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26–501 PDF 2017

REVIEWING ATF’S FAILURES IN THE DEATH OF 

ICE AGENT JAIME ZAPATA 

HEARING 

BEFORE THE

COMMITTEE ON OVERSIGHT 

AND GOVERNMENT REFORM 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED FIFTEENTH CONGRESS 

FIRST SESSION 

MARCH 9, 2017 

Serial No. 115–18 

Printed for the use of the Committee on Oversight and Government Reform 

( 

Available via the World Wide Web: http://www.fdsys.gov 

http://oversight.house.gov 


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COMMITTEE ON OVERSIGHT AND GOVERNMENT REFORM

Jason Chaffetz, Utah, Chairman 

John J. Duncan, Jr., Tennessee 

Darrell E. Issa, California 

Jim Jordan, Ohio 

Mark Sanford, South Carolina 

Justin Amash, Michigan 

Paul A. Gosar, Arizona 

Scott DesJarlais, Tennessee 

Trey Gowdy, South Carolina 

Blake Farenthold, Texas 

Virginia Foxx, North Carolina 

Thomas Massie, Kentucky 

Mark Meadows, North Carolina 

Ron DeSantis, Florida 

Dennis A. Ross, Florida 

Mark Walker, North Carolina 

Rod Blum, Iowa 

Jody B. Hice, Georgia 

Steve Russell, Oklahoma 

Glenn Grothman, Wisconsin 

Will Hurd, Texas 

Gary J. Palmer, Alabama 

James Comer, Kentucky 

Paul Mitchell, Michigan 

Elijah E. Cummings, Maryland, Ranking 

Minority Member 

Carolyn B. Maloney, New York 

Eleanor Holmes Norton, District of Columbia 

Wm. Lacy Clay, Missouri 

Stephen F. Lynch, Massachusetts 

Jim Cooper, Tennessee 

Gerald E. Connolly, Virginia 

Robin L. Kelly, Illinois 

Brenda L. Lawrence, Michigan 

Bonnie Watson Coleman, New Jersey 

Stacey E. Plaskett, Virgin Islands 

Val Butler Demings, Florida 

Raja Krishnamoorthi, Illinois 

Jamie Raskin, Maryland 

Peter Welch, Vermont 

Matthew Cartwright, Pennsylvania 

Mark DeSaulnier, California 

John Sarbanes, Maryland 

JONATHAN SKLADANY, Staff Director 

WILLIAM MCKENNA, General Counsel 

TRISTAN LEAVITT, Senior Counsel 

CORDELL HULL, Senior Counsel 

SHARON CASEY, Deputy Chief Clerk 

DAVID RAPALLO, Minority Staff Director 


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C O N T E N T S 

Page 

Hearing held on March 9, 2017 .............................................................................. 1 

WITNESSES 

The Hon. Michael E. Horowitz, Inspector General, U.S. Department of Justice 

Oral Statement ................................................................................................. 7 

Written Statement ............................................................................................ 9 

Mr. Thomas E. Brandon, Acting Director, Bureau of Alcohol, Tobacco, Firearms and Explosives, U.S. Department of Justice 

Oral Statement ................................................................................................. 14 

Written Statement ............................................................................................ 16 

Mr. Ronald B. Turk, Associate Deputy Director and Chief Operating Officer, 

Bureau of Alcohol, Tobacco, Firearms and Explosives, U.S. Department 

of Justice 

Mr. William A. Temple, Special Agent in Charge, Dallas Field Division, 

Bureau of Alcohol, Tobacco, Firearms and Explosives, U.S. Department 

of Justice 

Mr. John Craft, Assistant United States Attorney, Office of the U.S. Attorney 

for the Eastern District of Texas, U.S. Department of Justice 

APPENDIX 

February 22, 2017, New York Times ‘‘A.T.F Filled Secret Bank Account 

With Millions From Shadowy Cigarette Sales’’ submitted by Mr. Lynch ....... 60 

Hearing Follow-up Response submitted by Mr. Brandon, Acting Director, 

Bureau of Alcohol, Tobacco, Firearms and Explosives ...................................... 67 


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REVIEWING ATF’S FAILURES IN THE DEATH 

OF ICE AGENT JAIME ZAPATA 

Thursday, March 9, 2017 

HOUSE OF REPRESENTATIVES

COMMITTEE ON OVERSIGHT AND GOVERNMENT REFORM

Washington, D.C. 

The committee met, pursuant to call, at 10:03 a.m., in Room 

2154, Rayburn Office Building, Hon. Jason Chaffetz [chairman of 

the committee] presiding. 

Present: Representatives Chaffetz, Duncan, Jordan, Gosar, 

Farenthold, Walker, Blum, Hice, Russell, Grothman, Hurd, Palmer, 

Mitchell, Cummings, Maloney, Norton, Lynch, Connolly, Kelly, 

Watson Coleman, Plaskett, Krishnamoorthi, and DeSaulnier. 

Chairman CHAFFETZ. The Committee on Oversight and Government Reform will come to order, and without objection the chair is 

authorized to declare a recess at any time. 

We are here today to talk about ATF’s failures in the death of 

an ICE agent, Jaime Zapata. Well, there is nothing more difficult 

than dealing with a person who puts their life on the line for the 

United States of America and they get killed doing it. They lose 

their life. The Zapata family deserves some answers, a wonderful 

family. 

Jaime was one of, I think, 5 children, 5 kids. All those brothers 

serve in law enforcement in various capacities, and I do not know 

that the Zapata family is here. I hope they are able to watch on 

television. I think that they are. But it breaks your heart when you 

have somebody that young who is serving their Nation and their 

life is taken. And it was violent, and it was, many people believe, 

preventable. 

But it is also the responsibility, I believe, of the United States 

and the Congress to understand what happened so that we can try 

to help prevent it and make sure it never happens again. It is also, 

I think, imperative, it certainly is in my heart, to give answers to 

the family so they can understand what happened, and what went 

well and what did not go well. 

And as you will hear me say time and time again in this committee, we are different in the United States. We are self-critical. 

We do take a good, hard look at ourselves and ask difficult questions. And it is one of the things that differentiates the United 

States of America from just about every other country on the planet, that you can speak truth to power. You can bring people in. You 

can grill them and talk to them, and ask hard questions, and get 

those answers, and we are self-critical. It is not just here to protect 

the politically elite or the higher ups in government. 


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So, what happened on February 15th of 2011, more than 6 years 

ago now, cartel members in Mexico murdered an Immigration and 

Customs Enforcement agent, Jaime Zapata, when he was driving 

there on ICE business. One of the firearms recovered from the attack was traced back to an October 2010 purchase by Otilio Osorio 

at a Dallas/Fort Worth gun show. The evidence uncovered by the 

Department of Justice inspector general shows that the Bureau of 

Alcohol, Tobacco, and Firearms, the ATF, failed to investigate 

Osorio, his brother, Ranferi Osorio, and their associates who were 

all part of a straw purchasing ring. 

Straw purchasing. It is illegal in the United States of America 

to buy a gun for someone else, and you certainly cannot do that for 

others en masse. It is against the law. Evidently, the ATF potentially missed chances to prevent the firearms in question from trafficking to Mexico. 

The ATF knew in June of 2010 that the Osorios were associated 

with an organization that was likely trafficking firearms to Mexico. 

In fact, the inspector general found that by late September 2010, 

the ATF should have been investigating the Osorio brothers and 

their associates. As the IG summarized, and I quote, ‘‘These were 

dangerous individuals involved in serious and significant ongoing 

criminal activities that represented a substantial risk to public 

safety in the United States and Mexico.’’ 

The inspector general also found a scenario where ATF had both 

a legal authority and the opportunity to take firearms in the 

Osorios’ possession, but failed to seize them. Those firearms were 

also later found at a crime scene. 

Unlike the Fast and Furious case, which this committee has been 

vigorously pursuing, where refraining from contacting straw purchases was part of the flawed strategy, the inspector general found 

the Dallas Field Division simply failed to do its job. We will never 

know whether Agent Zapata would still be alive if the ATF had 

done its job properly, and we rely heavily on the inspector general 

and their expertise in looking at this. 

And, again, our hearts, and minds, and prayers go to the Zapata 

family. 

In September of 2012, nearly 5 years ago, the committee and 

Senator Chuck Grassley requested an investigation of ATF’s actions relating to Agent Zapata’s death. We presented evidence to 

the IG obtained from confidential sources as well as whistleblowers. We told the inspector general that ATF may have had 

probable cause to arrest the Osorio brothers in November of 2010 

when ATF witnessed them providing 40 weapons with obliterated 

serial numbers to an undercover ATF informant at a Walmart 

parking lot for the purpose of trafficking those weapons to Mexico. 

The Department of Justice inspector general report confirms these 

facts. 

ATF’s first contact with the Osorios and Morrison, however, did 

not occur until 3 months after Agent Zapata’s murder. So, again, 

information was there, but it was 3 months after Agent Zapata was 

murdered that the ATF first made contact. 

It has been more than 6 years since Agent Zapata was murdered 

in the ambush attack involving U.S. purchased and subsequently 


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trafficked firearms. It has been nearly 5 years since the probe was 

requested. 

Today we want to examine ATF’s past practices with respect to 

investigating straw purchases and firearms trafficking cases. We 

have had the ATF here on a couple different occasions dealing with 

these issues, and yet we are concerned that these problems are still 

happening. 

ATF must enforce the existing laws and aggressively stop illegally purchased and possessed firearms. Repeated excuses that the 

U.S. Attorney’s Office will not prosecute or that heightened probable cause is necessary I think should be rejected, you know. I 

think we do have a further problem with prosecutors prosecuting 

gun crimes. In fact, this committee is anticipating having hearings 

on that very subject. 

It is frustrating not only at the ATF level, but it is frustrating 

with the TSA. I mean, every day we are taking guns off airplanes, 

and yet go try to find a case that is prosecuted. It is rare to none. 

There seems to be virtually no consequence. And today we aim to 

bring renewed focus on the incident for not only the Zapata family, 

but also those other families who serve in our Nation and the overall general well-being of the United States of America. 

We invited ATF Deputy Director Ronald Turk and Special Agent 

in Charge William Temple to testify today because they could provide some of the answers the Zapata family and the public deserve. 

The Justice Department does not think we need to hear from them. 

You will notice that there are five seats there, but only two have 

bothered to show up. You know, when Congress, certainly an oversight committee, invites you to testify, it is not optional. It is not 

an exercise of whether or not it is convenient. They will show up, 

and we will get to that in a moment. 

Mr. Temple is the head of the Dallas Field Office, the special 

agent in charge, and he can provide a unique perspective in the 

field, one of the most challenging environments for fighting firearms trafficking. And in light of the serious problems that we covered in this IG report, we have to hear from the ATF officials outside of Washington. I am tired of hearing from just management. 

I want to hear from the people that actually are on the frontlines 

doing this. As you noticed, Mr. Temple is not here either. The Department of Justice continues to insist we should not talk to Mr. 

Turk or Mr. Temple, and I am going to get back to that later as 

we go through the questioning. 

We want to encourage ATF and other law enforcement agencies 

to place more emphasis on taking down criminals and their tools 

before they work their will. No law passed by Congress can require 

Federal law enforcement officers to simply do their job. It is tough. 

It is difficult. I have been on a lot of ride-alongs. I blow in and out 

in a few hours, and they do they do this day in and day out. 

They need to know that we got their back, we got their support, 

we love them, we care for them. And if there are problems and 

challenges that are happening at the front line, we need to know 

it. We cannot get that perspective if when we ask them to be here, 

some management person says, no, they really do not need to be 

here, I speak for the Agency, I speak for the mass. That is not the 


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way this is going to work. It is certainly not going to work in this 

Congress. It does not work for me. 

So, I thank the two that are here, but, Mr. Brandon, you got 

some questions to answer about why people that work for you are 

not here. And we will get to that in the questioning. 

And as for Mr. Craft, you know, when you work as an AUSA, an 

assistant U.S. attorney, again, we are going to have to have some 

hard discussions with the Department of Justice because they are 

not above oversight either, and they will be here in the future as 

well. 

I have gone well past my time. Let me now recognize Ms. 

Maloney of New York for her opening statement. 

Ms. MALONEY. I want to thank the chairman for holding this 

hearing, and thank him for his sensitivity for the sacrifice of law 

enforcement and the pain of families. This is an important hearing. 

When Special Agent Jaime Zapata was shot and killed in Mexico 

in February of 2011, he was only 32 years old. He was as enthusiastic and hardworking as any law enforcement agent can be. 6 

years ago, this remarkable young man was murdered in an ambush 

while working in service of his Nation. His partner, Special Agent 

Victor Avila, was gravely injured alongside him. Examining the circumstances of Agent Zapata’s death and the shooting of Agent 

Avila required a thorough and diligent investigation by the Office 

of Inspector General. 

I thank Mr. Horowitz and his staff for the report we are discussing today. This report identifies a number of serious problems 

in the way that ATF, the Drug Enforcement Administration, and 

the U.S. Attorney’s Office investigated the trafficking of weapons to 

Mexico in 2010 and 2011. 

Many of these issues are not new to us on this committee. We 

have investigated them over and over again for several years, and 

we have worked to ensure that these agencies make serious and 

lasting improvements. 

The IG’s report highlights some very important new facts. For 

example, it describes how a Federal prosecutor in Texas made a 

very serious mistake in agreeing to release a man by the name of 

Manuel Barba from Federal custody in July of 2010. According to 

the IG, that prosecutor had DEA reports with Mr. Barba claiming 

that he was heavily involved in drug trafficking. 

The IG found that this decision had terrible consequences, and 

I quote: ‘‘Based on the information reasonably knowable to the 

agents and the prosecutors, it is clear that they should not have 

agreed to Barba’s release from Federal custody and left at liberty 

to direct the straw purchase of one of the assault weapons and its 

trafficking to Mexico where it was used in the Zapata/Avila shooting.’’ 

This prosecutor’s supervisor, the U.S. attorney for the Eastern 

District of Texas, admitted later, and I quote: ‘‘We dropped the 

ball.’’ Well, I have got to say that this Congress has dropped the 

ball in its support of law enforcement. We had testimony before 

this committee on Fast and Furious where the agent said give us 

a tough anti-drug trafficking law. And this committee, I authored 

along with Chairman Cummings a bill that just did that, made it 


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a felony. They said we do not even bother to prosecute it because 

it is just a slap on the wrist, and give us the tools. 

I will say I am proud that it is the one bill addressing gun safety 

that has bipartisan support. I am reintroducing it again today with 

Republican support. It is the only gun safety bill that the NRA has 

not come out against because it makes so much sense, and practically every law enforcement agency in the country has endorsed 

this bill. 

And I would venture to say we have hearings about it, but it involves illegal trafficking of guns, and I hope that some members of 

this committee will join me and the chairman in having a hearing 

on the bill and actually doing something to keep these guns out of 

criminals’ hands. 

Now, the IG’s report also disproved an unfounded assertion made 

by Republicans on this committee at the time. They claimed that 

Agent Zapata and Avila may have been shot with the guns that 

were so-called walked as part of Operation Fast and Furious. These 

claims have turned out to be wrong. Let me be clear. This new information in no way diminishes our committee’s obligation to ask 

tough questions and demand answers, but it does caution against 

members rushing to judgment without all the facts. 

With that in mind, today we will also discuss a recent New York 

Times article alleging that ATF failed to properly oversee so-called, 

and I quote, ‘‘churning accounts’’ between 2011 and 2013 while investigating cigarette smuggling. In 2003, the Justice Department 

under Attorney General John Ashcroft argued in favor of allowing 

ATF to use churning accounts, asserting that Congress should give 

ATF authority to use money generated during undercover sting operations to offset their investigating expenses. In response, Congress granted this authority in 2004, and President Bush signed it 

into law. 

In 2013, the IG issued a report highlighting numerous accountability problems with these churning accounts between 2006 and 

2011. In response, ATF says that it stopped using these accounts. 

The New York Times article alleges that this latest operation was, 

and I quote, ‘‘not authorized under Justice Department rules and 

went beyond what was identified in that audit released in 2013.’’ 

We do not have the full story yet. The chairman asked ATF to 

submit documents, but the due date is not until tomorrow. In addition, litigation referenced in the press report is under seal. Documents on the public docket are heavily redacted, and it is unclear 

whether ATF has submitted documents in that case. 

Nevertheless, if the allegations in this press report are true, they 

raise serious, serious questions. Who authorized this program? 

How was the money used? Did this activity violate Department 

guidelines? Has there been an audit of these accounts to determine 

whether funds were used improperly? Has anyone been disciplined? 

And how were the activities described in this report any different 

than straight out tobacco smuggling? 

We will not rush to judgment, but we will seek answers. We will 

review the documents. We will monitor the litigation to determine 

whether the case is unsealed, and we will question today’s witnesses. 


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Also, Congress has a role. More than 5 years ago, several ATF 

whistleblowers testified at that very witness table about abuses 

that they saw firsthand. They called for legislation to make gun 

trafficking a serious Federal crime. They explained that the current 

penalties for gun trafficking are not more than paperwork violations, and they called them, and I quote, ‘‘toothless.’’ 

In response, I authored legislation in the past 2 Congresses. Our 

legislation was bipartisan. It had more than 100 co-sponsors from 

both political parties. It targeted criminals and, most importantly, 

helped law enforcement do their job. They asked for this. They endorsed it. It was endorsed by local, Federal, State police groups as 

well as prosecutor organizations with members across this country. 

Yet our bill received absolutely no action in this House. 

I will reintroduce it today, and I hope the chairman will grant 

the request of the ranking member for a hearing so that we can 

look at solving the problem of gun trafficking that is often with 

drug cartels, and gangs, and criminals. And I think it is a very important piece of legislation. It can save lives and prevent guns from 

getting into the hands of criminals that kill good agents, such as 

Jaime Zapata. 

My time has expired. I thank the chairman for calling this important hearing, and I hope you will grant our request for a hearing on the bill. 

Chairman CHAFFETZ. The gentlewoman yields back. I thank the 

gentlewoman. 

We will hold the record open for 5 legislative days for any members who would like to submit a written statement. 

Chairman CHAFFETZ. We will now recognize our panel of witnesses. 

We are pleased to welcome the Honorable Michael Horowitz, inspector general of the United States Department of Justice. We 

thank you and all the people that work with you for your service. 

One of the things we would like you to address, though, is why in 

the world it took so long to get to this point. It seems excessively 

long, but, again, you have a very storied and rich career in serving 

our country, and we thank you for that. 

Mr. Thomas Brandon is the acting director of the Bureau of Alcohol, Tobacco, and Firearms, and Explosives. Again, we thank you 

for your service both in the military, the United States Marines, 

but also at ATF and working on behalf of the United States of 

America. And a very difficult, but very important job, and we 

thank you again for your service and for your being here today. 

As you know, pursuant to committee rules, all witnesses are to 

be sworn before they testify. So, if you will please rise and raise 

your right hand. 

Do you solemnly swear or affirm that the testy you will give will 

be the truth, the whole truth, and nothing but the truth, so help 

you God? 

[Chorus of ayes.] 

Chairman CHAFFETZ. Thank you. Let the record reflect that both 

witnesses answered in the affirmative. 

We will give you some latitude, but we would appreciate it if you 

would limit your oral testimony to roughly 5 minutes. Again, we 


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will give you great latitude here, but your entire written statement 

and any supporting documents will be made part of the record. 

Mr. Horowitz, you are now recognized for 5 minutes. 

WITNESS STATEMENTS 

STATEMENT OF HONORABLE MICHAEL E. HOROWITZ 

Mr. HOROWITZ. Thank you, Mr. Chairman. Mr. Chairman, Ranking Member Cummings, members of the committee, thank you for 

inviting me to testify today at this important hearing. 

On February 15th, 2011, ICE Special Agents Victor Avila and 

Jaime Zapata were attacked by members of a drug cartel while 

working in Mexico. Tragically, Agent Zapata did not survive the attack, while Agent Avila was seriously injured. 

Two firearms used in that attack were traced to purchases in 

Texas made by Otilio Osorio and Robert Riendfliesh, both of whom 

were connected to then ongoing DOJ criminal investigations. Our 

review examined the information that the ATF, DEA, FBI, and the 

Department of Justice obtained about the illegal narcotics and gun 

trafficking activities of Osorio, Riendfliesh, and their associates 

prior to the attack on Agents Zapata and Avila. 

Our review of ATF’s investigation of Osorio, his brother, Ranferi 

Osorio, and neighbor, Kelvin Morrison, found numerous problems 

with the timeliness of ATF’s response to mounting evidence that 

the individuals were committing firearms trafficking offenses. 

We found that ATF had collected sufficient information prior to 

Osorio’s purchase on October 10, 2010 of the firearm that was later 

used in the attack on Agents Zapata and Avila to justify questioning his brother and Morrison, or taking other investigative 

steps regarding their firearms purchases. Our review also found 

that approximately 1 month after Osorio’s firearm purchase, the 

Osorio brothers were recorded transferring 40 firearms, 37 with obliterated serial numbers. Despite this information, ATF’s first contact with the Osorios and Morrison did not occur until late February 2011 following the attack on the agents. 

In addition, our review identified one instance, which occurred 

after the attacks on Agents Avila and Zapata, where we believe 

ATF had both the legal authority and opportunity to seize firearms 

in the Osorios’ possession, but did not. Two of the firearms that 

could have been seized were later recovered at a crime scene in 

Mexico. 

We concluded that the ATF supervisor in the Dallas Field Division was not sufficiently proactive and failed to ensure that all of 

ATF’s leads were investigated. The consultations with prosecutors 

were started, and that there was adequate coordination within ATF 

and with the DEA. We further determined that ATF delayed its investigation and arrests of the Osorios and Morrison for reasons 

that lacked sufficient justification. 

We also identified serious deficiencies with DEA’s handling of its 

narcotics investigation of Manuel Barba, the person who trafficked 

the firearm purchased by Riendfliesh. The DEA uncovered information about Barba’s potential gun trafficking in May 2010, yet never 

shared it with ATF. As a result, ATF only learned of Barba’s gun 


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trafficking as a result of its own investigation in August 2010, after 

the sale of the Riendfliesh firearm. 

We further determined that the AUSA handling the DEA narcotics prosecution of Barba should not have agreed to Barba’s release from jail in July 2010 following his arrest. That decision left 

Barba at liberty to lead a group of firearms traffickers and direct 

the straw purchase and trafficking of the Riendfliesh firearm to 

Mexico. 

We were not persuaded by DEA’s explanations for not passing on 

evidence of Barba’s firearms trafficking activities to ATF, and we 

determined that there is room for improvement in DEA’s policy to 

clearly require such communication in appropriate circumstances. 

As part of our oversight work concerning ATF’s Operation Fast and 

Furious, we previously encouraged DEA to develop policies that 

provide clear guidance to its agents about when to contact ATF, 

but to date, DEA has not implemented that recommendation. 

With respect to ATF’s own investigation of Barba and 

Riendfliesh, we found that ATF agents in that investigation diligently pursued leads, took effective investigative steps, and appropriately consulted and coordinated their activities with prosecutors. 

We did not identify any failure to take action by the ATF agents 

that might reasonably have prevented the trafficking of the 

Riendfliesh firearm. 

We did not make formal recommendations in this report because 

we believe our recommendations in the Operation Fast and Furious 

review that we did and in our recent follow-up review on the Operation Fast and Furious recommendations were sufficient to address 

the deficiencies we found in this review. 

We look forward to working with this committee and the Department to address the concerns identified in all of our reviews with 

regard to gun trafficking. And I’d be pleased to answer any questions the committee may have. 

Thank you. 

[Prepared statement of Mr. Horowitz follows:] 


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Office of the Inspector General 

l,!_nited S_tates _Qs;Jlartmerrt of Justice 

Statement of Michael E. Horowitz 

Inspector General, U.S. Department of Justice 

before the 

u.s. House of KPnre•spnre 

Committee on Oversight 

concerning 

A Review of Investigations of the Osorio and Barba Firearms Trafficking Rings 

March 9, 2017 
10 


KING-6430 with DISTILLERInsert offset folio 2 here 26501.002

Mr. Chairman, Ranking Member Cummings, and Members of the Committee: 

Thank you for inviting me to testify about the Department of Justice 

(Department) Office of the Inspector General's (OIG) review of investigations of the 

Osorio and Barba firearms trafficking rings and the OIG's earlier work on the 

Bureau of Alcohol, Tobacco, Firearms and Explosives' (ATF) use of incomegenerating, undercover operations. We appreciate the Committee's sincere interest 

in these important issues and look forward to continuing our oversight of the ATF. 

ATF's Investigation of the Osorio Firearms Trafficking Organization 

On February 15, 2011, Immigration and Customs Enforcement (ICE) Special 

Agents Victor Avila and Jaime Zapata were attacked by members of the Los Zetas 

drug cartel while travelling in Mexico. Agent Zapata did not survive the attack and 

Agent Avila was seriously injured. Two firearms used in the attack were traced to 

purchases in Texas made by Otilio Osorio (the Osorio firearm) and Robert 

Riendfliesh (the Riendfliesh firearm). Our review examined the information that the 

ATF, Drug Enforcement Administration (DEA), Federal Bureau of Investigation 

(FBI), and Department of Justice obtained about the illegal narcotics and gun 

trafficking activities of Osorio, Riendfliesh, and their associates prior to the attack 

on the ICE agents, and whether agents failed to seize firearms destined for Mexico. 

We also examined the circumstances surrounding the release of Manuel Barba from 

federal custody in Beaumont, Texas in July 2010 following his arrest for narcotics 

offenses. After his release, Barba trafficked the firearm purchased by Riendfliesh, 

which was recovered from members of the Los Zetas cartel following the attack on 

the ICE agents. 

Our review found numerous problems with how ATF assimilated information 

concerning Osorio, his brother Ranferi Osorio, and neighbor Kelvin Morrision, and 

with the timeliness of ATF's response to mounting evidence that these individuals 

were committing firearms offenses. We further had serious concerns with how DEA 

handled its Barba narcotics investigation, which also uncovered information about 

Barba's substantial gun trafficking. DEA never shared that information with ATF, 

and ATF only subsequently learned of Barba's firearms activities through its own 

separate investigation. 

Review of Information Prior to and Following the Purchase of the Osorio 

Firearm 

Our review found that ATF's Dallas Field Division had collected sufficient facts 

prior to Otilio Osorio's purchase of the Osorio firearm on October 10, 2010, to 

justify questioning Ranferi Osorio and Morrison or taking other investigative steps 

within a reasonable amount of time about their firearms purchases. While no single 

ATF staff member was aware of all of the collected facts, overall the information 

available to ATF prior to October 10 included the following key facts: 

(1) In June 2010, ATF agents seized a duffel bag containing firearms with 

obliterated serial numbers and Ranferi Osorio's luggage tags near the border 

2 
11 


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with Mexico. These firearms had what is known as short "times to crime," 

which refers to the time that passes between the purchase of a gun and its 

recovery in connection with a crime. Obliterated serial numbers and short 

"times to crime" are indicators of straw purchasing and firearms trafficking; 

(2) In June 2010, ATF agents also obtained information showing that one of 

the purchasers of the seized firearms described above listed the Osorio 

residence as her address and that a second purchaser resided less than 1 

mile from the Osorio home; 

(3) On August 7, 2010, law enforcement seized another shipment of firearms 

with obliterated serial numbers and short "times to crime" near the border 

with Mexico. Two of these firearms traced back to Ranferi Osorio and one 

traced back to Morrison; 

(4) Between August and September 2010, ATF collected information from 

sales reports and an intelligence analyst concerning multiple sales of 

handguns to the Osorio brothers and Morrison; and 

(5) On October 7, 2010, ATF received a tip from a concerned firearms vendor 

in the Dallas area about firearms purchases by the Osorio brothers, Morrison, 

and five others. 

Despite this information, ATF's first contact with the Osorios and Morrison did not 

occur until late February 2011, following the attack on agents Zapata and Avila. 

We determined that by early October 2010, before Osorio's purchase of a 

firearm that was ultimately used in the attack on Agents Avila and Zapata, the ATF 

had sufficient facts to justify questioning Ranferi Osorio and Morrison or taking 

other investigative steps about their firearms purchases. Our review also found 

that approximately one month after Osorio's firearm purchase, the Osorio brothers 

were recorded transferring 40 firearms, 37 of which had obliterated serial numbers. 

As we explain in the report, however, we do not believe that it is possible to identify 

what investigative steps should have been taken at the time, or precisely when 

arrests should have occurred, and that to attempt to do so now would be mere 

speculation. We did conclude that the supervisor of ATF's firearms group in Dallas 

was not sufficiently proactive and failed to ensure that the leads that ATF had 

received about Ranferi Osorio and Morrison were investigated, that consultations 

with prosecutors had started, and that there was adequate coordination within ATF 

and with DEA. We further determined that ATF delayed its investigations and 

arrests of the Osorios and Morrison for reasons that lacked sufficient justification. 

In addition, our review identified one instance where we believe ATF had 

both the legal authority and opportunity to take firearms in the Osorios' possession 

but failed to seize them. This occurred after the attack on agents Avila and Zapata. 

In response to the attack, agents searched the Osorio residence on February 24, 

2011, and found ten firearms. The ATF agents participating in the search did not 

seize the firearms because they did not believe that they had a legal basis to take 

3 
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them. We found that the agents reached their legal conclusion regarding probable 

cause and the likely views of the U.S. Attorney's Office without consulting any 

prosecutors in that office. When agents returned to the Osorio residence 4 days 

later to arrest the Osorios, five of the firearms were missing, and two of those were 

later recovered at a crime scene in Mexico. We believe that one of the lessons for 

ATF in this matter is the importance of coordination with the U.S. Attorney's Office. 

Barba's Release from Federal Custodv and Subsequent Trafficking of the 

Riendfliesh Firearm 

Our review also examined two investigations that were focused on Manuel 

Barba: a DEA narcotics investigation and an ATF firearms investigation. Our 

review found serious deficiencies with the DEA's and an Assistant U.S. Attorney's 

(AUSA) handling of the Barba case. DEA first learned in April 2010 of Barba's drug 

dealing and in May 2010 of his potential firearms trafficking to Mexico. However, 

DEA never shared the information about Barba's possible gun trafficking with ATF 

so that ATF could determine whether an investigation might be appropriate. ATF 

only learned of Barba's gun trafficking as a result of its own investigation of Barba 

in August 2010, after the sale of the Riendfliesh firearm. We were not persuaded 

by DEA's explanations for not passing on evidence of Barba's involvement with 

firearms trafficking to ATF, and we determined that there is room for improvement 

in DEA's policy to clearly require such communication in appropriate circumstances. 

As part of oversight work concerning ATF's Operation Fast and Furious, we 

previously encouraged DEA to develop policies that provide clear guidance to its 

agents about when to contact ATF, but to date DEA has not implemented our 

suggestions. 

We further determined that the AUSA handling the Barba drug prosecution 

should not have agreed to Barba's release from federal custody in July 2010 

following his indictment and ultimate plea in the Eastern District of Texas, leaving 

Barba at liberty to lead a group of firearms traffickers and ultimately to direct the 

straw purchase and the trafficking of the Riendfliesh firearm to Mexico. We found 

that, prior to his release, the DEA failed to highlight for the AUSA statements Barba 

had made about trafficking AK-47s. We also found no evidence that the AUSA read 

the DEA report that included these statements or took them into account in 

agreeing to Barba's release. 

With respect to the conduct of the firearms trafficking investigations that led 

to ATF's identification and arrests of Barba and Riendfliesh, we did not identify any 

failure to take action on the part of the investigating agents that might reasonably 

have prevented the trafficking of the Riendfliesh firearm. We found that ATF agents 

diligently pursued leads, took effective investigative steps, and appropriately 

consulted and coordinated their activities with the U.S. Attorney's Office for the 

Southern District of Texas. Our investigation did not identify circumstances where 

agents witnessed the unlawful transfer of firearms and failed to seize them. 

Further, our review did not find evidence that the FBI, ATF Headquarters, or 

DOJ were alerted to or aware of the criminal activities of the Osorios, Morrison, 

4 
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Riendfliesh, or Barba before the shooting of agents Avila and Zapata, or that there 

were deficiencies regarding the notification process in that regard. 

We did not make formal recommendations for improvement in this report 

because we believe the recommendations we made in our Operation Fast and 

Furious review, and in our recent follow up report, also address the deficiencies we 

identified in this review. As these reports demonstrate, the high risks associated 

with these matters and the possibility of tragic consequences for failure to respond 

to them appropriately is all too real. 

Our report can be found on the OIG's website at the following link: 

https ://oig.justice.gov/reports/2017/o1701.pdf. 

We look forward to working with this Committee and the Department to 

address the concerns identified in our reviews. This concludes my prepared 

statement, and I would be pleased to answer any questions that you may have. 

5 
14 

Chairman CHAFFETZ. Thank you. Mr. Brandon, you are now recognized for 5 minutes. 

STATEMENT OF THOMAS E. BRANDON 

Mr. BRANDON. Chairman Chaffetz, Ranking Member Cummings, 

and members of the committee, thank you for the opportunity to 

appear before you today. I welcome the opportunity to discuss the 

Department of Justice Office of Inspector General reports titled, 

‘‘Review of Investigations of the Osorio and Barba Firearms Trafficking Rings,’’ and ‘‘ATF’s Use of Income-Generating Undercover 

Operations.’’ 

I appreciate the work of the OIG in these matters. We agree with 

all of the findings in both reports, and ATF has implemented all 

of the recommendations from the 2013 report. I will continue to 

work closely with inspector general to further improve ATF. 

Before addressing those matters, however, I want to express the 

deepfelt condolences of all the men and women of ATF, to the family, friends, and colleagues of Special Agents Jaime Zapata and Victor Avila for the loss and suffering they have endured. Any time 

a law enforcement officer is lost in the line of duty, it is a tragedy 

that affects everyone. And over my career, I have had friends and 

colleagues killed in the line of duty, and every morning I contemplate the sacrifice that law enforcement officers have made on 

my behalf and on behalf of all Americans. I make my decisions as 

ATF’s acting director with this in mind. 

Mr. Chairman, you know that I am a career special agent. I am 

not a political appointee. I have worked the streets in Detroit, L.A., 

and Phoenix. I understand the impact a law enforcement career 

has on a family. So, when I say that every day ATF special agents, 

investigators, and professional staff work tirelessly to remove the 

most violent offenders from the streets to make our communities 

safer, I speak from the heart and the very essence of my being. I’ve 

been there myself. It’s not a talking point for me. It has been my 

life, and I’m honored and proud to lead the men and women of 

ATF. 

Leadership requires from time to time that we turn inward and 

examine ourselves. The DOJ OIG has helped us do that. I have 

closely read the OIG report on the Osorio and Barba gun trafficking rings, and I thank the inspector general for the thorough 

assessments of the events involved in those investigations. 

In particular, the OIG pointed out where ATF could make improvements to communications and information dissemination. 

ATF could and should have done better. We make no excuses, and 

I accept full responsibility for the lapses in 2010 and 2011. These 

events occurred more than 7 years ago before substantial leadership changes were implemented at ATF. The ATF of 2017 is not 

the ATF of 2010. 

Let me tell you how ATF has changed since that time. Since my 

arrival as the ATF deputy director in the fall of 2011, I’ve brought 

a laser focus to enhancing communication, operational oversight, 

and accountability to ensure that our investigations are effective, 

focused, and efficiently executed. In particular, hard lessons have 

taught us that the level of complexity involved in firearms trafficking investigations demand constant organizational vigilance, 


KING-6430 with DISTILLER
15 

management oversight, and that effective communication is essential to success in these high stakes cases. 

To meet these demands, ATF has implemented a broad range of 

organizational improvements during my tenure. These improvements include implementation of Frontline as ATF’s intelligenceled risk-based business model; establishment of crime gun intelligence centers in every ATF field division; focused hiring of intelligence research specialists with an emphasis on those with military experience; establishment of a formal ATF internal communications plan; enhancement of ATF’s Monitored Case Program; enhancement of mandatory leadership command and control training 

for first-line supervisors and management; and mandatory training 

for all agents on firearms trafficking techniques. I want to assure 

the committee for that as long as I’m privileged to lead ATF, we 

will continue to identify areas where we can further strengthen our 

operational effectiveness. 

I also understand the committee’s interest in recent media reports regarding ATF tobacco investigation. That investigation is 

the subject of an ongoing Federal civil lawsuit, and the Court has 

sealed the case pending trial. The United States is a party to that 

litigation, and, therefore, the Court’s order is binding on ATF and 

me. Consequently, my ability to respond to questions specific to 

that investigation is extremely limited at this time. 

What I can advise the committee is that the OIG conducted a full 

program audit of ATF’s income-generating undercover activities beginning in 2011, and issued a comprehensive report in September 

2013. That report, which evaluated the period of 2006 to 2011, 

identified serious deficiencies in ATF’s policies and controls over 

those investigations. 

Before the OIG issued the report, ATF had internally recognized 

the need for more robust policies, procedures, and oversight on income-generating undercover activity investigations, and had begun 

implementing enhancements in 2011. In April 2013, ATF issued a 

comprehensive order governing tobacco investigations, including 

strict rules on the use of income-generating undercover activities. 

ATF is not currently using this technique, and has not done so 

since 2013, and will not do so in the future unless very specific and 

limited parameters are met. ATF has closed all of these bank accounts and deposited all remaining funds from those accounts in 

the U.S. Treasury General Fund. Beyond implementation and strict 

enforcement of the April 2013 order, as noted, ATF has implemented all of the OIG’s 2013 recommendations, and, as a result, 

by October 2015, the OIG has closed all of its recommendations. 

Mr. Chairman and members of the committee, I am proud to be 

here today representing the men and women of the ATF. They 

work diligently every day to keep our communities safer. Thank 

you for this opportunity, and I am pleased to take your questions. 

[Prepared statement of Mr. Brandon follows:] 


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KING-6430 with DISTILLERInsert offset folio 6 here 26501.006

STATEMENT OF 

THOMAS E. BRANDON 

ACTING DIRECTOR 

BUREAU OF ALCOHOL, TOBACCO, FIREARMS, AND EXnOSIVES 

U.S. DEPARTMENT OF JUSTICE 

BEFORE THE 

COMMITTEE ON OVERSIGHT AND GOVERNMENT REFORM 

U.S. HOlJSE OF REPRESENT A HVES 

FOR A HEARING CONCERNING 

REVIEWING ATF'S FAILURES 

IN Tm: DEATH OF lCE AGENT ,I AI ME ZAP AT A 

PRESENTED 

MARCH 9, 2017 
17 


KING-6430 with DISTILLERInsert offset folio 7 here 26501.007

Chairman Chaffetz, Ranking Member Cummings, and Members of the 

Committee, thank you for the opportunity to appear before the Committee today. 

welcome the opportunity to discuss the Department of Justice (DOJ) Office of 

Inspector General's (OIG) reports "Review oflnvestigations of the Osorio and 

Barba Firearms Trafficking Rings" and "ATF's Use oflncome-Generating, 

Undercover Operations." 

Before addressing those matters, however, I want to express again the deeply 

felt condolences of all the men and women of ATF to the families, friends and 

colleagues of Special Agents Jaime Zapata and Victor Avila for the loss and 

suffering they have endured. As a career special agent, I understand all too well the 

devastating impact of having a colleague killed or seriously injured in the line of 

duty. The entire law enforcement community is a family that depends on each other, 

and whatever missteps we have made as an agency, ATF's commitment to 

supporting our law enforcement partners is and always has been -- deep and 

unwavering. 

Mr. Chairman and Members ofthe Committee, every day, ATF Special 

Agents, Investigators, and professional staff work tirelessly to remove the most 

violent offenders from the streets and make our communities safer. I am honored 

and proud to lead the men and women of ATF. We take our motto, "Protecting the 

Public; Serving our Nation" to heart. 

-I-
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Review ofinvestigations of the Osorio and Barba Firearms Trafficking Rings 

I have closely reviewed the OIG report on the Osorio and Barba gun 

trafficking rings, and I thank the Inspector General for the thorough assessment of 

the events involved in those investigations. The primary findings of the OIG report 

with respect to A TF relate to the Osorio investigation, so I will focus my remarks on 

that part of the report. Overall, ATF agrees with the OIG's assessment that we did 

not effectively evaluate and internally disseminate information developed during the 

summer of2010 indicating the existence of the Osorio trafficking ring; that we did 

not effectively communicate with the U.S. Attorney about charging options that 

information may have supported; and that we did not effectively communicate with 

our partner agency and prosecutors following the November 2010 seizure of the 

firearms the Osorio brothers delivered in the undercover operation. 

ATF could-- and should-- have done better. ATF makes no excuses, and I 

accept full responsibility for those lapses in 2010 and 2011. 

Since my arrival as ATF Deputy Director in the fall of2011, the ATF 

Executive staff has been laser-focused on enhancing communication, operational 

oversight, and accountability to ensure that our investigations are effective, focused 

and efficiently executed. In particular, we know from hard-learned lessons that the 

level of complexity involved in firearms trafficking investigations demands constant 

-2-
19 


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organizational vigilance, and that effective communication is essential to success in 

these high-stakes cases. 

To meet these demands, A TF has implemented a broad-range of 

organizational improvements over the last six years. These improvements include 

implementation of Frontline, ATF's intelligence-led, risk-based business model; 

establishment of Crime Gun Intelligence Centers in every ATF field division; 

focused hiring of intelligence research specialists with an emphasis on those with 

military experience; establishment of a formal ATF internal communications plan; 

enhancement of ATF's Monitored Case Program; enhancement of mandatory 

leadership command and control training for first line supervisors and managers; and 

mandatory training for all agents on firearms trafficking techniques. 

The Inspector General is aware of these changes, and we hope the absence of 

new recommendations in this report indicates that these changes have effectively 

addressed recommendations in prior reports. I assure the Members of the 

Committee that A TF will continue to identify areas where we can further strengthen 

our operational effectiveness. 

-3-
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ATF's Use oflncome-Generating, Undercover Operations 

I also understand the Committee's interest in recent media reports regarding 

an A TF tobacco investigation. That investigation is the subject of an ongoing 

federal civil lawsuit, and the Court has ordered the sealing of the case pending 

trial. The United States is a party to that litigation, and A TF is bound by the 

Court's order. Consequently, my ability to respond to questions specific to that 

investigation is extremely limited, but I look forward to addressing the 

Committee's concerns in the future. 

What I can advise the Committee is that the OIG conducted a full program 

audit of A TF's "income generating undercover activities" beginning in 2011, and 

issued a comprehensive report in September 2013. That report, which evaluated 

the period 2009 to 2011, identified serious deficiencies in ATF's policies and 

controls over those investigations, commonly referred to as "churning" cases. 

Well prior to the issuance of that report, A TF had internally recognized the need 

for more robust policies, procedures and oversight on churning investigations, and 

had begun implementing enhancements in 2011. In April 2013, A TF issued a 

comprehensive Order governing use of the churning technique and tobacco 

investigations. Beyond implementation and strict enforcement of the April2013 

Order, ATF also complied with all of the subsequent recommendations made by 

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the OIG in the September 2013 report. As a result, by October 2015, OIG had 

closed all of its recommendations. 

I can also advise the Committee that ATF is not currently utilizing the 

churning technique in any tobacco investigation, and has not done so since 2013. 

All churning bank accounts have been closed, and all remaining funds in those 

accounts, have been deposited into the U.S. Treasury general fund. 

Mr. Chairman and Members of the Committee, I am proud to be here today 

representing the men and women of ATF; they work diligently every day to make 

our communities safer. Thank you for this opportunity. 

-5-
22 

Chairman CHAFFETZ. Thank you, and I will recognize myself for 

5 minutes. 

Mr. Brandon, you have been the acting director a year and 11 

months now, correct? 

Mr. BRANDON. Yes, sir. 

Chairman CHAFFETZ. Mr. Turk and Mr. Temple work for you? 

Mr. BRANDON. They do. 

Chairman CHAFFETZ. Why are they not here? 

Mr. BRANDON. When we received the request, the invitation to 

testify, Mr. Chairman, I met with my team, consulted with DOJ, 

and wanted to quickly respond by having someone here from ATF, 

and that person would be me. 

Chairman CHAFFETZ. But the invitation was to yourself, Mr. 

Turk, and Mr. Temple, and you unilaterally decided that Mr. Turk 

and Mr. Temple would not be here? 

Mr. BRANDON. No, I did not. 

Chairman CHAFFETZ. Who decided that Mr. Turk and Mr. Temple were not going to be here? 

Mr. BRANDON. Well, the decision is theirs voluntarily. To let you 

know, Mr. Chairman, I did not order them not be here, and no one 

that I know of from the Department ordered them not to be here. 

Chairman CHAFFETZ. So, they personally chose not to be here. 

Mr. BRANDON. That is their free decision, but also I agreed with 

it. I am not going to duck anything here. 

Chairman CHAFFETZ. So, they just decided that coming before 

Congress was an optional activity and that they were not going to 

do it. I think I understand. Do you know what a subpoena is, Mr. 

Brandon? 

Mr. BRANDON. Yes, I do. 

Chairman CHAFFETZ. What does a subpoena require you to do? 

Mr. BRANDON. To appear before the Court or the legislative body 

in this case. 

Chairman CHAFFETZ. See this subpoena right here? I do not have 

to ask a judge. I do not get a vote here. We are now hereby subpoenaing, here is one for Mr. Turk. He is to testify before this committee in a deposition on March 21st. Is there any reason he cannot attend at that time? 

Mr. BRANDON. I do not believe so. 

Chairman CHAFFETZ. He will be served this subpoena. Mr. Temple, he is going to present himself for a deposition, which is a much 

more difficult thing than appearing before Congress. These things 

go on for hours under oath. Any reason he cannot be here on March 

22nd at 10:00 a.m.? 

Mr. BRANDON. Not that I am aware of. 

Chairman CHAFFETZ. Okay. And you are the director, or you are 

the acting director, so you can help make sure that his schedule 

is free to be here at that time? 

Mr. BRANDON. I will make sure of that. 

Chairman CHAFFETZ. I just issued a subpoena for Mr. Temple as 

well. He will present himself before this committee. These are not 

optional exercises. 

Now, Mr. Craft was given a little bit shorter notice. We are going 

to have to have that discussion with the Department of Justice. He 

was the minority witness that was requested by Mr. Cummings to 


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23 

be here. His non-presence is also totally and wholly unacceptable, 

and we will figure out how to best move forward on him. 

These are not optional exercises. You are wasting this committee’s time by allowing Mr. Turk and Mr. Temple to think anything 

other than. When they are invited to come to Congress, they will 

come to Congress. And when I sent you a notice on Thursday of 

last week, for you to contact your Department, your Agency, your 

people, for them to contact our office last night in the 5:00 hour is 

totally and wholly unacceptable. There is no excuse for that, and 

we will not tolerate that. 

And if I need to issue a subpoena at the get-go, you tell me. We 

will do that every time because they should have been here today. 

And if you had given us the proper notice as was laid out in the 

letter, which says that you will contact the committee by March 

6th, which you did not, then we would have issued a subpoena, and 

they would be here today, and we would have a more full and complete hearing. And everybody in this audience, and especially the 

Zapata family, could hear from these people. 

Do we understand each other? 

Mr. BRANDON. Yes, Mr. Chairman, we do. And I apologize if 

there was a communication as late as yesterday. I was under the 

understanding that there was communication, and if there was a 

subpoena, obviously they would be here. But I hear you loud and 

clear. 

Mr. CUMMINGS. Mr. Chairman, would you yield for a second? 

Chairman CHAFFETZ. Yes, I will yield. 

Mr. CUMMINGS. Mr. Brandon, I think the thing that concerned 

me more is when you said you agreed with the decision of them not 

to come. You understand the significance of a subpoena, do you not, 

and a request that your agents be here. But you just sat there and 

said you agreed with their decision, so apparently there was some 

back and forth. And you being their boss, I am just trying to figure 

out, you know, what part you played in all of that because that 

bothers me. 

It also bothers me that, you know, the late getting back to us. 

I mean, I think we try to accommodate, but when we get something, a response the evening before, that is kind of rough. But tell 

me what part you played. 

Chairman CHAFFETZ. No, go ahead. 

Mr. CUMMINGS. I just want to be clear on this. 

Mr. BRANDON. Thank you, sir. 

Mr. CUMMINGS. You are their boss now, right? 

Mr. BRANDON. Yes, I am. 

Mr. CUMMINGS. Okay. 

Mr. BRANDON. We got the invitations, not subpoenas, and I was 

told that normally we would get more time to respond within the 

14-day rule. We wanted to absolutely appear here and be prepared, 

and that in talking to the Department, which had a lot of things 

going on with hearings, that this was the proper way to handle 

—— 

Mr. CUMMINGS. But you said you agreed. You said you agreed 

with the decision for them not to be here. See, that puts in a kind 

of awkward position. We got the boss who says, okay, guys, you do 


KING-6430 with DISTILLER
24 

not have to show up, and that sends a hell of a message. That is 

a problem. 

Mr. BRANDON. It was not meant to be anything disrespectful to 

this committee in trying to say, okay, who was going to representing the Agency. 

Mr. CUMMINGS. Thank you, Mr. Chairman. 

Chairman CHAFFETZ. Jaime Zapata was killed about 6 years ago. 

This has been under investigation nearly 5 years. When did you get 

the report from the Department of Justice, the inspector general? 

How long ago did you get the initial draft of the report? 

Mr. BRANDON. The members of my team received the report, and 

it was the back and forth with edits. And I received it, I believe, 

approximately a month ago to read it. 

Chairman CHAFFETZ. Mr. Horowitz, do you have a more specific 

time? 

Mr. HOROWITZ. I can get you a more specific time, but it would 

probably be about a month to 6 weeks ago. If I can check and just 

get a more refined —— 

Chairman CHAFFETZ. So, your excuse that you needed more time, 

that just is not flying, okay? You had to know that we were deeply 

interested in this. And if you get the report 4 to 6 weeks ago, you 

are going back and forth with edits, my understanding is that 

members of the ATF actually got a draft in December. Mr. Horowitz? 

Mr. HOROWITZ. That is correct, Mr. Chairman. It was December. 

Chairman CHAFFETZ. So, you get it in December, and now your 

complaint is you did not have enough time to prepare for this hearing. And that is why in part we invited Mr. Temple here because 

my concern is 6 years after we had an American killed, an agent 

killed, that you all have not got the lesson. So, do not tell me that 

you need more time because if you cannot communicate to Congress that you get it and that you are implementing the changes, 

my guess is all those men and women, the thousands of people out 

in the field, they have not gotten the message either. 

And that is the concern. That is the concern. You all try to dress 

it up so that you come to Congress and put on the best-looking picture you can. We want the raw truth of what has happened and 

what those men and women are having to deal with on the front 

lines. So, the idea that you needed more time, we did not get the 

customary 2 weeks, is a load of crap, and you know it because you 

have had this since December, and that is my frustration. I could 

go on, but my time has expired. 

I will now recognize Ms. Maloney of New York for 5 minutes. 

Ms. MALONEY. Thank you. I would like to ask Mr. Brandon to 

respond to my comments concerning really Congress not giving you 

the tools that you need to get the job done. 

When Congress first began working on this and we were looking 

into the shooting death of Agent Zapata in 2012, we were already— 

2011, I believe it was—we were already in the midst of an investigation of the so-called Operation Fast and Furious. And that was 

the botched attempt to target gun traffickers connected to Mexican 

drug cartels. 

And we had whistleblowers testify sitting right where you are 

right now, Mr. Brandon, and they asked us to give them the tools 


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to get the job done. I can remember it like yesterday. He said we 

do not even bother to go after serious gun traffickers because there 

is no enforcement, and even if you caught them, you cannot do anything to them. It is just a paper violation. ‘‘A paper violation.’’ Give 

us the tools. Make it a felony, make it a crime, and crack down on 

these straw purchasers who buy guns for criminals and then use 

them to kill our agents. 

Well, we did, Mr. Cummings and I along with members of the 

Republican Party, and actually Senator Duckworth. She was then 

a member of this committee. We drafted a bill that cracked down, 

and it has been universally endorsed by law enforcement across the 

country. Now, that was 5 years ago. 

So, I would like to ask Mr. Brandon, is it true that today there 

is no such dedicated statute targeting gun trafficking? Is gun trafficking still just a paper violation as your agent testified before us 

5 years ago? 

Mr. BRANDON. Yes, ma’am, nothing has changed. 

Ms. MALONEY. And how big a problem is it? That makes guns 

flow easily, not only through Mexico, but probably throughout the 

world. I was talking to a representative from the Caribbean. They 

say guns flow all over the Caribbean from the U.S., but there is 

no law against it. Is that correct? 

Mr. BRANDON. That is true, ma’am, and there is no doubt that 

a firearms trafficking statute would help deal with the gun violence 

in America. 

Ms. MALONEY. Then I really want to ask my colleagues on the 

other side of the aisle to join Ranking Member Cummings and 

other members of this committee. Ms. Kelly was very active in it 

as there was a lot of violence in the district that she represents. 

And I for one thought after we had Newtown when the 23 young 

children were killed, that we would act on gun violence. 

But the one bill that has bipartisan support and the one bill that 

law enforcement has come out almost universally in support of is 

give us the tools to do the job. So, my question is, if we did make 

that a Federal felony, if we did crack down on straw purchasers, 

would that help you? Would that help our law enforcement, not 

just ATF, but all law enforcement do their job in a better way to 

protect people? 

Mr. BRANDON. Yes, ma’am, it would, in my opinion. Absolutely. 

Ms. MALONEY. Now, the bill was supported by the American Bar 

Association, the Association of Prosecuting Attorneys, the Federal 

Law Enforcement Officers Association, Major Cities Chiefs Association, but, most importantly in my mind, the police and fire that are 

on the front line in the district that I represent across this country. 

So, let me ask you, Mr. Brandon, how serious is the problem of 

gun trafficking along the southwest border today? Has the concern 

in any way gone away? 

Mr. BRANDON. The concern has not. We at ATF, without having 

that statute and with the laws that we enforce, have given credit 

for agents to have interdiction and deterrence of firearms rather 

than waiting for building a criminal case and where guns can get 

to the criminal element and be misused to shoot and hurt people. 

We are doing the best with what we have. And so, with interdiction deterrence—we refer to it as being on the left side of boom— 


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and that is one of the strategies we have taken. But firearms trafficking along the southwest border and across the United States 

still is a problem. 

Ms. MALONEY. Well, it is one that we can address. And for all 

of the talk of building a wall that may cost tens of billions of dollars along the southwest border, there is remarkably little talk 

about passing this law which costs nothing. This would cost nothing to the taxpayer to enact this law, which then would give our 

law enforcement the ability to better protect the American people, 

and it seems to me that it is just common sense. And our chairman 

is a commonsense guy, so I hope he will join the ranking member 

and myself, and I would say many members on this side of the 

aisle, and on the Republican side of the aisle. 

It is interesting. All of the Republican prosecutors, they know the 

problem, so they are co-sponsors of this. And we go a big step forward in combatting violent crime on the border in Mexico, and 

really the exporting of guns, and really the use of guns by criminals. Even if you sell one to a drug cartel, a criminal, a murderer, 

or whatever, there is no penalty for it. 

And I got to think that if we made it a penalty, and our bill has 

a 20-year visit to jail if you do so knowingly, then we could cut 

down on this violence. How many agents have to be killed by illegal 

guns that are sold to bad people because there is no enforcement 

against gun trafficking? It is a simple thing to do. We could pass 

it. 

Again, I join the ranking member in really pleading for a hearing 

on this bill that we have had in for 2 different Congresses now for 

4 years, and we are reintroducing it today. I think it could help us 

solve the problem and give law enforcement stronger tools to crack 

down on the bad guys, on the bad guys that are buying these illegal guns and using them in terrible ways to kill people, including 

our own agents. 

My time has expired. 

Chairman CHAFFETZ. I thank the gentlewoman. 

Ms. MALONEY. But I feel very strongly about this, and I am very 

frustrated because I would like to see some action. I would like to 

see this bill passed. 

Chairman CHAFFETZ. I thank the gentlewoman. We will now recognize the gentleman from Tennessee, Mr. Duncan, for 5 minutes. 

Mr. DUNCAN. Thank you, Mr. Chairman. Mr. Horowitz, this committee depends in a significant way on work by inspectors general, 

and you have done very good work for this committee in the past. 

But I noticed that on March 8th, 2011, the Department of Justice 

referred questions about the firearms recovered at the scene of Mr. 

Zapata’s death on March 8th, 2011. And then, on September 19th, 

2012, Senator Grassley wrote a letter to it asking these same questions, yet your report did not come out until March 1st, 2017. 

I think several of us are concerned about that length of that 

time, that delay. 

Mr. HOROWITZ. Yes. We got the request and the referral from 

this committee and Chairman Grassley in September 2012, and the 

bottom line is there is no excuse. We should have gotten it done 

more promptly. I could tell you about some of the staffing issues 

we had and challenges we had on the Barba piece of the report. We 


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learned some new information later on in the investigation that I 

think is important to the story here. 

But the bottom line is I agree with you, Congressman. And we 

have talked internally and are taking steps to make sure we can 

get these out more timely. 

Mr. DUNCAN. All right. Well, good. Do you believe there was 

probable cause to arrest both of the Osorio brothers and their 

neighbor, Kelvin Morrison, after the ATF witnessed completion of 

a transfer of 40 firearms on November 9th, 2010? 

Mr. HOROWITZ. That is what we found in our report, and I agree 

with you, Congressman. 

Mr. DUNCAN. Mr. Brandon, you said a few minutes ago that you 

were told this was, I think the words you used, that this was a 

proper way to handle this in telling Mr. Turk and Mr. Temple that 

this was up to them or something. Who told you this was the proper way to handle this? 

Mr. BRANDON. I was speaking with attorneys within ATF and 

also with members from the Legislative Affairs at DOJ. 

Mr. DUNCAN. Can you tell us specifically the people that told you 

that this was the proper way to handle this? 

Mr. BRANDON. I had my chief of staff, Joe Allen, communicating 

with the Department, and like I said, that with everything going 

on, communication was not the best. I will say to you, in respect 

to you and Mr. Chaffetz, as far as referring to it as crap, had I 

known this was the feeling coming down, and also to you, Mr. 

Cummings, you know, that this was your feelings, you know, that 

would be a different thing. I would say, well, hey, an invitation is 

really subpoena. There is no option here. 

And so, I just want to clarify that to you, that it was no disrespect from me as a leader and trying to shove it to the committee. That is absolutely not the truth. We have been trying to 

run to the truth. And so, I just want to make that clear of the intent, and to look you right in the eyes, Mr. Chairman, because I 

can see you glaring at me, that that is absolutely not how it went 

down. 

And an invitation, I am taking this and a clear interpretation 

from you is an invitation is really a subpoena. It is not an option. 

I get it, and they would be sitting here. And so, I just wanted to 

say I apologize for not having that political understanding of this. 

And also, saying I was trying to hide behind something for 2 

weeks. I am not a hiding type guy. And so, basically it was not 

B.S., and I just wanted to share that with all of you. 

Mr. DUNCAN. All right. Well, let me get to one other thing before 

my time runs out. The inspector general found that the Dallas 

Field Division simply failed to do its job. The report says the supervisor of ATF’s Dallas Firearms Group was not sufficiently 

proactive, and failed to ensure that the leads the ATF had received 

about Osorio and Morrison were investigated, and that consultations with prosecutors had started. What do you say about that? 

Mr. BRANDON. Sir, I agree with the OIG, Mr. Horowitz, and his 

team. We had a supervisor that has retired that was over our firearms trafficking that was asleep at the switch, and I totally agree 

with it, the findings of the OIG. 


KING-6430 with DISTILLER
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Mr. DUNCAN. And have you taken steps to see that something 

like this does not happen again in the future? 

Mr. BRANDON. Yes, sir. I mean, as I mentioned in my opening 

statement, we developed a Frontline intelligence-led, risk-based 

way of doing business. One of the key components of that is each 

division, we have 25 of them around the country, has to do a domain assessment and have to share that domain assessment with 

the U.S. attorney. And that is an important part because of the 

communication that was lacking. 

And if we are out of step with the U.S. Attorney’s Office, if we 

are not in step, we are out of step, and we do not want to waste 

our limited investigative time, our resources and time if they are 

not going to be prosecuted. So, to share that with you, sir, that is 

how we have tightened it up, and that was implemented in the beginning of 2012, and I will leave it at that. 

Mr. DUNCAN. All right. Thank you very much. 

Chairman CHAFFETZ. I thank the gentleman. We will now go to 

the gentleman from Virginia, Mr. Connolly, for 5 minutes. 

Mr. CONNOLLY. I thank the chair, and I welcome the panel. 

I would just say to you, Mr. Brandon, on a bipartisan basis, I 

mean, when executive branch officials are invited to testify before 

Congress, it is an invitation, but it is also an obligation. And I appreciate what you have said, but I do not think it ought to require 

a subpoena to get the executive branch to be accountable to the legislative branch. That is our constitutional system, and we do not 

want to go down that road. I do not think we want to set the precedent that the only way we can compel your testimony is by subpoena. I am sure you would agree. 

Mr. BRANDON. Sir, yes, I totally agree, and had I understood this 

storm coming down on me right now, they would be sitting here. 

Mr. CONNOLLY. Okay. You are the acting director of the ATF. In 

the last 10 years, how many confirmed directors have there been 

at the ATF? 

Mr. BRANDON. I am sorry, sir, in how many years? 

Mr. CONNOLLY. In the last decade. 

Mr. BRANDON. There has only been one. It was —— 

Mr. CONNOLLY. One. And how recently was that? 

Mr. BRANDON. I believe it was July 31st, 2013. It was B. Todd 

Jones, my former boss. 

Mr. CONNOLLY. So, for most of the decade, we have had acting 

directors. Is that correct? 

Mr. BRANDON. That is correct, sir. 

Mr. CONNOLLY. And the reason for that is what? 

Mr. BRANDON. Well, it is presidentially nominated, Senate confirmed. 

Mr. CONNOLLY. And the Senate gave it the slows. 

Mr. BRANDON. Well, I would say that the process is slow. 

Mr. CONNOLLY. What has happened to your budget? 

Mr. BRANDON. Well, like many in the Federal government, you 

know, you could do more with more, and the budget with ATF is 

tight. And in candor, sir, with what I refer to here being up in D.C. 

as decimal dust to the Federal budget of $50 million to $100 million extra ATF, we could make a significant input with technology 

to help our State and local—— 


KING-6430 with DISTILLER
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Mr. CONNOLLY. But, I mean, in the last 6, 7 years. I mean, we 

are so concerned about things like Fast and Furious and the tragic 

death of Mr. Zapata. We have certainly beefed up your budget with 

additional resources, have we not? 

Mr. BRANDON. No, sir. No. Our budget has been eroding. 

Mr. CONNOLLY. Really, eroding. So, we do not want to confirm a 

director, at least not very often. We have deliberately left the organization, with no disrespect to you or your predecessors who were 

in an acting capacity, but the proper form is to have a confirmed 

director of the Agency. We have actually reduced the resources 

available to you. 

And, as Ms. Maloney just pointed out, despite testimony, and 

your testimony is consistent with other agents who have sat here. 

I remember one hearing where I believe it was the agent from 

Phoenix who said, yeah, that would be a tool we want. And I remember the then chairman, not this chairman, actually interfering 

with the testimony because he did not like the answer, and actually started to direct the answer. 

It seems to me that we cannot have it both ways in Congress. 

If we want you to do your job and do it well, and we want to 

achieve the goals the Agency has and has set for especially the 

southern part of our border, it seems to me we have to do our jobs. 

And I am not sure we have consistently done that. You can comment or not, Mr. Brandon. 

Mr. BRANDON. No, sir. Look, I have a lot of friends, Democrats 

and Republicans, and I will say raise your hand if you are in favor 

of gun violence, and I have never seen a hand go up. This is an 

American issue. It is not a ‘‘D’’ or an ‘‘R’’ issue. 

Mr. CONNOLLY. Yeah, but it is quite another matter if we are unwilling to do something about it. 

Mr. BRANDON. Oh, I agree. That is what you guys are here for. 

Mr. CONNOLLY. Mr. Horowitz. Your office issued recommendations from the Operation Fast and Furious review in 2012. Is that 

correct? 

Mr. HOROWITZ. That is correct. 

Mr. CONNOLLY. And did ATF make major improvements pursuant to those recommendations? 

Mr. HOROWITZ. The ATF, as we noted in last year’s follow-up review, made significant changes to their policies and practices. 

Mr. CONNOLLY. Anything glaring that still needs to be resolved? 

Mr. HOROWITZ. Not from ATF. 

Mr. CONNOLLY. Not from ATF. Okay. Your office also issued a report reviewing, well, you reviewed the implementation and it was 

a favorable report. 

Mr. HOROWITZ. As to ATF. 

Mr. CONNOLLY. As to ATF. Who is not favorable? 

Mr. HOROWITZ. There were two outstanding recommendations, 

one with regard to the FBI, which had not put in place a policy regarding when guns should or should not be seized, and DEA regarding, among other things, regarding notifications to ATF, which 

played itself out in this case that we are here today to talk about. 

Mr. CONNOLLY. Thank you. Mr. Brandon, final point. I have got 

10 seconds. Thank you for your service. Thank you to the men and 

women of the Agency. I just hope Congress will back you up. 


KING-6430 with DISTILLER
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I yield back. 

Mr. BRANDON. Thank you, sir. 

Chairman CHAFFETZ. And right on time. I am highly impressed. 

Mr. CONNOLLY. [Off audio.] 

Chairman CHAFFETZ. See, you got constituents in the crowd. I 

would just further note to tell you how on time that Mr. Connolly 

is, at least today. So, this is good. 

Mr. CONNOLLY. I thank the chair for his praise. 

[Laughter.] 

Chairman CHAFFETZ. Thank you. I will now recognize Mr. 

Farenthold of Texas. And I think, as he will tell you, Mr. Zapata 

was a constituent of Blake Farenthold’s, so. 

Mr. FARENTHOLD. Thank you, Mr. Chairman. When I was first 

elected in 2010, I had the privilege of representing the Rio Grande 

Valley in Brownsville, and Agent Zapata and his family grew up 

in Brownsville. So, this is a very important issue to me. 

Before I get started, though, I do want to address one or two 

things Mr. Connolly had said, the first of which is I think the Senate does need to be much more speedy in their confirmation process, and would urge Mr. Connolly to speak to some members of his 

Party over there about that as we are in the middle of quite a few 

confirmations now. 

Mr. Brandon, you also testified that you could do more with more 

resources. And I think everybody that I regularly associate with in 

Congress wants to give our law enforcement agencies, be it yours 

or the others, the tools necessary to do what they need to do. But 

I would imagine you would not want to see your taxes go up significantly to fund that either. 

Mr. BRANDON. No, sir. I am fiscally conservative. 

Mr. FARENTHOLD. So, as much as we would like to, there are a 

lot of things we have got to do in this government, and that is why 

we are asking you and the fine men and women who work for you, 

you know, to do more with less, just like we are asking the vast 

majority of the government to do the same. 

But let me get along to my lines of questioning. And I do not 

want to pound on about the fact that the other folks are not here, 

but I want to explain the frustration that this committee faces. We 

faced 6 years of stonewalling, a lot of which has to do with Fast 

and Furious, to the point that we held the former Attorney General 

in contempt of Congress and pursued litigation against him and to 

obtain documents from the Department of Justice. 

So, there is a frustration here that we would hope would start 

to evaporate with new leadership in the executive branch. Obviously, we are early on in there, and we do not have folks confirmed. 

But this stonewalling does nothing but cost the taxpayers dollars 

and deny the American people the opportunity to have good oversight of their government. So, you know, I am not pounding on it. 

I just wanted to explain that frustration to you and where we are 

coming from. 

But let us talk a little bit about what is going on now and the 

report. So, let me start with Mr. Horowitz. Let us talk a little bit 

about Fast and Furious and the gun running operation. Can you 

in roughly a minute tell me what we have learned and what still 


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needs to be done as a result of your investigation into this? Just 

bullet points. 

Mr. HOROWITZ. Yeah. So, with regard to Fast and Furious, our 

follow-up review, and now this review, the couple of open recommendations that still are out there involve, in particular on this 

matter, on the Mr. Barba side of the case we found once again that 

one Federal law enforcement agency, in this case DEA, failed to tell 

another law enforcement agency, in this case ATF, about gun trafficking activity that it knew about. 

That failure was, in our view, significant and important, and 

should not have occurred. And DEA needs to have a policy in place 

that ensures that its agents develop that —— 

Mr. FARENTHOLD. All right. We have fusion centers everywhere. 

What are we not doing? I mean, I have been to multiple fusion centers where you guys are supposed to be talking to each other. 

Mr. HOROWITZ. Yeah. Look, I think that is a concern. We saw 

that, as you will recall, in Fast and Furious between ICE and ATF, 

the lack of sharing of information. It is an issue that continues to 

arise, and as these centers exist it needs to be addressed and overcome. There is no excuse for it. 

Mr. FARENTHOLD. I am sorry. I have a lot of questions and not 

a lot of time. Mr. Brandon, I want to ask you to reassure me that 

we do not have any programs like Fast and Furious going on now 

where we are letting weapons move across borders in an attempt 

to get the bigger guy. Have we learned that lesson? 

Mr. BRANDON. Yes, sir, and one of our things for responding to 

that was the Monitored Case Program that I have every month in 

these cases, which anything dealing with international trafficking 

are briefed up to me. One of the things we put in there is progress, 

plans, and problems. And if a problem is identified of communication, it is to communicate, collaborate, and de-conflict, and from the 

briefings to me, and which I am very actively involved because I 

was a street agent in the field. Got shot at and all the other stuff, 

so I am not a suit in D.C. 

Mr. FARENTHOLD. And let us talk about getting shot at, too. 

What programs have we, if any, Mr. Horowitz, have we implemented with respect to our various law enforcement agents detailed to countries with high drug violence, like Mexico, to ensure 

that they are safe? At the time of the Zapata shooting, they were 

unarmed due to our policies in dealing with Mexico. Has anything 

changed where our agents are able to carry weapons or they are 

escorted by Mexican agents who are armed? 

Mr. HOROWITZ. I know there remain issues with regard to that, 

Congressman. If I could get back to you on that and follow up, I 

would appreciate it. 

Mr. FARENTHOLD. Thank you very much. I see my time has expired. 

Chairman CHAFFETZ. I thank the gentleman. I now recognize the 

ranking member, Mr. Cummings, of Maryland. 

Mr. CUMMINGS. Thank you very much, Mr. Chairman. Mr. Horowitz, your report identified serious deficiencies in the actions of the 

U.S. Attorney’s Office for the Eastern District of Texas against the 

drugs and firearms trafficker named Manuel Barba. Specifically, 

according to your report, and I quote, ‘‘The assistant U.S. attorney 


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handling the Barba drug prosecution should not have agreed to 

Barba’s release from Federal custody in July 2010 following his indictment and ultimate plea in the Eastern District of Texas, leaving him at liberty to leave the Bates Allen Crew, and ultimately 

direct the straw purchase and trafficking of the firearm to Mexico.’’ 

Apparently, the DEA had recorded statements of Mr. Barba saying that he planned to traffic 20 AKA–47s, and those statements 

were included in the DEA report. But your report found ‘‘no evidence’’ that the prosecutor ‘‘read the DEA report that recited 

Barba’s statements.’’ Mr. Horowitz, that sounds like a serious mistake that had significant repercussions. Would you agree? 

Mr. HOROWITZ. Yes. 

Mr. CUMMINGS. I think they tell children, they measure children’s progress in the first grade, and one of the things they measure is follow directions. It seems like you would read a document. 

Would you agree? 

Mr. HOROWITZ. Yes. 

Mr. CUMMINGS. So, Mr. Barba was released following the prosecutor’s motion in July 2010. About 1 month later, Mr. Barba’s 

trafficking ring purchased the firearm that was later used in the 

Zapata shooting. Is that correct? 

Mr. HOROWITZ. That is correct. 

Mr. CUMMINGS. So, Mr. Barba was not re-arrested until February of 2011. That is 7 months that he was free to operate his gun 

trafficking ring, 7 long months. So, Mr. Horowitz, do you know how 

many firearms were trafficked by Mr. Barba’s ring during that 7- 

month period? 

Mr. HOROWITZ. The information that we have currently, but 

would require further investigation, determined is at least 10 firearms were purchased by Riendfliesh on August 20th. We cannot 

rule out that there were not others, but there are at least 10 post 

to the July release. 

Mr. CUMMINGS. So, these were very serious findings, and I do 

commend your office for uncovering them. But I understand the 

U.S. attorney acknowledged that his office dropped the ball and 

made some changes to their policy around the release of defendants 

before securing their cooperation. 

Now, Mr. Horowitz, do you know whether the prosecutor who 

made this significant error was ever disciplined in any way for mishandling the Mr. Barba case? And you would agree that it was a 

mishandling, would you not? 

Mr. HOROWITZ. I agree, and I do not know the answer as I sit 

here, but certainly we can follow up and get back on it. 

Mr. CUMMINGS. How soon can you get back to me on that, today? 

That should be easy. 

Mr. HOROWITZ. Well, it depends on the Department providing me 

the information. I do not have the information in my files, so we 

need to go to the Justice Department to get that and alert them 

to your request. 

Mr. CUMMINGS. All right. Mr. Horowitz, I do not know if you are 

aware of this, but my staff did a little research on that prosecutor. 

And in 2013, the New York Post posted that same prosecutor who 

mishandled the Barba case, and he criticized Trayvon Martin on 

social media, called President Obama the, and I quote, ‘‘Dalibama,’’ 


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and said that, I quote, ‘‘Obama: Why Stupid People Shouldn’t 

Vote.’’ That was the same prosecutor. 

Do you know whether the prosecutor was disciplined in that instance, or were you aware of any of that? 

Mr. HOROWITZ. I was aware of it, and I am limited in what I can 

say with regard to any personnel action in a public setting. So, we 

would have to have further discussions with you about that. 

Mr. CUMMINGS. But it appears that the prosecutor still works in 

the office. We invited him to appear here today to provide him with 

an opportunity to respond to your findings and address what I 

think are very serious questions about his judgment. He declined. 

And, you know, when we are paying people to do the work of the 

Federal government and they have those kinds of attitudes, there 

is no place for that. There is just no place for it, and it concerns 

me greatly. 

And, you know, I do not mind saying it. I think President Obama 

is one of the most brilliant persons I have ever met and very principled, and these kind of comments simply have no place in our society. 

So, I will yield back on that. 

Chairman CHAFFETZ. The gentleman yields back. I will now recognize the gentleman from North Carolina, Mr. Walker, for 5 minutes. 

Mr. WALKER. Thank you, Mr. Chairman. Mr. Brandon, how are 

you holding up? Doing okay? 

Mr. BRANDON. I have had better days. 

Mr. WALKER. Okay. All right. I do not want your probably, even 

though I am not familiar with it, your distinguished career to be 

defined in a few minutes here today. So, I want to make sure that 

we are kind of starting over and getting some information here. 

You mentioned that you talked with your attorneys and chief of 

staff about the best decision, whether or not to bring or advise Mr. 

Turk and Mr. Temple. Early on you were pretty defiant as far as 

saying you are agreeing with these decisions. Did you not get good 

counsel from attorneys or your chief of staff of talking about the 

importance of coming to testify before Congress? 

Mr. BRANDON. From my opinion, sir, I believe that there was a 

misunderstanding of what an invitation is to come before you. Now 

I know, so I would weigh in differently, you know, during that. But 

also, we are a component within DOJ, so we have to coordinate 

through the Department of Justice. 

And I want to be fair to them, these people who are dealing with 

the DAG hearing and everything else, and so, I take responsibility. 

I am not going to duck it as far as I thought it was the best thing 

to do. And you can see, I am plain spoken. I am not a polished 

headquarters type person. And to answer your question, knowing 

what I know now, like I previously said, and to be respectful to this 

committee, I would have a different view of things weighing in. 

Mr. WALKER. You have made a couple of comments about that. 

You are not a suit in D.C. You are more of a non-polished guy. You 

have kind of like a just do the job type personality. How long have 

you been the acting director there, Mr. Brandon? 

Mr. BRANDON. Well, if I may say so, to answer your question, 

since April 1st. I say that, that that does not measure someone’s 


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intelligence, or drive, or commitment to do that job. I just say it 

is my style and who I am, and I try to be who I am. But since April 

1st of 2015 I have been acting director. 

Mr. WALKER. Sure, okay. So, coming up on 2 years. You know, 

you understand the responsibility. I mean, even though you may 

not be on the street and you are wearing a suit and tie, you understand the responsibility of being the director, right, the acting director? 

Mr. BRANDON. I have been living and breathing it 7 days a week. 

Mr. WALKER. All right. So, with that comes with the responsibility of fulfilling the requests or the obligation that comes with the 

position. My specific question today that I want to get into, 2 weeks 

ago the committee requested documents on a North Carolina 

churning investigation reported on in the New York Times. Tomorrow is the deadline for that request. Can you tell me what steps 

have been taken to collect, identify, and produce those documents 

responsive to the committee’s February 22nd letter? 

Mr. BRANDON. Yes, sir. I have a team inside headquarters, and 

I actually pulled people off the street that have knowledge of these 

types of investigations, and working through the weekend and everything to meet the document production that we are allowed to 

do. 

Mr. WALKER. I believe the New York Times also talked about, 

maybe even have written you guys about the informants receiving 

more than $1 million. Precisely how much did each informant receive? 

Mr. BRANDON. You know, sir, and this is what I mentioned in my 

opening statement, and this is advice I have gotten through the attorneys as the U.S. government is named in that lawsuit. And the 

judge has it under seal, and I cannot comment before the committee. 

Mr. WALKER. Like you cannot comment on the amounts? 

Mr. BRANDON. I have been told not to comment on anything regarding the litigation that the United States government is a party 

to. 

Mr. WALKER. So, you cannot say what the purpose of these payments were, were they profit or expenses paid on behalf of the government, whether all the money and the property was accounted 

for, or were any of these payments in cash. So, any of those questions you are telling me that you cannot address at all. 

Mr. BRANDON. Yes, sir, that is what I am saying. 

Mr. WALKER. Okay. Well, then let me switch to, I know you said 

earlier you cannot go back to 2010. Let me talk about 2015 and 

2016. Can you tell me how many straw purchases or firearm trafficking cases did the ATF refer for prosecution in 2015 and 2016, 

respectively? 

Mr. BRANDON. I do not have those numbers in front of me, but 

I will take them back and report back to the committee, sir. 

Mr. WALKER. So, if you do not have those numbers, you would 

not have any numbers as far as how many of those cases were ultimately prosecuted either. Is that correct? 

Mr. BRANDON. With our system, I would be able to get that information, too, as far as recommended for prosecution, and we track 

the ones that get prosecuted and convicted. 


KING-6430 with DISTILLER
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Mr. WALKER. I have a few more questions, but I am just going 

to wrap it up this one because my time is quickly expiring. What 

is ATF doing to ensure agents coordinate with the prosecutor in 

U.S. attorneys’ office as early as possible in their investigations? 

Mr. BRANDON. Thank you for the question. Part of what I mentioned about Frontline with our domain assessments, even for our 

strategic plan for the year, they have to coordinate. And an ATF 

agent cannot open an investigation anymore, and this came after 

Fast and Furious. They have to coordinate with their supervisor, 

and then they have to note that they have consulted with an 

AUSA. 

Mr. WALKER. Thank you, Mr. Chairman. 

Chairman CHAFFETZ. I thank the gentleman. I will now recognize 

the gentlewoman from New Jersey, Ms. Watson Coleman. 

Ms. WATSON COLEMAN. Thank you very much. First of all, to the 

Zapata family, please accept my condolences even at this late date. 

And I know it is even difficult to have to be revisiting this so many 

years later. 

Mr. Horowitz, this is basically for you. In light of the recent reporting of the ATF tobacco diversion case, I would like to ask about 

the status of the recommendations in the IG’s audit of ATF churning operations. The order was released in 2013? 

Mr. HOROWITZ. That is correct. 

Ms. WATSON COLEMAN. How many of these recommendations are 

now closed out? 

Mr. HOROWITZ. We made 17 recommendations, and all 17 are 

now closed out. 

Ms. WATSON COLEMAN. Good to hear. So, and there is no need 

for a follow-up then. 

Mr. HOROWITZ. Well, there might have been, but we are informed, as the acting director said in his testimony, that the ATF 

has shut down their operations. So, at this point there would be 

nothing for us to —— 

Ms. WATSON COLEMAN. I want to tell you that we appreciate the 

work that you do and how important your function is. And having 

said that, I would like to kind of bring us up to date on some questions that I have. 

It seems like every day there is a new revelation about the contacts between this President’s campaign, and actually his Administration, and his associates, and even his family, and Russian officials. First, there were reports that former policy advisor, Carter 

Page, traveled to Moscow. It was denied, then it was admitted. But 

we have got indications that there have been interactions with 

Page, and Roger Stone, and Rick Gates, and Paul Manafort, and 

Michael Flynn, now the Attorney General, the son-in-law, Jared 

Kushner, even reports of Donald, Jr. and J.D. Gordon. 

In light of this, I would like to ask you, do you realize why Congress would be so very, very concerned about these things, and 

these revelations that are coming to bear? 

Mr. HOROWITZ. Well, just broadly speaking, I certainly understand why folks would have questions about various issues. 

Ms. WATSON COLEMAN. Thank you. Mr. Horowitz, Senator Schumer recently sent his letter asking you to open an investigation 

into whether there has been any political interference with any onVerDate Nov 24 2008 10:48 Aug 24, 2017 Jkt 000000 PO 00000 Frm 00039 Fmt 6633 Sfmt 6633 H:\26501.TXT APRIL

KING-6430 with DISTILLER
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going DOJ investigation that is related to President Trump’s campaign, transition, and Administration’s contact with Russia, as well 

as attempts by Russia to interfere with our election. And I would 

like to add my strong support to Senator Schumer’s request for an 

investigation of these matters. 

Can you tell me whether you will be investigating whether there 

was any political interference with any potential DOJ or FBI investigations on this matter? 

Mr. HOROWITZ. Congresswoman, we have Senator Schumer’s letter, a letter from other senators. We have the chairman’s letter on 

a matter related to it. And we are reviewing that and deciding and 

considering what, if anything, we should be doing with regard to 

that matter. 

Ms. WATSON COLEMAN. Could you pledge to us that any investigation, if undertaken, will be fact based and thorough, and that 

the American people will be informed to the extent that it is significant and possible, and not a threat to our security at home? 

Mr. HOROWITZ. Absolutely, Congresswoman. Every piece of work 

we do, we do with the two principles that every IG office operates 

under, which is independence and transparency. And if and when 

we do any work in that area, we would do the same thing that you 

have seen from us in the matters that we are here to testify about 

today. 

Ms. WATSON COLEMAN. Thank you, Mr. Horowitz. We are definitely thirsty and hungry for the truth in these matters. 

Mr. Brandon, let me just echo some of the concerns that we were 

raised by my chairman and my ranking member as it relates to the 

absence of the 2 individuals that have been expected to be a part 

of this today. I think that is very unfortunate. I thank you acknowledging the fact that perhaps this was a wrong call on your 

part, and I certainly hope that we have better cooperation in the 

near future. 

Mr. Chairman, I yield back. Thank you. 

Chairman CHAFFETZ. I thank the gentlewoman. I will now recognize the gentleman from Georgia, Mr. Hice, for 5 minutes. 

Mr. HICE. Thank you, Mr. Chairman. Just following up because 

I think it is pretty unavoidable connecting some dots here, Fast 

and Furious and all of this. Of course, the program lasted from 

2009 to 2011, allowing weapons from the U.S. pass to suspected 

gun smugglers. We ended up losing some 1,400 firearms during 

that, many of which ended up being used in crimes, including the 

death of Border Patrol Agent Brian Terry in December of 2010. 

All right. Shortly after that Fast and Furious ends, and then investigations begin both with this committee and the House Judiciary Committee, and that is a fascinating process to me. Let me just 

highlight some of the issues that take place. 

In October 2011, documents are obtained after Eric Holder was 

subpoenaed, documents. It is found that his testimony was inconsistent. He said he knew of Fast and Furious for only a few weeks. 

The documents revealed he knew over a year. February 2012, Holder tells this committee that firings and charges against DOJ officials who oversaw Fast and Furious are likely to come within 6 

months, and he denies any cover up involvement. 


KING-6430 with DISTILLER
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June of that year, this committee recommends Holder to be held 

in contempt of Congress for failing to turn over documents that 

have been sought by the committee. On that same day, President 

Obama asserts executive privilege over the documents that are 

sought by this committee. Then 8 days later, the House here votes 

to hold Eric Holder in criminal contempt. 

The next month, a congressional report is released placing blame 

on Acting ATF Director Nelson, and Deputy Director Hoover. Hoover resigns that day. Then you, Mr. Horowitz, release a report a 

few months later that says, in essence, that there were 14 ATF individuals and DOJ employees who were responsible for management failures. I think that was a very polite way of putting it. And 

then, it takes 2 years before finally DOJ turns over the 65,000 

pages that had been sought. 

Why did it take so long to get those 65,000 pages? 

Mr. HOROWITZ. I would not know the answer on that, Congressman. We were not involved in the litigation or any of that —— 

Mr. HICE. You were not involved in that. Do you know if any action was ever taken against those who were involved in the Fast 

and Furious scandal? 

Mr. HOROWITZ. The acting director. 

Mr. HICE. Okay. 

Mr. BRANDON. Yes, Congressman. That would be me as the deciding official on Fast and Furious. Many of the people retired, but 

I know that, I believe it was July of last year, a document was provided to this committee regarding each person listed and their status, and any discipline they received. And to respect the privacy 

laws, that is how it was delivered, and it is DOJ policy that I not 

speak publicly on those —— 

Mr. HICE. So, there was some action taken against some. Is that 

—— 

Mr. BRANDON. There was action, and things were resolved. 

Mr. HICE. Okay. Could you provide this committee with what action was taken, because it appears as though there was some criminal activity involved. 

Mr. HICE. Let me ask you, Mr. Horowitz. Would you agree with 

that? I mean, in your findings, you used the phrase ‘‘management 

failures,’’ but I think Congress is holding Eric Holder in criminal 

contempt. I mean, is there criminal activity involved in this whole 

Fast and Furious? 

Mr. HOROWITZ. We did not see criminal activity by the agents or 

the prosecutors involved in the case. We did find, as you noted, 

very serious failures in what occurred and how they handled themselves and their responsibilities. 

Mr. HICE. Okay. With Eric Holder? 

Mr. HOROWITZ. Again, Congressman, on the documents back and 

forth, given our independence as an independent entity within the 

Department, we were not in the middle of any of the back and 

forth. And so, I only know what I have read in the newspaper 

about that. 

Mr. HICE. Okay. Do you have any idea of how much of the 65,000 

pages they finally turned over were redacted percentage wise? 

Mr. BRANDON. Sir, I do not. 


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Mr. HICE. Okay. Mr. Brandon, I mean, as a result of Fast and 

Furious, you have testified that there are lessons learned. Things 

have changed. Now, does ATF, do you believe, have a responsibility 

to disrupt potential straw purchasing, even if they are unable to 

obtain a prosecution? 

Mr. BRANDON. Yes, sir. As I commented, that was one of the 

things when I came up here saying that agents do not get credit 

for interdiction and deterrence, and I will give you an example. My 

life was impacted. I was in Detroit. I got sent to Phoenix over Fast 

and Furious. And when I was sitting down with people looking at 

information coming in on multiple sales, it would be, hey, we do 

not have the time to build a criminal case. And I said, hey, you can 

knock on the door and do an old shoe leather, and that was the 

interdiction or deterrence and emphasizing that. 

So, to answer your question, we now give credit for ATF agents 

who do exactly that investigative work where previously they did 

not get credit in all the spirit of public safety to prevent guns, like 

I mentioned, to be on the left side of boom, to prevent it from happening. 

Mr. HICE. Okay. Thank you, sir. I yield back. 

Chairman CHAFFETZ. Thank you. I now recognize the gentlewoman from the Virgin Islands, Ms. Plaskett, for 5 minutes. 

Ms. PLASKETT. Thank you, Mr. Chairman and Ranking Member. 

We were talking just now about Fast and Furious, and several 

members on this committee are, of course, very familiar with the 

ATF problems in previous years through the investigation that occurred on this committee. 

Mr. Horowitz, your office issued recommendations from Fast and 

Furious review in 2012. That is correct, right? 

Mr. HOROWITZ. That is correct. 

Ms. PLASKETT. And, Mr. Brandon, you say that there are key lessons that ATF has learned from in the aftermath of Fast and Furious and how the Agency has changed, correct? 

Mr. BRANDON. Yes, ma’am. 

Ms. PLASKETT. Would you say those are substantial? 

Mr. BRANDON. Yes, and cultural within the organization. 

Ms. PLASKETT. Now, was that based on just the IG’s report or 

this committee as well? 

Mr. BRANDON. Well, I think a combination of both to answer your 

question, ma’am. 

Ms. PLASKETT. Thank you. And, you know, this committee, of 

course, relies on you, Mr. Horowitz, tremendously. I think maybe 

you should have a seat up here as well. You come and testify in 

front of us so often. Well, maybe not up here, but, you know, you 

can have a staff seat because we rely on you so tremendously for 

the work that you do that then leads to other investigations, leads 

to hearings that we have, as in Fast and Furious. 

Last week, Mr. Horowitz, a number of Senate Judiciary members 

wrote to your office requesting an investigation of Attorney General 

Jeff Sessions and his recusal decision, his contacts with Russian officials, and his testimony to the Senate about those contacts. Did 

you receive that letter from those senators? 

Mr. HOROWITZ. We did. 


KING-6430 with DISTILLER
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Ms. PLASKETT. Okay. And can you tell us whether you plan on 

conducting that investigation? 

Mr. HOROWITZ. One of the things we do when we get requests 

like that, and we have gotten a request from Senator Schumer as 

well, the chair of this committee, chair of House of Judiciary related to certain issues there, is we take them under advisement, 

carefully assess what the ask is, and then make a determination. 

So, at this point I do not have an answer for you on what, if anything, we might do in response. But we obviously take requests like 

that seriously and we will look at it. 

Ms. PLASKETT. So, you are looking at it. 

Mr. HOROWITZ. Right. 

Ms. PLASKETT. You are taking it under advisement. 

Mr. HOROWITZ. Correct. 

Ms. PLASKETT. And at some point, would you let us know if you 

are going to make an investigation, or do you just conduct the investigation without our —— 

Mr. HOROWITZ. We always respond to the member to let them 

know what we are intending to do. 

Ms. PLASKETT. Thank you. And we really appreciate that because 

it is the independence and the transparency of the IG’s office that 

makes your work so important to us. And it is important that we 

believe that everyone understands the Department of Justice’s own 

rules and regulations on recusals. 

The Code of Federal Regulations state, and I am quoting here, 

‘‘No employee shall participate in a criminal investigation or prosecution if he has a personal or political relationship with any person or organization which he knows has a specific and substantial 

interest that would be directly affected by the outcome of the investigation or prosecution.’’ 

The regulations go on to state, ‘‘A ’political relationship’ means 

a close identification with an elected official or candidate arising 

from service as a principal advisor thereto or principal official 

thereof.’’ We all know that Attorney General Sessions was the first 

senator to endorse Donald Trump in his presidential bid. He served 

as a key surrogate throughout the campaign, including since March 

of 2016, in his official role as chairman of President Trump’s National Security Advisory Committee. 

Mr. Horowitz, would you agree that Attorney General Sessions’ 

role on the campaign meets the regulations criteria for recusal? 

Mr. HOROWITZ. I am going to defer on that, Congresswoman, if 

I could because that is obviously something we would be thinking 

about in connection with the claims, allegations made in the letter. 

Ms. PLASKETT. And would you say that as well to my question 

of whether you agree or not that the Attorney General has a political relationship with President Trump and his campaign for President? 

Mr. HOROWITZ. Again, I would defer on that for now, Congresswoman. 

Ms. PLASKETT. And do you agree or would you defer to answer 

that President Trump has a specific or substantial interest that 

would be directly affected by the outcome of any investigation into 

Russian interference in the 2016 election? 

Mr. HOROWITZ. I would defer as well, Congresswoman. 


KING-6430 with DISTILLER
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Ms. PLASKETT. Okay. Thank you. Mr. Horowitz, from our reading, his final announcement, the Attorney General’s announcement 

that he would recuse himself would then have us conclude that he 

is recusing himself because of his role in the Trump campaign. 

Would you agree or not agree with that? 

Mr. HOROWITZ. Again, I would defer given our review of the allegation that we have been getting. 

Ms. PLASKETT. And then, okay. So, but, I mean, just following 

the logical conclusion of that, should not other officials working at 

the Justice Department who worked for the Trump campaign also 

recuse themselves from investigations related to the Trump campaign and to Russian interference? 

Mr. HOROWITZ. I would want to know if there are such officials 

in the Justice Department and whether they have recused or not 

before answering —— 

Ms. PLASKETT. Would your investigation as presented by the senators requesting that you investigate this, would it also entail you 

looking to see if there were officials, or would it merely be within 

the scope of Attorney General Sessions? 

Mr. HOROWITZ. I think it is fair to say that with any reviews we 

do, once we undertake a review, if we found other issues to look 

at that were closely related, we would pick up those issues as well. 

Ms. PLASKETT. Okay. Thank you so much for responding to my 

questions, and I thank you for your indulgence, Mr. Chairman. 

Chairman CHAFFETZ. The gentlewoman yields back. I will now 

recognize the gentleman from Oklahoma, Mr. Russell, for 5 minutes. 

Mr. RUSSELL. Thank you, Mr. Chairman, and thank both of you 

for being here, and Mr. Horowitz, your continued dedication, and 

thank you, Mr. Brandon, for your service. I have a lot of respect 

for the field agents. However, there are some troubling questions 

that really have not been answered. 

June, August 2010, we had the Eagle Pass and La Pryor seizures. We know that these firearms are being trafficked. We have 

obliterated serial numbers. And notwithstanding what we heard in 

testimony here today from you, Mr. Brandon, about the uncertainty 

of how whether or not something could be seized or we need more 

laws, it is pretty clear, as you should know, that serial numbers obliterated constitute a real problem. And we can go into what those 

codes are. 

With regard to 2010, an ATF agent is tipped off by an FFL, often 

demonized. FFL is often demonized as the problem for making 

straw purchases when the reality is they are the ones linking some 

of this because of their alertness. And then a decision is made at 

that point to allow the straw purchase to try to continue when we 

have already had the Osorios linked and tied with the La Pryor 

and the Eagle Pass seizures. But yet, we are going to continue on 

with that. 

So, my question to you, Mr. Horowitz, in your investigation, what 

value could you determine that these agents or others would find 

by allowing dozens of illegally purchased firearms to continue to 

walk? 

Mr. HOROWITZ. In this review, like in Fast and Furious, I think 

that is one of the significant concerns we have. This was a different 


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scenario than Fast and Furious, as we outlined, but when you see 

firearm violations and you have the opportunity to make arrests or 

take other investigative activity given the risks associated with 

them, it is important to do that. The firearms you mentioned at 

those two seizures had 2 days to 2 weeks of time to crime stat, so. 

Mr. RUSSELL. Which is a real problem. And so, okay, you can 

kind of look at, well, within the next month they did make a purchase with an agent. But now we have 40 more firearms with obliterated serial numbers. Mr. Brandon, why did that not result in an 

instant arrest? We are talking literally scores of firearms now illegally trafficked. ATF is fully aware of it, and yet nothing happens 

in November 2010. Why was that? 

Mr. BRANDON. The explanation from the Dallas Field Division, 

which Bill Temple was not in charge —— 

Mr. RUSSELL. Yeah, we would like to have heard from him. 

Mr. BRANDON. So, he used to work for me in Detroit, and he just 

got to Dallas, I believe, less than a year ago. But I am not here 

to defend that other than there was —— 

Mr. RUSSELL. Why was no arrest made? I mean, we are talking 

scores of firearms. We know they are going south. Why was no arrest made in November 2010? 

Mr. BRANDON. There was a sensitive DEA investigation going on. 

Mr. RUSSELL. Okay. Well then, let us move on from that because 

here is another problem that we have. We have the Osorios tied to 

this, and yet there is some uncertainty on the part of the ATF 

agents when by the time they get to February of 2011, they are not 

sure if they go and find in Osorio’s bedrooms these firearms, 

whether or not they are allowed to seize them. 

Well, my goodness, as the only firearms manufacturer in Congress, gee, even I know that if you have got illegal firearms in 

somebody’s bedroom, and you had a good warrant to go in and 

check it out, and you have got obliterated serial numbers, you are 

in deep kimchi. So, what happened? 

Mr. BRANDON. Well, sir, I agree with the OIG. The group supervisor for the Firearms Trafficking Group, he failed to communicate 

that to the agents who were there. Again, I am not defending it, 

and how we have —— 

Mr. RUSSELL. And this is the frustration that we have, Mr. Brandon, because what has happened is, you know, we had dedicated 

agents, like yourselves, who lost their lives because people were not 

doing their job. And worse, we had a desire on the part, which we 

have been trying to get to the bottom of, of people who allowed 

these firearms to walk south for reasons yet to be determined. And 

yet, everyone wants to sweep that under the rug. 

And with regard to my colleagues that have stated about the law 

and the need for more laws, I would remind everyone, the 1968 

Gun Control Act requires serial numbers. 18 U.S. Code Section 

1922(k), 26 U.S. Code 5861, Paragraph (g) lays out requirements 

for what constitutes legal firearms. And it is illegal to possess firearms and have serial numbers removed, obliterated, or altered. 

Mr. Brandon, are you familiar with the Don’t Lie For the Other 

Guy Program? 

Mr. BRANDON. Yes, with the National Shooting Sports Foundation. 


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Mr. RUSSELL. Sure, and not only them, but, my goodness, what, 

for 17 years now, we have had that program. Is it or is it not a 

felony to make a straw purchase? And here we are talking about 

the need from your own mouth in acknowledgement to some of my 

colleagues’ queries that we need to have a law to prevent this type 

of trafficking or straw purchases. Are you not aware of the Don’t 

Lie For the Other Guy Program? 

Mr. BRANDON. I am aware of it. 

Mr. RUSSELL. Do you know what the penalties are for that? 

Mr. BRANDON. Yeah, there is a 5-year felony, a 10-year felony. 

Mr. RUSSELL. No, it is 10 years, sir. A 10-year felony for a Federal crime, and up to $250,000 fine. You can find that in U.S. Code 

18 Section 924(c) and (e). I would be happy to show it to you. 

Here is the problem. We are talking around this issue. I have 

every belief that you are dedicated to your job, but right now we 

have three empty chairs, and we have you that does not even seem 

to know what the U.S. Code is. 

Mr. BRANDON. Can I —— 

Mr. RUSSELL. Now, I would like to believe that you do know 

those, but, Mr. Chairman, I would suggest that we have a regroup. 

The ranking member has not been allowed to have his witness here 

today. We have not even gotten to the tobacco issues. We need to 

have some follow on here. And, Mr. Horowitz, I am very grateful 

for the things that you have dug up. You have exposed some 

things. We are grateful for that. Mr. Brandon, I do believe you are 

dedicated, but I will tell you what, it is not looking too pretty here 

today. 

I yield back my time. Thank you, Mr. Chairman. 

Mr. BRANDON. Could I get a minute? 

Chairman CHAFFETZ. Mr. Brandon, you are recognized, sir. 

Mr. BRANDON. Mr. Russell —— 

Mr. RUSSELL. I am out of time. That is why. 

Mr. BRANDON. I am aware there are two statutes. One is a 5- 

year and one is 10-year, so I did not want you to come away with 

that. But I would also like to comment on what you said about Federal firearms licensees. 

We have built, and that is one of the things under my charge, 

a better relationship and communication with the Federal firearms 

licensees because they are the front line of defense in receiving 

that information. And if you even go onto ATF’s website, yesterday 

Twitter, one of the things under my leadership was the number of 

FFL burglaries that have been happening across the country, FFL 

robberies, things that were not tracked until 5 years ago. 

So, I just wanted to share that I have a passion for recognizing 

we regulate an industry, and good, honest, hardworking men and 

women dealing in a lawful commodity, and that are absolutely vital 

to our intelligence-led, risk-based way of doing business. 

And they should have followed up. When FFL called and gave 

those names, that should have been, you know, an alarm going off. 

So, thank you for letting me make that comment. 

Chairman CHAFFETZ. Thank you, of course. I will recognize the 

gentleman from Massachusetts, Mr. Lynch, for 5 minutes. 


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Mr. LYNCH. Thank you, Mr. Chairman. And I want to echo the 

gentleman from Oklahoma’s request for follow-up on this because 

I think we really need to drill down on this. 

Mr. Brandon, last month the New York Times wrote a story raising some troubling questions about ATF’s use of confidential informants in a tobacco operation that I guess was under way from 

2011 to 2013. 

Mr. Chairman, I ask unanimous consent to enter this story by 

Matt Apuzzo, the New York Times, February 22nd. The title is 

‘‘ATF Fills Secret Bank Account with Millions from Shadowy Cigarette Sales.’’ 

Chairman CHAFFETZ. Without objection, so ordered. 

Mr. LYNCH. So, the article reported that the ATF officials directed confidential informants to engage in sham transactions with 

a collective of tobacco farmers, and then used the off-the-books proceeds in an undercover ATF investigation. This is churning. You 

are familiar with that, right? 

Mr. BRANDON. Yes, sir. 

Mr. LYNCH. Okay. And the way it works is you use those illicit 

funds to fund your own operation. Is that right? 

Mr. BRANDON. Yeah, for continuing the operations. 

Mr. LYNCH. Okay. While ATF did in this case possess special authority granted to it under the Bush Administration that allows the 

use of black market cash and proceeds in undercover operations 

called churning, the news report further alleged that this operation 

exceeded that authority. Do you believe that they exceeded the authority in this case? 

Mr. BRANDON. Congressman, like I testified previously and included in my opening statement, that the U.S. government is a 

party to civil litigation, and I cannot comment on that. And also, 

the judge has it under seal. 

Mr. LYNCH. Okay. How long is that seal going to be in place. Do 

you have any idea? 

Mr. BRANDON. I believe it’s until the 24th of this month. 

Mr. LYNCH. Good. Good. We can have it back. Does the gentleman wish me to yield? 

Chairman CHAFFETZ. If you will yield, and we will give you plenty of extra time to make up for this. You commented ‘‘that we are 

allowed to do’’ as it relates to that. What have you done to address 

the Court and ask permission to comply with a congressional request for that material? Have you called the judge? Have you petitioned the Court? 

We go through this regularly. We are guided by the Constitution. 

We do not have these prohibitions. That information should be 

given to us, but we need you to approach the Court and tell them 

the dilemma that you are in in order to release that information. 

Mr. BRANDON. Mr. Chairman, we have had conversations with 

DOJ, the U.S. attorneys who are over the civil litigation, and I am 

punting to them for that answer. 

Chairman CHAFFETZ. And we are snapping the ball to you saying 

the ball is in your hands and saying you need to approach the 

Court and make the request to give them permission to comply 

with a congressional directive. 

Mr. BRANDON. Okay. I will take that back. 


KING-6430 with DISTILLER
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Chairman CHAFFETZ. I will go back to Mr. —— 

Mr. LYNCH. Thank you, reclaiming my time. Mr. Horowitz, are 

you familiar with this particular use of confidential informants for 

this cigarette scam which apparently generated millions of dollars 

and were put in these accounts? 

Mr. HOROWITZ. I am certainly familiar with these churning accounts from our 2012 audit, and the work we did there, and the 

substantial problems we found through that audit. 

Mr. LYNCH. Okay. How did we vet these particular informants? 

I mean, under the Reno guidelines, there is certain conduct that 

would disqualify someone from being a confidential informant on 

behalf of the ATF. Were these folks vetted or were they in compliance with the Reno standards? 

Mr. HOROWITZ. I am not sure I know as I sit here today the specific individuals in the case under seal. But I will say more broadly 

we found in our audit that in 33 of the 35 instances that we looked 

at back in 2013, that the critical information required the ATF policy to start the operation was not present. And we found a major 

churning investigation that had not ever been approved, and that 

the committee that was supposed to meet to review it never met. 

And we are close to issuing a report on ATF’s handling of its confidential informants more broadly beyond this matter, and can certainly discuss with you when we get that report out in the next 

hopefully month or so those issues further. 

Mr. LYNCH. Mr. Brandon, I know your previous answer was limited because of the seal. Is there anything you wish to dispute that 

has been put out here in terms of, the allegations are very, very 

serious. 

Mr. BRANDON. Yes, sir, they are. The one thing I would like to 

assert is what the OIG, their thorough investigation of our churning cases, as you said, where we recognized there was a problem 

7 years ago. In candor to you and the committee, the policy was 

lacking. The oversight was lacking. The leadership was poor. And 

we shut those down. There has not been a churning case since 

2013. 

But I compliment the OIG and his team because they did an excellent report. We cooperated fully, and there are no longer any 

outstanding recommendations regarding churning from the OIG 

with ATF. 

Mr. LYNCH. Okay. Is that authorization still out there, though? 

I know it came from the Bush Administration. Has anybody pulled 

that back, or is it just your own decision not to operate that way? 

Mr. BRANDON. We put in tight policy. To answer your question, 

it is still out there. However, there have been no requests for 

churning investigations because it is a very tight policy and standard to open a churching investigation, and we have not done so 

since —— 

Mr. LYNCH. Okay. Mr. Horowitz, from the accounting in terms of 

these accounts with the cash coming in and then going back out, 

it is sort of self-contained. And, you know, there is the opportunity 

for abuse, let us put it that way. Any recommendations that you 

have with regard to the way this is handled? 

Mr. HOROWITZ. Well, we certainly made several in connection 

with that review. And it is a report that we made sure the DepartVerDate Nov 24 2008 10:48 Aug 24, 2017 Jkt 000000 PO 00000 Frm 00048 Fmt 6633 Sfmt 6633 H:\26501.TXT APRIL

KING-6430 with DISTILLER
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ment saw and made recommendations to the deputy AG’s office because of the broader concern of whether any other Federal law enforcement agencies might have churning accounts and how they 

are doing things. But clearly, there needs to be far stricter controls 

than were in place back then. ATF has made changes in response, 

and that is what led us to close the recommendations as to ATF. 

Mr. LYNCH. That is good news, but was anybody disciplined for 

what they described going on here in the New York Times article? 

Mr. HOROWITZ. I am limited in what I can say other than, as we 

indicated in the audit, our auditors referred matters for further investigation to our agents. And I need to leave it at that. 

Mr. LYNCH. Okay. I know the chairman has a document request, 

and I believe it is due tomorrow. Mr. Brandon, are we prepared, 

are you prepared, to deliver those documents? 

Mr. BRANDON. Like I have testified, Congressman, I have pulled 

people from the field. They have been working through the weekend, and we are diligently working to comply with the request. 

Mr. LYNCH. Okay. I think I have exhausted my time. I yield 

back. 

Chairman CHAFFETZ. Will the gentleman yield? 

Mr. LYNCH. Sure, I would. Sure. 

Chairman CHAFFETZ. I believe there is a great big asterisk, 

though, to the end of that sentence, right? You are not going to provide us the things that you believe are under seal by the Court, 

correct? 

Mr. BRANDON. Mr. Chairman, I am going to have to comply with 

the U.S. Attorney’s Office and DOJ dealing with those legal matters. 

Chairman CHAFFETZ. Okay. 

Mr. LYNCH. Just sort of as a follow-up, Mr. Chairman. 

Chairman CHAFFETZ. Yeah. 

Mr. LYNCH. I think if we get to the 24th and that seal goes away 

or there is greater cooperation on the part of the Court, maybe we 

reconvene this hearing with all the folks that are missing and go 

at this again. 

Chairman CHAFFETZ. Oh, we will no doubt have people back. But 

it has been the long-term practice prior to me that civil litigation 

is not a prohibition on Congress being able to do its job, get its documents that it receives. 

Mr. LYNCH. I agree. I agree. 

Chairman CHAFFETZ. And so, yeah, we plan to issue a subpoena. 

The moment you provide that document production and it is shy 

of what we asked for, we will send you a subpoena. And so, we are 

planning on sending that to you on the 13th. I would rather not. 

I would rather have you give us all the documents we request, but 

we do not recognize that civil litigation given our constitutional duties. Anyway —— 

Mr. CUMMINGS. Just one question. 

Chairman CHAFFETZ. Mm-hmm. 

Mr. CUMMINGS. I just want to go back for a moment, and, Mr. 

Horowitz, maybe you can answer this. This seal was a Court seal, 

right? Who is sealing it? I assume it is the Court. 

Mr. HOROWITZ. As I sit here, that is my understanding, but I 

have not been involved in the litigation. 


KING-6430 with DISTILLER
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Mr. CUMMINGS. And if the Court seals it, then the Court has to 

unseal it, right? 

Mr. HOROWITZ. Correct. 

Mr. CUMMINGS. I mean, civil or criminal. It does not matter. 

Mr. HOROWITZ. Right. 

Mr. CUMMINGS. Okay. 

Mr. HOROWITZ. In fact, as the committee knows, we are dealing 

with that on the report that we issued on the Osorio/Barba matter, 

which is certain matters were under seal, and we are asking the 

Department to go back to the Court and get it unsealed so we can 

redact it. 

Mr. CUMMINGS. I got you. All right. Okay. 

Chairman CHAFFETZ. It is our belief that a congressional seal 

bars them from making it public, but to provide it to the United 

States Congress is not one of those prohibitions of a seal. A court 

seal, I should say. Not a congressional seal, but a court seal prohibits somebody from making it public. Providing the information 

we have requested to the United States Congress is not making it 

public. Therefore, we do not recognize that seal as something that 

prohibits Congress from doing its job. That is our position. 

And, Mr. Brandon, I know that puts you in a tough spot, but 

carry that message back if you will. 

Mr. BRANDON. Yes, sir. 

Chairman CHAFFETZ. Thank you. Mr. Grothman from the State 

of Wisconsin is now recognized for 5 minutes. 

Mr. GROTHMAN. Okay. Mr. Horowitz, thanks for being here. 

There are a lot of interesting things that you brought forth today. 

Can you give me other examples, or are you aware of any other examples in the last 5 years in which ATF by not communicating 

with DOA has led to, you would say, errors in investigations? 

Mr. HOROWITZ. As I sit here, I cannot think of anything off the 

top of my head. I do think we found in the storefronts report that 

we did, and I have to just go back and refresh myself, concerns 

about its coordination in some of those storefronts that were several years with State and Federal prosecutors, and the coordination 

between them on who would take which cases and whether they 

would, in fact, take cases. 

Mr. GROTHMAN. Okay. We will flip to Mr. Brandon. What are you 

doing to make sure that your agents coordinate with U.S. attorneys 

as quickly as possible compared to the past? 

Mr. BRANDON. Congressman, as I testified, we established what 

we call Frontline, an intelligence-led, risk-based business model in 

beginning of 2012. And in that, every special agent in charge of a 

division has to do an annual domain assessment. And that came 

from me that they had to share that with the U.S. attorney and 

his first assistant, the criminal chief, to make sure that ATF is in 

step with the U.S. attorney. And it also makes us more efficient 

and effective on our resources to make sure that what we are investigating are the most violent people, and that there will be a 

prosecution from it. 

Mr. GROTHMAN. Do you feel the U.S. attorneys’ willingness to 

prosecute a straw purchasing case is influenced by how you investigate a case? 


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Mr. BRANDON. Sure. You know, I mean, prosecutors want good 

cases. I do not blame them, and that is our job to deliver them. But 

I also know that across the country, U.S. attorneys have different 

challenges on what they are wanting to investigate with their resources. So, it is not the same all across the board. 

Mr. GROTHMAN. Do you ever change your investigative methods 

because you think the case is unlikely to lead to prosecution? 

Mr. BRANDON. To be candid, there have been some divisions 

where if it did not look the U.S. attorney would take it, that we 

would go to the State attorney general’s office for prosecution. 

Mr. GROTHMAN. And do you feel you have the responsibility to 

disrupt straw purchasing or firearms trafficking, even if you think 

you are unable to obtain a prosecution or conviction? 

Mr. BRANDON. Yes, sir. And as I testified, I really believe the 

interdiction and deterrence credit that we give agents for their production has helped knock down the number of, say, straw purchases where they get scared off, and let them know that they have 

come under ATF attention. 

So, I keep using the expression, but be on the left side of boom. 

That was not in the culture. It was, why waste our time on this 

if we are not going to get a prosecution. And we put an emphasis 

on public safety with interdiction and deterrence from firearms getting in the wrong hands. 

Mr. GROTHMAN. Okay, thank you. 

Chairman CHAFFETZ. Sorry. 

Mr. CUMMINGS. Would the gentleman yield? Thank you. I want 

to go back to something that Mr. Lynch was talking about, Mr. 

Horowitz. To get to a churning situation, I guess that really calls 

for some folks to be cooperating, right? I mean, in other words, you 

got to have several people working together for that to happen, 

right? 

Mr. HOROWITZ. That is my understanding from what we have 

seen. 

Mr. CUMMINGS. And so, you know, when I read the story, and I 

know we cannot get into that too much here, I was kind of surprised to even see that, particularly after all the Fast and Furious 

stuff that we have been through. It just seemed to be a bit much. 

I was shocked, to be frank with you. Were you? 

Mr. HOROWITZ. I have to say I was not primarily because —— 

Mr. CUMMINGS. Because you had more information. 

Mr. HOROWITZ. Because our 2013 audit —— 

Mr. CUMMINGS. Yeah. 

Mr. HOROWITZ.—identified many similar situations, frankly, of a 

lack of controls. In that circumstance, we not only found a problem 

with the controls over the bank accounts and the controls over the 

CIs, the informants, but the controls over the cigarettes themselves. ATF could not reconcile all the cigarettes with a substantial 

value to them. 

So, in that report we saw a series of failures, so, frankly, I was 

not particularly surprised. 

Mr. CUMMINGS. So, you think this is just people in the Agency 

that just say, you know, we will use any method necessary to get 

the job done, or are they people that just say we do not care about, 

you know, how this is going to appear? In other words, I am conVerDate Nov 24 2008 10:48 Aug 24, 2017 Jkt 000000 PO 00000 Frm 00051 Fmt 6633 Sfmt 6633 H:\26501.TXT APRIL

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cerned that, you know, you can let any agency or any organization 

get lulled into a culture of I do it the way I want to do it, and that 

is why I was asking you about does it take several people. How do 

we even get there? 

Mr. HOROWITZ. This was —— 

Mr. CUMMINGS. Because I do not want to see it happening again. 

We should not be opening up the New York Times reading about 

this kind of stuff. Go ahead. 

Mr. HOROWITZ. I was just going to say, the churning issues that 

we identified, the issues in Fast and Furious we identified, the 

ATF storefronts report, some of the things we have been before the 

committee and talked about on the DEA side, those were not, generally speaking, as you just indicated, Congressman, one person 

running amuck. They were multiple people without adequate controls, leadership, and oversight being able to do what they thought, 

in most of those instances, not all, were advancing law enforcement 

interests when, in fact, they were not. 

Mr. CUMMINGS. Thank you, Mr. Chairman. 

Chairman CHAFFETZ. Thank you. We will now recognize Mr. 

DeSaulnier of California. 

Mr. DESAULNIER. Thank you, Mr. Chairman. And along the lines 

of what the ranking member just mentioned, we have heard in this 

committee when you have come and testified before, Mr. Horowitz, 

just on lessons learned and doing reasoned nonpartisan interventions. So, to Mr. Brandon, does ATF maintain a database of Federal law enforcement weapons that have been lost or stolen? 

Mr. BRANDON. No, we do not. 

Mr. DESAULNIER. Right. So, in the San Francisco Bay area where 

I am from, there has been a lot of media attention, and the San 

Jose Mercury News has done an extensive series of stories—you 

may have read it—about lost and stolen weapons by both State, 

local, and Federal officers. 

Two people have lost their lives that I am aware of because of 

lost and stolen Federal weapons, one by an agent from the Bureau 

of Land Management that led to the tragic death of Kate Steinle, 

a former constituent of mine, that has led to the larger discussion 

both by the President and members of Congress about immigration 

status. But the fact remains that that gun that was used in that 

murder and in another murder in Oakland were Federal law enforcement officers who had weapons stolen. 

So, I have a bill, and to my friend from Oklahoma, I do not need 

to have a bill passed. I have also asked the Administration, the 

previous Administration, could you at least, led by ATF, create a 

policy that was germane to all Federal law enforcement both on 

proper storage of weapons so we would not have the situation that 

happened in San Francisco that happens a lot in San Francisco unfortunately where if there is anything in the car, thieves will break 

a window and grab and snatch, snatch and grab anything in there 

that led to these two deaths. 

So, it just seems to me common sense that you would lead an effort to make sure that there was the best policy possible, whether 

it requires a statute or not, to make sure that we have learned the 

lesson in this instance and others just in terms of an inventory control and accountability issue, that you would make sure that these 


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kind of things were at least minimized. And the fact that you do 

not even create a database to follow these things for Federal law 

enforcement seems to me to be negligence in the extreme, and personally, having seen people, constituents, people suffer the consequences. 

So, my question is, the State of California responded to this by 

passing a statute that required Federal and State agencies, because they have been guilty of the same thing, and sometimes 

quite tragically, I will add, to law enforcement officers. I have another constituent who is a police chief, and his weapons were stolen 

out of his car in a driveway in a very affluent community and used 

to commit a crime, and he was horrified and quite guilty about it. 

So, I have heard sort of the culture question by the ranking 

member, friends of mine in law enforcement saying you should not 

be imposing these, we care about public safety, let us take care of 

it, but that is not enough. I really think that it is incumbent on 

you, and the IG has pointed this out, to develop better inventory 

control, and better accountability, and better consequences for Federal law enforcement officers, and better preventative practices. 

So, my question is, as I understand the law in California, Federal 

agents will have to comply with that. And if you are aware of how 

you are helping to comply with that effort, and why we do not do 

it on a national level, and I do not think it needs statute. I think 

you could do it administratively, and it would help a great deal. So, 

could you respond to those observations? 

Mr. BRANDON. Yes, Congressman. You described tragedies, you 

know, and I remember reading about it in the paper. 

As far as ATF and I know the other agencies as well, we account 

for our firearms inventory, and that is an annual thing as far as 

having to account for every firearm. I will share my sensitivity to 

what you are saying is that when I was in the deputy director position, I increased the penalty if an agent had a firearm stolen out 

of their care a mandatory 5 days off without compensation, and it 

could not be reduced. And I was sending a message culturally because of the sensitivity, which has become prominent amongst people stealing guns out of cars. 

I have gone to St. Petersburg. The chief had billboards up about 

please lock your car up, secure your firearm. I was in Memphis. 

The chief was saying the same thing. So, I support that. 

Whether or not ATF would be the custodian of everybody’s firearms, I believe that it is being done at each law enforcement bureau component, and that we do an annual inventory, and that any 

firearm that is stolen with ATF, that it is investigated by our Internal Affairs. The OIG always has a chance of reviewing the files, 

and then it will go through our process for discipline. 

Mr. DESAULNIER. Mr. Brandon, I hope that all of those changes 

actually result in a positive thing that we both want, but it is not 

working so far. We just had another incident with an FBI agent 

out of the Concord, California Bureau office, which is in my hometown, where multiple weapons were taken. So, it is not working. 

So, my question is, why given that law enforcement has said over 

and over again we care about these things, we are doing things, as 

you had pointed out to, but it is not working. So, understood that 


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there is going to be some margin of error and there are going to 

be instances, but we are not doing enough. 

So, my admonition and request for you and of the committee is 

we need to do things and do it across the board to all Federal agencies as the State of California is doing for State and local officers, 

and make sure, particularly on the front on storage of the weapons, 

and when they are not in use. If they are not on your person, the 

new law says they have got to be locked in your trunk and have 

a gun lock on them, which seems to me to be the right thing to do. 

So, I would just ask you and the committee that we continue to 

pursue this in the prevention area in this larger thing so we do not 

have these tragic situations, knowing that they may happen on occasion, but they are happening far too often as it is right now. 

Mr. BRANDON. No. Thank you, Congressman, and ATF’s policy is, 

what you said, is about the secure storage of firearms in a vehicle. 

It has to be not just in a trunk, but within a container that is within that trunk that is designed for firearms storage. 

Mr. DESAULNIER. So, my only observation is that is great, but it 

is not working across all Federal agencies. And to the degree that 

you have the ability to enforce that and bring up the best standards, I think we should be pursuing that. Thank you. 

Mr. BRANDON. I am sorry —— 

Chairman CHAFFETZ. No, go ahead. 

Mr. BRANDON. Congressman, we have a quarterly meeting at 

DOJ with FBI, DEA, the Marshals, and the FBI, the four components. I will bring it up at the meeting as a topic of firearms storage. 

Mr. DESAULNIER. I would appreciate that. 

Mr. BRANDON. Thank you. 

Chairman CHAFFETZ. Thank you, and that is a good point. The 

committee is happy to follow up, and perhaps we could get an inventory or some sort of indication as to what they are doing or not 

doing in that. So, let us work with you on that as well. That is a 

good point. 

I will now recognize myself. Mr. Horowitz, you said earlier that 

your office found no criminal conduct from anyone involved in Fast 

and Furious. I want to ask about former ATF Phoenix Field Division Assistant Special Agent-in-Charge George Gillett, who was 

heavily involved in running Fast and Furious. He had personally 

purchased a firearm. What happened, do you recall, to that firearm? 

Mr. HOROWITZ. I do, and it was transferred by him to a non-U.S. 

national. 

Chairman CHAFFETZ. And so, he sold it to a non-U.S. national, 

and what happened with that gun? Where did they find it? 

Mr. HOROWITZ. If I recall correctly, it was a scene of a crime, but 

I would have to go back and just make sure I remember. 

Chairman CHAFFETZ. Yeah, that is the way we recall it as well. 

Mr. Brandon, when you fill out Form 4473, are you allowed to use 

your work address or are you supposed to use your home address? 

Mr. BRANDON. You are supposed to use the residence you live at. 

Chairman CHAFFETZ. If you put something other than your home 

address, can you prosecute those crimes? Is that a crime? 


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Mr. BRANDON. If you intentionally and knowingly put something 

down false on a form, yes, it is. 

Chairman CHAFFETZ. So, the form says you are supposed to put 

your home address, correct? 

Mr. BRANDON. I believe so. As I recall, yes. 

Chairman CHAFFETZ. Yeah. So, something other than your home 

address would be inaccurate, correct? 

Mr. BRANDON. Correct. I mean, I bought a gun last summer. I 

put down my apartment. 

Chairman CHAFFETZ. So, did the Inspector General’s Office make 

any recommendation to the Department of Justice to consider prosecuting him for—this is Mr. Gillett—for lying about his address on 

Form 4473? Mr. Horowitz? 

Mr. HOROWITZ. I do not believe we did. 

Chairman CHAFFETZ. And why not? 

Mr. HOROWITZ. Because what we have been told or were told is 

that for law enforcement agents at the Department, many of them 

do not use their home address for security purposes, but instead 

use a P.O. Box, or UPS Box, or some other location, and that that 

was not sufficient evidence of intent to warrant a criminal prosecution. 

Chairman CHAFFETZ. Even though he sold it to a non-U.S. national and it ended up at a crime, and he used an address that is 

different on the form. You just decided that, nah, we will not prosecute that. What is hard for the American people to understand is 

why that waiver? Are these forms publicly available? I mean, can 

you just go look this up? 

Mr. HOROWITZ. I believe you can. I think if you go on the internet and look, it is on ATF’s website. 

Chairman CHAFFETZ. But, I mean, can you look up, oh, let us go 

find and ATF agent, and then we look at his form and see if he 

purchased anything, and, oh, there is his address? I mean, what 

are we trying to protect him from? 

Mr. HOROWITZ. I would defer to —— 

Chairman CHAFFETZ. Mr. Brandon, is that common practice? Is 

that what ATF agents are doing in putting a work address on 

there? 

Mr. BRANDON. Not to my knowledge. I was surprised at George 

Gillett’s response. In candor to you, Mr. Chairman, I am glad he 

is off ATF. He was not one of our best. And people that were doing 

undercover work, ATF would provide undercover identification, and 

that would be the permissible type. 

Chairman CHAFFETZ. Right. 

Mr. BRANDON. But I think, if I remember correctly, he was using 

a drop box at a mail place, a P.O. Box, and I was surprised. And 

it is not common that I know of to ATF. 

Chairman CHAFFETZ. Let me switch gears. Mr. Brandon, you 

said that there was a person, the group supervisor who was supposed to have some responsibility here—we are going back to the 

Zapata case—I think the phrase you used ‘‘asleep at the switch.’’ 

How long did it take for you to all figure out—and I am not talking 

about you personally, but the organization—how long did it take 

ATF to figure out that there was somebody asleep at the switch? 


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And the second part of that is, what happened to him? Was he 

fired? Was he disciplined? Did you give him bonuses? What happened to this person? 

Mr. BRANDON. The person retired from ATF. 

Chairman CHAFFETZ. As a result of this? Right after it? I mean, 

help me with the timespan. 6 years have passed, so help me with 

the timespan. 

Mr. BRANDON. Well, I know the employee, from reading the report, that the OIG interviewed him. He retired before the report 

came out, and his reputation was not that of a dynamic leader that 

was engaged. 

Chairman CHAFFETZ. Mr. Horowitz, can you weigh in on this? 

Mr. HOROWITZ. My understanding is he retired in June of 2012, 

so even before we got the referral in September 2012. 

Chairman CHAFFETZ. Okay. 

Mr. HOROWITZ. And before we began our review. 

Chairman CHAFFETZ. Mr. Horowitz, we have talked in general 

about access issues to a whole host of things. Are you having access 

issues at the ATF? 

Mr. HOROWITZ. We are not, and I want to be clear also. The 

delay had nothing to do with any access issues with ATF. We got 

what we needed. That was not an issue. 

Chairman CHAFFETZ. And outside the Zapata case, on a broader 

sense, are there access issues that you care to highlight here at 

this hearing? 

Mr. HOROWITZ. Currently we do not. ATF has been very good in 

the last several years about getting us, even as we were having 

fights with DEA and FBI. Our access issues with ATF were actually in connection with the Fast and Furious matter. 

Chairman CHAFFETZ. Well, let us note that 2011, we got some 

good news, so congratulations, Mr. Brandon. We thank you for 

that. 

Mr. BRANDON. Well, thank you. 

Chairman CHAFFETZ. My time has expired. 

Mr. BRANDON. Mr. Chairman, can I —— 

Chairman CHAFFETZ. Yes. 

Mr. BRANDON.—because I did want anybody to think I was lying. 

I confused it. There was another employee that retired at the end 

of 2016 that the OIG was critical of in documenting his surveillance and interview of an FFL. So, that is what I was referring to 

my head just for the clarification. I did not want to be inconsistent. 

Chairman CHAFFETZ. Okay. No, I appreciate it. No, thank you. 

Let us go back to Mr. Lynch of Massachusetts for 5 minutes. 

Mr. LYNCH. Thank you, Mr. Chairman. Mr. Horowitz, I want to 

go back to the cigarette smuggling case. Mr. Brandon, you had ATF 

agents working with at least a couple of informants in that case. 

And it says here in the New York Times article that they were funneling tens of millions of dollars, and then apparently they are 

using the black market cash to pay the informants. Is that a usual 

practice? 

Mr. BRANDON. Again, sir, if I can comment not particularly to 

this investigation. It is under seal. 

Mr. LYNCH. Okay. 


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Mr. BRANDON. But in churning in general and how the OIG’s report was spot on, and that oversight was deficient, policy was deficient, it was a hot mess. And that is why we shut it down, all of 

them, in 2013. There has not been another one. And I actually, you 

know, welcome when everything that can come out on this case 

that the government is a party of. 

Mr. LYNCH. All right. Let me thank you for that. Mr. Horowitz, 

so I am trying to follow your investigation. You did a very good report. I think it was a 2013 report. You went back from, I think, 

February of 2006 —— 

Mr. HOROWITZ. Right. 

Mr. LYNCH.—to about June of 2011, right? 

Mr. HOROWITZ. Yes. 

Mr. LYNCH. So, we got that block of time. 

Mr. HOROWITZ. Right. 

Mr. LYNCH. You had some reports there where informants were 

being paid, some of them a million dollars, a million dollars a year. 

To pay an informant, who I think at that point was working with 

the DEA, if I am not mistaken. 

Okay. So, now we have another report from the New York Times 

that goes to January and February of 2011, so it is within the 

scope of your study, Mr. Horowitz, your report. So, there is some 

overlap here that this churning is going on. 

So, is your investigation, did you cover this? Did you cover the 

accounts? I am trying to figure out is the money being reported 

properly? Who did it go to? How much money were these folks getting? 

Mr. HOROWITZ. Again, I do not know all the specifics of the matter and what is under seal. 

Mr. LYNCH. But did you investigate that, though? 

Mr. HOROWITZ. But I will say that given what my auditors 

looked at and the accounts they looked at —— 

Mr. LYNCH. Okay. 

Mr. HOROWITZ.—I believe we looked at the breadth of the undercover churning accounts that ATF was using, and that our audit 

report covered those accounts in full, and that the problems we 

identified covered that. 

Now, when we finished in June 2011 in our field work, one of the 

reasons it took some time to issue the report was, frankly, because 

as we were doing our audit work beginning in 2011, ATF was making many of the changes that Acting Director Brandon outlined. 

And so, what we ended up doing was continually updating our 

audit report, which caused us to want to make sure we were picking up some of the changes they made. And they asked us actually 

to look at some of the changes they made. 

Mr. LYNCH. Okay. 

Mr. HOROWITZ. So, I think —— 

Mr. LYNCH. I was just trying to get the timeline down to make 

sure that you were looking at this case, and it appears that you 

did. Part of your investigation at least captured this before the 

practices ended. 

Mr. HOROWITZ. I will say this. I do not, again, know all the specifics of what is under seal, but if it fell into a period through June 

2011, I think it is safe to say that our auditors looked at the scope 


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of their churning accounts through June 2011. And my guess is the 

acting director, given our back and forth —— 

Mr. LYNCH. Okay. 

Mr. HOROWITZ.—could probably speak to that as well as to 

whether we looked at all of their accounts. 

Mr. LYNCH. All right. Well, you know what we will do is we will 

wait until the 24th and have another bite at that just to make sure 

we are right. All right. 

I yield back, Mr. Chairman. Thank you. 

Chairman CHAFFETZ. Thank you. I will now recognize the ranking member, Mr. Cummings, for 5 minutes. 

Mr. CUMMINGS. It would be legislative malpractice, Mr. Brandon, 

if I did not ask you these questions. 

In my district, in the inner city of Baltimore, you have situations 

where young men can get a gun just as fast as they can get a cigarette, and it is interesting that there has been a proliferation of 

sales of guns. And I am just wondering, how does that make your 

job harder, and how do you all deal with that? And you do not have 

to sugar coat it with me. I believe that the ATF has been treated 

like a stepchild, and I think there are some that, if they had their 

way, would get rid of you guys immediately. 

One of the reasons why Mr. Lynch’s questions are so significant, 

and one of the reasons why Fast and Furious was significant, is because it then gives people who do not like you and your organization justification to treat your organization the way it is treated. 

And anybody who knows anything about the ATF can sit here and 

be dishonest, but I believe that with all my heart because I attend 

the funerals of young, particularly, black men who die tragic 

deaths, and even my own nephew, brains blown away on a wall 

being robbed. That was in Norfolk 5 years ago. They still have not 

found the person who did it, but I know the ATF got involved. 

But this is my question. Yesterday I had a meeting with President Trump, you know, and I told him, I said, Mr. President, do 

me a favor. When you talk about the black community, do not just 

talk about, make it sound as if we are all in some bunker somewhere suffering. Do not judge us by a weakest link. 

But he keeps saying that I am trying to figure out. He keeps saying that he is going to send in the feds—I do not who he is talking 

about, I guess troops, probably ATF—to help with places Baltimore, and he loves to talk about Baltimore. He loves to talk about 

Chicago. And we know we have limited resources. One of our members told you a little bit earlier that you just got to do more with 

less pretty much. 

So, if the President came to you and said, Brandon, you know, 

how can we use our resources best to help places like Baltimore 

and Chicago, what would you say, because I am just wondering 

how he would do that. I know about the task force, you know, because we have got that in Baltimore. That to me is important. But 

do you, I mean, just send people in and say ATF, you know, look 

at this situation, do whatever you want? 

I mean, what would your recommendation be, because he is probably going to come to you if he has not already, or somebody is 

going to come to you. 

Mr. BRANDON. Congressman, I appreciate the question. 


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Mr. CUMMINGS. And I am not trying to put you on the spot. I am 

really curious because I want us to be effective and efficient in 

whatever we do, and I know you do, too. 

Mr. BRANDON. I would love the opportunity. Like I said, I think 

everybody wants to be tight with the taxpayers’ money, and I am 

one of those persons. But one of the things from the major cities 

chiefs that they all said is we what we would do is go in with enhanced enforcement initiatives for 90, 120 days, and you are not 

selling sustainability. 

There is a program called the National Integrated Ballistics Information Network, NIBIN. It has been a game changer, and it is 

where the casings at shootings, and perhaps, I do not know if this 

was done with your nephew in Norfolk. But that is entered into 

what they call, it is a fancy microscope that puts a digital signature 

on the casing, much like a fingerprint. 

And when you have a comprehensive collection plan with the 

PDs and it goes through NIBIN, it will link up shootings in different States and to go after people, and I will give you an example 

if I had the chance to talk to President Trump. We have done more 

with less, but this is good for the American public. It is decimal 

dust. $50 million to $100 million for this technology, not for another ATF employee. 

The example was when I was at San Diego, the International Association of Chiefs of Police, the deputy chief made a point, and I 

was speaking before the Police Executive Research Forum. He said, 

our PD got shot at. Within 12 hours, we collected that, had that 

scanned in, and it went down to our National NIBIN Correlation 

and Training Center where we as ATF said how can we serve the 

States and locals better. 

Within 12 hours, we sent the response back saying that shooting 

at that PD is matched up with 3 other shootings. It went to our 

Crime Gun Intelligence Center. The misery of Fast and Furious, 

and I do not defend it, was us establishing the Crime Gun Intelligence Center where you collect, analyze, and synthesize, and disseminate information rapidly with our law enforcement partners. 

They had 3 or 4 guys locked up within 24 hours. 

So, if I had the President’s ear, that is what I would say. NIBIN, 

it is a game changer for investigative leads, what I refer to as trigger pullers, and then to go after the traffickers that are supplying 

them with firearms. And I think it is something everybody can 

wrap their arms around because, as you well know, sir, and I spent 

a lot of my career in Detroit and the victims, it is painful to watch 

people being shot, and the misery it does on the families. And then 

there are shootings even at funerals, as you know. 

Mr. CUMMINGS. Yes, oh, I do. 

Mr. BRANDON. Which I have done surveillances on those and so 

forth. So, to answer your question, I believe even if I was a taxpayer outside of ATF, this is something worthy of attention to address the gun violence across America. And also to reiterate the 

point, I think we have made a lot of progress in working with our 

local PDs on federal firearms licensee burglaries. 

Last year, there were over 7,500 guns stolen during FFL burglaries. And so, we are trying to say, hey, prevent that. Working 

with the National Shooting Sports Foundation and others, and the 


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SHOT Show, and so forth, to educate them for security. And, again, 

it is different than an armed robbery where we could hit them federally with 924(c), you know, or the Hobbs Act and so forth like 

that. An FFL burglary is a different animal. 

But that is what I would say, and it is just the right thing. 

Mr. CUMMINGS. Thank you very much. 

Chairman CHAFFETZ. These machines, they cost how much? 

Mr. BRANDON. Mr. Chairman, I have to go back, but I think it maybe $129,000. And if I may comment where, again, to your point 

of the cost of this, which is just like fire departments have done 

across the country and tactical teams during regionalization, that 

not every PD needs a machine, you know. You can have where they 

have memorandums of agreement, and that I know of other PDs 

that say, hey, come down on Tuesdays, enter all your casings. So, 

it is an expensive item, but it saves lives. 

Chairman CHAFFETZ. We just want to work with you. I would 

love to learn more about it, and if you could just educate us on 

that. I would love to help you get more of them. 

Mr. BRANDON. Mr. Chairman, I really appreciate it. I would love 

to. 

Chairman CHAFFETZ. Yeah. No, that would be great. You said 

something that really caught my ear, and it is something the committee has been looking at it, and we would really appreciate your 

help. I was encouraged when you said that the statistics that you 

have at your disposal, you said ‘‘We do not want to waste our time 

on cases that will not be prosecuted.’’ 

That is true with every law enforcement agency I have ever encountered, right? There is nothing more frustrating than the men 

and women who go out there, do the hard work, they put a case 

together, and then a prosecutor says, eh, it is not as sexy, it is not 

as jury friendly as we hoped it would be, and so, hey, you know, 

we are not going to do anything here. 

In order for us to get our arms wrapped around that, you are as 

swift as you can providing us sort of, and I think a 3-year window, 

unless somebody else wants to weigh in here. I do not want to go 

back 15 years. But if you can look back over the past 3 years and 

give us some statistics here is how many straw purchasing cases 

we had. 

I have got push the Department of Justice to find out what they 

are actually prosecuting, but my guess is most every one of your 

agents already knows, if I give them this paperwork, they are not 

going to prosecute it, so why bother, right? 

So, I want to know what those cases are, but as importantly, I 

want to know what you have given them. And the example and the 

parallel that I am giving is the TSA. TSA, I cannot say enough 

about their Instagram account. You want to go see an amazing 

Instagram account, go to the TSA one. 

Every day they are putting up pictures of guns and other types 

of weapons, and knives, and things that people are trying to bring 

on airplanes. And then when you go work with the local law enforcement, when you work with the prosecutors, it is crickets. They 

almost never prosecute anybody. And my guess is we are having 

the exact phenomenon throughout the country with these gun violations. 


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I need exposure to that, and that is where your help in providing 

us the statistics, sooner rather than later. I do not know what 

timeframe to put on that, but you did say that they were fairly 

easy to put together. Can you get back to us as to when is a reasonable time and to provide us those statistics? 

Mr. BRANDON. Mr. Chairman, I would be happy to. 

Chairman CHAFFETZ. That would be really helpful. 

Chairman CHAFFETZ. Please do familiarize yourself with that 

churning case as highlighted in the New York Times. We will be 

having a hearing about this. I need to know that you are personally 

involved and engaged on this, and that you are willing to cooperate 

with us on this investigation. Do I have your cooperation on that? 

Mr. BRANDON. Mr. Chairman, you absolutely do. And whatever 

I am legally allowed to do without getting in a jam with a Federal 

judge, I am all yours —— 

Chairman CHAFFETZ. Again, our —— 

Mr. BRANDON.—to testify. 

Chairman CHAFFETZ. I know I have said it a couple of times, but 

your providing Congress the information requested is not making 

that information public. And not only do we not recognize the seal, 

so to speak, but we do not believe it binds you, but I know there 

are lots of attorneys that are going to give you a lot of advice. 

But we do need that information, and, at the very least, we also 

need you to try to pursue that in the Court if you think you have 

to. Again, we do not think you have to, but if you think you have 

to, I want to make sure you are at least asking them. 

Mr. CUMMINGS. Mr. Chairman? 

Chairman CHAFFETZ. Yes? 

Mr. CUMMINGS. Let me say this to you, Mr. Brandon. You know, 

so often we have these hearings, and things do not get tied up 

properly, and I am going to tell you what I told the chairman a few 

minutes ago about you. I said I believe this guy is a good guy, and 

that he may not have fully understood the invitation because I do 

feel your sincerity, I really do. I have interviewed a lot of witnesses 

in my career as a lawyer. 

And I just want to thank you for, you know, your candor, I mean. 

But I got to tell you something about this guy. He can be kind of 

nice, but once he thinks you understand him, you think you saw 

some fury today? It gets worse. 

[Laughter.] 

Mr. CUMMINGS. So, all I am saying is that you are now on notice 

that an invitation, we expect you to make sure that folk get here 

as best you can, okay? You got me? 

Mr. BRANDON. Mr. Chairman, my former boss said the education 

of Tom Brandon continues. 

[Laughter.] 

Mr. BRANDON. And this was an education today. Again, I meant 

no disrespect. I was trying to do the right thing, but, hey, obviously 

it did not go that well. But I appreciate your comments about me 

being candid and open, and that is my MO. 

Mr. CUMMINGS. And we also thank you for your service because 

—— 

Mr. BRANDON. I appreciate that. 


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Mr. CUMMINGS.—obviously you have been through a lot. You 

have seen a lot. 

Mr. BRANDON. Fast and Furious changed my life. 

Mr. CUMMINGS. Yeah. 

Mr. BRANDON. And I stayed in the game. I stayed in the fight 

because I love the men and women of ATF. They do a vital, important mission of protecting the public and serving our Nation. And, 

you know, the ATF of 2017 is not the ATF of 2010 when much of 

this stuff happened, and I just wanted to thank you for allowing 

me to say that. 

Mr. CUMMINGS. Thank you very much. 

Chairman CHAFFETZ. And I want to thank you for your service 

and your candor. You are earning our respect, and the proof will 

be in the pudding as we move forward. But I do believe you, too, 

and I think we better understand each other, and hopefully DOJ 

understands us as well. But I think we made the message clear, 

and I appreciate your working with us. 

And, again, back to your service in the U.S. Marines and moving 

forward, you have done a lot for this Nation and put your life on 

the line on a regular basis, which is more than, you know, most 

people do. And we admire, and I cannot say enough about the men 

and women who also serve with you in doing that because, you 

know, we are up here wearing ties and real clertical. And yet you 

see the 16-hour days these people put in with their lives on their 

line dealing with the worst scum you can possibly imagine. 

And I want you to know we all recognize that, and grateful that 

people will step up and do that, not only at ATF, but other departments and agencies as well, everybody from Border Patrol to working in the prisons. I mean, it is tough. It is tough, and we do not 

praise people enough for the good work and the sacrifices they 

make and their families make, their spouses, their kids, their 

friends, their family, their parents. It is tough, and they do amazing work, and we never compensate them enough. But I do hope 

from time to time, we stop, and pause, and recognize them. 

So, again, I think it is one of the beauties of this Nation is that 

we have these kind of really candid discussions, but we have also 

got a duty to do on both sides of these tables here. And so, we appreciate your working with us and helping us to ultimately get to 

the truth and make things better. 

And so, to Mr. Horowitz, again, the number of people that work 

with you at the IG’s office, know how much we appreciate them. 

I thank all the members here today. It is an important topic and 

something we will continue to follow up on. 

The committee stands adjourned. 

[Whereupon, at 12:32 p.m., the committee was adjourned.] 


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APPENDIX 

MATERIAL SUBMITTED FOR THE HEARING RECORD


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318!2017 A T.F. Filled Secret Bank Account Wth Mi!!ions FromShad<My'Cigarette Sales- The New York Times 

u.s. 

By MATT APUZZO FEB. 

secret bank account. They weren't smugglers, 

Bureau of Alcohol, Tobacco, Firearms and Explosives. 

phony shipments of snack food disguised 

job 

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Government records and interviews with people involved reveal an operation that 

existed on a murky frontier- between investigating smuggling and being 

complicit in it. After The New York Times began asking about the operation last 

summer, the Justice Department disclosed it to the department's inspector 

general's office, which is investigating. The inspector general "expressed serious 

concerns," court records show. 

It is unclear how broadly the A.T.F. adopted this practice, at what level it was 

approved, and whether it continues. Nearly all references to the A.T.F. have been 

blacked out of public court records, and most documents are entirely sealed. 

The investigation and the looming racketeering trial will bring renewed 

scrutiny to the A.T.F., which has been buffeted in recent years by the botched guntracking operation known as Fast and Furious and its mismanagement of 

undercover investigations. Representative .Jason Chaffetz, whose House oversight 

committee investigated Fast and Furious, asked the A.T.F. on Wednesday for 

reams of documents related to the secret tobacco account. 

Members of Congress, particularly Republicans, have heaped criticism on the 

agency for decades, and the National Rifle Association has lobbied to limit the 

agency's authority and funding. 

While government auditors have previously cited problems with A.T.F.'s 

tobacco investigations, this operation went beyond what was identified in that 

audit, released in 2013. The A.T.F. and the .Justice Department declined to 

com1nent. 

Documents in the racketeering lawsuit outline the A. T.F. operation. The 

tobacco cooperative is suing a former employee and a consultant who, according 

to court documents, both worked as A.T.F. informants. The informants have 

denied all wrongdoing. 

Part of their defense, records show, is that they acted on behalf of the 

government. In response, a judge recently added the United States government as 

a defendant. 

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3/8/2017 A.T.F. Filled Secret BanlcAccountW!h Millions FromShadov.yCigarette Sales- The New York Times 

Since last summer, The Times has fought to make all the documents public, 

but the ,Justice Department has argued successfully in court to keep them secret. 

Crucial details, however, have been revealed through poor redaction, documents 

that were filed publicly by mistake and the sheer difficulty of keeping so much a 

secret for so long. 

Buying Into an Operation 

In spring 2011, U.S. Tobacco Cooperative was looking to expand its 

distribution network. The co-op is made up of about 700 tobacco farmers- from 

Virginia to Florida -who pool their crops and share the profits. Based in Raleigh, 

N.C., the company is a major exporter to China and produces discount-brand 

cigarettes including Wildhorse, Traffic and 1839. 

"These are really, really good people," said Stuart D. Thompson, the 

cooperative's chief executive. "Every year, they take all their chips. They put them 

on the table, and they hope they get them all back." 

The company began negotiating to buy a tobacco distributor in Bristol, Va., 

Big South Wholesale. Big South's owners, ,Jason Carpenter and Christopher Small, 

had a network of customers and owned a warehouse. 

They also had an existing secret relationship with the A.T.F., records show. 

The two men have filed court documents acknowledging "participation in 

undercover law enforcement activities." And a judge's sealed order, which is 

publicly available online, revealed that the two men worked "on behalf of various 

government agencies, primarily the Bureau of Alcohol, Tobacco, Firearms and 

Explosives." 

The basics of cigarette smuggling are simple. Each state sets its tobacco taxes. 

Buying cigarettes in low-tax states, like Virginia, and secretly selling them in 

higher-tax states, like New York, generates large profits. More complicated 

schemes have shipped cigarettes to Indian reservations, where they are not taxed, 

then rerouted them for sale on the black market. 

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A.T.F. agents try to disrupt these networks. Often that means working with 

informants to buy and sell tobacco on the black market, much the way agents pose 

as drug dealers to investigate cartels. 

Because so much of the case remains sealed, Mr. Carpenter and Mr. Small are 

prohibited from answering questions about nearly every aspect of the case. 

"Everything we did that is being attacked now in litigation, we did in good faith," 

they said in a statement. 

Exactly who at U.S. Tobacco knew about their A.T.F. ties and what they knew 

are a matter of dispute. But there were signs that Big South was not a simple 

tobacco distributor. Its assets included more than two dozen vehicles, including 

expensive S.U.V.s and a fleet of Mercedes, BMW, Audi, Lexus and Jaguar sports 

cars. 

Early 2011 was a time of intense pressure inside the A.T.F. The agency was 

under fire from Congress over the Fast and Furious operation, in which agents 

allowed gun traffickers to buy weapons and ship them to Mexico, hoping the 

shipments could lead them to major weapons dealers. Justice Department 

auditors began scrutinizing how A.T.F. agents managed their tobacco smuggling 

investigations. 

With that audit continuing, the A.T .F. issued new rules to tightly monitor 

undercover investigations. Soon after those rules went into effect, U.S. Tobacco 

completed its purchase of Big South for $5.5 million, a deal that gave Big South 

the authority to buy and sell cigarettes on behalf of the cooperative. Almost 

immediately, the farmers say, Mr. Carpenter and Mr. Small began defrauding 

them. 

It worked like this: An export company working with the A.T.F. placed an 

order for cigarettes to be shipped internationally thus not subject to American 

taxes. Big South would instead ship bottled water and potato chips, making it look 

as if cigarettes had been exported. Mr. Carpenter and Mr. Small would then buy 

the tobacco at a slight markup through a private bank account. Lastly, they would 

sell the tobacco to Big South, again at a markup. 

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Because they had the authority to buy on behalf of the tobacco cooperative, 

"Carpenter and Small simply sold products to themselves," the farmers wrote in 

court documents. All of these transactions occurred on paper. The cigarettes never 

left the Virginia warehouse. 

"It's what I saw with my own eyes," said Brandon Moore, the warehouse 

manager and one of the people who discussed the transactions in the case. Their 

accounts fit with descriptions in court records. 

Mr. Moore said he was aware of the A.T.F. operation but became troubled by 

it as he learned more. "It shouldn't be going on, even if it is the A.T.F.," he said. 

In one deal described in the lawsuit, the informants bought tobacco at $15 a 

carton and sold it to U.S. Tobacco at $17.50. The profit, about $519,000, went into 

what was known as a "management account." That account, while controlled by 

Mr. Carpenter and Mr. Small, helped pay for A.T.F. investigations. 

Mr. Moore, the warehouse manager, said agents often told him what to buy 

on the company's credit card. For instance, he recalled spending tens ofthousands 

of dollars at Best Buy on iPads, tele\~sions and other gifts to curry favor with 

potential criminal targets. 

Mr. Carpenter and Mr. Small have also acknowledged in court documents 

receh~ng more than $1 million each, though it is not clear from public documents 

whether that was profit or reimbursement for expenses paid on behalf of the 

government. 

How that arrangement began is unclear. Ryan Kaye, an A.T.F. supervisor, 

testified that the management account was created "as a result of verbal directives 

from the A.T.F. program office and other headquarters officials." Mr. Kaye's full 

statement is sealed, but excerpts are cited in one publicly available document. 

The defendants in the lawsuit contend that U.S. Tobacco got a good deal on 

the cigarettes, even at the prices they paid. The farmers tell a different story, 

sa)~ng they never would have purchased Big South if they understood that Mr. 

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Carpenter and Mr. Small had a side arrangement that invoh-ed selling them 

tobacco at inflated values. 

Thomas Lesnak, a retired A.T.F. agent who was involved in the operation, 

dismissed suggestions that anything was done improperly. He said he could not 

discuss Big South because the Justice Department was still conducting 

investigations based on information developed during operations based at the 

warehouse. 

The arrangement began to break down in late 2012, when Mr. Thompson 

joined U.S. Tobacco as the chief financial officer. He was curious why his 

warehouse was placing so many orders for a brand of cigarette that competes 

against U.S. Tobacco. He could not get a straight answer, the company said in 

court documents. 

In March 2013, Mr. Moore picked up the phone, called Mr. Thompson and 

explained what was happening. "I did what I did because ofthe ethics of it," Mr. 

Moore said recently. "What was happening there was wrong." 

Once U.S. Tobacco discovered the bookkeeping irregularities, it reported 

them to the Justice Department, which investigates white-collar crime and 

government misconduct. Records show that the Justice Department, which 

includes the A.T.F., investigated some aspects of the case but no charges were 

filed. 

"We voted unanimously to give everything we had to the government," said 

Charlie Batten, a U.S. Tobacco board member whose family has worked the same 

North Carolina soil for generations. "We thought they would take it and run with 

it. What happened was, they've fought us tooth and nail." 

Because of the sealing order, Mr. Thompson, Mr. Batten and others are 

prohibited from discussing what happened to the money- e\·en with their own 

farmers. 

Three years into its lawsuit, U.S. Tobacco still cannot disentangle itself from 

the government. The cooperative recently told a judge that it was under 

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investigation by the Treasury Department. 

All those secret tobacco sales, it turns out, should have been taxed. And tbe 

government wants its money. 

Kitty Bennett contributed research. 

Get politics and Washington news updates via Facebook, Twitter and in the Morning 

Briefing newsletter. 

A ~.ersion of this article appears in print on February 23. 2017. on Page A1 of the New York edition with the 

headline: Shadowy Cigarette Sales Filled Secret Bank Account for A.TF. 

© 2017 The New York Times Company 

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Honorable Jason Chaffetz 

Chahman 

Dear Chairman Chaffetz: 

U.S. i)epartment .Tustice 

my testimony before the Committee on March 9, 2017, you observed that you've 

enforcement say that "we don't want to waste our time on cases that won't be 

prosecuted. You asked me to provide the Committee the number of straw cases ATF 

recommended for prosecution over the past three years, and how many 

three years, A TF refencd 636 

false or oral or \\<Titten statement with 

to any fact material to sale of a firearm (Title 18 U.S.C. 922(a)(6)). 

these, 334 were It is worth noting that the increase of 

recommendations in to FY 2015 follows several years in which ATF worked 

the of Justice, the of the General, and 10 conduct a 

rigorous of policies and procedures related to trafficking straw purchase 

investigations and prosecutions. 

yon find this infmmation helpful. Please let us know if you or your staff would 

briefing of this materia!. 

Sincerely yours, 

Acting Director 

Bureau of Alcohol, Tobacco, Firearms and Explosives 

Attachment 

cc: Ranking Member Elijah Cummings 
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U.S. Department of Justice 

Bureau of Alcohol, Tobacco, Firearms and Explosives 

Office of Public and Governmental Affairs 

Legfislative Affairs Division 

March 15,2017 

Firearms Trafficking 

There is no specific Federal statute for fireanns trafficking. Most firearms trafficking cases rely 

on proving that "straw purchasers" falsified firearms transaction records to acquire firearms for 

someone else. The falsification of the Federal form- "Lying and Buying" is a criminal act. 

There are seven principal false statement violations charged in "Lying and Buying" cases. The 

decision on what to charge depends on facts, strength of evidence, and court precedent. However, 

18 USC 922(a)(6) is the violation most frequently used to prosecute straw-purchasing. Below, as 

requested, are the number of such cases over the past three years, as well as the number of those 

accepted, declined, and pending. 

FY 2014-2016, Nationwide (Percentages Rounded) 

# 

2 

3 

4 

300 

250 

200 

150 

100 

50 

0 

Code: 18 USC 922(a)(6) 2014 

Violations Referred 206 

Cases Acce ted 89 (43%) 

Cases Declined 76 (37%) 

Cases Pending 41 (20%) 

18 USC 922(a)(6) Violations 

FY 2014~2016 

254 

206 

144 

76 

40 

Referred Accepted Declined 

1112014 lil2015 2016 

70 

Pending 
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Prosecution of 

Statements Made When 

Buying Firearms 

BUREAU OF ALCOHOL, TOBACCO, FIREARMS AND EXPLOSIVES 
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DATF 

lllegal Firearms Trafficking 

There is no specific Federal charge for illegal "firearms trafficking." Most illegal firearms 

trafficking cases rely on proving that "straw purchasers" falsified firearms transaction records to 

acquire firearms for someone else. The falsification of the Federal form lying and buying- is 

the criminal act. 

"Straw Purchasing" False Statement Violations 

There are seven principal false statement violations charged in Lying and Buying Cases (hereafter 

"false statement(s)".) The decision on what to charge depends on facts, strength of evidence, and 

court precedent. 

# Code Description Sentencin~ 

1 l8USC2 Aiding and Abetting Dependent on 

underlvina offense 

2 18 USC 922(a)(6) Non-FFL Providing False or Fictitious Information to Up to 10 years 

Buy Firearms From an FFL 

3 18 USC 922(m) FFL Omitting Information From or Falsifying Up to 1 year 

Records- Penalty up to one year imprisonment 

4 18 USC 924(a)(l)(A) False statements in required records or in applying Up to 5 years 

for a license 

s !SUSC 1001 False statements -Penalty up to five years Up to 5 years 

imPrisonment 

6 26 usc 5861(1) Make/cause false entry on any NFA application or Up to 10 years 

record 

7 26 usc 7206 Fraud and false statements Up to 3 years 

Prosecution of False Statement Violations 

Chairman Chaffetz specifically asked about prosecutions under 18 USC 922(a)(6). This violation 

is most frequently used to prosecute straw-purchasing. 

FY 2007-2016, Nationwide 

# Code % of All False Statement Acceptance Declination Pending 

Charges Referred Rate Rate Rate 

1 18USC2 27% (2,446) 65% (1,601) 30% (744) 4% (101) 

2 18 USC 922(a)(6) 36% (3,259) 56% (1,839) 38% (1,232) 6% (188) 

3 18 USC 922(m) 1% (104) 49%(51) 39%(41) 12%(12)-

4 18 USC 924(a)(i)(A) 33% (2,985) 67% (1,991) 28% (833) 5% (161) 

5 18 usc 1001 4% (375) 44% (164) 49% (185) 7%(26) 

6 26 usc 5861(1) 0%(3) 0%(0) 100%(3) 0%(0) 

7 26 usc 7206 0%(6) 83% (5) 17%(1) 0%(0) 
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flATF 

FY 2007-2016, Top Ten Judicial Districts 

The prosecution of false statement violations is regionalized and aligns with known firearms 

trafficking cotTidors. The top ten judicial districts account for 5,081 (55%) of the 9,178 false 

statement violations recommended for prosecution. 

200 

180 172 

160 

140 

l20 

100 

80 

60 

40 

20 

Top Ten Judicial Districts for Prosecution By Cases 

FY 2007 through FY 2016 

164 164 

120 110 

93 82 77 70 

Sentencing 

Of the 9,178 violations, 1,167 have thus far resulted in a sentence to prison for an average 

period of 67 months 

An additional 598 have resulted in a sentence to probation for an average of 50 months 

ATF Recommendation of False Statement Violations for Prosecution 

1600 

1400 

1200 

1000 

800 

500 

400 

200 

2007 

Count of All False Statement Related Violations Recommended for Prosecution in 

Firearms Trafficking Investigations 

FY 2007-2016 

2008 2009 2010 2011 2012 2013 2014 2015 2016 
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DATF 

• Reduction innamber of charges recommended for prosecution (2011-2015 ), post Fast and 

Furious 

The number of charges recommended for prosecution for false statement violations has declined 

steadily since Fiscal Year 2011. Between 2011 and 2015, ATF, working in conjunction with the 

Department of Justice, the Office of the Inspector General, and Congress conducted a rigorous 

review of A TF policies and procedures related to firearms trafficking and straw purchase 

investigations. During this review, investigative activity in these areas dropped significantly while 

policy revisions were developed and implemented, Concurrently, ATF began to pursue and track 

firearms interdiction (see Firearms Interdiction Section). 

• Increase in number of charges recommended for prosecution (20 I 6- ) 

In 2016, there was a 54% increase in recommendations for prosecution of false statement 

violations compared to FY 2015. This increase comes around the time that OIG reported ATF's 

progress in closing all of their recommendations from the Fast and Furious review. 

A review of our new strategic plan and its supporting vision, mission, and value statements clearly 

sets fot1h our goals to put public safety first and documents a continued focus on illegal firearms 

trafficking and violent gun crime as our top priority, 

One of the most substantive changes to ATF policy and practice was placing fireanns 

interdiction!deten·ence as a top priority, The revised weapons transfer policy was issued in 

November 20 II: 
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DATF 

"When an agent has a legal basis to make an arrest or seize the firearm, the agent, 

considering primarily public and officer safety, must take all reasonable steps to prevent 

the firearm's criminal misuse by: (I) intervening to stop the transfer (if the transfer has not 

yet occurred); (2) arresting the suspect; (3) taking the firearm into law enforcement 

custody; andfor ( 4) conducting continuous on-site physical surveillance to identify 

additional suspects or locations before taking enforcement action. If continuous on-site 

physical surveillance is used, such surveillance may not cease until enforcement action is 

taken." 

As part of this effott, ATF began tracking interdiction and deterrence actions in mid-2012 

(instances where ATF disrupted or stopped the transfer of firearms to protect public safety, even 

if it meant foregoing a viable criminal prosecution). Since then: 

-220 firearms trafficking cases/year have been terminated with an interdiction or 

deterrence action in order to protect public safety by actively preventing fireatms from 

moving into the illegal market place. 

In FY 2016, interdiction and deterrence actions were taken in 3, 161 firearms-related cases. 

False Statement Violations with Other Violations 

FY 2007-2016 

False statement offenses frequently involve other criminal conduct. Over the past lO years, 2,810 

cases with a total of I 0,574 involved defendants recommended for prosecution contained an 

allegation of a false statement(s) having been made by one or more of the defendants. Of the 

10,574 defendants, 6,181 defendants were charged with 8,460 false statement violations. Of the 

6,181 defendants charged with false statements, 3,914 were accepted for prosecution on a false 

statements charge, 

Defendants in Cases Alleging False Statement Violations 

Total Defendants Defendants Defendants Defendants Defendants Defendants Defendants 

Defe.ndants Charged Accepted Charged Accepted Charged Accepted Accepted With False for False with Other for Other with Both for Both for Other in Statements Statements Than False Violations Lieu of Statements False 

Statements 

10,574 6,181 3,914 8,725 6,224 6,865 4,474 294 

The scope of the criminality associated with false statement violations is illustrated by the 

following list of the top 20 violations charged in the 2,810 cases that alleged a false statement 

violation. 
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Top 20 Violations Charged In Cases Alleging a False Statements Violation 

Statute Charge Description Total 

18 usc 371 Conspiracy to commit offense against U.S. 3,554 

18 USC 922(a)(6) I Falsified information when buying firearms 2,935 

18 USC 924(a)(l)(A) I Cause FFL to falsify records 2,759 

18 usc (2) Aiding and Abetting 2,297 

21 USC 841(a)(1) Mfg., distribute, or possess controlled substance 1,738 

I Possession of firearm/ammunition by convicted 

18 usc 922(g)(1) felon 1,719 

21 usc 846 Drug Conspiracy 1,370 

18 USC 922(a)(l)(A) Dealing firearms without license 903 

18 USC 924(c) Use of firearm in Federal drug/violent crime 738 

18 usc 554 Smuggling goods from the United States 495 

18 usc 922(j) Possession of stolen firearm 435 

NARCOTICS (FEDERAL OR 

STATE) Narcotics (Federal or State) 425 

OTHER GENERAL 

CHARGES Other General Charges 411 

18 usc 922(d)(1) Sale of firearms to felon or person under indictment 404 

18 usc 922(g)(3) Possession of firearm by drug user 372 

FIREARMS OTHER Firearms Other 369 

!8 usc !001 False statement 365 

!8 USC 922(a)(5) Transfer firearm to out-of-state resident 291 

Receive/possess NFA firearm not registered in 

26 usc 586l(d) NFRTR 267 

18 USC 924(o) Conspire to Commit an offense under 924( c) 259 

The overwhelming majority of the criminal activity involving false statements recommended for 

prosecution involves individual actors attempting to or acquiring firearms. There are only 104 

instances over the past 10 years where A TF has recommended that an FFL be prosecuted for 

falsifying or omitting required information from their records. Not surprisingly, given the 

extensive vetting process associated with the registration and transfer of NFA weapons, there are 

only nine instances in the past I 0 years where false statements have been alleged in connection 

with NFA weapons. 
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Prosecution of False 

Statements Made When 

Buying Firearms 

BUREAU OF ALCOHOL, TOBACCO, FIREARMS AND EXPLOSIVES 
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l'&.ATF. 

Illegal Firearms Trafficking 

There is no specific Federal charge for illegal "firearms trafficking." Most illegal firearms 

trafficking cases rely on proving that "straw purchasers" falsified firearms transaction records to 

acquire firearms for someone else. The falsification of the Federal form lying and buying is 

the criminal act. 

"Straw Purchasing"- False Statement Violations 

There are seven principal false statement violations charged in Lying and Buying Cases (hereafter 

"false statement(s)".) The decision on what to charge depends on facts, strength of evidence, and 

court precedent. 

# Code Descrintion Sentencinf! 

1 18USC2 Aiding and Abetting Dependent on 

underlving offense 

2 18 USC 922(a)(6) Non-FFL Providing False or Fictitious Information to Up to 10 years 

Buy Firearms From an FFL 

3 18 USC 922(m) FFL Omitting Information From or Falsifying Up to 1 year 

Records -Penalty up to one vear imorisonment 

4 18 USC 924(a)(I)(A) False statements in required records or in applying Up to 5 years 

for a license 

5 18 usc 1001 False statements - Penalty up to five years Up to 5 years 

imprisonment 

6 26 usc 5861(1) Make/cause false entry on any NF A application or Up to 10 years 

record 

7 26 usc 7206 Fraud and false statements Uo to 3 vears 

Prosecution of False Statement Violations 

Chairman Chaffetz specifically asked about prosecutions under 18 USC 922(a)(6). This violation 

is most frequently used to prosecute straw-purchasing. 

FY 2007-2016, Nationwide 

II Code % of All False Statement Acceptance I Declination Pending 

Charges Referred Rate I Rate Rate 

1 18 usc 2 27% (2,446) 65%(1,601) 130% (744) 4% (101) 

2 !S'usc 922(a)(6l 36% (3,259) 56% (1,839) ' 38% (1,232) 6% (188) 

3 18 USC 922(m) 1% (104) 499'c (51) 39% (41) 12%(12) 

4 18 USC 924(a)(l )(A) 33% (2,985) 67%(1,991) 28% (833) 5% (161) 

5 18 usc 1001 4% (375) 44%(164) '49% (185) 7% (26) 

6 26 usc 5861 (I) 0%(3) 0% (0) 100% (3) 0% (0) 

7 26 usc 7206 0%(6) 83%(5) 17% (I) 0% (0) 
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DATF 

FY 2007-2016, Top Ten Judicial Districts 

The prosecution of false statement violations is regionalized and aligns with known firearms 

trafficking corridors. The top ten judicial districts account for 5,081 (55%) of the 9,178 false 

statement violations recommended for prosecution. 

200 

180 

160 

140 

120 

100 

80 

60 

40 

20 

172 

Top Ten Judicial Districts for Prosecution By Cases 

FY 2007 through FY 2016 

164 164 

65 

Sentencing 

Of the 9,178 violations, 1,!67 have thus far resulted in a sentence to prison for an average 

period of 67 months 

• An additional 598 have resulted in a sentence to probation for an average of 50 months 

ATI<' Recommendation of False Statement Violations for Prosecution 

1600 

1400 

1200 

1000 

800 

600 

400 

Count of All False Statement Related Violations Recommended for Prosecution in 

Firearms Trafficking Investigations 

FY 2007-2016 

1508 

1099 1120 

892 

823 

609 

378 

2007 2008 2009 2010 2011 2011 2013 2014 2015 

582 

2016 
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Reduction in 1wmber of charges recommendedfor prosecution (2011-2015 ), post Fast and 

Furious 

The number of charges recommended for prosecution for false statement violations has declined 

steadily since Fiscal Year 2011. Between 20!1 and 2015, ATF, working in conjunction with the 

Department of Justice, the Office of the Inspector General, and Congress conducted a rigorous 

review of ATF policies and procedures related to firearms trafficking and straw purchase 

investigations. During review, investigative activity in these areas dropped significantly while 

policy revisions were developed and implemented. Concurrently, A TF began to pursue and track 

firearms interdiction (see Firearms Interdiction Section), 

Increase in number af clwrges recommended for prosecution (2016-) 

In 20!6, there was a 54% increase in recommendations for prosecution of false statement 

violations compared to FY 2015. This increase comes around the time that OIG reported ATF's 

progress in closing all of their recommendations from the Fast and Furious review. 

A review of our new strategic plan and its supporting vision, mission, and value statements clearly 

sets forth our goals to put public safety first and documents a continued focus on illegal firearms 

trafficking and violent gun crime as our top priority. 

One of the most substantive changes to A TF policy and practice was placing firearms 

interdiction/deterrence a top priority. The revised weapons transfer policy was issued in 

November 2011: 
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DATF 

-...;;;;;;::: 

!'o.o•""''~~n"P..~u< 

$., .. ,,...o~.:s.,~·~ 

"When an agent has a legal basis to make an arrest or seize the firearm, the agent, 

considering primarily public and officer safety, must take all reasonable steps to prevent 

the firearm's criminal misuse by: (1) intervening to stop the transfer (if the transfer has not 

yet occurred); (2) arresting the suspect; (3) taking the firearm into law enforcement 

custody; and/or (4) conducting continuous on-site physical surveillance to identify 

additional suspects or locations before taking enforcement action. If continuous on-site 

physical surveillance is used, such surveillance may not cease until enforcement action is 

taken." 

As part of this effort, ATF began tracking interdiction and deterrence actions in mid-2012 

(instances where ATF disrupted or stopped the transfer of firearms to protect public safety, even 

if it meant foregoing a viable criminal prosecution). Since then: 

• -220 firearms trafficking cases/year have been terminated with an interdiction or 

deterrence action in order to protect public safety by actively preventing firearms from 

moving into the illegal market place. 

• In FY 2016, interdiction and deterrence actions were taken in 3,161 firearms-related cases. 

False Statement Violations with Other Violations 

FY 2007-2016 

False statement offenses frequently involve other criminal conduct. Over the past 10 years, 2,810 

cases with a total of 10,574 involved defendants recommended for prosecution contained an 

allegation of a false statement(s) having been made by one or more of the defendants. Of the 

10,574 defendants, 6,181 defendants were charged with 8,460 false statement violations. Of the 

6,181 defendants charged with false statements, 3,914 were accepted for prosecution on a false 

statements charge. 

Defendants in Cases Alleging False Statement Violations Total Defendants Defendants Defendants Defendants Defendants Defendants Defendants 

Defendants Charged Accepted Charged Accepted Charged Accepted Accepted 

With False for False with Other for Other with Both for Both for Other in 

I 

Statements Statements Than False Violations Lieu of 

Statements False 

Statements 

10,574 6,181 3,914 8,725 6,224 6,865 4474 294 

The scope of the criminality associated with false statement violations is illustrated by the 

following list of the top 20 violations charged in the 2,810 cases that alleged a false statement 

violation. 
80 

Æ 


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t"'ATF 

Top 20 Violations Charged in Cases Alleging a False Statements Violation 

Statute Charge Description Total 

18 usc 371 Conspiracy to commit offense against U.S. 3,554 

18 USC 922(a)(6) Falsified information when buying firearms 2,935 

18 USC 924(a)(l)(A) Cause FFL to falsify records 2,759 

18 usc (2) Aiding and Abetting I 2,297 

~-usc 84l(a)(ll Mfg., distribute, or possess controlled substance 1,73~-

Possession of firearm/ammunition by convicted 

18 usc 922(g)(l) felon 1,719 

21 usc 846 Drug Conspiracy 1,370 

18 USC 922(a)(l)(A) Dealing firearms without license 903 

18 USC 924(c) Use of firearm in Federal drug/violent crime 738 

18 usc 554 Smuggling goods from the United States 495 

18 USC922(j) Possession of stolen fireatm 435 

NARCOTICS (FEDERAL OR 

STATE) Narcotics (Federal or State) 425 

OTHER """'"o A r I 

CHARGES Other General Charges 411 

18 usc 922(d)(1) _ -~al(!_()f fi!<!_ll_flTI_!_t()_f~lon or person under indictll!~ 404 

18 usc 922(g)(3) Possession of firearm by dmg user ~7z- FIREARMS OTHER Firearms Other 369 

18 usc 1001 False statement 365 

18 USC 922(a)(5) Transfer firearm to out-of-state resident 291 

Receive/possess NFA firearm not registered in 

26 usc 586l(d) NFRTR 267 

18 USC 924(o) Conspire to Commit an offense under 924( c) 259 

The overwhelming majority of the criminal activity involving false statements recommended for 

prosecution involves individual actors attempting to or acquiring firearms. There are only 104 

instances over the past I 0 years where A TF has recommended that an FFL be prosecuted for 

falsifying or omitting required infommtion from their records. Not surprisingly, given the 

extensive vetting process associated with the registration and transfer of NFA weapons, there are 

only nine instances in the past 10 years where false statements have been alleged in connection 

with NFA weapons.