AUDIT RESULTS

personnel, targeting methodologies, examination methods, use of
technology, examination standards, and posting of results. A
minimum of 20 percent of cargo must be physically examined to
record an inspection as a narcotic enforcement examination. This
type of examination requires x-raying or opening packing containers
and/or removal of contents for handling, viewing or weighing. Ports
with non-intrusive inspection systems can use these systems in lieu
of, or in combination with the off-loading of cargo to meet the

20 percent requirement.

The OIG believes that proper use of the new Narcotics Interdiction
Guide will satisfy the intent of the recommendation. The use of x-
ray equipment in cargo examinations is considered acceptable if
equipment suitable to the task is used. Some non-intrusive inspection
systems are designed for, and capable of examining only empty
containers. These systems, therefore, would not be adequate for
examining cargo within containers.

Customs management agreed with recommendation 6 and stated that
each port was encouraged to designate a Hazardous Materials
Coordinator, and a Tools and Technology Coordinator to be
responsible for maintenance, training, proper utilization, and
inventory accountability associated with the various pieces of
examination equipment. Oversight is tracked via a five point self-
examination document and blanket purchase order agreements have
been issued for the centralized collection, repair and return of broken
devices. Also, the Applied Technology Division and ASD jointly
cooperate with a contractor who is developing performance measures
and tracking the success of narcotics examinations.

The OIG believes that these actions, along with those indicated in
response to recommendation 5, will satisfy the intent of this
recommendation.

OIG-00-066 CUSTOMS’ AUTOMATED COMMERCIAL SYSTEM
CARGO SELECTIVITY Page 13


MAJOR CONTRIBUTORS TO THE REPORT

Appendix 3

Charles Mataya, Director, Program Audits
Kenneth W. Coleman, Audit Manager
Robert F. Edwards, Auditor-in-Charge
Clara J. Veal, Auditor

Linda J. Howarton, Auditor

Gene Wendt, Audit Referencer

OIG-00-066 CUSTOMS’ AUTOMATED COMMERCIAL SYSTEM

CARGO SELECTIVITY

Page 30


AUDIT RESULTS

Management Response and OIG Comment

Customs management agreed and initiated corrective actions that will
meet the intent of our recommendations. Concerning the first
recommendation, Customs stated that a Manifest Review Unit
Handbook, dated August, 1999, gives sole responsibility for ACS
cargo selectivity criteria to the OAS and makes criteria effectiveness
and management a priority. Workshops were held at a national
conference in June, 1999 which addressed the role of OAS in trade
compliance and anti-smuggling. A new directive for OAS was
prepared and will be issued upon completion of an extensive
assessment of the future role of OAS which commenced on
November 1, 1999.

In response to the second recommendation, Customs stated that a
two-week formal training program for OAS analysts responsible for
narcotics criteria was developed at the U.S. Customs Service
Academy. A total of four classes are scheduled for FY 2000. For
field inspectors, three other training sessions are provided. First, it
is an integral part of the Inspectors Course. Second, it has been
incorporated into the six day Targeting and Examination Technology
Training Course. Third, it has been incorporated into the six day
Southern Border Interdiction Training Course. For the purpose of
tracking the accuracy of reporting narcotics examination statistics,
OFO developed and implemented the program Managing OMR Data
Quality (Customs Directive 4320-024) dated June 3, 1999.

Regarding the third recommendation, Customs stated that the
exchange of information between Office of Investigations (OI) and
OFO disciplines is accomplished through ICATs which are guided by
national standard operating procedures. ICATs are comprised of
Special Agents, Inspectors, Intelligence Analysts and other state and
federal law enforcement representatives dedicated to the collection,
utilization, dissemination and sharing of tactical and operational
intelligence.

OIG-00-066 CUSTOMS’ AUTOMATED COMMERCIAL SYSTEM
CARGO SELECTIVITY Page 7


AUDIT RESULTS

Details
Performance Measures

Customs has traditionally measured the effectiveness of drug
interdiction efforts by the number of arrests and seizures. Using
these measures, the absence of seizures resulting from the use of
ACS Cargo Selectivity narcotics criteria suggests that this system, as
currently implemented, may be an ineffective targeting tool.
Traditional methods, however, track only seizure activity and
increases or decreases in seizures do not necessarily measure the
entire success of a program. It could also mean that the amount of
smuggling has increased or decreased significantly. Other factors
that could have an impact on the effectiveness of ACS Cargo
Selectivity include the strength of the narcotics threat, the quality of
examination criteria and thoroughness of examinations. performed,
the availability of experienced inspectors to perform examinations,
and the excessive use of examination overrides.

Although Customs intelligence indicated there was a strong narcotics
threat in commercial cargo, there were just two seizures credited to
using ACS Cargo Selectivity targeting during the period under
review. Officials could not determine the exact cause for the lack of
seizure results, but speculated it could be due to the frequency of
homogeneous shipments, lack of good intelligence, sharing of
information, and seasonal shipments. This range of possibilities is
too broad to specifically determine if results reflect poor performance
or inadequate performance measures.

Management Controls

Management control reviews performed at two ports did not include
sufficient review controls over ACS Cargo Selectivity. Operational
controls needed to be added for the physical processing of cargo and
the overriding of examination criteria. These controls were not
developed and implemented in one of the ports because of the time
and effort required, and a lack of management emphasis. At the
other port, management stated they used Operational Management

OIG-00-066 CUSTOMS’ AUTOMATED COMMERCIAL SYSTEM
CARGO SELECTIVITY Page 17


EXECUTIVE DIGEST

Recommendations

Act) requires new effectiveness measures for Customs’ drug
enforcement strategy.

Periodic management reviews did not provide sufficient
coverage to identify operational weaknesses in the ACS Cargo
Selectivity Program. Reviews did not include controls over
the use of examination overrides or the physical processing of
cargo. Weaknesses in these areas can undermine the
effectiveness of targeting efforts, and allow fraudulent
activities to go undetected.

The ATS was being tested in Laredo to determine the
effectiveness of the system as designed, and whether it should
be expanded to other land border ports. However, we found
that the present practice of annually rotating inspectors
reduced the effectiveness of the system, since it was based on
inspector knowledge. During our field work we also found
that the General Accounting Office recommended and
Customs agreed to suspend use of the 3T System, due to a
lack of reliable information and its cumbersome workload.

We have made eight recommendations on issues that include
the development of narcotics examination criteria, the
improvement of examination procedures, the implementation
of management controls, and the effectiveness of the ATS.
Three of the recommendations address procedures needed to
implement national guidelines for handling ACS Cargo
Selectivity narcotics examination criteria; training needed to
maintain data analysis and research proficiency; and, the
sharing of proactively developed intelligence between
disciplines. The other five recommendations address the
excessive use of examination overrides; the following of
established examination and reporting guidelines; the

OIG-00-066 CUSTOMS’ AUTOMATED COMMERCIAL SYSTEM

CARGO SELECTIVITY Page iii


Appendix 2

MANAGEMENT RESPONSE

off-loading cargo. If cargo is off-loaded and NII systems are used, the “20%”
requirement may be met by combining the opening of boxes with the use of these
systems. For ports without NII systems, the “20%” requirement is met by off-loading
and examining 20% of the cargo.

Headquarters guidance for the recording of “NRAY” in the devan file was provided to all
CMC Enforcement Coordinators via cc:mail dated October 1, 1999.

Recommendation 6:

The Assistant Commissioner, Office of Field Operations, should require that
management procedures are in place to review the performance of intensive narcotics
examinations, and ensure that hazardous material equipment is maintained, repaired, or
replaced as necessary.

Response:

We agree with this recommendation and have taken the following actions to ensure it is
properly implemented.

Page 8 of the Narcotics Interdiction Guide provides specific guidance that examination
of hazardous material shipments be performed In Accordance With (IAW) the
Hazardous Cargo Plan (Customs Directive 5290-008). Each port was encouraged to
designate a Hazardous Material Coordinator who, in turn, is encouraged to negotiate
cooperative agreements with local fire departments and hazardous response teams.

Page 9 of the Narcotics Interdiction Guide instructs Port Directors to designate a Senior
Inspector as a Tools and Technology Coordinator. This person, reporting to the CET
chief and Port Director, is responsible for the maintenance, training, proper utilization,
and inventory accountability associated with the various pieces of examination
equipment in their port. Headquarters oversight for tools and technology used in
examinations is now tracked via a 5 point self-inspection document. In support of the
Office of Field Operations, the Applied Technology Division has signed blanket
purchase order agreements for the centralized collection, repair, and return of broken
hand held detection devices.

The Applied Technology Division and the ASD jointly cooperate with a contractor who is
developing performance measures and tracking the success of narcotics examinations
with emphasis on the utilization rates of all NII systems as well as hand held tools.

Recommendation 7:

The Assistant Commissioner, Office of Field Operations, should ensure that
management control reviews are performed at the port level, and include procedures for
processing cargo through ACS Cargo Selectivity and the performance of narcotics
enforcement and hazardous material examinations.

OIG-00-066 CUSTOMS’ AUTOMATED COMMERCIAL SYSTEM
CARGO SELECTIVITY Page 28


AUDIT RESULTS

Details

Cargo Examination Procedures

During observations of inspectors in the performance of 12 narcotics
intensive examinations, we found 6 of 12 examinations had the
following 11 errors:

e Twice inspectors relied on the use of canines rather than
performing thorough examinations. An intensive narcotics
examination, as defined by Customs, includes a physical inspection
of at least 20 percent of the cargo. During the first examination, the
inspector opened only 1 of 1,074 boxes of hospital supplies, stating
that the other containers would be examined thoroughly only if there
was a canine alert on the containers. However, the inspector
reported in the Devan File that a 100 percent narcotics examination
was performed. During the second examination, the inspector did
not inspect any of the 22 bags of industrial paper and plastic waste
because the canine team was not alerted to them, and the importer
had a prior good record.

e Three times inspectors examined amounts significantly less
than the required 20 percent. During one examination, 39 of 2073
or less than 2 percent of the cartons of toys were opened or x-rayed,
yet the inspector reported that a 75 percent narcotics examination was
performed. During another examination, 7 of 1,224 or less than

1 percent of boxes of lighters and pens were opened and examined.
In this case, a 60 percent narcotics examination was reported as
having been performed. During the third examination, 26 of 308, or
slightly more than 8.4 percent of the boxes of electrical components
were opened and examined. Although the correct number of items
examined was reported, this was also short of the 20 percent
examination requirement for a narcotics examination.

OIG-00-066 CUSTOMS’ AUTOMATED COMMERCIAL SYSTEM

CARGO SELECTIVITY Page 14


AUDIT RESULTS

Details

In concurrence with a recent General Accounting Office
recommendation which was included in the report
GAO/GGD-98-175, Low-Risk Cargo Entry Program, dated

July 1998, Customs was evaluating the effectiveness of the ATS at
the Port of Laredo. They also planned to collect data on the other
southwest border ports of entry to determine the feasibility of
deployment to those ports. Customs viewed the system as having
been successful, with the identification of three shipments of
marijuana totaling more than 5,000 pounds. However, there is a
question as to whether the success of the ATS will continue to
improve without properly trained and experienced personnel working
the system. An obstacle to be overcome was that Customs and the
National Treasury Employees Union (NTEU) had a practice in place
of annually rotating inspectors. This policy made formal training
impractical, and job training manuals and trial-and-error learning
were the only training aids available.

NTEU and Customs management were working on a solution to the
frequent rotation problem. One possibility was to place ATS
personnel under the responsibility of the CET which would extend
the rotation period, but this must be negotiated. At the very least,
when rotations occur, they will be staggered so that there will always
be an experienced analyst on hand.

OIG-00-066 CUSTOMS’ AUTOMATED COMMERCIAL SYSTEM

CARGO SELECTIVITY Page 20


AUDIT RESULTS

Finding 4.

Recommendation

Better Performance Measures and Management
Control Reviews Were Needed

Better performance measures were necessary to determine the impact
of poor targeting criteria, examination procedures, and threat
assessments on the low seizure rate. However, officials have already
recognized this need and were developing new measures of
effectiveness for their drug enforcement strategy. In addition, the
Results Act requires every major federal agency to set strategic
goals, measure performance, and report on accomplishments. In
addition, two ports needed to add operational controls over the
processing of cargo through ACS Cargo Selectivity.

7. The Assistant Commissioner, Office of Field Operations,
should ensure that management control reviews are performed
at the port level, and include procedures for processing cargo
through ACS Cargo Selectivity and the performance of
narcotics enforcement and hazardous material examinations.

Management Response and OIG Comment

Customs management agreed with the recommendation. Customs is
in the process of enhancing criteria management through new
handbooks and a general assessment of the OAS. Customs also
recognizes the need for management controls over cargo selectivity
processing and examination. Recently created self-inspection
worksheets monitor the development and maintenance of selectivity
criteria and for monitoring overrides. Similar worksheets for
ensuring the proper performance of cargo, narcotics, and hazardous
materials examinations will be implemented in time for the next cycle
of self-inspections.

The OIG believes that implementation of the actions indicated will
satisfy the intent of the recommendation.

OIG-00-066 CUSTOMS’ AUTOMATED COMMERCIAL SYSTEM

CARGO SELECTIVITY Page 16


Appendix 2

MANAGEMENT RESPONSE

Response:

We agree with this recommendation and have taken the following actions to ensure it is
properly implemented.

As noted in our response to Recommendation 1, the U.S. Customs Service is in the
process of enhancing criteria management through new handbooks and a general
assessment of the OAS. These actions, along with our regular review of criteria
effectiveness, should promote better targeting for improved cargo and narcotics
enforcement.

The U.S. Customs Service also recognizes the need for management controls that
ensure adherence to procedures for processing cargo through selectivity and
performing examinations. In that regard, recently created self-inspection worksheets
now monitor each port's development and maintenance of selectivity criteria.
Regarding management controls for examination, self-inspection worksheets already
exist for monitoring overrides, and similar worksheets for ensuring the proper
performance of cargo, narcotics, and hazmat examinations will be implemented in time
for the next cycle of self-inspections.

Recommendation 8:

The Assistant Commissioner, Office of Field Operations, should ensure that
management continues to work with the National Treasury Employees Union (NTEU)
until the rotation problem adversely effecting the Automated Targeting System is
resolved.

Response:
We agree with this recommendation.

Since the drafting of this OIG audit, the issue of staffing the Automated Targeting
System (ATS) in Laredo, Texas has been resolved. Port management and the NTEU
reached an agreement whereby no less than 50% of the ATS team is retained each
cycle to ensure continuity of the operation. In other ports where ATS has subsequently
been deployed, those Inspectors were assigned to CET, and are covered by rotation
policies negotiated in the national CET Directive.

OIG-00-066 CUSTOMS’ AUTOMATED COMMERCIAL SYSTEM
CARGO SELECTIVITY Page 29


AUDIT RESULTS

examination criteria. Each time a high risk shipment is chosen for
intensive examination but is unnecessarily overridden through
inspectional error or clerical mistake, the purpose of selective
targeting is undermined. Further, this should raise questions as to
whether the system is being compromised. A major risk in avoiding
examinations through unnecessary overrides is that overrides could
mask deliberate fraud and abuse, allowing undetected narcotic
shipments to pass through border ports. We recognize that there are
valid reasons for overriding examination criteria, such as the release
of shipments without performance of required examinations due to an
inoperative system or unforeseen problems. These actions, however,
should always be properly documented and reviewed in order to
prevent abuses.

We reviewed operating logs used for documenting examination
overrides. We found 607 examinations that were downgraded from
intensive to general, or overridden and not performed. Of this total,
66 examinations, or 10.9 percent were unnecessarily avoided due to
inspector errors or clerical mistakes. However, the number of
examinations avoided may have been as high as 168, or 27.6 percent.
The actual amount could not be determined because reasons for the
overrides were not clearly or properly stated in the override logs.

Specifically, 102 examination overrides were coded “other,”
meaning the reasons for the overrides were not covered by any of the
specific codes listed in the override logs. Customs managers said
that uses of this code in these instances were not acceptable, since
descriptive codes were available and should have been used. This
practice defeats the purpose of coding as a management tool to
ensure that the override process is used only when absolutely
necessary. Management cannot determine exactly why examinations
are not performed when inaccurate or nebulous coding is used.

OIG-00-066 CUSTOMS’ AUTOMATED COMMERCIAL SYSTEM
CARGO SELECTIVITY Page 11


BACKGROUND

While personnel from these two teams focus on proactive
intelligence collection, OAS personnel perform a reactive type
of post seizure analysis. Their duties extend to developing,
creating, and maintaining criteria for ACS Cargo and Entry
Summary Selectivity as well as other automated processes
within ACS, such as the Automated Manifest System and the
Automated Export System. They also maintain the
Compliance Measurement Program in addition to performing
research and analysis for targeting narcotics in most ports.
The work of each of these persons requires skill with personal
computers and mainframe applications.

The effectiveness of the ACS Cargo Selectivity System
depends on proper performance of examinations and accurate
reporting of results. Feedback of this nature is needed to
either validate the accuracy of the established criteria or
provide a basis for developing future criteria. Narcotics
examinations involve conducting thorough inspections and
physical examinations of vehicles and cargo. Customs defines
physical cargo examination as either x-raying cargo or
opening packing containers and removal of contents for
handling, viewing, counting, and weighing. Examinations
should include physical inspection of at least 20 percent of
cargo, and observation of the conveyance interior and
exterior. A canine team should be used whenever available,
but should not be a substitute for thorough examination.
Available tools and technology, such as probes, drills, x-rays,
and scales, should be used. Site supervisors are responsible
for ensuring that all examinations are properly conducted and
accurately recorded in the Devan! files of ACS, which
provide a means of tracking performance of examinations.

' Devan file - provides an ACS means of tracking cargo examinations and results associated with a particular

consignee, broker, or other entity.

OIG-00-066 CUSTOMS’ AUTOMATED COMMERCIAL SYSTEM

CARGO SELECTIVITY Page 3


Appendix 2

MANAGEMENT RESPONSE

Response:

We agree with this recommendation and have taken the following actions to ensure it is
properly implemented.

The exchange of information between various disciplines in Ol and OFO is
accomplished through Intelligence Collection Analysis Teams (ICAT) which are guided
by a national SOP. The ICAT intelligence program focuses on the following major
components:

4) Targeting contraband and alien smuggling at the Ports of Entry (POE) via
commercial and private transportation, (i.e. maritime vessels, vehicles,
tractor trailers, cargo, railroad, aircraft and pedestrians).

2) Actionable, tactical and operational intelligence collection, analysis and
dissemination focused on drug transportation organizations, alien
smuggling groups, document fraud and the illegal movement of stolen
vehicles and firearms.

3) Specialized investigative support and investigative leads.

Located at strategic POEs, the ICAT groups are required to be highly mobile,
aggressive intelligence field units dedicated to the collection, utilization, dissemination
and sharing of tactical and operational intelligence. The ICATs will closely monitor
changes in the nature and location of the smuggling threat at our borders and will focus
on criminal organizations operating in and around the POEs. ICATs are comprised of
Special Agents, Inspectors, Intelligence Analysts, and other state and federal law
enforcement representatives.

Recommendation 4:
The Assistant Commissioner, Office of Field Operations, should instruct Port Directors

to establish procedures ensuring that reasons for overriding intensive cargo
examinations are properly documented and reviewed.

Response:

We agree with this recommendation and have taken the following actions to ensure it is
properly implemented.

The U.S. Customs Service recognizes the need for established procedures for
overriding intensive cargo examinations. A work group is scheduled for January 2000,
with the goal of developing a new “Cargo Release Handbook". This work group will
focus on establishing practices and procedures regarding cargo release with a special
emphasis on developing a uniform policy for overriding intensive cargo examinations.

OIG-00-066 CUSTOMS’ AUTOMATED COMMERCIAL SYSTEM
CARGO SELECTIVITY Page 26


Appendix 2

MANAGEMENT RESPONSE

DEPARTMENT OF THE TREASURY
él A) U.S. CUSTOMS SERVICE

DATE: Nov 19

FILE: AUD-1-OP BAB

MEMORANDUM FOR DENNIS SCHINDEL
ASSISTANT INSPECTOR GENERAL

FROM: Director, Office of Planning

SUBJECT: Automated Commercial System Cargo Selectivity

Thank you for providing us with a copy of your draft report entitled “Automated
Commercial System Cargo Selectivity” and the opportunity to discuss the issues in this
report. Customs has taken a number of steps to address the issues identified during
your review. These steps, and additional on-going actions, are outlined in the attached

document, as are Customs comments on this draft report.

We have determined that the information in the audit does not warrant protection under
the Freedom of Information Act.

If you have any questions regarding the attached comments, please have a member of
your staff contact Ms. Brenda Brockman at (202)927-1507.

Attachment

eres SY Deere evn Opporinty Employer

OIG-00-066 CUSTOMS’ AUTOMATED COMMERCIAL SYSTEM
CARGO SELECTIVITY Page 23


TABLE OF CONTENTS

EXECUTIVE DIGEST.. i
BACKGROUND 0.0.0.0 eee eects c cert ese teeeeeteenierneetenseeneenses 1
OBJECTIVE, SCOPE, AND METHODOLOGY .......000000.. eee 5
AUDIT RESULTS 000000... cece ee eee ene cneeeenreenretirteneeteeneeene 6
Finding 1. Development of Narcotics Criteria Needed Improvement .......... 6
Finding 2. Use of Examination Overrides Was Excessive................0005085 10

Finding 3. Established Examination and Reporting Guidelines Were Not

B50) | C0) (en 12
Finding 4. Better Performance Measures and Management Control Reviews
Were Needed «2.22.0... ..eeccceeeeceeeeeeeeeeeee nese eeseeneseeeeeeeneeeenees 16

Finding 5. The Automated Targeting System Was Being Evaluated...

Other Issues. The 3T Program Has Been Suspended ..................2:.:sseeeeeeees 21

APPENDICES
Appendix 1. Abbreviations
Appendix 2. Management Response .....
Appendix 3. Major Contributors to This Report
Appendix 4. Final Report Distribution

- 30

OIG-00-066 CUSTOMS’ AUTOMATED COMMERCIAL SYSTEM
CARGO SELECTIVITY Page v


EXECUTIVE DIGEST

improvement of hazardous material examination procedures;
better management controls; and, improvements needed to the
ATS.

Management Response and OIG Comment

Customs management agreed with our audit results and
concurred with all the recommendations. Corrective actions
have either been implemented or planned. The complete text
of Customs management response is provided in Appendix 1.

OIG-00-066 CUSTOMS’ AUTOMATED COMMERCIAL SYSTEM
CARGO SELECTIVITY Page iv


AUDIT RESULTS

Finding 3. Established Examination and Reporting Guidelines
Were Not Followed

At the four ports we visited, we found examination and reporting
guidelines were not followed, and improvement of both cargo and
hazardous materials (HAZMAT) examination procedures were
needed. Inspectors relied on the use of canines rather than performing
thorough examinations, failed to properly inspect trucks, and inspected
significantly less cargo than the 20 percent required for narcotics
examinations. Also, narcotics examinations were improperly reported,
and equipment needed for HAZMAT examination was in need of
maintenance, repair, or replacement. As a result, Customs had limited
assurance that contraband and narcotics did not bypass Customs

scrutiny.
Recommendations
5. The Assistant Commissioner, Office of Field Operations,

should require that Port Directors issue local standard
operating procedures, using the Customs Narcotics
Interdiction Guide to explain how to properly perform and
report the results of intensive narcotics examinations.

6. The Assistant Commissioner, Office of Field Operations,
should require that management procedures are in place to
review the performance of intensive narcotic examinations,
and ensure that hazardous material equipment is maintained,
repaired, or replaced as necessary.

Management Response and OIG Comment

Customs management agreed with recommendation 5 and stated that
in June, 1999 the Anti-Smuggling Division (ASD) updated and re-
issued the Narcotics Interdiction Guide to serve as a procedural
guideline for both examining inspectors and those who review the
examination results. The new guide provides guidance on
responsibilities of cargo examination teams including assignment of

OIG-00-066 CUSTOMS’ AUTOMATED COMMERCIAL SYSTEM
CARGO SELECTIVITY Page 12


BACKGROUND

The Operational Analysis Staff (OAS) creates and maintains
criteria for use in the ACS Cargo Selectivity System. They
collect, monitor, and analyze data which are essential for
effective targeting and resource management. The
effectiveness of the selectivity criteria system is based on the
premise of coordination among all Customs disciplines, such
as inspectors, import specialists, agents, OAS and intelligence
analysts, in sharing knowledge with each other. The focus of
the OAS is to facilitate the entry of legitimate cargo, while
stopping attempts at fraud, narcotics smuggling, and the
entrance of illegal cargo. Their efforts are generally split
between narcotics and commercial fraud. Input on selectivity
criteria is solicited from the employees who work in these
areas (inspectors and special agents for narcotics; import
specialists and Fines, Penalties, and Forfeitures personnel for
fraud) to enhance the success of the local programs.

The National Narcotics Operational Analysis Staff located at
John F. Kennedy Airport in New York and the port of
Newark, New Jersey is responsible for the creation and
maintenance of national narcotics criteria. Port Directors are
responsible for implementing the local narcotics criteria
program. The Assistant Commissioner, Office of Field
Operations (OFO), has policy oversight for the program at
both the local and national levels.

In addition, the Intelligence Collection Analysis Team (ICAT)
and the Cargo Analysis Research Investigative Team (CARIT)
also collect, analyze, and disseminate intelligence
information. These are multi-disciplined teams comprised of
agents, inspectors, and analysts, as well as other agency
representatives. Both teams collect intelligence that identify
smuggling techniques and trends, members of narcotic
trafficking organizations, areas of smuggling activities, and
smuggling conveyances. The CARIT also emphasizes
operations involving controlled deliveries for larger seizures
and arrests.

OIG-00-066 CUSTOMS’ AUTOMATED COMMERCIAL SYSTEM

CARGO SELECTIVITY Page 2


AUDIT RESULTS

Reports’ as their control reviews over ACS Cargo Selectivity;
however, the use was not documented. Therefore, management
could not readily determine that proper controls existed for the
program. At the conclusion of our field work, one of the Port
Management Control Coordinators provided us with a draft of the
South Texas Customs Management Center (CMC) Compliance Review
Report, Cargo Control - AU# 506-00. This document contained
compliance reviews of ACS Cargo Selectivity operations, such as
cargo entry and examinations procedures, which when implemented,
could strengthen controls over cargo operations.

In addition, narcotics and hazardous materials examinations
procedures were not included in the management control reviews
performed at any of the locations we visited. In our opinion,
periodic reviews of controls in these areas will further ensure that
ACS cargo processing operations are performed as intended.

* The Operational Management Reports (OMR) is a data warehouse personal computer application that
provides users the ability to retrieve, analyze, graph, and report selected summary data.

OIG-00-066 CUSTOMS’ AUTOMATED COMMERCIAL SYSTEM
CARGO SELECTIVITY Page 18


Audit Report on the

United States Customs Service
Automated Commercial System Cargo Selectivity

OIG-00-066 March 06, 2000

Office of Inspector General

Deed

United States Department of the Treasury



OBJECTIVE, SCOPE, AND METHODOLOGY

This is the first in a planned series of audits covering various
aspects of Operation Hard Line. Operation Hard Line is a
long-term Customs strategy to disrupt and deter narcotics
smuggling at southwest border ports via passenger vehicles
and cargo. The objective was to determine whether the ACS
Cargo Selectivity System effectively targets high risk cargo
for narcotic examinations. The audit scope focused on
activities from October 1, 1995 to September 18, 1998. The
audit work was performed at Customs headquarters in
Washington, DC, the National Narcotics Operational Analysis
Staff office in Newark, New Jersey; and the ports at El Paso
and Laredo, Texas; Otay Mesa, California; and Nogales,
Arizona.

We interviewed Customs headquarters officials and National
Narcotics Operational Analysis Staff Analysts responsible for
the ACS Cargo Selectivity System and the development of
selectivity criteria. Policies and procedures were obtained
and reviewed for the process. We reviewed local standard
operating procedures for the responsible units, and obtained
pertinent ACS reports and documentation for the audit period.
This included seizure reports, examination reports, error
reports, and internal control reviews. We interviewed local
responsible operating unit personnel. We also observed port
cargo processing and examination procedures and reviewed
data on all major targeting systems. We reviewed
effectiveness measures and management control reviews, and
evaluated the adequacy of targeting systems.

This audit was conducted in accordance with Government
Auditing Standards issued by the Comptroller General of the
United States and included such tests as were determined
necessary.

OIG-00-066 CUSTOMS’ AUTOMATED COMMERCIAL SYSTEM
CARGO SELECTIVITY Page 5


BACKGROUND

Another Customs targeting system, the Automated Targeting
System (ATS), is being tested at the port of Laredo. This
system relies on experience to identify imports that pose a
high risk of containing narcotics or other contraband. The
system standardizes’ ACS bills of lading, entry and entry
summary data, and creates shipment records. These
shipments are evaluated and scored by more than

300 weighted rules derived from methods used by
experienced personnel. The higher the score, the more the
shipment warrants attention. The system allows personnel to
conduct analyses of profile information accumulated on
shippers, carriers, and importers.

The Three Tier Targeting System (3T) system is another
major program which was implemented along the southwest
border. This is an ACS cargo stratification program which
expedites release of shipments that pose little narcotics risk,
while targeting high risk shipments for enforcement
examinations. This system stratifies shipments into three
categories depending on an analytical assessment of the
degree of risk associated with each shipment. The extent of
examination performed varies with each category. In
concurrence with General Accounting Office
recommendations issued during our fieldwork, Customs has
agreed to suspend the 3T system.

? The ATS standardizes the data it receives from the mainframe. It may change abbreviations, such as
replacing STR with ST for street. This can also resolve duplicate information, such as establishing duplicate
records for the same importer because of slight variations in name spelling.

OIG-00-066 CUSTOMS’ AUTOMATED COMMERCIAL SYSTEM

CARGO SELECTIVITY Page 4


Appendix 2
MANAGEMENT RESPONSE

Recommendation 2:

The Commissioner of Customs should direct the Office of Field Operations (OFO) to
implement an oversight program to ensure that port personnel in charge of cargo
selectivity narcotics criteria are adequately trained to maintain proficiency in data
analysis and research.

Response:

We agree with this recommendation and have taken the following actions to ensure it is
properly implemented.

In order to provide the highest level of proficiency in data analysis, the

U.S. Customs Service has created a number of training programs for ACS Cargo
Selectivity criteria management. The U.S. Customs Service Academy has created a
two-week formal training program for OAS analysts who are currently responsible for
narcotics criteria development, posting, and review. In FY 2000, a total of four classes
are scheduled at the Customs Academy (co-located at the Federal Law Enforcement
Training Center (FLETC)). For field Inspectors, three other training sessions are
provided on ACS Cargo Selectivity criteria: first, it is an integral part of the Basic
Inspector course at the Customs Academy; second, it has been incorporated into the 6
day Targeting and Examination Technology Training (TETT) course in Miami, Florida;
third, it has been incorporated into the 6 day Southern Border Interdiction Training
(SBIT) course in Laredo, Texas. The Customs Academy administers both TETT and
SBIT conducting 10 courses of each per year. Headquarters OFO, Anti-Smuggling
Division (ASD) officers work closely with Customs Academy instructors to provide
oversight, scheduling, and support for both TETT and SBIT. Approximately every two
years, a team of ASD officers, field managers, and Academy instructors meet to review
and update the TETT and SBIT course syllabus.

For the purpose of tracking the accuracy of reporting narcotics examination statistics,
the OFO Measurement Team developed a comprehensive program entitled Managing
OMR Data Quality (Customs Directive 4320-024), dated June 3, 1999. The analysis of
this data is reviewed regularly by National Data Element Owners and by field validators.

Recommendation 3:

The Commissioner of Customs should direct that the Office of Field Operations (OFO)
and the Office of Investigations (Ol) ensure that, whenever possible, proactively
developed intelligence is shared between disciplines to achieve the common goal of
interdicting drugs.

OIG-00-066 CUSTOMS’ AUTOMATED COMMERCIAL SYSTEM
CARGO SELECTIVITY Page 25


Appendix 2

MANAGEMENT RESPONSE

OIG Audit AHT-98-022
Automated Cargo System (ACS) Cargo Selectivity

Recommendation 1:

The Commissioner of Customs should direct the Office of Field Operations (OFO) to
ensure that ports establish and implement local Standard Operating Procedures (SOP)
which follow national guidelines for handling ACS Cargo Selectivity narcotics criteria.
These procedures should establish accountability for required tasks, including
developing and maintaining narcotics criteria, and submitting suggestions for improving
national narcotics criteria.

Response:

We agree with this recommendation and have taken the following actions to ensure it is
properly implemented.

The U.S. Customs Service is in the process of addressing the need for criteria
management through new handbooks and an assessment of the Operational Analysis
Staff (OAS). The “Manifest Review Units Handbook” dated August 1999 gives sole
responsibility for ACS cargo selectivity criteria to the OAS and makes criteria
effectiveness and management a priority.

The U.S. Customs Service also recognizes the need to better define and coordinate the
functions of OAS resources.

In June 1999, a national conference was held where the vast majority of the agenda
constituted workshops on bringing uniformity to processes and sharing best practices.
The role of OAS in Trade Compliance and the role of OAS in Anti Smuggling were two
of the workshops. Another workshop dealt exclusively with training. Throughout the
summer of 1999 there was follow up to the conference and a draft directive was
created.

In early September 1999, the Assistant Commissioner, Office of Field Operations,
decided that an extensive assessment should be conducted of OAS. Arrangements
were made to have the Director of the office that manages the operations of the former
national OAS to be detailed for this assessment. On November 1, 1999, the
assessment commenced.

The U.S. Customs Service is withholding issuing a new directive for OAS until the
assessment is complete. While it is recognized that enhancing performance of OAS.
units is critical, the future role of the units will be decided consistent with the context of
the assessment findings.

OIG-00-066 CUSTOMS’ AUTOMATED COMMERCIAL SYSTEM
CARGO SELECTIVITY Page 24


BACKGROUND

As the principal border agency charged with ensuring that all
goods and persons entering the United States comply with
laws, Customs has a fundamental role to play in national
narcotics strategy. This strategy is based on a drug
smuggling threat that intelligence indicates exists along the
southern border of the United States. Therefore, a long-term
strategy, named Operation Hard Line, was developed and
initiated in Fiscal Year 1995 to disrupt and deter narcotics
smuggling via passenger vehicles and cargo at southwest
border ports. However, Customs must rely more on targeting
techniques to effectively address the smuggling threat and
handle increasing workloads. One such technique is
Automated Commercial System (ACS) Cargo Selectivity.

ACS is the comprehensive tracking system for Customs. All
import transactions related to moving or releasing cargo,
importing merchandise, filing entries or protests, paying fines
and duties, and conducting international business are
processed through ACS. A variety of ACS reports are used
to track, study, and evaluate processing with the trade
community in addition to processing daily transactions.

The Cargo Selectivity system of ACS is an essential
enforcement and entry processing tool. The system facilitates
the release of low risk cargo, while targeting high risk cargo
for examination. This is done by comparing entry data from
each shipment, such as the type of commodity, country of
origin, consignee, or manufacturer, against similar database
components which have demonstrated high risk
characteristics. These are commonly referred to as local and
national examination criteria. From this comparison, cargo
selectivity establishes whether an examination should be
undertaken and the level and type of examination to be
performed.

OIG-00-066 CUSTOMS’ AUTOMATED COMMERCIAL SYSTEM

CARGO SELECTIVITY Page 1


AUDIT RESULTS

e Six times inspectors failed to inspect trucks properly. Truck
inspections were not performed correctly with areas such as engine
compartments, storage areas, and tires not being properly checked

for narcotics.

HAZMAT Examination Procedures were Needed

At all four ports, HAZMAT examination procedures and equipment
were in need of improvement. Examination equipment needed to be
either maintained and repaired, or replaced. Equipment such as
mobile x-rays, density meters, fiber optic scopes, and truck scales
needed repair or replacement. For example, at two ports scales to
weigh vehicles had been inoperable for up to eight months. In
addition, safety equipment such as facilities for the emergency
cleansing of eyes, were not operational, with faucet handles removed
or paper cup dispensers empty. Resultantly, with only canine teams,
probes, and physical observation in use for many examinations, there
was limited assurance that contraband and narcotics were not hidden
in HAZMAT shipments.

OIG-00-066 CUSTOMS’ AUTOMATED COMMERCIAL SYSTEM
CARGO SELECTIVITY Page 15


AUDIT RESULTS

Other Issues. The 3T Program Has Been Suspended

In concurrence with another recommendation in GAO/GGD-98-175,
Low-Risk Cargo Entry Program, dated July 1998, Customs agreed to
suspend the 3T Program until more reliable information was
developed for classifying low risk shipments. Customs further stated
that due to a lack of reliable information on foreign corporations, in
addition to the workload involved in obtaining this data, the program
has proved impractical. Also tier criteria were not being periodically
reviewed and updated because OAS personnel considered the process
to be time consuming and obsolete.

OIG-00-066 CUSTOMS’ AUTOMATED COMMERCIAL SYSTEM
CARGO SELECTIVITY Page 21


EXECUTIVE DIGEST

Audit Results

In our opinion, the use of the ACS Cargo Selectivity Program
to effectively target high risk narcotic shipments for
examination could be improved by developing better narcotics
examination criteria. This could be accomplished by:
establishing local accountability for implementing the national
guidelines for handling narcotics criteria; providing additional
training in data analysis and research techniques for persons
working with criteria; and, sharing intelligence and other
information more freely among Customs disciplines. Also,
the practice of overriding examination criteria unnecessarily,
led to releasing a significant number of targeted shipments
without examination which hindered targeting effectiveness.
Although we found no instances of fraud, this practice along
with inadequate performance of cargo examinations and
inaccurate reporting of examination results, could mask
fraudulent activities, and needs correcting. These conditions
applied equally to the examination of hazardous material,
where we found examination teams in need of training and
equipment in need of maintenance, repair, or replacement.

Useful performance measures and management controls were
also needed. For instance, Customs officials could not
determine the exact cause for the lack of performance as
evidenced by the extremely low seizure rate when using ACS
Cargo Selectivity criteria. They speculated it could be due to
homogeneous shipments, lack of good intelligence, absence of
regular information sharing, and seasonal shipments.
However, better performance measures were needed to
determine if the low seizure rate was attributable to these
factors, or if poor targeting, examinations, or threat
assessments were more significant factors. Customs had
already recognized the need for developing better measures
and the Government Performance and Results Act (Results

OIG-00-066 CUSTOMS’ AUTOMATED COMMERCIAL SYSTEM
CARGO SELECTIVITY Page ii


AUDIT RESULTS

Details

Standard Operating Procedures Were Needed

The OAS units at all ports visited did not have local written standard
operating procedures to describe assigned duties. This delineation of
duties was essential in providing specific guidelines for developing,
creating and maintaining ACS Cargo Selectivity System criteria.
Without operating guidelines to follow, analysts were not always
providing adequate support for drug enforcement efforts. Analysts
primarily performed compliance measurement and document analysis
functions rather than develop examination criteria to target high risk
cargo shipments and offer criteria suggestions to National Narcotics
Operational Analysis Staff Analysts. At the ports visited, these
functions were assigned to other groups, such as Intelligence
Collection Analysis Teams. However, the emphasis of these other
groups was usually on passenger rather than cargo processing, and
the responsible parties usually did not have the training necessary to
effectively research and develop narcotics examination criteria.

More Training Was Necessary

Proficiency in data analysis and research is a basic requirement for
personnel in charge of the maintenance and development of narcotics
examination criteria. We interviewed 10 of 15 personnel responsible
for criteria development at the four ports visited, and found that nine
felt they were in need of more training. A selective review of
training records for three of the personnel confirmed that more
training was needed. Personnel expressed a need for more training
in data analysis and research techniques used to analyze trends and
anomalies in cargo, and thereby improve the development of
meaningful criteria. There also was a need for better access to new
information systems, such as the Internet, to improve the quality and
amount of data for their analyses and research.

OIG-00-066 CUSTOMS’ AUTOMATED COMMERCIAL SYSTEM
CARGO SELECTIVITY Page 8


AUDIT RESULTS

Finding 2.

Recommendation

Use of Examination Overrides Was Excessive

The use of examination overrides, at the four Southwest Border Ports
we visited was excessive, with 607 examinations downgraded from
intensive to general and not performed during FY 1997 and

FY 1998. A major risk in avoiding examinations through
unnecessary overrides is that they could mask deliberate fraud and
abuse, allowing undetected narcotic shipments to pass through border
ports.

4. The Assistant Commissioner, Office of Field Operations,
should instruct Port Directors to establish procedures ensuring
that reasons for overriding intensive cargo examinations are
properly documented and reviewed.

Management Response and OIG Comment

Details

Customs management agreed with the recommendation. A work
group to develop a new Cargo Release Handbook was scheduled for
January, 2000. This group will place special emphasis on developing
a uniform policy for overriding intensive cargo examinations. Once
approved, the handbook procedures will be implemented on a
national basis. A Self-Inspection Worksheet will be used to ensure
policies are followed.

The OIG believes that implementation of these corrective actions will
satisfy the intent of the recommendation.

The ACS Cargo Selectivity System is a sensitive system that depends
on the proper working of all of its elements to process large volumes
of cargo efficiently. Key system elements are examination criteria,
which allow Customs to focus on high risk cargo and expedite the
processing of low risk shipments. Especially critical are narcotic

OIG-00-066 CUSTOMS’ AUTOMATED COMMERCIAL SYSTEM

CARGO SELECTIVITY Page 10


EXECUTIVE DIGEST

Overview

The Automated Commercial System (ACS) Cargo Selectivity
Program was created to facilitate the processing of legitimate
cargo while attempting to stop fraud, narcotics smuggling,
and the entrance of illegal cargo. In our opinion, trade has
been facilitated to a great extent by limiting cargo
examinations to targeted shipments; however, selectivity has
not been as successful in stopping the smuggling of narcotics.
For example, from October, 1995 to March, 1998, the
southwest border ports of El Paso and Laredo, Texas, Otay
Mesa, California, and Nogales, Arizona attributed only two
narcotic seizures to the ACS targeting. In addition, our
review showed that two other Customs targeting systems were
ineffective. The Automated Targeting System (ATS) was
hindered by a lack of experienced personnel, and during our
fieldwork, Customs suspended use of the Three Tier
Targeting (3T) System due to the lack of reliable information.

Objective, Scope and Methodology

Our audit objective was to determine whether ACS Cargo
Selectivity effectively targets high risk cargo for narcotics
examinations. The audit included visits to Washington, DC
and Newark, New Jersey; as well as the southwest border
ports of El Paso and Laredo, Texas, Otay Mesa, California,
and Nogales, Arizona. At these locations we obtained
policies and procedures and reviewed documentation on
selectivity activities from October 1, 1995 to September 18,
1998. We also observed the performance of cargo
examinations on site, evaluated the adequacy of Customs
targeting systems and reviewed management controls over the
ACS Cargo Selectivity Program.

OIG-00-066 CUSTOMS’ AUTOMATED COMMERCIAL SYSTEM
CARGO SELECTIVITY Page i


Appendix 4
FINAL REPORT DISTRUBITION

DEPARTMENTAL OFFICES

Under Secretary for Enforcement

Assistant Secretary (Enforcement)

Desk Officer, Office of Accounting and Internal Control
Acting Director, Office of Organizational Improvement
Director, Office of Strategic Planning

U.S. CUSTOMS SERVICE

Assistant Commissioner, Office of Field Operations
Director, Office of Seizures and Penalties

Director, Office of Planning and Evaluation
Director, Office of Management Inspection

OFFICE OF MANAGEMENT AND BUDGET

Budget Examiner

OIG-00-066 CUSTOMS’ AUTOMATED COMMERCIAL SYSTEM
CARGO SELECTIVITY Page 31


AUDIT RESULTS

Finding 5.

Recommendation

The Automated Targeting System Was Being Evaluated

The frequent rotation of personnel adversely affected the ATS.
Customs had a problem maintaining properly trained and
experienced personnel necessary to effectively run the system. An
annual rotation policy made formal training impractical, and the
opportunity to apply experience gained on the job by inspectors, was
lost as inspectors were rotated to other assignments. Customs agreed
to continue negotiating for better ATS team retention to ensure
success of the operation.

8. The Assistant Commissioner, Office of Field Operations,
should ensure that management continues to work with the
National Treasury Employees Union until the rotation
problem adversely effecting the Automated Targeting System
is resolved.

Management Response and OIG Comment

Customs management agreed with the recommendation. The issue of
staffing the ATS in Laredo was resolved when port management and
the NTEU agreed that at least 50 percent of the ATS team would be
retained each year to ensure continuity. At other ports where ATS
has been subsequently deployed, ATS inspectors were assigned to
CET’ and covered by negotiated rotation policies.

The OIG believes that the actions taken satisfy the intent of the
recommendation.

* Contraband Enforcement Team (CET) Customs personnel, who are mostly inspectors, work in teams, and
are specially trained to interdict narcotics and other contraband in cargo shipments.

OIG-00-066 CUSTOMS’ AUTOMATED COMMERCIAL SYSTEM

CARGO SELECTIVITY Page 19


DEPARTMENT OF THE TREASURY
WASHINGTON, D.C. 20220

orrice oF MAR 6 2000

INSPECTOR GENERAL

MEMORANDUM FOR RAYMOND KELLY, COMMISSIONER
UNITED STATES CUSTOMS ‘SERVICE

Wa Va
FROM: Dennis S$. Schindel paren bbb

Assistant Inspector General for Audit

SUBJECT: Audit Report on the United States Customs
Service Automated Commercial System Cargo
Selectivity

This memorandum transmits the final report of the Office of
Inspector General (OIG) Audit of the United States Customs
Service Automated Commercial System Cargo Selectivity.

This audit is the first in a series of planned audits
covering various aspects of the United States Customs
Service (Customs) Operation Hard Line, a long-term strategy
to disrupt and deter narcotics smuggling at southwest
border ports via passenger vehicles and cargo.

This report discusses improvements needed in targeting high
risk shipments for narcotics examinations. Issues include
development of cargo narcotics criteria, improvement of
examination procedures, implementation of performance
measures and management controls, and effectiveness of
other targeting systems. The OIG made eight

recommendations.in these areas. Customs management agreed
with these recommendations and initiated corrective
actions.

In your November 19, 1999 written response to our draft
report, you stated that the information in the audit report
did not warrant protection under the Freedom of Information
Act. Accordingly, we have removed the Limited Official Use
designation which we had applied to the draft report.

We appreciate the courtesies and cooperation provided to
our auditors. If you have any questions, you may call me
at (202) 927-5400 or a member of your staff may contact
Charles Mataya, Director, Program Audits at (713) 706-4611.

Attachment


Appendix 2
MANAGEMENT RESPONSE

Once this handbook is completed and approved, the procedures established therein will
be implemented on a national basis. A Self-Inspection Worksheet will follow the policy
implementation to ensure that the policies are followed.

Recommendation 5:

The Assistant Commissioner, Office of Field Operations, should require that Port
Directors issue local Standard Operating Procedures, using the Customs Narcotics
Interdiction Guide to explain how to properly perform and report the results of intensive
narcotics examinations.

Response:

We agree with this recommendation and have taken the following actions to ensure it is
properly implemented.

In June 1999, the ASD updated and re-issued the Narcotics Interdiction Guide to the 20
Customs Management Centers (CMC). In addition, the Narcotics Interdiction Guide
was posted to the handbook section of the electronic Info Base system. All
U.S.Customs Service offices can access the Info Base system. The “purpose” section
specifically states that the guide is intended to serve as a procedural guideline for both
examining Inspectors and those who will review the examination results. The new
guide provides specific guidance to Port Directors on the responsibilities of cargo
examination teams including the assignment of personnel, targeting methodologies,
examples of special examination methods, the use of technology, examination
standards, and the posting of examination results. In the assignment of personnel
section, the guide specifically states that the responsibilities for narcotics enforcement
examinations rest with the Contraband Enforcement Teams (CET). CET activities are
uniformly guided by the National CET Directive (Customs Directive 3290-013A), dated
August 28, 1999.

In addition to the above listed guidance, all 20 CMC and Special Agent-in-Charge
offices submitted Joint Narcotics interdiction Plans which serve as local roadmaps for
narcotics enforcement goals/procedures.

The Narcotics Interdiction Guide details the proper procedures for conducting a
narcotics examination, where to record the results, and provides definitions for specific
terms. In order for a port to record an inspection as a narcotic enforcement
examination, a minimum of 20% of the cargo must be physically examined. Page 7 of
the Narcotics Interdiction Guide defines physical examination as “the x-raying or
opening of packing containers and/or the removal of their contents for handling, viewing,
weighing, etc.”

This “20%” requirement was established prior to the deployment of truck and container
sized non-intrusive inspection systems (NII). Thus, for those ports with NII systems, the
devan record is coded “NRAY”" in the exam type field if the Nil system is used in lieu of

OIG-00-066 CUSTOMS’ AUTOMATED COMMERCIAL SYSTEM
CARGO SELECTIVITY Page 27


Appendix 1

ABBREVIATIONS
ACS Automated Commercial System
ASD Anti-Smuggling Division
ATS Automated Targeting System
AU Assessable Unit for compliance reviews
CARIT Cargo Analysis Research Investigative Team
CET Contraband Enforcement Team
CMC Customs Management Center
Customs United States Customs Service
GAO/GGD _ U.S. General Accounting Office/General

Government Division

HAZMAT Hazardous Materials
ICAT Intelligence Collection Analysis Team
NTEU National Treasury Employees Union
OAS Operational Analysis Staff
OFO Office of Field Operations
OMR Operational Management Reports

Results Act

3T

Government Performance and Results Act

Three Tier Targeting System

OIG-00-066 CUSTOMS’ AUTOMATED COMMERCIAL SYSTEM
CARGO SELECTIVITY Page 22


AUDIT RESULTS

Finding 1. Development of Narcotics Criteria Needed Improvement

The development of narcotics examination criteria could be
improved. Local standard operating procedures for OAS units, and
others responsible for handling these examination criteria, were
needed to establish individual accountability for criteria maintenance
and development. Responsible persons also needed more training in
analytical techniques to improve their skills in developing effective
criteria. In addition, the targeting effectiveness of criteria could be
enhanced by sharing proactively obtained intelligence among
inspectors, special agents, and analysts. Ineffective criteria will only
frustrate inspectors in their narcotics targeting efforts.

Recommendations

1. The Commissioner of Customs should direct the Office of
Field Operations to ensure that ports establish and implement
local standard operating procedures which follow national
guidelines for handling ACS cargo selectivity narcotics
criteria. These procedures should establish accountability for
required tasks, including developing and maintaining narcotics
criteria, and submitting suggestions for improving national
narcotics criteria.

2. The Commissioner of Customs should direct the Office of
Field Operations to implement an oversight program to ensure
that port personnel in charge of cargo selectivity narcotics
criteria are adequately trained to maintain proficiency in data
analysis and research.

3. The Commissioner of Customs should direct that the Office of
Field Operations and the Office of Investigations ensure that,
whenever possible, proactively developed intelligence is
shared between disciplines to achieve the common goal of
interdicting drugs.

OIG-00-066 CUSTOMS’ AUTOMATED COMMERCIAL SYSTEM
CARGO SELECTIVITY Page 6


AUDIT RESULTS

Proactively Obtained Intelligence Should Be Shared

Examination criteria, currently being developed for the ACS Cargo
Selectivity System is mainly reactive in nature. A reactive
methodology analyzes past events, as documented by various records
and reports, and provides information that is dated and general in
nature. This methodology was typically used because of the limited
dissemination of information among personnel and the lack of
training in data analysis and research. The nature and objectives of
drug interdiction activity sometimes impede the sharing of
proactively obtained intelligence among disciplines. Accordingly,
the exchange of information has been hindered by concerns over
developing more significant cases, versus prompt seizures that are
necessary for performance recognition.

A proactive approach would be especially beneficial for targeting
smugglers on the southwest border, where there is a large volume of
homogeneous and seasonal shipments, and numerous one-time
importers. This could be accomplished by sharing useful intelligence
information more frequently, and using improved data query and
analysis techniques to research trends and anomalies.

OIG-00-066 CUSTOMS’ AUTOMATED COMMERCIAL SYSTEM
CARGO SELECTIVITY Page 9