sets forth the responsibilities and other particulars of the position. Managers were alleged to have engaged in ''preselection,'' that is, they decided whom to hire before beginning the competitive selection process required by federal regulations.

    The hiring of Jill Hogarty in particular raised complaints. Hogarty was an attorney who worked as a bartender at Lulu's New Orleans Cafe, an establishment located near the ICITAP offices which was visited regularly by ICITAP Associate Director Trincellito and other ICITAP staff. While visiting Lulu's, Trincellito discussed ICITAP's work with Hogarty, and eventually Trincellito invited Hogarty to consider working as a consultant to ICITAP. Hogarty gave Trincellito her resume, and Trincellito wrote the paperwork that resulted in her being hired as an ICITAP consultant in September 1994. According to Hogarty, while she was a consultant to ICITAP, she dated Bratt for several months, from September 1995 to December 1995. At that time Bratt had resumed his position as Executive Officer but he retained authority to approve personnel decisions at ICITAP. In November 1995, during the time that Hogarty and Bratt were dating, Hogarty applied to become a temporary federal employee at ICITAP. She was selected by Trincellito for this position in December 1995.

    On January 5, 1997, Hogarty's employment status changed once again, and she became a permanent federal employee. It was this selection that raised the complaint about preselection. The vacancy announcement for the position that Hogarty obtained opened on November 1, 1996. An ICITAP employee who held a term position told the OIG that while the position was still open for applications, he was discussing the announcement for the position with another employee when Hogarty told them that it was her position and that she had been selected for it. The employee told the OIG that even though he was interested in the position himself, he did not apply for it because he believed Hogarty's statement that she had already been selected.

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    To investigate the allegation of preselection, we attempted to determine which manager had selected Hogarty for the position and the reason for the selection. The paperwork listed Stromsem as the official requesting the recruitment. The paperwork did not show who had made the selection, however. All of ICITAP's top managers—Director Stromsem, Associate Director Trincellito (who was also Hogarty's direct supervisor), the ICITAP Deputy Directors, and Special Assistant to the Director Hoover—denied having selected Hogarty for the permanent position. Bratt also denied selecting Hogarty.

    We found strong evidence that Bratt and Stromsem preselected Hogarty. An e-mail from Bratt on October 8, 1996, showed that Bratt authorized hiring Hogarty before the vacancy announcement that opened the position for competition was issued. We also learned from an ICITAP administrative official that in October or November 1996, Stromsem asked the official to determine how they could get Hogarty health benefits, which Hogarty did not have at that time. The administrative official said that he and Stromsem agreed to create a ''term'' position vacancy for Hogarty, but that instructions came back from Bratt through Stromsem to make the position permanent. We concluded that Bratt and Stromsem engaged in preselection in violation of federal regulations governing personnel hiring.

    We investigated other allegations of favoritism, including the hiring of a consultant who was the father of Stromsem's former husband's stepchildren. He was subsequently selected by Stromsem to become an ICITAP term employee although his qualifications for the position were questionable. He was ultimately not hired for the term position because of the intervention of Warlow when she became Coordinator. We concluded that Stromsem's involvement with this hire gave rise to the appearance of favoritism.

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The OIG also received numerous allegations that Bratt gave favored treatment to a select group of Office of Administration and ICITAP staff and that he dated subordinates. Although we only conducted a limited investigation into these allegations, we found that some of the employees who socialized with Bratt received rapid career advancement and that Bratt was often involved in the promotions. We saw evidence that he dated staff in the Office of Administration and ICITAP and that in one instance he intervened to protect the salary of a subcontractor with whom he had a social interest but who had been found unqualified by Office of Administration staff for the position she held. We concluded that Bratt's actions gave rise to an appearance of favoritism.

H. Financial Management

In response to allegations that ICITAP's finances were mismanaged, the OIG examined ICITAP's financial management system. We found that until 1997 ICITAP could not account for its expenditures. ICITAP did not receive sufficient information from its contractors to permit it to track whether it received the goods and services for which it had paid. This led to significant problems in 1997 when the State Department, which was funding ICITAP's programs, asked for detailed information on how the money for programs in the Newly Independent States had been spent. ICITAP spent several months trying to provide an acceptable answer to the State Department's request and only succeeded by the use of estimates and extrapolations from the financial information ICITAP did collect. Although the OIG had advised ICITAP in its 1994 report following an earlier investigation into ICITAP's financial management system that ICITAP needed to collect more detailed information from its contractors, the problem was not remedied until after the State Department requested detailed financial information in 1997.

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    We found that ICITAP did not pay sufficient attention to the services its contractors provided and left itself vulnerable to overcharges. In one instance, a contractor notified ICITAP that it was unilaterally raising one of its fees, an action not permitted by the contract. Despite this notice, ICITAP did nothing for two years until a JMD contracting officer noticed the overcharge. Subsequent negotiations with the contractor resulted in reimbursement to ICITAP of some of the money.

    Office of Administration managers hired staff for the Criminal Division by using contractor personnel for jobs that were outside the scope of the contract under which they worked. In 1991 the Criminal Division awarded a contract to provide computer support services and in 1996 the Criminal Division awarded the same contractor a second contract for computer support services. The contractor provided employees to work in the Criminal Division's correspondence units performing tasks such as reading and responding to correspondence. This work was outside the scope of the first contract, which only authorized computer support services. The contractor also provided employees who worked as writers, planned conferences, published reports, and organized parties. The services of these personnel were outside the scope of both contracts.

    We also found that Criminal Division managers failed to adequately supervise the contract and the contractor charged the government for the services of personnel who were unqualified under the terms of the contract. The contract set out very specific labor categories, such as Senior Programmer Analyst, and set forth the tasks to be accomplished and the qualifications for each labor category. We found problems with 25 of 56 of the contractor's personnel under the first contract and problems with 19 of 54 of the contractor's personnel under the second contract. We concluded that the minimum the contractor overcharged the government was $1,164,702.01.

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The OIG received an allegation that ICITAP had spent substantial sums of money on an automated management information system (IMIS) that did not function properly. Our investigation showed that the development of IMIS was difficult, that users were unhappy with the product, and that a system designed to replace IMIS could not be completed by the contractor. We concluded that managers did not adequately analyze ICITAP's needs in the initial stages of development, and consequently IMIS was constantly being upgraded and modified leading to new problems. Also, the decision to use floppy disks to transfer information from the field to headquarters rather than develop a network capacity that could be utilized by all users led to significant problems, such as that the data from the floppy disks was often out of date or could not be accessed once it was received at headquarters. IMIS and the attempt to develop the replacement system ultimately cost more than one million dollars. We did not investigate to determine how much money might have been saved had IMIS been better planned.

ICITAP's lack of planning also led to a substantial cost overrun of the translation budget for the first ILEA conference. A hypothetical transnational crime and the statutes of various countries were translated for the conference. The budget for translations was $16,000; the ultimate cost was $128,258. Lake delegated much of the responsibility for coordinating the ILEA conference to his assistant, who worked for a contractor. Lake's assistant ordered large amounts of material to be translated on an expedited basis without adequately determining the cost of the translations. The assistant failed to research whether some of the material was already translated and ordered some of the material on a costly expedited basis when it was unnecessary to do so. We concluded that Lake delegated responsibility to someone who was not qualified to manage the task and then failed to adequately supervise her.

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    We examined whether ICITAP could account for the goods it ordered for use in Haiti by selecting 131 expensive items to track. The investigation showed that the contractor responsible for providing goods and services to ICITAP in Haiti had in place an effective inventory control system and that ICITAP could account for all but one of the selected items.

I. Miscellaneous Allegations

    In this chapter we summarize the results of our investigation of additional allegations, most of which we did not substantiate.

    We found that Bratt directed that Criminal Division excess computers be sent to a school associated with a girlfriend, and Deputy Executive Officer Sandra Bright initiated and pursued the donation of computers to a school associated with her husband. In 1996 Bratt directed that 35 computers be sent to an elementary school in Virginia where his then girlfriend was employed as a teacher. On one occasion in 1996 Bright directed that 25 computers be sent to the school district in Virginia where her husband was employed as a principal and on another occasion in 1996 Bright directed that 30 computers be sent to the school at which her husband was employed. We concluded that Bratt's and Bright's actions created the appearance of favoritism.

    We did not substantiate an allegation that Robert Lockwood was awarded an OPDAT grant because of his alleged association with Attorney General Janet Reno. The American-Israeli Russian Committee that Lockwood directed received a $17,000 grant from OPDAT in 1997. At the time, Lockwood was the Clerk of Courts of Broward County, Florida, and was acquainted with the Attorney General, although not closely so. We determined that the Attorney General received a phone call from Lockwood in 1997 but that they only discussed Lockwood's organization and its mission; he did not seek any funding from her. Lockwood became involved with OPDAT through the OPDAT Resident Legal Advisor in Moscow. We did not find evidence that the Attorney General encouraged anyone to award a grant to Lockwood's Committee or that she knew that an award had been made. We also did not find any evidence that the Attorney General or anyone from her office took any action after Lockwood's grant was not renewed the following year.

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    The remainder of the chapter discusses allegations that we failed to substantiate concerning personnel issues, financial matters, allegations of retaliation, and other issues.

III. RECOMMENDATIONS AND CONCLUSIONS

    In this chapter of the report, we offer a series of recommendations to the Department, including that certain employees receive discipline and that the Department seek compensation from employees who improperly received money or benefits from the Department. We also made nine recommendations concerning systemic improvements in the areas of travel, ethics, and training.

    Bratt retired from the Department effective August 1, 2000, and is not subject to discipline. We recommended that the Department recover the costs of his improper use of business class travel and his improper use of frequent flyer miles.

    Lake is also not employed by the Department any longer and is not subject to discipline. We recommended that the Department recover the $25,000 Buyout bonus and the cost of travel expenses that Lake improperly charged the government, including costs associated with the November 1996 trip to Moscow.

    We found that Stromsem violated security regulations, improperly used frequent flyer miles accrued on government travel for personal benefit, and was involved in the preselection of Hogarty in violation of personnel regulations. We concluded that Stromsem's conduct warrants the imposition of discipline. We also recommended that the Department recover the costs of Stromsem's improper use of frequent flyer miles.

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    We found that Hoover violated security regulations by disclosing classified information to uncleared parties and by removing classified documents to his home. We also found that he improperly traveled on business class on a flight to Moscow in January 1997 and that he improperly used frequent flyer miles accrued on government travel for his personal benefit. We concluded that Hoover's conduct warrants the imposition of discipline. We also recommended that the Department recover the costs of Hoover's improper use of business class travel and frequent flyer miles.

    We concluded that Trincellito's repeated failure to observe fundamental security practices and his continued resistance to the advice and warnings of ICITAP's security officers warrants the imposition of discipline.

    We also recommended that SEPS and other agencies responsible for issuing security clearances carefully consider the findings and conclusions set forth in this report before issuing a security clearance to the individuals most involved in the security breaches. In addition, we made non-disciplinary recommendations with respect to two other individuals.

    During the course of the investigation, we observed various systemic issues, and we suggested improvements for the Department to consider relating to oversight of ICITAP and OPDAT, security, investigative follow-up, travel, training, performance evaluations, and early retirement programs. For example, we recommended that the Department monitor ICITAP's compliance with security regulations by continuing to perform periodic unannounced security reviews.

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    Because many of the travel violations that we found were apparent on the face of the travel forms, we recommended that the Department review the process JMD uses to audit travel vouchers. We believe the Department should offer increased training on travel regulations to employees and secretarial or clerical staff who process travel-related paperwork. And we offered suggestions designed to increase Department employees' use of frequent flyer miles for government travel and to decrease the incidents of improper use.

    We recommended that increased attention be given to the recommendations and lessons learned from investigations. We found that despite numerous investigations of ICITAP, the same problems continued to surface and that managers failed to act on investigative recommendations. Management must take increased responsibility for ensuring that the results of investigations are appropriately considered and addressed.

CHAPTER ELEVEN: RECOMMENDATIONS AND CONCLUSIONS

I. RECOMMENDATIONS REGARDING DISCIPLINE AND REPAYMENT OF FUNDS

    As the evidence that we set forth throughout the report has shown, we found that managers in ICITAP, OPDAT, and the Office of Administration violated government regulations relating to travel, security, the use of contractors, and the hiring and promotion of federal employees, among others. Some of these violations were issues of performance that should be addressed through training and counseling; in some instances, however, the violation rose to the level of misconduct that warranted the imposition of discipline.

    In our recommendations, we have taken into consideration the facts found in this investigation and the seriousness of the misconduct.(see footnote 3) As part of the analysis, we have considered the employee's position in the Department of Justice, his level of culpability for the misconduct, the extent to which the employee involved others in misconduct, and the extent to which an employee acknowledged misconduct or cooperated with the OIG.

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A. Criminal Division Executive Officer Robert K. Bratt

    We found that former Criminal Division Executive Officer Robert K. Bratt repeatedly engaged in substantial misconduct while serving as the Executive Officer of the Criminal Division and while he was responsible for overseeing ICITAP and OPDAT. We found that Bratt put his own interests ahead of the interests of the government and the interests of his subordinates for whom his conduct was a model. We therefore believed that Bratt's conduct warranted severe discipline under the Department's Standards of Disciplinary Offenses and Penalties, including possible termination from the Department of Justice.

    However, Bratt retired on August 1, 2000, and is no longer subject to discipline by the Department. At the time of his retirement, Bratt's security clearance was suspended. Because Bratt may seek to work on matters that require a security clearance, we discuss our assessment of whether Bratt has the requisite qualifications or judgment to receive a security clearance.

    First, we concluded that Bratt committed egregious misconduct by using his government position to improperly procure visas for two Russian citizens, Yelena Koreneva and Ludmilla Bolgak. We found that Lake improperly used the referral process on Bratt's behalf, that Bratt was aware of Lake's actions, that Bratt knew the referral process required a government interest in the visa applicant's visit to the United States, and that no such government interest existed for either Koreneva's or Bolgak's visit.

    Bratt's involvement with Koreneva also raised significant security concerns. Bratt held an SCI clearance and had access to highly classified material. Bratt, as the Criminal Division Executive Officer, had distributed to all Criminal Division personnel a brochure reminding employees that foreign intelligence threats often occurred in an ''unobtrusive and non-threatening fashion. . . .'' Yet, Bratt asked to meet an unmarried Russian woman, engaged in a romantic relationship with her, invited her and a friend to visit the United States and tour his office, and improperly used his influence to obtain visas for the two women. He failed to timely notify the Department's security office of his relationship as he was required to do by the security regulations and only did so after being prompted by the head of the Department's security office. Even when notifying the Department's security office of the relationship, Bratt did not fully disclose the nature of that relationship. He also attempted to conceal the true nature of the relationship when he was first asked about it by the OIG. These actions left Bratt vulnerable to blackmail by Russian intelligence services or others.

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    In addition, we found that Bratt committed serious misconduct in connection with his government travel. He knowingly and intentionally violated the government's Travel Regulations. He directed his assistant to book business class flights on government travel when he knew that the trips did not qualify for that class of travel. As a result of his use of business class, Bratt's subordinates also improperly traveled using business class. Bratt also misused for his personal benefit frequent flyer miles he collected on his government travel. The Department has repeatedly advised its employees that frequent flyer miles belong to the government. As the Criminal Division's top administrative officer, Bratt knew the rules but did not follow them.

    In this review, we found a pattern of Bratt blaming his staff for his own misconduct and failures to abide by the rules. According to Bratt, Lake was responsible for improperly obtaining visas for the Russian women, Turcotte was responsible for his misuse of business class, and assorted unidentified Office of Administration, ICITAP, and JMD employees were at fault for either incorrectly informing him that his actions were proper when they were not or because they failed to warn him that his actions violated rules and regulations. We believe that Bratt is the person who should be held accountable for his own misconduct and improprieties. Adding to his culpability is the fact that Bratt involved subordinates in his misconduct. He engaged Lake to improperly submit the referral form on his behalf. He engaged Turcotte to improperly arrange business class on his behalf. In addition, his improper actions caused his subordinates to follow his lead — Stromsem and Hoover used business class because Bratt did.

    We concluded that Bratt was not forthcoming and honest during his interviews with us. He repeatedly failed to disclose pertinent facts and made false statements about his role in various events. As a few examples, we concluded that Bratt made false statements about the true nature of his relationship with Koreneva, made false statements about his knowledge of the visa referral process, failed to disclose a conversation he had with Harris when they discussed the potential for her working for OPDAT, and failed to disclose his role in Hogarty's selection as a permanent federal employee.

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    What emerges from our investigation of Bratt's actions is a supervisor who willfully violated government regulations, who was recklessly indifferent to the security interests of the government, who induced subordinates to aid and abet his misconduct, and who made false statements to the OIG.

    In light of these findings, we recommend that SEPS incorporate into Bratt's security file the findings of our investigation and provide them to the Defense Investigative Service Clearance Office (DISCO), which performs background investigations of government contractors. We recommend that any agency that might be charged in the future with determining whether Bratt receives a security clearance — either DISCO or another government agency — carefully consider the findings and conclusions we have made throughout this report in considering whether Bratt has the requisite judgement and appreciation for security required of someone who is to be entrusted with a security clearance.

    Bratt converted frequent flyer miles earned on government travel to his personal benefit and traveled business class at government expense in violation of the Travel Regulations. We recommend that the Department recoup from Bratt the costs of travel improperly borne by the Criminal Division. For the reasons we set forth in Chapter Four, Section IIIC regarding the March 1997 trip, we concluded that Bratt was responsible for the improper travel of Hoover and Stromsem. Therefore, we believe that he should reimburse the Department for the costs of their improper travel as well as his own. We believe that a reasonable estimate of his business class travel can be achieved by comparing the authorized fares for business travel and the actual costs. We calculate that cost as $8815.93. Since Bratt failed to keep the requisite records, reconstruction of his frequent flyer accounts also involves estimates. As we have discussed, Bratt used between 156,000 and 230,000 government earned miles for personal travel. We calculate that value as between $3900 and $5750.(see footnote 4)

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    In addition, Bratt should surrender to the Department all remaining miles in his frequent flyer accounts. He has already used for personal purposes more than the total number of personal miles he claimed; the remaining miles are the property of the government.

B. Associate Executive Officer Joseph R. Lake, Jr.

    Lake retired from the government on March 31, 1997, and consequently he is not subject to discipline as a federal employee. Lake's security clearance was suspended in March 1998 for his actions relating to the visa matter. In this investigation, we found that Lake committed egregious misconduct by willfully submitting a false statement on the visa referral form. We also believe that his statements to us regarding that matter were not credible. We recommend that SEPS incorporate the findings of our investigation and report in Lake's security file and provide them to DISCO.

    In addition, we found that Lake materially violated the terms of his early retirement agreement by performing personal services for OPDAT and INS as a contract employee. Pursuant to the federal law governing the Buyout Program, he should repay $25,000 to the Department of Justice, the amount of his Buyout bonus. If Lake does not voluntarily make the repayment, then we recommend that the Department take action to enforce the terms of his Buyout agreement.

    In addition, we recommend that the government recover from Lake the costs of his improper business class travel, $2100, and the costs of personal travel improperly charged to the government, which we calculate at $988. Lake also left the government with substantial frequent flyer miles earned from government travel. Because the miles are government property, the Department should recover the miles that are remaining.

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C. ICITAP Director Janice Stromsem

    We found that Stromsem repeatedly failed to comply with government regulations and policies while serving as ICITAP Director, even those she established. We consider most grave Stromsem's failure to follow and enforce the government's security regulations. Stromsem represented that she did not understand the gravity of the security problems in her office and that she followed practices established by others. We found these claims unpersuasive. We believe that Stromsem was insufficiently attentive both to following security regulations and ensuring that her subordinates properly handled classified information. We believe that this attitude, along with her widely known failure to correct Trincellito's persistent violations, were directly responsible for the depth and breadth of security violations found by our investigation.

    As ICITAP Director, Stromsem had an SCI clearance. We recommend that SEPS evaluate whether Stromsem should continue to have a security clearance, and if so, at what level. We further recommend that at a minimum, Stromsem be re-briefed on security requirements, including how and to whom to report the failures of third parties to follow security regulations.

    Stromsem was replaced as ICITAP Director during the course of our investigation and was detailed in 1999 to the United States Agency for International Development. We believe that the Department should carefully evaluate whether Stromsem has the managerial skills to assume a leadership position in the Department given her failure to comply with regulations governing security, government travel, contracts, and hiring. Stromsem also seemed to have no appreciation for the appearance of favoritism that was created when she participated in personnel matters in which she appeared to have a personal interest.

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    We conclude that Stromsem's personal violation of the security regulations, her use of frequent flyer miles accrued on government travel for personal benefit, and her involvement in the preselection of Hogarty warrant discipline. We recommend discipline in the range of a written reprimand to a suspension.

    In addition, we recommend that Stromsem be ordered to repay the cost of the government frequent flyer miles that she used for impermissible upgrades and for the purchase of upgrade stickers. We calculate that cost as $2500. We also recommend that Stromsem either be required to use the frequent flyer miles that she accumulated on ICITAP travel that remain in her account for future government travel or return them to the Department.

D. Special Assistant to the ICITAP Director Cary Hoover

    Hoover was a manager and a long-standing government employee. We believe that Hoover knowingly violated security regulations, both by disseminating classified information to uncleared parties and by removing classified documents to his home. He was a part of an ICITAP management structure that sent the message throughout ICITAP that security was not important. Hoover's security clearance was suspended by SEPS in 1997. We recommend that SEPS take into consideration the findings in this investigation in determining whether or when Hoover's clearance should be reinstated. If reinstated, Hoover should be given extensive and continuing training on security regulations.

    Hoover violated the Travel Regulations by improperly flying business class on the January 1997 trip to Moscow and using government frequent flyer benefits accrued from government travel for his personal benefit. The Department should recover the appropriate costs, which we calculate at this time as $1474 for his business class travel. We calculated the value of Hoover's improper use of frequent flyer miles as $ 2075.

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    Hoover was a part of senior management at ICITAP and someone from whom others took their cues. This leadership position makes all the more serious his misconduct. We find that Hoover's misconduct should result in discipline. We recommend that Hoover be disciplined in the range of a written reprimand to a period of suspension for his violations of the security regulations. We also recommend that Hoover make available to the Department the frequent flyer miles that he accumulated on ICITAP travel.

E. Associate ICITAP Director Joseph Trincellito

    We find that Trincellito's extended and repeated failure to observe fundamental security practices, his deliberate indifference to established security practices, and his hostility to the assistance and reminders that ICITAP's security officers repeatedly offered him warrant discipline. We recommend a period of suspension for this misconduct.

    Trincellito's security clearance has been suspended since April 1997. We recommend that SEPS take into consideration the findings in this investigation in determining whether or when Trincellito's clearance should be reinstated. If reinstated, Trincellito should be given extensive and continuing training on security regulations.

F. Acting Director of OPDAT Thomas Snow

    Snow violated the Travel Regulations by taking a weekend trip to Frankfurt, Germany, with other ICITAP/OPDAT travelers, which improperly increased the cost of his November 1996 trip. He should be directed to repay the excess cost of this travel, which we calculated as $2140.75.

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G. Executive Assistant Denise Turcotte

    Turcotte arranged business class travel for Bratt even though she knew that he did not qualify for it under the Travel Regulations, and she worked with the government's travel agency to make it appear that he did qualify. Nonetheless, we do not believe that Turcotte's conduct warrants discipline. We come to this conclusion on the basis of several considerations. Unlike others with whom we spoke, Turcotte immediately accepted full responsibility for her own acts. Even though she neither initiated her misconduct nor benefited from it, she did not attempt to shift responsibility; she understood that when she acceded to Bratt's improper request, she erred. We also recognize that employees like Turcotte who are not in a supervisory position, who are directed or urged by their supervisors to engage in misconduct, feel themselves to be and are in a difficult situation. Turcotte thought that she would put her job at risk if she refused Bratt's request to find a way for him to fly business class on his government trips.

    Notwithstanding this recommendation, we note that Turcotte, and other employees in similar situations, could have availed herself of the resources that are available in the Department of Justice when faced with a supervisor who engages in misconduct. The OIG is available to all employees and constitutes recourse within the Department of Justice where other avenues appear to be unavailable. Complaints can be made either anonymously or confidentially.

II. OTHER RECOMMENDATIONS

    In this section, we discuss systemic improvements for the Department to consider as a result of our review.

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A. Oversight Committee

In 1998, the Department of Justice and Department of State organized a high-level supervisory working group to coordinate and monitor the work of ICITAP and OPDAT. We believe that the formation of this group was overdue and while it has ceased meeting, we believe that the continuation in some form of a joint oversight committee would benefit the development of the organizations. The Oversight Committee permits policy to be articulated and refined where there is expertise available on international matters and in an atmosphere in which the program interests of both Departments can be heard and accommodated. We note, however, that the Oversight Committee is in addition to, not a substitute for, adequate oversight of ICITAP and OPDAT by the Criminal Division.

B. Follow-up After Investigations

We found that the recommendations and the lessons learned from previous investigations or reviews of ICITAP were generally ignored. In the few instances where some corrective action was instituted, little attention was paid to see if the problem was fixed in the long-term. For example, in a memorandum to the Assistant Attorney General for the Criminal Division following an investigation in 1994, the OIG cautioned that the billing systems used by ICITAP's contractors made it difficult, ''if not impossible,'' for ICITAP to verify the accuracy of invoices and that without a system for matching delivery orders with invoices, ICITAP was ''highly vulnerable to contractor over-charges.'' Yet, we did not find evidence that any effort was made to remedy this problem until 1997 when ICITAP was unable to provide needed information to the State Department.

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    The OIG noted throughout the two reports it submitted to the Criminal Division in 1994 that ICITAP's lack of planning resulted in problems. We cited as an example that ICITAP paid more for services related to a training course because ICITAP waited until the last moment when the situation became a crisis. We saw this situation repeat itself with the ILEA conference cost overrun and the development of IMIS. Indeed, the OIG noted in the 1994 reports that recommendations made by JMD following a 1992 review had not been implemented. Security problems continued over the course of years, despite reports highlighting the issues and suggesting ways to resolve the problems. Poor staff morale continued despite a 1995 report by Bratt noting the problem and some of the causes.

    Senior Criminal Division management, as well as the management of the office being investigated or reviewed, must take responsibility for ensuring that recommendations resulting from investigations are either implemented or that the failure to implement the recommendations is the result of careful consideration rather than inertia.

C. Security Issues

    Given that ICITAP's security violations were long-standing and extensive, we recommend that SEPS continue to monitor ICITAP's progress, including conducting unannounced security reviews, and provide training to both new and experienced staff members who handle classified information. SEPS should also consider whether ICITAP should have a SCIF on its premises.

    Our investigation of the security problems at ICITAP leads us to believe that there may be broader security issues beyond failures on the part of individual ICITAP managers. For example, SEPS did not seem to have a mechanism for ensuring that ICITAP had in fact remedied its long-standing security violations. In addition to the training given when employees receive a security clearance, refresher training in security practice may also be appropriate. We, therefore, are considering initiating a review of security practices within the Department of Justice to determine whether some of the problems we observed at ICITAP exist elsewhere in the Department and whether we can provide recommendations to assist the Department to improve its overall security program.

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D. Travel

1. Review of Audit Process

Many of the travel violations that we discovered were apparent on the face of the documents that JMD's travel staff reviewed. For example, airline ticket receipts showed that employees traveled business class when travel was represented as coach class on travel vouchers. We do not know whether a different, less rigorous standard of review is given to certain persons or offices in the Department or whether these violations were not identified for other reasons. We recommend that JMD review its auditing process to determine whether changes are warranted, such as additional training for auditors or periodic reviews of audits conducted.

2. Training

We recommend that on an annual basis, the Department offer training on government Travel Regulations to Department employees. We believe that Department employees who travel regularly, such as attorneys in litigating sections, as well as the secretarial or clerical staff who are often given the responsibility of completing the travel forms and supervisors who are responsible for authorizing travel and approving travel vouchers, would benefit from such training. This would give both new and seasoned travelers and staff who must arrange government travel a forum in which to learn and raise questions about the regulations. We have found from this review and others, as well as from the personal experience of individuals who worked on this investigation, that Department employees too often learn only about travel regulations informally from other personnel in their own offices and as a result often learn incorrect or improper practices.

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3. Frequent Flyer Miles

    We have found in this investigation and in prior investigations that the collection of frequent flyer miles by government travelers creates the opportunity for an undue number of travel violations. We understand that the government has an interest in the savings that these miles might represent. However, the Department's actual savings from the use of frequent flyer miles appears to be so insignificant that it raises the question of whether to continue to permit employees to collect frequent flyer miles on government travel.

    The Department has put in place a program, called the Gainsharing Program, to share its savings from various travel cost cutting measures with employees as an incentive to encourage employees to use frequent flyer miles and other cost saving measures for the government's benefit. The Gainsharing Program was implemented in 1995 at the direction of the Attorney General. Under the program, employees who use or transfer to another employee frequent flyer miles may earn up to 50 percent of the government's savings when those miles are used for government business.

    According to Mark Rodeffer, savings to the Department of Justice from the Gainsharing Program were as follows:(see footnote 5)

FY  1996  $ 70,494.56

FY  1997  $201,946.98

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FY  1998  $ 44,796.81

    The Department should consider whether the Gainsharing Program needs improvement through increased publicity or whether other issues are hampering its use. The Department should also consider whether the opportunity for misconduct is so substantial when compared to the insignificant cost benefit the Department receives that it warrants eliminating having employees collect frequent flyer miles. Another alternative would be to assist employees to maintain separate frequent flyer accounts. The refusal of airlines to allow separate accounts for personal and business travel creates problems for employees. We suggest that the Department press the airlines, or recommend to the General Services Administration to press the airlines, to allow separate frequent flyer accounts for personal and governmental travel.

E. Training on Ethical Issues

    The Department requires mandatory ethics training of its employees. However, we found in this investigation that managers had little appreciation for ethical issues beyond the most obvious situations involving financial conflicts of interest. Therefore, the Department should revise its ethics training material to include other more difficult and less obvious situations, such as situations involving the appearance of a conflict of interest. The training should also advise managers on the appropriate course of action, such as obtaining a written waiver of the conflict.

F. Performance Evaluations

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    We observed during the course of the investigation that Criminal Division managers did not complete performance evaluations for many of their subordinates and that many ICITAP, OPDAT, and Office of Administration managers did not have performance evaluations in their files. In some instances, when we did find performance evaluations, employees were rated ''outstanding'' although their supervisors had complained to us about their performance. The Department should remind managers to complete performance evaluations for all subordinates, including subordinate managers, on a yearly basis and that the evaluations should reflect an honest appraisal of employees' performances.

G. Re-employment Issues

    In the event that a future Buyout bonus is offered to Department employees, the Department should provide training to the administrative officers regarding the requirements of the program. If other type of retirement programs, such as early out programs, also contain restrictions on employees' ability to return to government service or work as contractors, the Department should ensure that administrative officers are trained and alert to the issues involving returning employees.

III. CONCLUSIONS

    This report discusses in detail a disturbing history of managers who knowingly committing misconduct and willfully violated rules and regulations they acknowledged they knew. In other instances, senior managers professed ignorance of long-standing rules that others in the Department routinely abide by. Many subordinates who witnessed the improprieties of the managers either also became lax about their own conduct or became cynical about the ethics of the Department as a whole, believing that certain favored managers could get away with improper conduct.

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    It would be tempting to conclude that the problems lie solely with the individual managers and that with their transfers or retirements the problems have been fixed. We believe that such a conclusion would only focus on part of the problem and would ignore the long-term lessons that could be learned from this investigation.

    As we noted in the Introduction to this report, ICITAP had a troubled history before becoming part of the Criminal Division in 1994. Yet, between 1995 and 1997, rather than providing increased supervision of the office, the Criminal Division seemed to provide even less. We found that at various periods between 1995 and 1997, none of the Criminal Division's managers with the closest connection to ICITAP believed that they were responsible for supervising ICITAP. ICITAP's Director did not understand to whom she was to report. In some part, this lack of supervision may have been the result of the fact that the State Department rather than the Criminal Division provided ICITAP and OPDAT's funding. It also may have been that Criminal Division managers considered the decision to put Bratt in charge as in effect providing supervision. Even if Bratt had been an exemplary manager, ICITAP and OPDAT would have benefited from attention and guidance by senior Criminal Division managers as it made its way in its new home in the Department.

    As we have seen, however, Bratt was far from an exemplary manager, and the failure to adequately supervise his conduct added fuel to ICITAP's preexisting problems. We do not believe that all of ICITAP's difficulties and Bratt's and other managers' improprieties could only have been ferreted out by an OIG investigation. Some of them, particularly security and travel issues, should have been apparent to anyone taking the time to look. The fact that the Criminal Division did not follow up to ensure that recommendations from other OIG or internal investigations had been implemented is an example of the lack of adequate oversight.

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There is new management at ICITAP and OPDAT, and our sense is that improvements have been made in various areas, such as security. However, we did not review the current management and the changes it has made. Moreover, we believe that it is still too soon to tell whether ICITAP has moved away from its previous attitude that it was ''different'' and ''unique'' and that therefore the rules applicable to other Department employees do not apply to its personnel. Attitudes and practices that have been engrained for years are not likely to disappear with the introduction of a few new personnel, even if those personnel are managers. Consequently, managers at ICITAP and OPDAT must be vigilant in ensuring that ICITAP and OPDAT staff adhere to Department rules and standards.

Another lesson to be taken from this investigation is the ease with which managers can slip from carelessness to misconduct. In this investigation, and others, we found some employees rationalized their conduct by noting that they worked hard, they were overburdened with work, they were focusing on other issues, they deserved certain benefits, or that the regulations were burdensome. We found during this investigation that the occasional ''bending of the rules'' became a way of doing business. We believe that Department managers need to be vigilant to avoid the attitudes that can easily lead to the problems we found during this investigation.

Glenn A. Fine, Acting Inspector General,

Robert L. Ashbaugh, Deputy Inspector General.

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(Footnote 1 return)
In March 1998, after Bratt refused to answer further questions from the OIG, we referred the matter involving visas to the United States Attorney's Office for the District of Columbia for a prosecutive decision. The United States Attorney's Office ultimately declined prosecution, and Bratt was compelled to provide answers to our questions.

(Footnote 2 return)
I have not been involved with any matters related to the investigation or presentation of the OIG's findings with respect to this contractor. The contractor in question was represented by a lawyer at the law firm where my wife formerly worked. While she never worked on any matters associated with this client, I thought it best to recuse myself from this issue in order to avoid even the appearance of a conflict of interest.

(Footnote 3 return)
While we rely primarily on the facts described earlier in our report, where necessary to make clear the basis of our assessments of responsibility we refer to facts not contained elsewhere in the report.

(Footnote 4 return)
In some instances, frequent flyer miles can be purchased. United charges 2.5 cents per mile, and we used that cost to calculate a value for frequent flyer miles.

(Footnote 5 return)
Rodeffer said that if in its discretion an office did not make any award when frequent flyer miles had been used, JMD would have no record of the savings to the government. The Criminal Division did not participate in the Program in Fiscal Years 1997 or 1998. Rodeffer said that one concern of the Criminal Division was the apparent inequity of a program that would only benefit some, but not all, employees.