The number of assets seized by the Internal Revenue Services Criminal Investigation Division fell in 2009 and 2008, according to a new government report.
The report, from the Treasury Inspector General for Tax Administration, evaluated whether the CI Division adequately considered the seizure of assets during its illegal source and narcotics investigations of white collar criminals and drug dealers. The CI Division uses its asset seizure and forfeiture authority to combat financial crimes and unlawful activities aimed at evading taxes. Seizure is the confiscation of a person's property by a legal process. In forfeitures, the federal government assumes ownership of the seized asset.
During fiscal year 2009, the CI Division seized 1,624 assets, a 13 percent decline from the previous year, and a 28 percent decline from the six-year high in FY 2007. However, the decline in the number of assets seized can be partly attributed to the decrease in the number of illegal source and narcotics investigations initiated during that period and the loss of experienced special agents in recent years. In addition, there was a significant disparity in the number of assets seized among the various field offices.
The use of asset forfeiture has become one of the most important tools that federal law enforcement can employ against criminals, so the Criminal Investigation Division must take steps to ensure that seizure opportunities are maximized, said TIGTA Inspector General J. Russell George in a statement. The IRS needs to use all of its available resources to deprive individuals who knowingly violate the nations tax laws of their ill-gotten gains.
TIGTA found several opportunities for the CI Division to improve its asset forfeiture program. In addition, TIGTAs analyses of the CI Division's management information system data indicated that the CI Division may have missed some seizure opportunities.
TIGTA analyzed a sample of investigations with money-laundering or bank-structuring violations and found that requests to pursue seizure were made in only 34 percent of the investigations, with the percentage of requests varying significantly among field offices. But while the CI Division may have missed some seizure opportunities, its asset forfeiture program is respected by outside stakeholders and, when compared to other federal agencies, its program appears to be productive.
TIGTA recommended that the CI Division require its contractor employees to review the CI Divisions management information system reports to identify recently initiated narcotics and illegal source investigations where there is no corresponding seizure investigative activity. The report also recommended that the contractor employees should proactively engage the special agents in discussions regarding the identification of forfeitable assets; and require contractor employees to periodically contact special agents to determine the status of the seizure and offer additional assistance.
TIGTA also recommended that the division should conduct an internal study, with the cooperation of the U.S. Attorneys Offices, to determine if seizure opportunities are being missed. The study should incorporate a review of a sample of narcotics and illegal source investigations where the seizure of assets was not pursued to determine if assets with seizure potential were not identified.
IRS CI Division officials agreed with most of the recommendations, but disagreed with one. The CI Division did not agree with conducting an internal study but plans to ensure the appropriate management reviews are being performed. However, because TIGTA is precluded from reviewing case file information due to grand jury restrictions, TIGTA believes the CI Division would benefit from conducting this review because it would determine the extent of the issue and provide ideas for improvement.
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