U.S. Department of Justice

Office of the Inspector General

C-4 Crack Cocaine

A Review of Allegations of a 

Double Standard of Discipline 

at the FBI

Office of the Inspector General 

November 15, 2002

DRAFT
TABLE OF CONTENTS 

CHAPTER ONE: INTRODUCTION........................................................................1

I. Background...............................................................................................1

II. OIG Investigation and Report...................................................................1

III. Summary of OIG Conclusions..................................................................2

CHAPTER TWO: FBI DISCIPLINARY STRUCTURE..........................................4

I. FBI’s Prior Disciplinary Process..............................................................4

II. New Disciplinary Process.........................................................................5

CHAPTER THREE: THE LEEU REPORT..............................................................9

I. LEEU’s Statistical Analysis......................................................................9

II. OIG’s Analysis........................................................................................11

III. Unprofessional Behavior of a Special Agent in Charge.........................12

IV. Discipline of SES Employees for Loss of FBI Property ........................15

CHAPTER FOUR: THE POTTS RETIREMENT PARTY....................................17

I. Background.............................................................................................17

II. The Evidence ..........................................................................................18

A. Training Division Personnel ...........................................................18

B. SAC Herbert Collins.......................................................................19

C. SAC Van Harp ................................................................................20

D. SAC Victor Gonzalez .....................................................................20

E. SAC Jack Daulton...........................................................................21

F. Precedent.........................................................................................22

III. The Disciplinary Decisions.....................................................................25

A. The SES Board................................................................................25

B. The Deputy Director’s Decision .....................................................29

C. Oversight By DOJ OPR..................................................................29

IV. OIG Analysis ..........................................................................................29

CHAPTER FIVE: RUBY RIDGE...........................................................................32

I. Background.............................................................................................35

II. Initial Internal Inquiries..........................................................................36

III. Department’s “Berman” Inquiry and FBI’s “Walsh” Inquiry................37

IV. The FBI’s “Mathews” Review................................................................39

V. FBI Disciplinary Decisions.....................................................................40

VI. Investigation of Alleged Cover Up.........................................................41

i
A. DOJ OPR Draft Report and FBI OPR Comments..........................43

B. Memorandum to DOJ OPR from FBI OPR Investigators..............45

C. DOJ OPR Final Report ...................................................................46

D. DOJ OPR Report Forwarded to the Justice Management Division

.........................................................................................................48

VII. The Justice Management Division Review ............................................49

A. Jarcho’s Analysis............................................................................49

B. Consideration of Matter by Deputy Assistant Attorney Generals 

Sposato and Vail .............................................................................52

C. DOJ OPR Disagrees with Vail and Sposato’s Recommendations.56

D. FBI OPR’s Response to DOJ OPR.................................................58

E. Colgate’s Decision ..........................................................................59

VIII. OIG Analysis...................................................................................62

IX. Bonuses and Promotions.........................................................................65

CHAPTER SIX: OIG RECOMMENDATIONS AND CONCLUSIONS..............70

ii
CHAPTER ONE 

INTRODUCTION 

CHAPTER ONE: INTRODUCTION

I. Background 

This report examines complaints from Federal Bureau of Investigation (FBI) 

employees alleging that the FBI’s system of discipline was unfair because FBI 

senior managers were treated more leniently than rank and file employees. In 

particular, members of the Senior Executive Service (SES) were alleged to receive 

light or no discipline while lower-level employees were treated more harshly for 

similar offenses. Among the concerns was that the FBI used a separate 

disciplinary system for SES members in which other SES members sat in judgment 

of their SES colleagues. 

In 1999 the FBI’s Law Enforcement Ethics Unit (LEEU), a division of the 

FBI’s Office of Professional Responsibility (OPR), conducted an analysis to 

determine whether the FBI had such a “double standard” of discipline. The LEEU 

examined statistics on misconduct investigations and the discipline imposed for 

SES and non-SES employees. The LEEU also examined the outcome of several 

cases involving investigations of senior managers for various alleged acts of 

misconduct. In September 1999, the LEEU issued an internal report stating that it 

had concluded that senior FBI managers received different and more favorable 

treatment than other employees. 

In August 2000 FBI Director Louis Freeh made several changes to the 

disciplinary system, including disbanding the separate SES disciplinary process. 

Currently, the discipline process for managers, line agents, and support personnel 

is similar, although there are still a few differences. 

II. OIG Investigation and Report 

In order to review the allegations of a double standard of discipline in the 

FBI, the Office of the Inspector General (OIG) first reviewed the LEEU double 

standard report and carefully examined the cases it put forward as examples of a 

double standard. We also reviewed more recent cases in which SES-level 

employees were disciplined. In addition, we thoroughly reviewed the investigation 

and discipline in the “Ruby Ridge” and “Potts retirement party” cases, two wellknown cases that generated significant controversy inside and outside the FBI 

about the discipline imposed on FBI employees. During our review, we 

interviewed many FBI officials involved with the disciplinary process, including 

1
the authors of the LEEU double standard report, and many FBI and Department of 

Justice (DOJ) managers. 

This report describes the results of our examination. In Chapter Two of the 

report, we briefly describe the FBI disciplinary system, including recent changes to 

it. In Chapter Three, we discuss the LEEU report, including two of the examples 

of SES discipline cases that suggested a double standard of discipline. We also 

discuss our review of recent disciplinary actions involving SES employees since 

changes in the disciplinary process were made in August 2000. Chapter Four 

describes in detail the Potts retirement party case, and our analysis of the outcome

of that disciplinary process. Chapter Five examines the Ruby Ridge case, 

including the investigations conducted in the aftermath of the Ruby Ridge matter, 

the discipline that was imposed at various stages of the process, and our evaluation 

of the ultimate discipline imposed. In Chapter Five, we also describe the bonuses 

and promotions that the FBI awarded to subjects of the Ruby Ridge internal 

investigations while those investigations were still pending. In Chapter Six, we 

describe our overall conclusions and recommendations as to the FBI’s disciplinary 

process.1

III. Summary of OIG Conclusions 

In sum, we did not find sufficient evidence to conclusively establish that the 

FBI systematically favors SES members in the discipline process. Because of the 

low number of cases involving SES members, we could not reach such a 

conclusion based on a comparison of similar cases. Moreover, differences in 

individual facts made it difficult to fairly compare cases. Another impediment to 

conducting a definitive comparison is the fact that legal requirements restrict the 

discipline that can be imposed on members of the SES throughout the government. 

Federal regulation states that a member of the SES cannot be suspended for less 

than 15 days. The practical effect of this law is that in SES cases, FBI deciding 

officials must choose between a letter of censure (essentially a written reprimand) 

and a suspension of 15 or more days. Because it is not possible to impose a short 

suspension in SES discipline cases as it is in non-SES discipline cases, a true 

comparison of SES and non-SES disciplinary sanctions is even more difficult. In 

 

1

 This report does not discuss the allegation that an FBI employee was retaliated against for 

raising claims of a double standard. The OIG is investigating that allegation and will report 

separately on that matter.

2
addition, we found that senior managers are able and more likely to retire while 

under investigation, thereby avoiding discipline. 

We did conclude, however, that the FBI suffered and still suffers from a 

strong, and not unreasonable, perception among employees that a double standard 

exists within the FBI. This perception was fostered in large part by the existence 

of a dual system of discipline that existed prior to August 2000, in which SES 

members were judged only by other SES members. Furthermore, our review 

describes several troubling cases in which the discipline imposed for SES 

employees appeared unduly lenient and less severe than discipline in similar cases 

involving non-SES employees. In particular, FBI senior managers were not fired 

or harshly disciplined in either the Ruby Ridge or Potts retirement party cases. We 

believe that in these cases, FBI senior managers were afforded different and more 

favorable treatment than less senior FBI employees would have received. These 

cases, which were well known within the FBI, fed the perception that senior 

managers were treated more favorably than subordinate employees. 

We believe the August 2000 changes will help address to some extent the 

perception of a double standard, as well as any actual bias that existed while the 

dual system was in place. We also believe that the Attorney General’s decision in 

July 2001 to expand the jurisdiction of the OIG to investigate misconduct in the 

FBI will help address issues relating to a double standard of discipline because the 

OIG will be able to review and handle most misconduct allegations against senior 

FBI officials. 

We are still concerned, however, that to the extent the new system still 

provides SES members with a right of appeal of discipline to a board made up of 

three SES members, one of whom the appellant selects, the perception and 

possibly the reality may be that a double standard of discipline may continue to 

exist. We also believe that the FBI’s legal inability to impose a suspension on SES 

members of less than 15 days will continue to impede its ability to discipline senior 

managers appropriately and will continue to foster the perception of a double 

standard of discipline. At the end of this report, we make 11 recommendations 

regarding these and other issues that we believe will assist the FBI in moving 

further to a disciplinary system that is fair and consistent, and that is also perceived 

as fair and consistent. 

3
CHAPTER TWO 

FBI DISCIPLINARY STRUCTURE 

CHAPTER TWO: FBI DISCIPLINARY STRUCTURE 

I. FBI’s Prior Disciplinary Process 

Prior to March 1997, FBI OPR, which was part of the FBI’s Inspection 

Division, was charged with the responsibility for investigating employee 

misconduct matters. Adjudication was handled by a different unit, the 

Administrative Summary Unit, which was part of the FBI’s Administrative 

Services Division. 

In March 1997, the FBI’s disciplinary process was significantly reorganized 

when FBI Director Freeh instituted several changes to that system. OPR became a 

freestanding entity, reporting directly to the FBI Deputy Director, and it was given 

responsibility not only for investigating misconduct but also for proposing and 

deciding certain disciplinary action. An Assistant Director and a Deputy Assistant 

Director headed the new OPR, which was divided into an investigations 

component and an adjudications component. 

As part of the 1997 changes, the FBI developed two systems of adjudicating 

disciplinary matters – one for members of the SES and one for all other 

employees.2

 Under the two-tier system, allegations of serious misconduct against 

non-SES employees were adjudicated by OPR. The OPR Investigative Units 

investigated and determined the relevant facts, and then sent the results of its 

investigation to the OPR Adjudication Units, which evaluated the evidence and 

recommended discipline. As part of its analysis, the Adjudication Units considered 

the discipline imposed in precedent cases; that is, prior cases in similar categories 

of misconduct. The discipline imposed had to be approved by the Deputy 

Assistant Director or the Assistant Director of OPR.3

Non-SES employees had the right to appeal OPR’s decision to the Assistant 

Director of the FBI’s Inspection Division, who would convene a Disciplinary 

 

2

 The investigation of allegations of misconduct against both SES and non-SES FBI 

employees was handled similarly by OPR Investigative Units. However, less serious allegations

of misconduct against lower-level employees were, and still are, assigned for investigation to 

FBI field offices or Headquarters units, although they are supervised and monitored by FBI OPR. 

3

 Since October 1, 2002, the two Adjudication Unit chiefs can approve disciplinary actions 

against FBI employees below grade GS-15, if the discipline is less than a 15-day suspension. 

4
Review Board if the employee was suspended for more than 14 days. The 

Disciplinary Review Board was composed of three SES members and was chaired 

by the either the FBI’s Inspection Division’s Deputy Assistant Director or 

Assistant Director. The decisions of the Inspection Division or the Board 

constituted the final agency action. 

The disciplinary process for SES employees was different. SES members 

accused of misconduct were investigated by OPR, but they were entitled to have 

factual findings and disciplinary decisions adjudicated by a Disciplinary Review 

Board comprised of other SES members. For SES members accused of 

misconduct, the OPR Adjudication Unit forwarded to the FBI’s Deputy Director a 

package containing the results of the investigation and a summary of precedent 

cases and the disciplinary findings in those cases. The package did not contain a 

formal recommendation for discipline, or any final findings regarding misconduct. 

If the Deputy Director determined that the allegations appeared to have been 

substantiated by the OPR inquiry, the Deputy Director convened a Disciplinary 

Review Board composed of five SES members. The Deputy Director picked the 

five members who sat on each case. The SES Board reviewed the analysis of the 

Adjudication Unit with reference to prior disciplinary cases and, where it found the 

misconduct to be substantiated, the SES Board recommended disciplinary action to 

the Deputy Director. The Deputy Director made the final determination, based on 

the recommendation of the SES Board.4

 

II. New Disciplinary Process 

On August 15, 2000, former Director Freeh issued a memorandum changing 

the two-tiered disciplinary system. The memorandum addressed the difference 

between the adjudication of SES and non-SES cases. The memorandum noted that 

the SES Board made a disciplinary recommendation for SES members based upon 

its appraisal of the facts and precedents, with particular reference to the relatively 

small number of prior SES disciplinary cases, “some of which predated the 

strengthening of our disciplinary policies.” The memorandum concluded that the 

difference in adjudication procedures, together with the problem of different 

deciding officials applying different precedent bases, permitted “a perception of a 

double standard which is neither warranted nor permissible, while at the same time 

 

4

 In cases involving FBI executives at the level of Assistant Director or above, however, all 

final decisions were reserved for the Deputy Attorney General. 

5
denying SES members the appellate protection enjoyed by other employees.” The 

memorandum stated that the revisions would help to achieve the goal of giving 

both FBI employees and the public confidence that the FBI’s disciplinary system 

punishes misconduct fairly and expeditiously “without fear or favor.” 

The new procedures abolished the SES Board. They required that 

adjudication of administrative inquiries involving SES employees would be 

handled by OPR and would be based on the uniform application of precedent 

cases, for both SES and non-SES employees, decided since March 1997. Freeh’s 

August 2000 memorandum stated that “[t]he same standards for evaluating 

evidence would be consistently applied to all employees with due regard for the 

increased responsibilities and obligations of a senior executive.” As required by 

regulation, final disciplinary authority over “key executives” was still reserved to 

DOJ. Moreover, by statute (5 U.S.C. § 7543(a)), SES members still cannot be 

suspended for less than a 15-day period. 

Under the new system, an official in OPR, normally the OPR Deputy 

Assistant Director, proposes disciplinary action for senior executives and the OPR 

Assistant Director makes the disciplinary decision. Cases involving non-SES 

employees continued to be handled in the same manner as established by Freeh’s 

directive in March 1997. Appeals are permitted for all disciplinary actions, except 

letters of censure and oral reprimands. SES members may now appeal to the 

Inspection Division, which will convene the same Disciplinary Review Board to 

which all other employees have access. The Board consists of three SES members. 

The chair of the Board is the Assistant Director of the Inspection Division. The 

person appealing gets to select one member of the Board. The third member of the 

Board is chosen at random from a list of SES members. 

In reviewing appeals, the Assistant Director of the Inspection Division or the 

Disciplinary Review Board may “independently redetermine the factual findings 

and/or the penalty imposed.” If a new penalty is imposed, it must be consistent 

with applicable precedent. Both the Assistant Director of the Inspection Division 

and the Board are required to document their findings in writing and provide the 

employee a written decision. There is no requirement, however, that the Assistant 

Director or the Disciplinary Review Board provide written justification for their 

findings or for any change that is made to the decision of the original disciplinary 

decision. 

Although there are no further internal appeals beyond the Assistant Director 

or the Board, the FBI Director retains a discretionary power to change disciplinary 

actions concerning all employees except those senior executives whose discipline 

6
must be approved by the Deputy Attorney General. According to Freeh’s August 

2000 memorandum, the FBI Director’s power to change discipline, which could be 

both in favor of and to the disadvantage of the employee, is “not intended to be an 

additional level of appeal and will not be exercised routinely. It is intended to be 

exercised only in those rare and exceptional cases when the Director considers it 

necessary to correct an injustice or to prevent harm to the FBI.” 

According to the FBI’s Manual of Administrative Operations and Procedures 

(MAOP), when deciding discipline the FBI should give consideration to “Bureau 

policy and similar incidents previously resolved, as well as any aggravating or 

mitigating circumstances of the case in point.” The MAOP states that for 

discipline of SES and non-SES employees, the decision-maker should consider 

possible mitigating or aggravating factors in making a final disciplinary decision. 

These factors are commonly known as the “Douglas Factors,” and stem from the 

Merit Systems Protection Board (MSPB) case Douglas v. Veterans’

Administration, et al., 5 M.S.P.B. 313 (1981).5 Despite the fact that very few FBI 

 

(continued)

5

 These factors include: 

• the nature and seriousness of the offense, and its relationship to the employee’s duties, 

position and responsibilities, including whether the offense was intentional or technical or 

inadvertent, or was committed maliciously or for gain, or was frequently repeated; 

• the employee’s job level and type of employment, including supervisory or fiduciary role, 

contacts with the public, and prominence of the position;

• the employee’s past disciplinary record; 

• the employee’s past work record, including length of service, performance on the job, ability 

to get along with fellow workers, and dependability; 

• the effect of the offense upon the employee’s ability to perform at a satisfactory level and its 

effect upon the supervisor’s confidence in the employee’s ability to perform assigned duties;

• the notoriety of the offense or its impact upon the reputation of the agency; 

• the clarity with which the employee was on notice of any rules that were violated in 

committing the offense, or had been warned about the conduct in question; 

• potential for the employee’s rehabilitation; 

• mitigating circumstances surrounding the offense, such as unusual job tensions, personality 

problems, mental impairment, harassment, or bad faith, malice or provocation on the part of 

others involved in the matter; 

7
employees have appeal rights to the MSPB,6

 the FBI considers the Douglas factors 

in arriving at disciplinary decisions. 

The FBI’s MAOP also states that in most instances penalties for violations of 

regulations fall within a range of penalties set forth in that manual. However, a 

penalty outside of the range may be imposed where aggravating circumstances 

exist. The MAOP cites as an example the case of a supervisor or Bureau official 

who, because of his or her responsibility to demonstrate exemplary behavior, “may 

be subject to a greater penalty than is provided in the range of penalties.” 

Pursuant to statute, however, FBI SES employees, like all other SES 

employees in the federal government, cannot be suspended for fewer than 15 days. 

An FBI decision-maker must therefore choose between a letter of censure and a 

minimum 15-day suspension for SES employees, but may impose suspensions for 

less than 15 days on non-SES employees. 

 (continued)

• the adequacy and effectiveness of alternative sanctions to deter such conduct in the future by 

the employee or others; 

• consistency of the penalty with those imposed upon other employees for the same or similar 

offenses; and 

• consistency of the penalty with any applicable agency table of penalties.

6

 Only preference-eligible veterans have appeal rights to the MSPB. Veterans are 

preference-eligible if they are disabled or served on active duty during certain specified time 

periods or in military campaigns.

8
CHAPTER THREE 

THE LEEU REPORT 

CHAPTER THREE: THE LEEU REPORT 

The LEEU was established as a unit of FBI OPR in 1995. Its mission is to

teach ethics to FBI personnel and to monitor the overall integrity of the FBI’s 

components. The unit’s first chief was FBI Special Agent Frank Perry. He told 

the OIG that as chief of the unit he began to hear frequent complaints about 

unaddressed misconduct by senior executives. Perry and his staff found that many 

rank and file employees of the FBI believed that the discipline administered to SES 

members was less severe than normally would be given to other employees of the 

FBI who had engaged in similar conduct. Perry believed that the LEEU had an 

obligation to look into such allegations because of the serious impact they could 

have on the FBI. He noted to the OIG that a belief by employees that their 

superiors are judged by a more lenient standard leads to morale problems and a 

lack of respect for senior management. 

On September 1, 1999, the LEEU issued a report entitled “FBI Senior 

Executive Service Accountability: A Higher Standard or a Double Standard?” 

The report, which was written by Perry and two other FBI employees, concluded 

that a double standard existed and recommended systemic changes to the 

disciplinary process. This report was the impetus for the changes in the FBI’s 

disciplinary system that were instituted in August 2000. 

I. LEEU’s Statistical Analysis 

The LEEU’s report first attempted to statistically compare OPR cases

involving similar acts of misconduct between non-SES agents and SES managers. 

It presented for six years the number of SES subjects of OPR investigations versus 

the overall SES population in the FBI for a given year compared to the number of 

non-SES subjects versus the overall non-SES FBI population for the same year. 

According to the report, these numbers revealed that SES employees are 

approximately three times more likely to have an OPR case initiated against them 

as are non-SES employees.7

 The report concluded from these statistics that OPR 

 

(continued)

7

 The LEEU report found that while the number of OPR cases opened on Special Agents 

(SA) remained fairly constant between 1994 and 1999, the number of cases opened on SES 

employees during that same time period fluctuated significantly. The report did not reach a 

conclusion as to why the number of OPR cases opened on SES employees fluctuated by 

comparison to SA cases, but noted that the fluctuation alone was “cause for concern.” The report 

9
did not shy away from opening misconduct cases on senior managers. The report 

stated that “few within our ranks would argue with the claim that the investigation 

of those matters is firm, fair, and thorough.” 

The report then compared the discipline administered to SES and non-SES 

agents for similar misconduct. The report presented the data for various categories 

of misconduct for fiscal years 1996 through 1998, including the number of SES 

and non-SES subjects in several misconduct categories, the number and percentage 

of those subjects who were disciplined, and the number and percentage of those 

subjects who were suspended or dismissed. It concluded that the data showed a 

“clear trend” that SES employees receive fewer suspensions and dismissals than 

non-SES employees for the same offense. The LEEU noted, however, that the 

comparison was difficult because of the small sample of SES cases and because 

every case is factually different. 

We heard several concerns about the LEEU’s statistical comparison and 

conclusions. First, as acknowledged in the LEEU report, comparison of cases 

between the two categories of employees was difficult because of the small 

number of SES cases. For example, in one of the categories, there were 98 nonSES employees investigated and only 4 SES employees. Second, a large number 

of SES employees are eligible to retire and take advantage of this option while 

under investigation to avoid any penalty. Third, as discussed above, the “Douglas 

Factors” are to be considered prior to making any disciplinary decision. These 

factors, which include the length of an employee’s service, the level of their 

responsibility, and their past work and disciplinary record, necessarily make 

disciplinary decisions highly individualized. 

Despite these limitations, we believe the LEEU report brought justified 

attention to a clear problem – the widespread perception throughout the FBI of a 

 (continued)

presented two points of view as to why the number of SES OPR cases might be greater than nonSES cases. The first was that because of the senior position of an SES employee and the higher 

level of responsibility, it would be more likely that an OPR inquiry would be initiated on alleged 

misconduct. Likewise, the report noted, “unpopular decisions made by senior managers could 

prompt more allegations by disgruntled subordinates.” On the other hand, the report noted that 

SAs conducting investigations might be more likely to have OPR cases opened on them because 

of “their greater hands-on activity with arrests, searches, informants and trial.” 

10
double standard of discipline. As an internal document that created an impetus to 

change, the LEEU report was extremely useful and effective. 

II. OIG’s Analysis 

In an attempt to evaluate whether a double standard of discipline exists in the 

FBI, we reviewed the files of 15 SES disciplinary matters closed between August 

2000 (when the new disciplinary system was implemented) and November 2001. 

We assessed whether the discipline imposed appeared inappropriate to the facts of 

the case or inconsistent with precedent. Of the 15 SES closed matters,8

 we found: 

• one dismissal in the case of Robert Hanssen, who later pled guilty to 

espionage charges; 

• six retirements while under investigation; 

• a 15-day suspension for a variety of offenses, including furnishing beer 

during work hours, obtaining FBI employment for his daughter, and 

making inappropriate remarks at a retirement party; 

• a 35-day suspension for driving while under the influence of alcohol 

and resisting arrest; 

• a letter of censure for failure to report a matter to OPR; 

• a letter of censure for making unprofessional remarks to FBI Inspectors; 

• an oral reprimand for disclosure of Privacy Act-protected information to 

the media; and 

• three “no actions” in matters involving alleged misuse of a government 

vehicle, improper remarks, and improper strip-search of agents.

Our review was limited by the same factors that limited the statistical review 

of the LEEU. Our review did not find that any of the 15 disciplinary decisions was 

obviously lenient or unfair, or inconsistent with the precedent of discipline 

imposed on non-SES employees in like cases. 

Nevertheless, our review of these cases raised several troubling issues. First, 

out of 19 SES disciplinary matters that were closed between August 2000 and 

 

8

 We did not include the four SES matters relating to Ruby Ridge, which we describe and 

analyze extensively in Chapter Five of this report. 

11
November 2001 (which includes, in addition to the 15 discussed above, the Ruby 

Ridge cases discussed in Chapter Five), we found that 6 SES employees, or almost 

one-third, retired while under investigation. The ability to retire with a pension in 

order to avoid disciplinary action is not as commonly available to less senior FBI 

employees. Also, the ability to retire while under investigation fuels the perception 

that SES employees can avoid discipline and receive preferential treatment. 

Second, because of the statutory restrictions on suspensions for SES employees, 

we considered only whether the SES employees who received letters of censure 

should have received a 15-day suspension instead – the next level of discipline 

available. In some cases, it appears that a shorter suspension may have been 

appropriate discipline, but that option was not available to the FBI. 

In sum, a comparison of SES versus non-SES discipline did not yield 

definitive conclusions about whether a systemic double standard exists in the FBI. 

But there were four troubling cases of disparate discipline for SES members that 

the LEEU report noted, which we examined in detail: the investigation of a 

Special Agent in Charge (SAC) who behaved inappropriately in a hospital 

emergency room, an Assistant Director who lost his pager, the Potts retirement 

party case, and the Ruby Ridge case. These cases reveal troubling instances of 

light discipline for SES members. They also fostered a strong perception of a 

double standard within the FBI. In the rest of this chapter and in the two chapters 

that follow, we discuss these cases in detail. 

III. Unprofessional Behavior of a Special Agent in Charge 

In 1997, an SAC of an FBI field office was involved in an altercation with 

hospital staff after he took his elderly father to the emergency room for treatment. 

Three doctors, two nurses, and three local police officers described the SAC as 

probably intoxicated and said that his behavior was loud, belligerent, inappropriate, 

and frightening. Several witnesses described being afraid for their safety. Because 

of his actions, hospital personnel asked the SAC to remove his weapon. The SAC 

refused to do so, and local police were called to the hospital. The SAC initially 

refused to produce identification, and a confrontation with the police ensued. He 

was sent home by the police with his fiancée. The SAC later refused to cooperate 

with the local chief of police who was conducting an investigation of the matter. 

When interviewed by OPR, the SAC admitted to having had one 12-ounce beer 

several hours before the incident, denied making statements about drinking beer to 

hospital staff, and denied making abusive statements to the police officer at the 

hospital. 

12
OPR concluded that the SAC had committed misconduct. In evaluating the 

appropriate discipline, OPR cited five similar cases as precedent: 

• A Supervisory Special Agent (SSA) received a seven-day suspension and 

one-year probation after he was found to have used “abusive/offensive 

language” toward employees at a hotel where he was staying. He was 

alleged to have been intoxicated. He was found to have been suffering from

job-related stress and depression, which were viewed as mitigating factors. 

• An SSA was suspended for 14 days and placed on probation for six months 

for making loud, abusive comments after hours to the FBI inspection team 

that was inspecting his office. 

• An SAC was suspended for 21 days, put on probation for 6 months, and 

received a “loss of effectiveness” transfer to FBI Headquarters after he was 

arrested for drunk driving and then requested and obtained assistance from a 

colonel in the highway patrol in obtaining his release at the arrest scene. 

• An FBI Section Chief was censured for engaging in a verbal altercation with 

an FBI employee in the parking garage because the Section Chief believed 

that the other employee was driving in a dangerous manner and may not 

have been an FBI employee. 

• An SAC was censured and received a transfer to FBI Headquarters after 

improperly upgrading to business class during a flight to Paris while the 

agent accompanying him flew in tourist class and for inadequately preparing 

for the meetings in Paris.9

 

An SES Board was convened and recommended that the SAC involved in the 

hospital altercation be immediately removed from his position and be given a loss 

of effectiveness transfer to FBI Headquarters. The Board proposed that the

transfer order specify that the transfer was to further the mission and needs of the 

FBI and “should not be considered a punitive measure.” The Board also 

recommended a fitness-for-duty examination in order to determine the effects of 

alcohol, stress, and medication on the SAC’s actions. 

The SAC was placed on administrative leave pending the receipt of the 

fitness-for-duty report. The SAC was examined and the doctor concluded that the 

SAC’s depressive condition, continued use of alcohol, and recurrent need for the 

9

 It is not clear why this last case was considered to be comparable. 

13
medication Prednisone “contribute to a vulnerability to recurrent inappropriate 

behavior, mood instability, and impaired judgment.” The doctor recommended a 

course of treatment and that the SAC remain in a limited-duty position until he 

recovered. The doctor’s report stated that the SAC had reported temper and other 

problems when taking Prednisone, but the report noted that the SAC was not 

taking Prednisone on the day in question and had not taken it for about “a month 

before the incident.” 

The SES Board reconvened and concluded that the SAC’s behavior, while 

otherwise actionable, was mitigated heavily by the effects of his medication. The 

Board recommended that no further action, beyond the SAC’s transfer to FBI 

Headquarters, was necessary. The Board also noted that it was aware of the SAC’s 

intention to retire before the end of the year. 

The FBI Deputy Director at the time, Robert Bryant, wrote the SAC a letter 

stating that although the Board found his conduct to be “totally unacceptable and 

unprofessional,” it had recommended no disciplinary action because his actions 

were significantly mitigated by the effects of prescription medications he was 

taking at the time of the incident. Bryant stated in the letter that he was “seriously 

disturbed by the damage which [the SAC’s] conduct caused,” noted that the 

negative impact of his behavior was enhanced by his status as a member of the 

SES, and strongly suggested that the SAC make amends with both the hospital 

staff and local police. Significantly, however, the file copy of the letter included 

specific instructions that the letter should be personally presented to the SAC and 

stated that the letter was for “information only and that no copy will be designated 

to the employee’s official personnel file.”10 

This case was cited by the LEEU report as an example of a disparity between 

the discipline imposed on SES and non-SES employees. We agree. There was no 

evidence in the record about the side effects of the SAC’s medications, which the 

SES Board referred to as evidence to heavily mitigate discipline. But the doctor’s 

report was clear that the SAC had not taken Prednisone on the day of the incident 

and had not taken it for about one month prior to the incident. 

The outcome of this case was troubling. The ultimate result – removal of the 

SAC from his supervisory position and a retirement – seems only minimally 

 

10 Former Deputy Director Bryant, now retired, did not respond to our requests to interview 

him on this matter. 

14
acceptable, and other aspects of the case raise questions. For example, it is unclear 

why the removal was described as “nonpunitive.” Most disturbing, the SES 

Board’s reliance on the SAC’s medication as mitigating evidence appears to have 

stretched the actual facts. Although the fitness-for-duty report clearly noted that 

the SAC had not taken medication for one month prior to the incident in question, 

the Board relied heavily on the SAC’s use of medication as a mitigating factor. 

IV. Discipline of SES Employees for Loss of FBI Property 

Another case discussed in the LEEU report was the discipline imposed when 

an Assistant Director lost his pager. According to the report, the discipline 

imposed on FBI personnel for loss of FBI property traditionally had been a letter of 

censure.11 In July 1996, when an Assistant Director lost his pager, the Personnel 

Division recommended that a letter of censure was appropriate and in keeping with 

precedent. Deputy Director Bryant decided, however, that the Assistant Director 

should receive an oral reprimand “due to the minimal monetary and operational 

value of the lost equipment.” Later in 1996, the Deputy Director asked the 

Personnel Division to circulate an employee notice articulating a new position that 

an oral reprimand was the appropriate sanction for this type of loss. OPR internal 

records also noted that this case set “new precedent” for this type of loss. 

This policy change was never formally distributed to the field, where most 

minor misconduct cases like this are resolved. The LEEU report stated that, 

probably through word-of-mouth or through contact with OPR, the majority of 

pager losses since 1996 against special agents have resulted in findings of “no 

action” or in oral reprimands. However, the report asserted that from the time the 

Assistant Director received his oral reprimand to the time of the LEEU report, five 

special agents had received letters of censure for loss of their pagers. The report 

concluded that “the disparate and favorable treatment could not be any more 

obvious.” 

We did not find that the policy change itself necessarily reflected a double 

standard. We were concerned, however, by the fact that five line agents continued 

to be punished under the old standard. This discrepancy reflects a failure to ensure 

that FBI disciplinary policies are adequately communicated to the field. 

 

11 The LEEU report noted, however, that for unexplained reasons one SAC had received 

only an oral reprimand for the loss of his pager in June 1995. However, in November 1995 

another SAC lost his pager and received a letter of censure. 

15
Regardless of the reasons for it, this lack of consistency should not be tolerated 

because it results in the perception of a double standard. 

In the next two chapters of this report, we describe the Potts retirement party 

and Ruby Ridge cases, two well-known incidents that exacerbated the perception 

of a double standard of discipline in the FBI. 

16
CHAPTER FOUR 

THE POTTS RETIREMENT PARTY 

CHAPTER FOUR: THE POTTS RETIREMENT PARTY 

The Potts retirement party is widely believed within and outside the FBI to 

be an egregious example of senior managers being excused or lightly disciplined 

for misconduct that would have resulted in severe sanctions if less senior 

employees had been involved. We interviewed numerous FBI employees, 

including members of the SES, who believed that the disciplinary decisions 

stemming from this case were fundamentally flawed. We agree. This chapter 

examines that case and provides our assessment of it. 

I. Background 

When Deputy Director Larry Potts retired from the FBI in 1997, a dinner was 

held in his honor in Arlington, Virginia, on October 9, 1997. The Assistant 

Director of the FBI’s Training Division, Joseph Wolfinger, was responsible for 

coordinating the retirement dinner. 

On October 2, 1997, seven days before the dinner, Wolfinger directed 

Training Division Section Chief John Louden to send an electronic communication 

(EC) to the field announcing an SAC conference at the FBI Academy in Quantico, 

Virginia, to discuss “New Agent Curriculum and Training” on October 10, 1997, 

the day after the dinner. The announcement did not contain a conference schedule, 

a starting or concluding time, a training identification number, or travel 

instructions. The conference was scheduled for a Friday, normally a travel day for 

FBI employees following the conclusion of conferences. 

The Potts retirement dinner was attended by approximately 140 people, 

including many SACs. The following day the conference was held at the FBI 

Academy. Only five people attended – Wolfinger, Louden, two SACs, and an 

individual who was not an SAC. The FBI Supervisory Special Agent (SSA) who 

was in charge of the presentation was informed about the event on October 7. 

There was no formal agenda for the conference. The SSA reported that he 

discussed the “integrated case” – a fictional investigation for training purposes – 

which was to be a part of the new agents’ training. The “conference” lasted no 

longer than 90 minutes and possibly as little as 45 minutes. 

It was alleged that the conference was scheduled for October 10 to provide 

justification for the FBI to pay for the travel of SACs to attend the Potts retirement 

dinner. Under FBI policy, which was unwritten at the time but which we 

17
understand was commonly known, travel to a retirement function was considered 

personal business and not reimbursable by the government. It was further alleged 

that seven SACs falsified travel vouchers in order to receive reimbursement for 

travel to the dinner. OPR and the Department of Justice Office of Professional 

Responsibility (DOJ OPR) jointly investigated the matter. While the investigation 

was ongoing, four SACs who were subjects of the investigation retired. After the 

investigation, OPR referred the actions of four other SACs, Wolfinger, and Louden 

to the SES Board for disciplinary action. 

II. The Evidence 

The evidence in this case was described in a memorandum dated November 

18, 1998, from FBI OPR Assistant Director Michael DeFeo to FBI Deputy 

Director Robert Bryant. We summarize that evidence below. 

A. Training Division Personnel 

Assistant Director Wolfinger acknowledged that he instructed Louden to 

prepare the EC announcing the training. Wolfinger said that he knew that a 

number of SACs would be in the Washington, D.C. area for Potts’ retirement 

party. He said he wanted to take advantage of their being in town to hold a 

conference on training. Wolfinger said that he would not have convened a 

conference like the one planned if the SACs had not been coming to Washington 

already. Since the SACs were going to be in the area anyway, he said he wanted 

them to travel to the FBI Training Academy to “talk to us about something that 

was very important to the Academy and [to him] and the FBI” – the curriculum 

and training for new agents. 

Louden told OPR that the conference was Wolfinger’s idea and was 

organized after the Potts dinner was scheduled. When asked whether the 

conference was set up to legitimize travel to the Potts dinner, Louden stated: 

I would have to defer to what Mr. Wolfinger was thinking 

with that because when he brought it up to me, my idea was yeah, 

the SACs can obviously use this as a mechanism, but I looked at it 

as a way to take advantage of SACs being here. 

Louden admitted there was no perceived need for the conference prior to the 

Potts function and stated that he did not believe an objective observer would 

conclude this was a legitimate conference, as opposed to a cover for SAC travel. 

Louden was polygraphed, and the results indicated no deception in his denial that 

18
the purpose of the conference was to increase the number of attendees at the 

retirement party. However, the important issue in this matter was not whether the 

conference was organized to increase attendance at the dinner, but rather whether 

the purpose of the conference was to legitimize travel for those who were already 

planning to attend, something Loudon essentially admitted in his interview. OPR 

recommended that an SES Board determine whether Wolfinger and Louden 

attempted to waste or misapply government resources or neglected their duty by 

inviting SACs to a conference of dubious substance to justify reimbursement for 

travel to the Potts retirement party. 

B. SAC Herbert Collins 

Herbert Collins, then the SAC of the Chicago field office, filed travel 

documents stating that he was attending a “conference” in Washington, D.C. on 

October 9-10, 1997. He subsequently told OPR investigators that this reason was 

not correct and that the justification on the travel documents should have been to 

attend Potts’ retirement party. According to Collins, at a June 1997 meeting of the 

FBI’s SAC Advisory Committee, of which Collins was a member, then FBI 

Deputy Director William Esposito had authorized members of the Advisory 

Committee to travel to attend retirement functions for senior FBI officials.12 

Collins told OPR that he had traveled to another retirement function in June 1997 

for the former SAC in Detroit. With respect to the Potts matter, Collins initially 

stated that he had indicated on the October 1997 voucher that the purpose of his 

travel was to attend the retirement function. When later confronted with his travel 

voucher, which stated that he the purpose was to attend a conference, he said that it 

was an error on his part not to review the travel documents prior to signing them. 

OPR referred to the SES Board the question of whether Collins relied on the 

 

12 OPR tried to determine the validity of this explanation. Esposito, who by then had retired, 

refused to be interviewed, but he informed OPR that he never changed any policy regarding who 

could attend a retirement function at government expense. Some individuals present at the June 

1997 meeting thought that Esposito was authorizing travel of all SACs to retirement functions; 

others thought that he was authorizing only the travel of SACs on the Advisory Committee. As 

part of its investigation regarding this issue, OPR interviewed SAC Advisory Committee 

member Don Clark, who stated that he believed such travel was authorized and that he had 

attended two such retirement functions and submitted vouchers to the FBI. An examination of 

those vouchers revealed that Clark’s voucher did not reflect that he had traveled to attend a 

retirement function, but rather stated “Attend meetings at FBIHQ” on one and “Attend Meeting – 

Inspection Div.” on the second. Clark subsequently became a subject of the investigation. 

19
Esposito conversation as justification for travel to retirement parties (and 

negligently overlooked his staff’s use of the justification of “meetings” or 

“conferences”) or whether he used the justification of attending a conference 

because he was concerned that attending a retirement party would be rejected as a 

justification. 

C. SAC Van Harp 

Van Harp, then the SAC of the Cleveland, Ohio field office and now the 

Assistant Director-In-Charge of the Washington field office, filed a travel request 

form stating that he was traveling to attend a “Conference.” However, he did not 

attend the October 10 training conference. Additional travel documents filed by 

Harp in October 1997 stated that he had traveled to Washington, D.C. for a Career 

Board meeting on October 9 and 10, 1997.13 Although Harp was a member of the 

Career Board, the Career Board did not meet on either October 9 or 10. 

When questioned by OPR, Harp acknowledged that the Career Board had not 

met on October 9 and 10. He stated that he used the term “Career Board” to mean 

business surrounding his role on the Career Board and not a specific meeting. 

Harp stated in a sworn deposition to DOJ OPR that his travel to Washington was 

really to attend meetings at FBI Headquarters. The evidence showed that Harp had 

no scheduled appointments, but he claimed to have made unscheduled visits to 

whoever was available at FBI Headquarters on matters relating to the Cleveland 

field office. He identified 11 senior-level executives with whom he “probably” or 

“could have” met. None of the 11 recalled specifically whether they met with 

Harp on that day, but several stated that they had met with him several times 

during that fall. One individual was on leave the day that Harp said he might have 

met with him. OPR referred to the SES Board the question of whether Harp’s 

rationale for traveling to FBI Headquarters at the time of the Potts party constituted 

false or improper justification for official travel. 

D. SAC Victor Gonzalez 

Victor Gonzalez, then a SAC in the New York Division, filed travel 

documents listing “travel to FBIHQ on Official Business” as his justification and 

“Management Travel” as his purpose. Gonzalez told OPR that the purpose of his 

 

13 The Career Board is a group of SES members who meet periodically to review the 

applications of FBI employees for management positions in the FBI.

20
travel was to assist an employee seeking a hardship transfer, to meet with a specific 

FBI official regarding his division’s pending move, and to attend the Potts dinner. 

The evidence showed that he had no scheduled appointments at FBI Headquarters 

on October 9 or 10. Gonzalez admitted never going to Headquarters to discuss the

hardship transfer, but he claimed to have met with a specific employee at an FBI 

offsite location about the move. FBI records revealed that the specific employee 

that he claimed to have met with was out of the country that entire week. Gonzalez 

identified two other employees that he “likely” met with, but neither could recall 

meeting with him. OPR referred to the SES Board the question of whether 

Gonzalez’s rationale for traveling to FBI Headquarters at the time of the Potts 

party constituted false or improper justification for official travel. 

E. SAC Jack Daulton 

Jack Daulton, then the SAC of the Atlanta Division, stated on his travel 

forms that his travel to Washington on October 9, 1997, was to “attend New Agent 

Curriculum Training Conference.” Daulton never attended the conference. He 

told OPR that he intended to go to the conference, but the time of the conference 

was later than he had expected and made it impossible for him to attend because of 

his return flight to Atlanta. 

Daulton told OPR that he had been told originally that the conference would 

start between 9 and 10 a.m. and that he had scheduled his return flight to Atlanta 

for 1:25 p.m. He said that he learned at the Potts retirement party that the 

conference would not start until 11 or 11:30 a.m. because of a new agent class 

graduation at the Academy. Daulton said that he started to go to Quantico the next 

morning, but then decided that he would not be able to make his flight. He stated 

that it was not his fault that he could not attend the conference because of the time 

change. He also said that he did not attempt to change the time of his flight 

because he felt he should get back to Atlanta. Daulton said that he arrived in 

Atlanta after 3 p.m. and went home. 

Daulton was later reinterviewed by OPR and was asked about the fact that his 

rental car was returned to the Washington airport at 8:21 a.m. and his car in Atlanta 

was taken out of the Atlanta airport parking lot at 12:12 p.m. He responded that he 

did not recall returning to Atlanta that early but that he must have decided that he 

would not be able to attend the conference and make his 1:25 p.m. flight, so he 

took an earlier flight. 

OPR recommended that the SES Board consider whether Daulton had 

intended to travel to the conference at Quantico and was deterred from attending 

21
because of an unexpected change in schedule, or whether he used the conference as 

justification for travel to Washington without any intention of attending the 

conference and lied under oath to OPR investigators. The SES Board later 

requested that Daulton be polygraphed regarding whether, on the morning of 

October 10, he actually intended to attend the conference. Daulton passed the 

polygraph test. 

F. Precedent 

As disciplinary precedent, OPR provided two categories of cases to be 

considered by the SES Board. The first was “False voucher, misuse of government 

property/position.” It cited 11 cases as precedent, including: 

• A former FBI Director was criticized for, among other things, abusing 

government travel for personal reasons and ordered to reimburse the 

government for the cost of the personal travel. He eventually was 

removed as the FBI Director. 

• An SAC was censured for transporting an unauthorized passenger in 

an FBI vehicle and using that vehicle for personal travel. 

• An SAC was found to have used poor judgment in traveling to deliver 

a brief speech to a criminal justice class in which his son was a 

student. The Deputy Director found that while FBI regulations were 

followed with respect to reporting the travel, a nearby executive could 

have delivered the speech and the SAC's trip constituted poor 

judgment because it created the impression that government funds 

were expended for travel primarily for a personal reason. The SAC 

was not found to have lacked candor when he omitted the fact that his 

son was a student in the class, but was found to have used poor 

judgment. 

• An SAC was censured and received a transfer to FBI Headquarters 

after improperly upgrading to business class during a flight to Paris 

while the agent accompanying him flew in tourist class and for 

inadequately preparing for the meetings in Paris. 

• No action was taken against a supervisory agent who claimed travel 

expenses to attend a “Tech. Conference” which appeared to have been 

scheduled to justify travel to a retirement dinner in New York. The 

employee had inquired about whether there would been an official 

function in New York to justify the travel as official business when he 

22
called to say he would attend the dinner. The technical conference had 

been scheduled to discuss issues relating to the technical investigative 

program. The employee stated that while there was no structured 

conference with a prepared syllabus, course outline, or designated 

meeting place, he toured a two-story structure in New Jersey called the 

Northeast Regional Technical Training Center and he had technical 

discussions with other attendees. OPR found no misconduct because 

the employee acted in reliance on a teletype providing a number for 

official travel and announcing a “facially valid conference,” had his 

travel approved by his Assistant Special Agent in Charge, and engaged 

in activities and discussions on technical matters. The employee’s 

travel documents were found to be truthful, and he was found to be 

completely candid when interviewed. 

• An agent was censured after he provided a voucher with receipts from

a taxi service that did not do business in the area that he visited. OPR 

determined that the agent had incurred the expenses and there was no 

intent to defraud. 

• A probationary agent was suspended for three days and placed on six 

months’ probation after he claimed reimbursement for a travel day 

when he actually returned a day earlier. 

• A support employee was suspended for 14 days and placed on 

probation for six months after she was found to have falsified 

documents by indicating that she had attended a computer training 

class when, in fact, she had not. 

• A GS-14 in the Personnel Division was suspended for 30 days for 

participating in the misuse of an FBI-leased vehicle. The employee 

accompanied a detective working with the FBI on two vacation trips 

and unauthorized local travel in the leased vehicle. 

• A Unit Chief resigned after being proposed for dismissal for having 

lied about the purpose of a trip to Los Angeles and his personal 

relationship with the secretary who accompanied him. Voucher fraud 

also was involved because the voucher misstated the purpose of his 

trip. 

The second category of cases concerned “Lying under oath/lack of candor.” 

The memorandum cited the following cases: 

23
• An agent was suspended for 30 days for a misdemeanor battery 

conviction for striking his wife. He was found to have lacked candor 

in his sworn statement when he denied that he had hit her. 

• A Language Specialist was dismissed for unauthorized contacts with 

foreign officials and intelligence officers, receipt of things of value 

from them, and a lack of candor in his “convoluted and contradictory 

responses” to questions about his contacts. 

• Two agents were proposed for dismissal, the first for lying under oath 

during an administrative inquiry, falsification of Bureau forms, 

misappropriation and conversion of Bureau ammunition and 

unauthorized disclosure. The second was proposed for dismissal as a 

result of her unauthorized disclosure and lying under oath during the 

administrative inquiry. 

• An agent was dismissed for failing to assist law enforcement in 

locating her boyfriend, associating with that individual, improper 

disposition of evidence and lack of candor by lying during the 

administrative inquiry about the boyfriend’s use of drugs. 

• An agent was dismissed for lying under oath about the circumstances 

of an accident in which he was arrested for driving under the influence 

of alcohol after leaving the scene. 

• A supervisory agent resigned after he was proposed for dismissal for 

converting Bureau property for his personal use, misappropriation of 

funds, and a lack of candor during the administrative inquiry. 

• A supervisory agent was proposed for a demotion, a 50-day 

suspension, and one-year probation after he misused his Bureau car, 

committed time and attendance violations, misused his Bureau calling 

card, and conducted an affair with his neighbor while on duty. At his 

hearing, the employee lacked candor and was informed that his lack of 

candor would be investigated. The employee resigned prior to the 

inquiry into his lack of candor. 

• An agent was dismissed for lying under oath after he misused his 

Bureau car to transport his daughter from day care, committed time 

and attendance violations, used poor judgment when he conducted an 

unauthorized traffic stop, and falsely stated the number of times he had 

improperly transported his daughter. 

24
• An agent was dismissed for repeated falsehoods after he falsely 

implicated a former Bureau employee and a local police officer for 

possessing an MP-5 shoulder weapon, which resulted in a theft case 

being opened against the former employee. 

• A Unit Chief resigned after being advised that he would be proposed 

for dismissal as a result of his lying under oath about the 

circumstances of his arrest for masturbating in a national park. 

• An agent resigned after being advised she would be proposed for 

dismissal regarding false statements she made at a National 

Transportation Safety Board hearing and for lying under oath during 

the administrative inquiry. 

• A probationary agent was dismissed when she lied to a staff counselor 

and misled two class counselors about her involvement with another 

married agent in her New Agent’s Class. Her actions were determined 

to have violated the FBI Academy Honor Code. 

• An agent resigned after being advised he would be proposed for 

dismissal after he lied about the second misuse of his government 

credit card while on probation for the first misuse. 

III. The Disciplinary Decisions 

A. The SES Board 

The initial SES Board met regarding the Potts party cases on December 14, 

1998. The Board consisted of five SES members from FBI Headquarters. 

According to notes of the December 14 meeting, the five SES Board members and 

six non-Board observers, including OPR Assistant Director DeFeo, were present. 

DeFeo began the SES Board meeting by making a presentation to the Board 

about the investigation of the Potts party issues. DeFeo noted in his presentation 

that this investigation was conducted jointly with DOJ OPR and that as a result 

DOJ OPR would be “watching” what they did. According to observers, Thomas 

Coyle, the Assistant Director of the Inspection Division and a member of the 

Board, stated during the meeting that he did not care what the Department thought 

and then went on to note that he would not rely on the forms (meaning form 540 

25
(request for travel authorization) and form 1012 (travel reimbursement voucher)).14 

Coyle later told the OIG that he was sympathetic to the fact that SACs are 

extremely busy and cannot give their personal attention to administrative details. 

Notes taken by observers of the meeting indicate that the Board initially 

discussed whether the October 10 training conference was a sham. The Board 

concluded that the conference was not a sham, but that the planners exercised poor 

judgment in not properly preparing for it. The notes indicate that one Board 

member stated that he believed that a preponderance of the evidence showed that 

the conference was organized solely to justify travel to the party and that a letter of 

censure was insufficient for misconduct. 

According to notes of the meeting, the Board discussed the unclear facts 

surrounding former Deputy Director Esposito’s encouragement to attend 

retirement events. This was viewed as a mitigating factor for the SACs who 

attended the Potts party.15 The notes from the Board meeting indicate that the 

Board felt there was “no harm, no foul” with respect to Collins’ trip, and that he 

did conduct some business during his trip. With respect to Gonzalez, the notes 

stated that the Board concluded it was a “bad practice,” and for Harp and Clark the 

notes state, “seems clear he did some business.” For Daulton, the notes state 

“reluctance to find lack of candor on a marginal fact.” It appears from the notes 

that there was some discussion as to whether the SACs used poor judgment, but the 

consensus of the Board was that the policies on SAC travel were “too unclear for 

culpability.”16

 

(continued)

14 At the time, Coyle, like Potts, was a subject of the Ruby Ridge investigation, which was 

ongoing at the time of the Potts party SES Board. Allegedly, Coyle had selected one of the FBI 

investigators who reviewed the original Ruby Ridge incident and that investigator was later 

found by DOJ OPR to have had a potential conflict of interest. See discussion of the Ruby Ridge 

case in Chapter Five. 

15 The OPR memorandum summarizing the evidence in the Potts case was unclear regarding 

the strength of the evidence on this issue. Esposito apparently indicated that he had not changed 

the policy to allow such travel, and certainly no written change had ever been issued. Officials 

in the FBI’s Finance Division also stated that the government-wide policy clearly prohibited 

such reimbursement, and that they would have advised Esposito, if they had been asked or had 

known about a purported change, that no such change was possible. 

16 While the SES Board may have thought the policy was unclear, an FBI Finance Division 

official told FBI OPR that memoranda issued by the Department prohibited reimbursement for 

retirement parties unless an employee had been designated as an official representative of the 

26
Two observers’ notes indicate that the Board voted for a letter of censure for 

Wolfinger, an oral reprimand for Louden, no action for Clark, Collins, Gonzalez, 

and Harp except restitution of their travel expenses, and a polygraph for Daulton. 

The Board met two days later, on December 16, 1998. Several witnesses told 

us that they believed that the Board met again because it had not finished its 

deliberations on the matter. Notes from this meeting indicate otherwise, and we 

were told by one observer that Board Chair Rubin Garcia, who at the time was 

Assistant Director of the Personnel Division, reconvened the Board because he 

believed that the initial decisions were inappropriate. Garcia told the OIG that he 

could not recall why the second Board meeting was convened. 

Notes from the December 16 meeting show that the issue of whether the 

October 10 conference was a sham was discussed again. The notes state that there 

was a “strong presentation” by OPR Assistant Director DeFeo citing statements of 

several witnesses that the conference was a sham. One of the observers told the 

OIG that although he could not recall specifically, he believed that the Board did 

not change its initial finding that the conference had the appearance of impropriety 

but was not a sham. The notes show that the Board was unanimous in its finding 

that some adverse action was appropriate for Wolfinger and that a letter of censure 

was appropriate for Louden in light of his subordinate position to Wolfinger. 

According to notes of the meeting, the Board also discussed whether there 

should be any changes to the recommendation of no discipline for Clark and 

Collins. The Board decided that Clark and Collins reasonably relied on Esposito’s 

encouragement to attend FBI retirement events, but the Board was concerned that 

their travel vouchers did not reflect that they had traveled for that purpose. The 

Board voted four to one in favor of a letter of censure for both Clark and Collins 

for “inattention to detail” in filling out the travel vouchers. The notes reflect that 

in discussing Harp, the Board felt that it could not disprove his assertion that he 

talked with someone about the Cleveland Field Office during his visit to

Washington, so there was no “candor issue.” The notes indicate that the Board 

concluded that Harp “did (probably) visit people” at FBI Headquarters, but that the 

 (continued)

agency, such as when presenting a plaque. All of the subjects interviewed by FBI OPR indicated 

that they understood that obtaining reimbursement for attending a retirement party was 

impermissible, although Clark and Collins argued that Esposito’s comments had at least changed 

the rules for the SAC Advisory Committee. 

27
meetings were not necessary. The Board voted unanimously to censure both Harp 

and Gonzalez for unauthorized and inappropriate travel. 

On December 24, 1998, the SES Board issued a memorandum reporting its 

recommendations. The Board recommended that Louden be suspended for 15 

days for neglect of duty resulting in a perception of impropriety. We were unable 

to determine how it came about that Louden’s punishment changed from the letter 

of censure agreed to during the previous Board meeting. The memorandum 

recommended that Clark and Collins be issued letters of censure for inattention to 

detail because they misstated the purpose of their travel on the FBI travel forms.17 

It also recommended that Gonzalez and Harp be issued letters of censure for travel 

without adequate justification, in violation of the Federal Travel Regulations. The 

Board requested a polygraph for Daulton. The December 24 memorandum also 

indicated that a separate recommendation was to be issued as to Wolfinger. We 

were told by DeFeo that no recommendation as to Wolfinger was ultimately made, 

primarily because he was expected to retire but also because it was well known 

that his wife was very ill. 

Former FBI Deputy Director Thomas Pickard and former Assistant Director 

Garcia, two members of the Board, told us that the Board took the Potts retirement 

party matter very seriously. They said that the Board believed most of the 

responsibility for the problems lay with the conference planners – Wolfinger and 

Louden. Both Pickard and Garcia also said that, as senior executives, the Board 

members were sensitive to the explanations offered by Clark and Collins that they 

had signed forms without really looking at them. Garcia said that all of the Board 

members were busy and knew what it was like to be in that position. Garcia stated 

that “inattention to detail” is different for a senior executive than it is for a line 

agent because of the amount of matters on a senior executive’s agenda each day. 

Garcia stated that the Board also was sensitive to the situation of Harp and 

Gonzalez because SES-level employees frequently do not have a written or 

planned agenda when they travel to FBI Headquarters, and it is possible to get a lot 

of work done just “walking the corridors.” He said that the Board believed it was 

possible that Harp and Gonzalez might not recall exactly with whom they met at 

Headquarters because there is no requirement that they document what they did 

there. Pickard said that to the extent that the SACs got work done while in 

Washington for the party, it was not a waste of government money. Garcia said 

 

17 Collins retired on December 31, 1998, so his letter of censure was never issued. 

28
that the Board ended up concluding that Harp and Gonzalez should have had 

clearer agendas and that, without more structured plans, their travel was 

inappropriate. Garcia also said that both Harp and Gonzalez might have received a 

short suspension if that had been an option.18 

B. The Deputy Director’s Decision 

Deputy Director Bryant issued the letters of censure as recommended by the 

Board. However, he decided that the recommendation of a 15-day suspension for 

Louden was “unnecessarily harsh,” because he believed that Louden neglected his 

duty but did not engage in willful misconduct. Instead, Bryant decided that a letter 

of censure to Louden was sufficient. Bryant has retired from the FBI, and he did 

not respond to our requests to interview him on this matter.

C. Oversight By DOJ OPR 

On September 12, 2000, DOJ OPR wrote a memorandum to FBI OPR 

suggesting that the evidence supported findings of serious misconduct by 

Gonzalez, Harp, and Louden and warranted consideration of more significant 

discipline. DOJ OPR stated in its memorandum that the fact that the three received 

only letters of censure raised concerns that certain evidence in the file was not 

given sufficient consideration. FBI OPR Assistant Director DeFeo responded on 

November 9, 2000, that the matter had been decided by an FBI SES Board and, 

although the system of convening an SES Board to make disciplinary decision on 

SES members had been disbanded in the summer of 2000, he did not believe that 

FBI OPR had the authority to review the SES Board’s decisions. 

IV. OIG Analysis 

A review of the Potts retirement party discipline matter four years after the 

events is difficult because the facts were not entirely clear, and the findings in 

many instances rested on an assessment of the credibility of statements made by 

the subjects. Moreover, the fact that an important witness, Esposito, retired and 

 

18 On December 21, 2001, the General Accounting Office (GAO) issued a four-page letter 

describing the results of its review of OPR’s investigation of the Potts party incident. The GAO 

concluded that the investigation of the matter by OPR had been thorough. In its letter, the GAO 

set forth the discipline that the subjects received, but it did not comment on the appropriateness 

of the discipline. 

29
refused to be interviewed made credibility assessments of certain subjects’ 

statements more difficult. 

Nonetheless, given the strong evidence against the subjects, we believe that 

the SES Board came to the result that it did because it gave undue weight to the 

subjects’ explanations that at a minimum were uncorroborated and in many 

instances were refuted. The Board also appeared to accept some of the subjects’ 

contentions that meeting with officials while walking the hallways of FBI 

Headquarters was sufficient to support a claim that they had accomplished business 

while in Washington. We do not believe that non-SES employees would have 

received a similar “benefit of the doubt,” or that their punishment would have been 

the same given similar circumstances. 

In addition, because of Wolfinger’s impending retirement, Louden was the 

only Training Division official recommended for discipline by the Board. We did 

not find the Board’s recommendation for a 15-day suspension of Louden to be 

unreasonable, and we believe the Deputy Director’s decision to reduce the penalty 

to a letter of censure is highly questionable. Several officials we spoke to felt that 

this reduction was appropriate because Wolfinger, Louden’s supervisor, had retired 

and would not be disciplined at all. Others felt that such a light sanction for 

Louden was inappropriate because he should not have followed orders to do 

something improper. These officials believed that reporting questionable orders to 

OPR or an FBI official was the appropriate course of action, and Louden’s failure 

to do that merited serious discipline. We agree with the position that an employee 

at the level of a section chief could have and should have refused to follow 

Wolfinger’s orders or reported the matter to OPR. In addition, we believe the 

discipline ultimately imposed on Louden was unduly lenient. 

One of the allegations we reviewed was whether Coyle’s participation on the 

SES Board was inappropriate because of a conflict of interest. We concluded that 

Coyle should not have participated because, at a minimum, an appearance of a 

conflict of interest existed, if not an actual conflict of interest. At the time of the 

Board decisions, Coyle and Potts were subjects in the Ruby Ridge investigation. 

The significant controversy about Ruby Ridge and the fact that many FBI 

managers believed that Potts was treated unfairly because of the Ruby Ridge 

allegations cannot be ignored. It was well known that many people wanted to 

attend the Potts retirement party to show support for him because of the Ruby 

Ridge investigation. That attitude was likely to be especially strong for someone 

like Coyle who also was a Ruby Ridge subject. We believe that Coyle should have 

recused himself or been removed from these Board proceedings. 

30
It is also clear that the decisions in the Potts party cases exacerbated the 

perception of a double standard throughout the FBI. First, it was widely believed 

that agents in the field would have been summarily fired for voucher fraud and 

false statements under the Director's “bright line” rule. While it is difficult to 

directly compare one case to another, we note that in a precedent case that appears 

on point, a Unit Chief resigned after being proposed for dismissal for having lied 

about the purpose of a trip to Los Angeles and his personal relationship with the 

secretary who accompanied him. Voucher fraud also was involved because the 

Unit Chief’s voucher misstated the purpose of his trip. 

Under the FBI disciplinary system in place at the time of the Potts party, FBI 

OPR did not make final conclusions as to whether there had been misconduct and 

the nature of that misconduct. The SES Board made the findings of fact using 

OPR’s factual record, including making disciplinary recommendations. It appears 

to us that the SES Board was unduly lenient and uncritical in its analysis of the 

facts available to it, and that the Board recommended very mild disciplinary action 

for the misconduct involved. In the face of what was perceived as a flagrant abuse 

of FBI travel vouchers, the punishment was only a letter of censure for a few of the 

FBI managers involved. We believe, based on our review of the facts and the FBI 

precedent, that this result was too lenient. 

31
CHAPTER FIVE 

RUBY RIDGE 

CHAPTER FIVE: RUBY RIDGE 

“Ruby Ridge” is a shorthand phrase for events that occurred in 1992 in Ruby 

Ridge, Idaho, after an attempt by U.S. Marshals to arrest Randall Weaver on a 

fugitive warrant. Deputy United States Marshals became involved in a shootout 

with Weaver, members of his family, and a family friend. A Deputy Marshal and 

Weaver’s teenage son were killed during the gunfire. A specialized FBI unit was 

then called in to capture Weaver and the others. During the resulting standoff, an 

FBI sharpshooter shot and killed Weaver’s wife. Weaver and his family ultimately 

surrendered. In a federal trial of Weaver, he was acquitted of murder and other 

serious federal charges. 

The conduct of the Deputy Marshals and the FBI in the Ruby Ridge matter 

also came under close scrutiny, and several internal FBI and DOJ investigations 

ensued. These internal investigations also came under scrutiny, including 

questions whether there was an effort in the FBI internal investigations to cover up 

the original misdeeds. 

In January 2001, nearly nine years after the original Ruby Ridge events, the 

final disciplinary decisions pertaining to the allegations were made by Assistant 

Attorney General Stephen Colgate, then the head of the DOJ’s Justice 

Management Division (JMD). Colgate decided, against the recommendations of 

DOJ OPR and the JMD Assistant Director for Human Resources who was asked to 

review the matter, that the evidence did not support additional discipline against 

anyone. 

The disciplinary decision in the Ruby Ridge incident has been cited as an 

example of a double standard in the FBI. We believe that substantial problems

marred the original investigation of the Ruby Ridge incident and the disciplinary 

process that took almost nine years to come to an end. Allegations arose that the 

FBI investigators who looked into what happened at Ruby Ridge intentionally or 

negligently conducted poor investigations resulting in a cover-up of misconduct by 

FBI officials. Although the motivation of the FBI investigators has never been 

clearly resolved, the evidence brought forth by later investigations showed that the 

original investigations conducted by the FBI were significantly flawed, perhaps to 

protect senior officials. These flawed investigations affected the disciplinary 

decisions.

32
Following years of subsequent investigations and retirements, only a few 

officials who were under investigation for the cover-up portion of the case were 

left to have their cases adjudicated. These final disciplinary decisions were 

assigned to and decided by JMD, and therefore the final decisions, to the extent 

that there is disagreement with them, cannot be blamed on the FBI’s protection of 

senior officials. Although we disagree with the ultimate JMD decision, we do not 

believe that the JMD officials involved were part of a systemic effort to protect 

senior FBI officials. Rather, we believe that JMD used an incorrect standard in 

evaluating the evidence. We also believe that the disciplinary actions in Ruby 

Ridge contributed to the continued perception of a double standard of discipline in 

the FBI. 

Although the original Ruby Ridge incident has been well documented and 

discussed, the tortured aftermath has not been disclosed previously in one report. 

We believe that a recitation of the internal investigations and disciplinary process 

can shed light on what has, up to now, been a process shrouded in secrecy. 

Accordingly, we explain in some detail the events from Ruby Ridge to the final 

disciplinary decisions. 

Chronology of Events in the Ruby Ridge Investigations 

1986 ATF begins to investigate Randall Weaver 

June 1990 Weaver indicted, fails to appear in court, arrest warrant issued 

August 1992 Standoff begins; FBI activates Strategic Information and Operations Center 

and Hostage Rescue Team; Rules of Engagement drafted; FBI sharpshooter 

Horiuchi wounds Weaver and Harris, kills Vicki Weaver 

September 30, 1992 FBI Shooting Incident Review Team finds shooting justified 

November 2, 1992 FBI holds routine after-action conference; Kahoe later destroys report 

November 9, 1992 FBI Shooting Incident Review Group finds no FBI misconduct 

April 1993 Weaver and Harris acquitted of murder charges. Weaver convicted of 

failure to appear and committing an offense on release; Coulson promoted 

July 1993 Deputy Attorney General forms special inquiry team headed by Barbara 

Berman; FBI forms team for investigative support to Berman team

September 1993 Inspectors Robert E. Walsh and Van Harp appointed to lead FBI team

assisting Berman 

November 1993 Coulson and Kahoe receive cash awards 

January 16, 1994 FBI team issues Walsh Report; finds no FBI misconduct 

33
June 10, 1994 Berman inquiry report; concludes rules of engagement were defective and 

Horiuchi first shot justified, second shot not justified 

June 1994 FBI forms Mathews team to review Walsh and Berman reports 

June 30, 1994 DOJ OPR issues separate opinion finding both Horiuchi shots were justified

Summer 1994 DOJ Civil Rights Division declines to prosecute Horiuchi for lack of 

evidence; concludes rules of engagement were unconstitutional 

September 1994 Coulson promoted 

December 6, 1994 Freeh promotes Potts to Acting Deputy Director 

December 16, 1994 Mathews team recommends discipline for Glenn, Rogers, and Kahoe, but 

not Potts or Coulson 

December 29, 1994 FBI Assistant Director Coyle sends letter to Freeh recommending

disciplinary action for Coulson and Potts 

December 29, 1994 Freeh recommends to DAG Gorelick that Potts be issued a letter of censure 

January 6, 1995 Freeh announces proposed discipline of FBI employees 

March 7, 1995 Freeh urges Gorelick to censure Potts instead of suspending him 

April 5, 1995 Gorelick decides to censure Potts 

May 2, 1995 Potts promoted to Deputy Director of FBI 

May 3, 1995 Glenn sends letter to DOJ OPR alleging cover up by Mathews team

May 1995 DOJ OPR begins investigation into alleged FBI cover up 

July 1995 DOJ OPR refers Ruby Ridge matter for criminal investigation; reports 

preliminary findings to the DAG; Mathews promoted 

August 1995 Criminal investigation begins, headed by Michael R. Stiles, the U.S. 

Attorney for the Eastern District of Pennsylvania 

August 11, 1995 Freeh places Potts and Coulson on administrative leave 

December 1995 Harp promoted to SAC, Cleveland 

October 1996 Kahoe pleads guilty to obstruction of justice and is sentenced to serve 18 

months in prison; Walsh receives bonus 

December 1996 Walsh promoted to SAC, San Francisco; Kahoe retires 

June 1997 Mathews promoted to SAC, New Orleans 

August 12, 1997 Stiles criminal investigation concludes with no further criminal charges, 

refers matter back to DOJ OPR for further administrative investigation 

August 1997 DOJ OPR starts administrative investigation; Coulson retires 

34
November 1997 Harp receives cash award 

March 1998 Walsh retires 

October 1998 Harp receives cash award 

January 1999 DOJ OPR provides copies of its draft report to FBI OPR 

April 8, 1999 FBI OPR responds to DOJ OPR's report 

June 30, 1999 DOJ OPR issues final report; concludes Potts, Coulson, Walsh, Harp, and 

Mathews committed misconduct; report sent to AAG Colgate for 

disciplinary decisions; Colgate assigns JMD Assistant Director Jarcho to 

review matter 

December 1999 Jarcho completes review; concludes Freeh, Potts, Coulson, Harp, and 

Mathews should be disciplined; recommends rescission of discipline for 

certain FBI employees, including Glenn and Rogers 

Colgate asks JMD Deputy AAGs Vail and Sposato to review Jarcho's report

April 17, 2000 Vail and Sposato complete their review; conclude no misconduct or 

evidence of bad intent 

October 5, 2000 DOJ OPR responds to Vail and Sposato; objects to no misconduct 

conclusions 

November 29, 2000 FBI OPR responds 

January 3, 2001 Colgate issues decision, concludes no further disciplinary action should be 

imposed and no prior disciplinary decisions should be changed or rescinded

 

I. Background 

The underlying events that comprise the Ruby Ridge incident are well 

known, so we will only briefly summarize them below. Beginning in 1986, 

Randall Weaver was the subject of an investigation by the Bureau of Alcohol, 

Tobacco and Firearms. Weaver lived on a mountain in Ruby Ridge, Idaho, and 

was believed to be associated with a white supremacist group and to traffic in 

illegal firearms. In June 1990, Weaver was indicted by a federal grand jury on 

weapons offenses. Weaver was arrested and released pending trial. Due in part to 

a clerical error notifying him of the trial date, he did not appear for trial and an 

arrest warrant was issued for him. According to law enforcement sources, Weaver 

retreated to his cabin and threatened to shoot any law enforcement officers who 

tried to arrest him. 

35
In August 1992, Weaver’s family discovered three Deputy U.S. Marshals 

who were surveilling Weaver to prepare for his arrest. Kevin Harris, a Weaver 

family friend, shot and killed Deputy Marshal William Degan, and Weaver’s 

teenage son Samuel was killed during the gunfire. 

 The FBI was called into the matter. The FBI activated its Strategic 

Information and Operations Center (SIOC), an FBI Headquarters post used for the 

management of crises. It also activated its Hostage Rescue Team (HRT), a tactical 

unit of agents trained in handling high-risk situations. The FBI Assistant Director 

for Criminal Investigative Division, Larry Potts, and his deputy, Danny Coulson, 

discussed the need for an operations plan containing rules of engagement that 

would provide guidance for the HRT’s actions. Rules of engagement were drafted 

which provided that if any adult male was observed with a weapon, deadly force 

“can and should be employed” if the shot could be taken without endangering any 

children. 

On August 26, 1992, the HRT was deployed to the site and surrounded 

Weaver’s cabin. When an HRT helicopter took off and flew near the cabin, 

Weaver, his sixteen-year-old daughter Sarah, and Kevin Harris came out of the 

cabin, all armed with rifles. HRT sharpshooter Lon Horiuchi fired one shot, 

wounding Weaver. Weaver, his daughter, and Harris began running back to the 

cabin, and Horiuchi fired a second shot that penetrated the open door of the cabin. 

The shot killed Weaver’s wife, Vicki Weaver, who was behind the door, and 

seriously wounded Harris. 

The standoff ended on August 31, when the remaining occupants voluntarily 

left the cabin. Weaver and Harris were charged with various federal offenses, 

including murder. They were both acquitted of the most serious charges following 

a trial. Weaver was convicted of failure to appear for trial and committing an 

offense while on release. 

II. Initial Internal Inquiries 

The FBI and the Department of Justice conducted several internal inquiries to 

determine what had occurred at Ruby Ridge and whether there had been any 

improper actions taken by law enforcement personnel. 

The first review of the Ruby Ridge incident was conducted by an FBI 

Shooting Incident Review Team (SIRT). FBI procedures call for an administrative 

review of all shooting incidents. The SIRT review of the Ruby Ridge shootings, 

which began even before the standoff at Ruby Ridge had ended, was headed by an 

36
FBI Inspector and included seven other FBI employees. This team was responsible 

for reviewing the propriety of the use of deadly force by Horiuchi and the 

adequacy of the command, control, and operational planning of the entire Ruby 

Ridge operation. 

The report issued by the SIRT team on September 30, 1992, concluded that 

Horiuchi had been justified in taking both shots and that the FBI had responded 

appropriately at Ruby Ridge. It noted that the rules of engagement that were in 

effect at the time of the shooting had been approved by SAC Eugene Glenn, who 

was the on-scene commander, HRT SAC Richard Rogers, “and FBIHQ personnel,

to include Assistant Director Larry A. Potts. . . .” 

After the SIRT report was issued, the Shooting Incident Review Group, 

headed by Michael Kahoe, the Section Chief of the FBI’s Violent Crimes and 

Major Offenders Section, reviewed the report and the FBI’s use of force at Ruby 

Ridge. According to FBI procedures, a Shooting Incident Review Group reviews 

the report and conclusions of the SIRT team. Kahoe’s Review Group issued its 

own conclusions in a memorandum dated November 9, 1992. Kahoe’s Review 

Group concluded that no FBI personnel had engaged in misconduct. It also 

concluded that the rules of engagement used at the scene had been approved by 

FBI Headquarters personnel. 

In addition, on November 2, 1992, the FBI held a routine after-action 

conference, which the FBI typically uses to critique an emergency response and to 

determine how the FBI can improve its response in the future. A report prepared 

by FBI employees under Kahoe’s direction summarized the conclusions of the 

conference. A subsequent criminal investigation, which we describe below, found 

that Kahoe failed to disclose the conference report during discovery in the trial of 

Weaver and Harris, and in fact had destroyed his copy of the report and ordered his 

subordinate to destroy his copies. As we describe below, for these actions, Kahoe 

later pled guilty to obstruction of justice and was sentenced to eighteen months in 

prison. 

III. Department’s “Berman” Inquiry and FBI’s “Walsh” Inquiry 

In July 1993, DOJ OPR initiated an investigation into the allegations of 

misconduct by the government in the Ruby Ridge matter. The allegations were 

raised by several sources, including defense counsel for Weaver and Harris, the 

U.S. Attorney’s office in Idaho (which had prosecuted the cases against Weaver 

and Harris), and FBI personnel. Shortly thereafter, Deputy Attorney General 

Philip Heymann assigned the allegations to a DOJ task force for review. Four 

37
attorneys from the Department’s Criminal Division were assigned to work with 

OPR Assistant Counsel Barbara Berman to investigate the allegations. This review 

became known as the “Berman Inquiry.” The FBI was asked to provide 

investigative support for the inquiry. The FBI assigned an investigative team, led 

by two FBI inspectors, to assist the DOJ task force. These two inspectors were

replaced by FBI Inspectors Robert Walsh and Van Harp in September 1993.19 

After a contentious decision was made by Deputy Attorney General 

Heymann to exclude FBI agents from some of the interviews, the FBI withdrew 

from the investigation and produced its own report, dated January 16, 1994, which 

came to be known as the Walsh Report. This report was issued several months 

prior to the Berman Inquiry’s final report. DOJ OPR later found that it was 

“understood that Berman was in charge of the inquiry and would be issuing a 

formal report on behalf of the DOJ task force.” A later JMD review also 

concluded that the FBI investigators had been instructed to assist the DOJ task 

force and not to reach their own conclusions regarding the Ruby Ridge incident. 

Yet, the Walsh report included conclusions and legal analysis, including the 

propriety of the rules of engagement and the shots fired by Horiuchi. The Walsh 

Report concluded that the rules of engagement as written could have been 

misunderstood, but it found that they were not misunderstood by Horiuchi and 

added that Horiuchi’s use of deadly force at Ruby Ridge was “reasonable under 

constitutional standards.” 

Berman and her team produced a different report, dated June 10, 1994. The 

Berman report found serious failings by the FBI and the U.S. Attorney’s office in 

their handling of the Ruby Ridge matter and subsequent events. The Berman 

report concluded that the rules of engagement were defective because of the 

inclusion of the word “should” in the phrase deadly force “can and should be 

employed,” which deviated from the standard deadly force policy that requires 

agents to assess the level of danger before using deadly force and to give warnings 

if feasible. The report was unable to reach a conclusion as to whether FBI 

Headquarters had approved the “can and should” language, but stated that it was 

“inconceivable” that FBI Headquarters remained ignorant of the rules of 

engagement throughout the entire incident. The report concluded that Horiuchi’s 

 

19 According to a later report issued by DOJ OPR, it was widely known that Walsh was a 

close friend of Potts, who was a subject of the investigation for his alleged approval of the rules 

of engagement. 

38
first shot was justified, but that his second shot was not because the immediacy of 

the threat had dissipated when the subjects retreated into the cabin. 

DOJ OPR Counsel Michael Shaheen transmitted the Berman report to 

Deputy Attorney General Jamie Gorelick on June 30, 1994, together with DOJ 

OPR’s separate views on the issue of Horiuchi’s second shot. In a report signed by 

Shaheen, DOJ OPR disagreed with the Berman report’s conclusion that the second 

shot was not justified. DOJ OPR argued that the second shot was justified in view 

of the totality of the circumstances. Based on its review of the reports, in the 

summer of 1994 the DOJ Civil Rights Division concluded that while the rules of 

engagement were probably unconstitutional, the evidence was insufficient to 

justify a prosecution of Horiuchi. 

IV. The FBI’s “Mathews” Review 

After the issuance of the Walsh and Berman reports, the FBI conducted an 

administrative review of the Berman findings to determine what, if any, 

disciplinary action should be taken against FBI personnel. The FBI’s General 

Counsel asked Thomas Coyle, Assistant Director for the Personnel Division, to 

assemble a team to determine what administrative action should be taken by the 

FBI. Coyle picked Charles Mathews, who was the Associate SAC (ASAC) in San 

Francisco, to conduct the review. Mathews had worked as an ASAC under 

Coulson for two and a half years, from 1988 to 1990, when Coulson was the SAC 

in Portland, Oregon. 

On December 6, 1994, ten days prior to the issuance of the Mathews report, 

Freeh elevated Potts to the position of FBI Acting Deputy Director. The Mathews 

team issued its report on December 16, 1994. It recommended discipline for 

several agents related to mishandling of the crime scene or laboratory issues. It 

also recommended a censure for on-scene commander Glenn for “approval of 

flawed rules of engagement that could reasonably be interpreted to direct FBI 

employees to act contrary to policy and law”; a censure for HRT SAC Richard 

Rogers for “creating and documenting flawed [rules of engagement] that could 

reasonably be interpreted to direct FBI employees to act contrary to policy and 

law”; a censure for Michael Kahoe for “failures in supervising the SIRG [Shooting 

Incident Review Group’s] review” of the incident; and a censure for the ASAC 

who prepared the Shooting Incident Review Team’s report on the incident for 

failures in preparing the team’s report. The Mathews report did not contain any 

recommendations for discipline against Potts or Coulson. The Mathew’s report 

suggested that it was not recommending discipline for Potts or Coulson in part 

39
because of the Mathews team’s conclusion that rules of engagement are generally 

approved at the level of the on-scene commander and not at FBI Headquarters. 

The report stated that because there was no requirement for the rules of 

engagement to be approved at the Headquarters level, there was no need to pursue 

whether the rules of engagement had actually been approved at the Headquarters 

level. 

V. FBI Disciplinary Decisions 

Following the Mathews report, on December 29, 1994, Coyle sent a 

memorandum to FBI Director Freeh containing amended recommendations for 

disciplinary action. Coyle suggested amending the Mathews recommendations so 

that Coulson and Potts would receive a censure for “failing to review the finalized 

[rules of engagement] after involving [themselves] in discussions leading to the 

promulgation of the [rules of engagement]”; that Glenn and Kahoe be referred to 

the SES Board for consideration of appropriate action rather than “merely 

censure”; and that Rogers be censured and suspended rather than “merely 

censure.” 

On December 29, 1994, Director Freeh sent a letter to Deputy Attorney 

General Gorelick recommending that Potts be issued a letter of censure.20 The 

letter stated that Freeh had found that Potts had discussed and approved the rules of 

engagement with ASAC Rogers prior to Rogers’ arrival at Ruby Ridge. But 

Freeh’s letter stated that he found the rules of engagement as subsequently drafted, 

approved, and disseminated on site, and which had been found to be improper, had 

not been approved by Potts. Freeh concluded that although Potts’ approval of the 

rules of engagement was not required by FBI policy at that time, Potts was remiss 

in failing to review the finalized rules after involving himself in discussions 

leading to their promulgation. 

On January 6, 1995, Director Freeh held a press conference and announced 

the proposed discipline of the FBI employees, as listed in the December 1994 

Coyle memorandum. 

On March 7, 1995, Freeh wrote a memorandum to Deputy Attorney General 

Gorelick urging her to approve his recommendation of a censure for Potts for 

 

20 As noted above, by regulation all final decisions on discipline for FBI executives at the 

level of Assistant Director or above must be approved by the Deputy Attorney General. 

40
“failing to follow through on his discussion concerning the rules of engagement to 

be recommended to the on-scene commander.” Freeh stated in the memorandum

that Gorelick had advised him that she was “preliminarily inclined to recommend 

the discipline be increased to a thirty-day suspension.” Freeh wrote that he 

strongly disagreed on the grounds that Potts’ actions were deficient only to the 

extent that he did not follow through on earlier discussions about the rules of 

engagement and that a thirty-day suspension would be disproportionate to Potts’ 

conduct. Freeh argued that the suspension would send “a wrong message to both 

the public and the employees of the FBI,” would signal that there was culpability 

among FBI employees for the accidental shooting of Vicki Weaver, and would 

harm the credibility of Potts and other FBI employees involved in the creation and 

implementation of the rules of engagement. Freeh also stated that the increased 

discipline was “so divergent from my recommendation that it is likely to do 

profound damage to the relationship between the Department and the FBI.” Freeh 

expressed concern about the impact that the suspension would have personally on 

Potts and about the impact it would have on Freeh’s credibility as Director. Freeh 

urged Gorelick to censure Potts, but recommended that if she was still persuaded to 

the contrary, that she consider reducing Potts in grade for six months and place him 

on probation for one year. 

On April 5, 1995, Gorelick approved Freeh’s recommendation that Potts be 

issued a letter of censure for his role in Ruby Ridge, and the letter of censure was 

issued. On May 2, 1995, the Attorney General approved Director Freeh’s 

recommendation that Potts be named as Deputy Director of the FBI. 

VI. Investigation of Alleged Cover Up 

On May 3, 1995, while the FBI’s final disciplinary actions against him were 

pending, Glenn sent a letter to DOJ OPR alleging that the disciplinary review 

conducted by Mathews had been faulty and requesting that DOJ OPR conduct its 

own investigation. Glenn alleged that the deficiencies in Mathews’ investigation 

“reveal a purpose to create scapegoats and false impressions, rather than 

uncovering or reinforcing the reality of what happened at Ruby Ridge.” Glenn 

stated that the DOJ and FBI investigations (referring to the Berman and Walsh 

Reports) had determined that the rules of engagement had been approved at the 

level of Headquarters, but that the Mathews report blamed Glenn alone for 

approving them. He also alleged that the Mathews investigation was incomplete 

and resulted in discipline for agents without faulting those who had supervised 

them. Glenn also alleged that Mathews had a close relationship with Coulson and 

41
that this association caused Mathews “to avoid the development of the necessary 

facts, and caused him to cover up facts germane to the central issues.” 

Glenn’s allegations led to several subsequent investigations. In the spring of 

1995, DOJ OPR began an investigation into allegations that some of the FBI 

agents involved in the earlier inquiries had intentionally withheld or covered up 

information in order to protect the FBI, Potts, and Coulson from criticism. As a 

result of the new investigation, DOJ OPR concluded that Kahoe had lied under 

oath to the Berman team about the destruction of the after-action report, that Potts 

and Coulson had been closely involved in the drafting of the rules of engagement, 

that Potts had approved the rules of engagement, and that the decision to destroy 

the after-action report had been made “above Kahoe.” 

In July 1995, DOJ OPR reported its preliminary conclusions to Deputy 

Attorney General Gorelick, and the matter was referred for criminal investigation. 

As a result, on August 11, 1995, Director Freeh placed Potts, Coulson, and two 

other officials on administrative leave with pay. 

The criminal investigation was supervised by Michael Stiles, the U.S. 

Attorney for the Eastern District of Pennsylvania. That two-year investigation 

resulted in the conviction of Kahoe for obstruction of justice in connection with his 

destruction of the after-action report. Stiles recommended no further prosecutions, 

but he referred several matters back to DOJ OPR for investigation of 

administrative misconduct. In a letter dated August 12, 1997, Stiles referred to 

DOJ OPR several issues that he believed required further administrative review.21 

DOJ OPR investigated these matters, together with the broader questions of 

(1) how did the rules of engagement that were in effect at Ruby Ridge come to be 

formulated and approved, and (2) to what extent did misconduct by FBI personnel

contribute to the failure of the internal inquiries to uncover the full story of FBI 

actions in connection with Ruby Ridge. With respect to this second issue, DOJ 

OPR investigated several key points, including: 

 

21 Among the issues he suggested should be investigated further were a communication by 

Harp to subordinates concerning changes to FD-302 reports during the Berman investigation; an 

alleged improper statement by a special agent during an interview with DOJ OPR investigators;

an alleged improper comment by an FBI deputy general counsel to a criminal investigator; an 

alleged written instruction to an HRT sharpshooter not to provide information that conflicted 

with Horiuchi’s version of events; and other alleged improper actions by FBI employees during 

the investigations of Ruby Ridge. 

42
• Walsh’s and Harp’s failure to interview key witnesses who had been in 

the SIOC during the Ruby Ridge incident and their failure to uncover 

the truth about the after-action report; 

• Walsh’s and Harp’s editing of other agents’ FD-302s; 

• Walsh’s failure to recuse himself in light of his close friendship with 

Potts, a subject of the investigation; 

• Walsh’s and Harp’s drafting performance evaluations for team

members that appeared to reward agents for “correctly” concluding 

that FBI officials had acted properly; 

• Mathews’ failure to interview key witnesses in the SIOC; 

• Mathews’ use of an unsupported conclusion that FBI Headquarters 

officials were not required to approve rules of engagement as 

justification for his team not investigating to determine whether 

Headquarters officials had in fact approved the rules of engagement; 

and 

• Mathews’ failure to recuse himself given his friendship with Coulson, 

a subject of the investigation. 

In analyzing the conduct of FBI employees, DOJ OPR considered whether a 

given act or failure to act constituted misconduct, demonstrated poor judgment, or 

did not present any problems. DOJ OPR found misconduct in instances where it 

determined that the subject had intentionally violated his duty or had acted in 

reckless disregard of a generally accepted duty. It found poor judgment in 

instances where it determined that the conduct amounted to a less serious failure to 

carry out responsibilities properly. 

A. DOJ OPR Draft Report and FBI OPR Comments 

In January 1999, DOJ OPR provided copies of its draft report describing the 

results of its investigation to FBI OPR for review and comment. This was done 

pursuant to an agreement that FBI OPR would provide DOJ decision-makers with 

information on what policy provisions it thought should be applied to the 

disciplinary decision and what discipline it thought would have been taken if the 

Rudy Ridge decisions were handled within the FBI. In a memorandum dated April 

8, 1999, FBI OPR Assistant Director DeFeo responded to the draft report. 

DeFeo’s memorandum included information about what policy provisions would 

apply and what disciplinary action the FBI believed would be taken if the Ruby 

43
Ridge inquiry were being handled within the FBI. The memorandum addressed 

only those employees about whom adverse findings had been made and those who 

still worked for the FBI. 

The FBI OPR memorandum discussed the proposed discipline of Harp at 

length. It agreed with DOJ OPR’s conclusion that Harp used poor judgment in 

writing the agent evaluations, which made it appear that agents were being 

rewarded for “correctly” deciding that the HRT had acted properly. However, the 

FBI OPR memorandum stated that poor judgment would not provide a basis for 

discipline of an FBI SES member unless it rose to the level of misconduct, 

malfeasance, or neglect of duty. FBI OPR concluded that it would not recommend 

to the Deputy Director that poor judgment of that nature be referred to an SES 

Disciplinary Review Board. On the issue of whether FD-302s had been 

improperly edited, FBI OPR did not agree that Harp’s actions constituted 

misconduct or neglect of duty and stated that it would not recommend that the 

incident be referred to an SES Board. The memorandum asserted that “all Harp 

did was question the interviewer if certain language was accurate, and neither 

pressured nor instructed the interviewer to make any changes. . . .” The 

memorandum disagreed with DOJ OPR’s statement that it was a serious dereliction 

of duty for a supervisor who did not participate in an interview to direct or request 

changes in the substance of an FD-302. FBI OPR asserted that DOJ OPR had not 

defined “what is substance and what is style,” and that the final version of the 

FD-302 was accurate. 

The OPR memorandum also considered the allegation against Harp that he 

failed to conduct a complete investigation. It concluded that, in the absence of any 

direct evidence of wrongful intent, OPR would not recommend that Harp’s failure 

to ensure interviews of every person on the after-action conference list or to 

ascertain that Kahoe had lied be referred to an SES Disciplinary Review Board as

misconduct or neglect of duty. OPR concluded that the facts did not establish that 

Harp was responsible for either FBI management or Berman being deceived or 

ignorant as to the completeness of the Walsh inquiry. OPR stated that it would not

consider the FBI’s decision to withdraw from the Berman Inquiry, which was 

approved at much higher levels than Harp, or the lack of a disclaimer that the 

Walsh report was incomplete, to be misconduct attributable to Harp. The 

memorandum also rejected DOJ OPR’s conclusion that Harp had tried to 

counterbalance the perceived bias of Berman, and “thereby to protect some of the 

subjects of the investigation.” 

44
With respect to Mathews, FBI OPR agreed with DOJ OPR that Mathews 

used “extremely poor judgment in failing to recuse himself from the inquiry.” FBI 

OPR stated that it would have recommended that Mathews’ creation of the 

foreseeable appearance of impropriety in a case as significant as Ruby Ridge be 

referred to an SES Disciplinary Board for a review of whether misconduct or 

neglect of duty were present and for disciplinary consideration. FBI OPR 

disagreed with DOJ OPR’s assertion that Mathews relied on unsupported 

statements about who bore the responsibility for the approval of the rules of 

engagement. But FBI OPR concluded that Mathews should have been aware of 

the investigative holes in prior Ruby Ridge investigations and that it would have 

referred what is “arguably a marked departure from professional standards of 

thoroughness and impartiality to the SES Board for disciplinary consideration, 

particularly given the recusal issue.” 

B. Memorandum to DOJ OPR from FBI OPR Investigators 

The disciplinary issues became even more complicated when investigators 

within FBI OPR made clear that they did not agree with the official FBI OPR 

position as reflected in Assistant Director DeFeo’s April 8, 1999, memorandum to 

DOJ OPR. Three FBI OPR investigators who had worked on the DOJ OPR 

investigation – FBI OPR Unit Chief John Roberts, FBI OPR Unit Chief Frank 

Perry, and Supervisory Senior Resident Agent John Werner – sent a memorandum 

to DOJ OPR commenting on the draft DOJ OPR report. The memorandum stated 

that the authors had been advised by Assistant Director DeFeo that their 

observations and recommendations did not represent the official opinion of FBI 

OPR, so they wanted to provide their comments to DOJ OPR directly. 

In their memorandum, the FBI investigators were more critical of many of 

the FBI officials than FBI OPR’s memorandum was. The most significant 

difference was the investigators’ criticism of FBI Director Freeh. The investigators 

stated that they believed that Freeh should receive “direct criticism for his role in 

the Ruby Ridge adjudication.” The memorandum stated that Freeh’s actions in 

creating a deadline for the Mathews report and his elevation of Potts during the 

investigation of him “at least lend the appearance of implied influence on as of 

then an unfinished investigation and adjudication of the Ruby Ridge matter.” It 

stated that Freeh also deserved criticism for his elevation of Potts given the 

information that had been provided to him about Potts’ exposure in the Ruby Ridge 

matter. The memorandum also stated that the investigators believed Freeh 

inadequately reviewed the Mathews report, or he would have realized that it was a 

significantly flawed investigation. It stated that “at a minimum, we have an 

45
appearance of an attempt on the part of Walsh, Harp, Mathews, Coyle and Director 

Freeh not to disclose the FBI’s improper conduct during and following the Ruby 

Ridge crisis, or inattention to detail on the part of these individuals in conducting a 

thorough and objective investigation and adjudication.” The memorandum also 

criticized Freeh for failing to remove Walsh from the investigation despite 

knowledge of Walsh’s relationship with Potts, for promoting Harp and Mathews 

while the investigation was pending, and for authorizing cash bonuses to several 

subjects of the investigation while the investigation was pending. 

C. DOJ OPR Final Report 

On June 30, 1999, after considering the comments of FBI OPR and the FBI 

investigators, DOJ OPR issued a 571-page final report describing the findings of 

its review. In an undated memo to FBI OPR, DOJ OPR stated that it disagreed 

with FBI OPR’s comments and would not change its conclusions.22 

On the issue of approval of the rules of engagement, the DOJ OPR final 

report found by a preponderance of the evidence that Coulson approved the “can 

and should” language in the rules. It did not find, however, that there was 

sufficient evidence to show that Potts had approved the language. But the report 

concluded that both Potts and Coulson committed misconduct by knowingly 

approving rules of engagement that improperly deviated from the FBI’s standard 

deadly force policy, regardless of whether they had approved the actual “can and 

should” language. It also concluded that Potts and Coulson later committed 

misconduct by making false statements about their approval of the rules of 

engagement. 

DOJ OPR also discussed the adequacy of the Walsh investigation and 

determined that both Walsh and Harp committed misconduct by failing to ensure 

that their inquiry was complete. DOJ OPR concluded that this failure was 

motivated in part by a desire to counterbalance what they perceived as the bias of 

Berman’s review. DOJ OPR also found that it was unwise to have Walsh conduct 

the investigation given his friendship with Potts, but it found no evidence of overt 

favoritism during the inquiry or evidence that Walsh was selected in order to 

protect Potts. Walsh and Harp were also found to have committed misconduct in 

 

22 DOJ OPR’s one substantive change based on FBI OPR’s comments was that DOJ OPR 

increased its finding of poor judgment to one of misconduct based on Mathews’ failure to recuse 

himself. 

46
failing to supervise properly the production of interview reports in order to ensure 

their integrity. In addition, DOJ OPR concluded that Walsh and Harp used poor 

judgment in drafting performance appraisals for agents who worked on the inquiry 

when they stated that the agents had “correctly determined that the HRT acted 

effectively and that the [rules of engagement] were formulated and modified within 

parameters of FBI policy.” 

The DOJ OPR report found that the Walsh team did not take sufficiently 

aggressive steps to investigate various areas and that the lack of diligence was 

evidence that the Walsh team avoided uncovering the full truth about Ruby Ridge. 

The report stated that Walsh and Harp reached conclusions in their report despite 

orders from DOJ not to, and that this was further evidence showing that the inquiry 

was slanted to protect Potts and Coulson. DOJ OPR recommended discipline for 

Harp ranging from censure to suspension for 30 days. DOJ OPR did not 

recommend any range of discipline for Walsh because he had already left the FBI. 

The DOJ OPR report examined the adequacy of the administrative review by 

Mathews. It concluded that Mathews committed misconduct by failing to recuse 

himself in light of his relationship with Coulson, and that Mathews’ supervisor, 

Thomas Coyle, used poor judgment in permitting him to work on the inquiry. It 

also concluded that Mathews committed misconduct in conducting an inquiry that 

was incomplete or inadequate by failing to interview key witnesses who had been 

in the SIOC and by using unsupported conclusions that FBI Headquarters did not 

need to approve rules of engagement as justification for not investigating 

Headquarters personnel’s actions. DOJ OPR recommended suspension of 

Mathews for 15 to 60 days. 

The DOJ OPR report discussed the adjudication of discipline following the 

issuance of the Mathews report. It concluded that, while those on the SES 

Disciplinary Board acted in good faith in making the disciplinary decisions, they 

relied on the unsupported conclusion that on-scene commanders were responsible 

for approving the rules of engagement. Based on DOJ OPR’s finding that the rules 

of engagement were approved at the FBI Headquarters level, DOJ OPR concluded 

that the FBI should consider whether Glenn should have his record cleared or 

modified with respect to discipline. 

The DOJ OPR report criticized numerous other agents and FBI officials for 

their roles in the investigations of the original Ruby Ridge incident. DOJ OPR also 

criticized Director Freeh by stating that he used poor judgment in promoting Potts 

to Deputy Director while investigations of Potts were ongoing. DOJ OPR 

concluded that this promotion, together with his earlier promotion to Acting 

47
Deputy Director, could be viewed as a signal to the FBI investigators that Potts 

should not be criticized for his conduct in Ruby Ridge. However, FBI OPR did not 

make any recommendation for discipline of Freeh. 

D. DOJ OPR Report Forwarded to the Justice Management Division 

On June 30, 1999, the Department of Justice referred the final DOJ OPR 

report to Assistant Attorney General (AAG) for Administration Stephen Colgate, 

who was the head of the Department’s Justice Management Division (JMD), for 

him to make the disciplinary decisions. Director Freeh had recused himself from

the decisions and the Department believed that the decision on disciplinary matters 

should be handled outside the FBI. Colgate was assigned because many of the 

other high-level Department officials had worked closely with Potts and also were 

recused. 

In a July 23, 1999, memorandum from Assistant Director DeFeo to Colgate 

and DOJ OPR, DeFeo urged that an “in-depth pre-decisional reexamination of 

several issues be made by a deciding authority detached from the DOJ 

investigation.” He stated that the “intensity of feeling reflected in DOJ OPR’s 

final report’s findings compel[led]” him to make this recommendation. The first 

such issue was DOJ OPR’s finding that the failures to conduct further interviews of 

SIOC witnesses and to locate the after-action report gave rise to the inference that 

Walsh and Harp were motivated by a desire to skew its results in order to 

counterbalance the perceived bias of Berman. DeFeo noted that no such adverse 

inference was drawn as to the motives of the DOJ attorneys who were in charge of 

the Berman inquiry, who consulted with the FBI about who to interview, and who 

had the ability to participate in interviews and to conduct separate interviews. 

DeFeo argued that if the attorneys were entitled to a presumption of regularity in 

the performance of their duties, no inference of bad faith was warranted as to the 

agents whose work was supervised by those attorneys. 

DeFeo also argued that punishment of Harp for terminating an incomplete 

investigation appeared to be “punishment for an institutional FBI decision, 

proposed against Harp because he is the only remaining on-board manager who 

was involved in that aspect of the inquiry.” DeFeo contended that the evidence 

demonstrated that the withdrawal from the investigation was decided well above 

Harp’s level. DeFeo also argued that the penalty proposed against Mathews was 

unduly severe and not in keeping with FBI precedent. He stated that the absence 

of evidence of intentional misconduct “would militate against a suspension as 

48
severe as that recommended,” and that Mathews’ actions were more akin to neglect

of duty than to intentional misconduct. 

VII. The Justice Management Division Review 

Colgate assigned JMD Assistant Director Vivian Jarcho to completely review 

DOJ OPR’s and FBI OPR’s analyses and provide recommendations as to the 

appropriate discipline. Jarcho was the Assistant Director for Workforce Relations 

Group at that time and had handled personnel matters for the Department for 

almost 15 years.23 Prior to handling the Ruby Ridge matter, she had reviewed and 

made disciplinary recommendations in two other sensitive Department matters – 

an OIG investigation into the Miami Immigration and Naturalization Service’s 

alleged deception of Congress when a congressional delegation came on a factfinding visit to the Miami District, and the OIG’s investigation about deficiencies 

in the FBI laboratory. 

A. Jarcho’s Analysis 

In June 1999, Jarcho began her review of DOJ OPR’s report, the responses to 

it, and the underlying materials. In December 1999, she completed a 216-page 

report that described the results of her review, contained her analysis of the 

underlying materials, and made recommendations for discipline. Jarcho told the 

OIG that even though FBI employees do not have appeal rights to the Merit 

System Protection Board (MSPB), she applied MSPB criteria for disciplinary 

action in her review “for the sake of equity.” Jarcho’s report stated that she also 

considered the criteria applied by DOJ OPR, conducted a “Douglas Factor 

analysis” in order to make recommendations regarding reasonable penalties, 

evaluated possible mitigating and aggravating factors, and applied FBI disciplinary 

precedent for similar deficiencies or misconduct. 

Jarcho’s report concluded that Potts and Coulson were directly involved in 

formulating and approving the rules of engagement and impeding official 

investigations by making false and misleading statements to investigators. It also 

concluded that they blamed more junior FBI members for their actions and let 

them be harshly judged and disciplined in their place. It stated that if Potts and 

 

23 The Work Force Relations Group was responsible for representing the Department in 

appeals to the Merit Systems Protection Board and the Federal Labor Relations Authority, and 

for providing advice and guidance throughout the Department on disciplinary matters. 

49
Coulson were still employed by the FBI, they could be subject to disciplinary 

action. 

Jarcho’s report also agreed with the DOJ OPR finding that Walsh and Harp 

committed misconduct by failing to ensure that the Walsh inquiry was complete 

with respect to the after-action report and the interview of SIOC personnel, and 

that this failure was motivated in part by a desire to counterbalance the perceived 

bias of Berman. The report agreed with DOJ OPR that it was unwise to have 

Walsh conduct the investigation given his friendship with Potts. It did not agree 

entirely, however, with DOJ OPR’s finding that there was no evidence of overt 

favoritism during the inquiry or evidence that he was selected in order to protect 

Potts. The report stated that Walsh’s independent decision to issue the findings 

and conclusions of his team in a separate report was troubling conduct. Jarcho 

found that this action was evidence that Walsh was trying to protect Potts and 

Coulson and deliberately sought to present findings that he believed would be 

more favorable to the FBI than the findings he anticipated would be included in 

Berman’s report. The report also stated that it was troubling that Walsh and Harp 

were unable to provide a satisfactory explanation for why SIOC personnel were 

not interviewed and why Walsh’s teams failed to thoroughly investigate the entire 

matter. 

In addition, Jarcho’s report agreed with DOJ OPR that Walsh and Harp 

committed misconduct in failing to supervise properly the production of interview 

reports in order to ensure their integrity. Jarcho also agreed that Walsh and Harp 

used poor judgment in drafting performance appraisals for agents who worked on 

the inquiry saying that they had “correctly determined that the HRT acted 

effectively and that the rules of engagement were formulated and modified within 

parameters of FBI policy.” The report recommended that Harp receive a 15-day 

suspension and found that it was an aggravating factor that Harp claimed to 

investigators that he did not know that the FBI was not to include conclusions in its 

fact-finding, “despite extensive documentation that proves otherwise.” 

On the issue of the adequacy of the Mathews review, the Jarcho report 

disagreed with the DOJ OPR finding that Mathews committed misconduct by 

failing to recuse himself in light of his relationship with Coulson. Jarcho stated 

that Mathews’ history with Coulson was well known at the FBI and that other 

agents who raised potential conflicts during their participation on the Walsh and 

Mathews inquiry teams were directed to remain members if they believed they 

could be objective. Jarcho found that it was likely that Mathews would have stated 

that he could have been objective and would have been allowed to conduct the 

50
inquiry regardless. Jarcho’s report stated that it is well-established FBI practice 

not to disqualify agents because they have worked for or have a personal 

relationship with the person under investigation. It noted that FBI OPR has 

expressed the opinion that any FBI official is expected to be able to investigate 

virtually any other FBI official, regardless of professional friendships that develop 

between senior employees over the years. However, the report recommended that 

the FBI review its policies regarding conflicts of interest and ensure that all FBI 

personnel understand the importance of avoiding both actual and apparent 

conflicts. 

The Jarcho report found that Mathews committed “egregious” misconduct in 

conducting an inquiry that was incomplete or inadequate in failing to interview 

SIOC personnel and in using unsupported statements about approval of the rules of 

engagement to conclude that the rules were not approved at FBI Headquarters. 

The report recommended that Mathews be suspended for 30 days for this 

misconduct. 

The Jarcho report questioned whether earlier disciplinary decisions in the 

Ruby Ridge matter were equitable, given the failures of the Mathews report. 

Jarcho found “procedural deficiencies and flawed analysis in the Mathews report 

which resulted in non-supportable disciplinary actions being taken against FBI 

employees.” Jarcho’s report reviewed the disciplinary decisions made in 1994 

relating to the rules of engagement and concluded that Glenn’s and Rogers’ 

discipline should be rescinded based both on earlier procedural problems and on 

the grounds that discipline had been imposed on the unsupported proposition that 

on-scene commanders were responsible for approving rules of engagement. Jarcho 

agreed with DOJ OPR that FBI Headquarters was responsible for approving the 

rules of engagement and that disciplinary action against Glenn and Rogers was 

unwarranted and unreasonably harsh. 

Jarcho, like the three FBI investigators who had commented on the DOJ OPR 

report, believed that Freeh’s conduct deserved significant criticism. Jarcho’s 

report stated that the Department had devoted considerable funding and staff to 

thoroughly review the events surrounding Ruby Ridge, which culminated in the 

Berman report. Despite this effort, Director Freeh dismissed the Department’s 

findings in favor of the Mathews report, which was conducted in two months, as 

51
being more credible and accurate.24 Jarcho’s report stated that the fact that the 

Mathews report was less critical of the FBI than the Berman report and made 

conclusions that insulated FBI leadership from culpability damaged the FBI’s 

credibility. Jarcho stated that the “Director’s support for [the Mathews report] also 

ensured that Ruby Ridge would remain a problematic public relations and FBI 

employee morale issue.” 

 Jarcho’s report concluded that Director Freeh bore significant responsibility 

for much of the adverse publicity surrounding Ruby Ridge and for the appearance 

of FBI bias. Jarcho concluded that Freeh’s actions undermined the integrity of the 

Department-led investigation and led to disciplinary actions being taken against 

FBI employees based on faulty analysis and incomplete fact-finding. The Jarcho 

report stated: 

Director Freeh’s admitted bias towards Larry Potts caused him to 

strong-arm the Department about approving his recommendation for 

Potts to receive censure rather than a 30 day suspension. These 

actions constitute misconduct and warrant disciplinary action. 

Therefore, we recommend that Director Freeh be censured for his 

actions and admitted demonstrated poor judgment. 

B. Consideration of Matter by Deputy Assistant Attorney Generals 

Sposato and Vail 

AAG Colgate told the OIG that Deputy Assistant Attorney General John Vail 

and Deputy Assistant Attorney General Janis Sposato acted as his counsel on the 

Ruby Ridge disciplinary matter and that he asked them to fully review the work of 

Jarcho and DOJ OPR. Jarcho gave her report to Vail in December 1999 and 

briefed Vail and Sposato several times about her conclusions. 

After their review, Vail and Sposato rejected DOJ OPR’s and Jarcho’s 

conclusions and disciplinary recommendations. In a memorandum to Colgate 

dated April 17, 2000, Vail and Sposato began by stating that the actual events of 

Ruby Ridge were long past. They stated that it also appeared to have been a “tale 

of the search for someone to blame for an operation that went so horribly wrong,” 

 

24 In a January 1995 press conference, Freeh had announced the results of the Mathews 

review and the disciplinary actions he was taking, stating that he supported Mathews’ finding 

that the rules of engagement were the responsibility of the on-scene commanders. 

52
and that “there has been a desperate need to hold someone to account for an 

outcome that no one wanted and which no one finds satisfactory.” 

With respect to Harp, Vail and Sposato stated in the memorandum that they 

believed that, “absent some evidence of volition on his part in producing an 

‘incomplete’ report, he should not be held to task on this basis.” They stated that 

this was especially true in light of the fact that Harp’s superiors had left the FBI 

and were never disciplined for their alleged roles in the matter. They stated that to 

focus responsibility for the inadequacies of the Walsh report on Harp, six years 

after the fact, “does not serve any apparent equitable or institutional purpose.” 

They added that Berman could also be said to have issued a report without the 

benefit of the same interviews but that no recommendation of discipline had been 

made in that case. Finally, they stated that any action against Harp on the basis of 

inadequacies of the Walsh report seemed more appropriate for the realm of 

performance evaluations than of discipline: 

That is, if there were any shortcomings in the report which 

Harp helped to produce, absent any evidence of improper motive on 

Harp’s part – and we have not been convinced of any – such 

deficiencies as “incompleteness” of work are matters for which an 

employee may be counseled, may suffer in his or her rating, or may 

not be rewarded when bonuses are handed out – but not, typically, 

disciplined. (Emphasis in original.)

In addition, Vail and Sposato did not view the changes to the FBI 302s as 

seriously as Jarcho did. Their memorandum stated that, since there appeared to 

have been an acceptance of the editing process generally, they would not 

recommend discipline for Harp on that basis. Sposato told the OIG that, while she 

believed that editing 302s should be kept to a minimum because the 302s should 

remain as faithful as possible to the original interview, she did not believe that 

discipline was appropriate when such a practice was not prohibited by the FBI and 

where she did not believe there were significant, material alterations. 

Regarding Mathews’ conduct, Vail and Sposato concurred with Jarcho that 

Mathews did not commit misconduct when he failed to recuse himself from the 

investigation because of his relationship with Coulson. They disagreed, however, 

with Jarcho’s (and DOJ OPR’s) conclusion that Mathews should be disciplined for 

conducting an inquiry that was incomplete and inadequate. The Vail and Sposato 

memorandum stated that, as with Harp, there was no evidence that Mathews 

intentionally slanted his report to further a “cover-up” of wrongdoing by senior 

FBI officials. They again concluded that, absent evidence of intent or of gross 

53
negligence or dereliction, deficiencies in work product are typically dealt with 

through the performance management process. 

Vail and Sposato also disagreed with Jarcho’s recommendation of a letter of 

censure for Freeh. Their memorandum to Colgate stated: 

Even assuming it would be in your purview to recommend it 

(given that Mr. Freeh is a Presidential appointee), we do not believe 

that censure is appropriate in this case. From our perspective, 

Director Freeh at all times used his own best judgment about 

matters that were hotly debated both within and without the 

Department. His judgments should not be the subject of discipline, 

no matter what others may think of them. 

Vail and Sposato’s memorandum also reviewed the issue of whether the 

earlier discipline against Glenn and Rogers was justified. The memorandum

discussed the propriety of whether rules of engagement should ever be developed, 

given the Department’s overarching deadly force policy. In the end, Vail and 

Sposato concluded that, with respect to discipline, they were “inclined to leave in 

place the discipline that has been proposed and/or taken by others, and to 

recommend no further disciplinary action based upon the promulgation of the rules 

of engagement.” 

Their memorandum stated: 

It is our intention that these recommendations should put the 

Ruby Ridge incident in perspective. While there has been much 

written and said about the “Rules of Engagement,” we believe most 

of that discussion has been misplaced, focusing on the niceties of a 

phrase (i.e. “could” v. “should” v. “can”) rather [than] on the real 

question of the appropriate role for such rules in a crisis. Most of 

the individuals responsible for the Ruby Ridge [rules of 

engagement] have either left the FBI voluntarily or been disciplined. 

This is not an outcome that many will find satisfying; indeed, 

some will be very dissatisfied with it. However, we are willing to 

accept that there are as many views of human events as there are 

viewers, and that it is rarely possible to reconcile them all. 

Their memorandum concluded with three brief recommendations: (1) that the 

FBI should clarify the role of the FD-302 and undertake a vigorous training effort 

to ensure that all agents prepare them in the same way; (2) that Department 

54
leadership needed to be mindful of the unsatisfactory conduct of the 

Berman/Walsh investigation25 and to consider whether the FBI can investigate 

itself when the conduct of top leadership is a potential subject of the investigation; 

and (3) that the Department should undertake a study of the proper role of rules of 

engagement in crisis management and then clearly articulate its policy in this area. 

Jarcho told the OIG that she felt that Vail and Sposato respected her work, 

but were “viewing things differently at a different time.” She added that Vail and 

Sposato were very “immersed” in considering the matter and that they were not 

cavalier about any aspect of it. She said that she believes they made considered 

decisions in this matter, but that they did not review the voluminous materials as 

thoroughly as she had. Jarcho told the OIG that she did not agree with Vail and 

Sposato’s analysis, and Jarcho remains convinced that her recommendations were 

appropriate. 

Vail and Sposato both told the OIG that they had concerns about Jarcho’s 

conclusions. Sposato stated that she thought Jarcho’s report was professional and 

thorough in its analysis, and that Sposato had high regard for Jarcho’s work, but 

Sposato disagreed with the conclusions. Sposato told the OIG that her major 

concern was that employees should not be disciplined for mistakes. She stated that 

she did not believe that discipline was appropriate in these cases without evidence 

of bad intent. She stated that, in the case of both Harp and Mathews, the 

investigations were not complete, but that there had been no attempt to hide this 

fact and no evidence that they had been ordered to take actions and had refused to 

do so. She stated that the criticisms made against Harp and Mathews also could 

have been made against Berman because she was the supervising attorney on the 

original Department investigation and Sposato believed that investigation had been 

flawed as well. Sposato also stated that she felt that many of the characterizations 

by DOJ OPR were unfair. She said that her review of the facts did not support a 

conclusion that the performance by Harp or Mathews was “terrible.” 

Vail said that he was very concerned that many of the subjects had left the 

FBI and that he did not find the DOJ OPR analysis of the insufficiency of the 

Walsh and Mathews investigations to be persuasive. He felt that DOJ OPR had 

made too many inferences and that there was “no evidence” of intent. Vail added 

that he was “not even convinced the work had been all that shoddy.” Vail said that 

“absent some evidence of motive,” he did not see the matter as appropriate for 

 

25 The memorandum did not explain this conclusion. 

55
disciplinary action. Vail agreed that evidence of intent is not always necessary in 

order to discipline an employee, but stated that negligence must reach a certain 

level in order for discipline to be appropriate. 

Vail and Sposato both said that they were also concerned that the matter was 

very old. They said they viewed it as unfair to discipline people who were still at 

the FBI when so many others who were equally or more culpable had left. They 

told the OIG that they were concerned that Harp had generally followed the orders 

of Walsh, who was gone and could not be disciplined. 

C. DOJ OPR Disagrees with Vail and Sposato’s Recommendations 

On July 21, 2000, representatives from DOJ OPR met with Sposato and Vail 

to discuss the appropriate levels of discipline in the Ruby Ridge matter. At that 

meeting, Sposato and Vail provided DOJ OPR with their April 17, 2000, 

memorandum to Colgate. In a memorandum dated October 5, 2000, DOJ OPR 

responded and strongly objected to Vail and Sposato’s conclusion that discipline 

should not be proposed without clear evidence of a bad motive: 

JMD apparently would conclude that a subject (Harp or 

Mathews, in this case) engaged in misconduct warranting discipline 

only if it found sufficient evidence to conclude that the subject 

failed to carry out his assigned duties (in this case, to conduct a 

complete and thorough inquiry) for an improper purpose (in this

case, to cover-up wrong-doing of high level FBI managers). Absent 

evidence of such an improper purpose, JMD apparently could 

conclude that the subject’s failure to perform his duties constituted a 

management rather than a misconduct issue. 

DOJ OPR stated that, under its analytical framework, an employee commits 

misconduct if he intentionally violates or acts in reckless disregard of an obligation 

or standard imposed by law, applicable rule of professional conduct, or 

Departmental regulation or policy. It stated that, in this case, both Harp and 

Mathews each had a professional obligation to conduct a thorough, complete 

inquiry into the Ruby Ridge matters assigned to him or to document that the 

inquiry was incomplete. DOJ OPR concluded that each of them breached that 

obligation. DOJ OPR stated that, under both its and FBI OPR’s frameworks, “it is 

not necessary to find that the employee’s breach of a duty was motivated by an 

improper purpose; rather, it is necessary only to find that the employee engaged in 

conduct while knowing that the natural consequence of that conduct would result 

in the breach of an obligation or standard.” DOJ OPR argued that JMD was 

56
substituting a narrower definition of misconduct than that used by DOJ OPR, the 

investigators, or the FBI.

DOJ OPR also argued that Vail and Sposato had failed to consider the 

evidence in DOJ OPR’s report of an improper purpose on the part of Harp and 

Mathews. With respect to Harp, DOJ OPR set forth its view of the evidence 

regarding Harp’s explanations and the evidence indicating bias in favor of the 

subjects of the investigation and bias against Berman. Specifically, DOJ OPR 

stated that Harp had admitted that the Walsh inquiry was incomplete. DOJ OPR 

concluded that Harp, as a highly experienced supervisor, had a professional duty to 

document clearly or notify people orally that the investigation was not complete. 

DOJ OPR also disagreed with the conclusion that Department attorneys could be 

equally faulted for conducting an incomplete inquiry. It stated that the Department 

attorneys were not familiar with the workings of the SIOC and justifiably relied on 

the agents of the Walsh group to guide them to the pertinent evidence. 

In addition, DOJ OPR stated that there was evidence of Harp’s intent to skew 

the inquiry based on his conduct with respect to the editing of the FBI 302’s. It 

cited an example of what it considered an attempt to “cleanse a 302 of language 

harmful to the FBI.” In this example, Harp admitted that he questioned the agent 

who was the author of a 302 about the accuracy of the 302. This inquiry by Harp 

resulted in the agent changing the 302 describing the rules of engagement from

“free to fire and justified in doing so,” to a “cleaned-up” version which stated 

“authorized to apply deadly force, if appropriate.” DOJ OPR concluded that it was 

significant that Harp singled out this statement for his inquiry and that the 302 was 

then changed to a more innocuous formulation of the rules of engagement. 

With respect to Mathews, DOJ OPR asserted that Mathews had been 

instructed to make sure the investigation was complete, that it was clear that the 

investigation was not complete, and that Mathews should have been aware of that 

fact because there were a number of pieces of important information missing. DOJ 

OPR also stated that it had not found direct evidence of intent on the part of 

Mathews, but that it had found statements that, when taken together, suggested 

Mathews’ intent to skew the inquiry. For example, Mathews said to an agent that 

he wanted to see “an arrow pointing to Glenn,” and criticized an agent who 

commented that Potts and Coulson were likely to be disciplined. DOJ OPR found 

that Mathews also changed the report’s finding that there was “little evidence” to 

“no evidence” in the discussion of the evidence against Headquarters officials. 

DOJ OPR found that these actions, together with the “clearly unreasonable 

discussions in his report of the approval of the [rules of engagement],” led DOJ 

57
OPR to conclude, by a preponderance of the evidence, that Mathews had 

conducted an inadequate investigation in order to skew the results of his inquiry to 

protect Coulson, Potts, and others at FBI Headquarters. 

DOJ OPR also disagreed with JMD’s conclusion that Mathews did not 

commit misconduct when he failed to recuse himself because of his relationship 

with Coulson. DOJ OPR concluded that Mathews alone knew of his deep sense of 

loyalty to Coulson and that it was incumbent upon Mathews to remove himself 

from the inquiry. DOJ OPR cited statements by Mathews that “[his] friend Danny 

is not going to get hurt in this,” and Mathews’ notes to Coulson and Freeh after the 

inquiry had ended enclosing press articles that were complimentary to Coulson and 

expressing satisfaction that Coulson was being remembered for his good work at 

the FBI. 

DOJ OPR also objected to JMD’s assertion that Director Freeh’s judgments 

should not be the subject of discipline. DOJ OPR stated that JMD’s conclusion 

was an “extremely broad approach [that] would amount to granting the Director 

blanket immunity for any decision he makes, no matter how lacking in judgment.” 

DOJ OPR stated that it rejected that view and affirmed its conclusion that Freeh 

should be criticized for using poor judgment. 

JMD did not respond formally to DOJ OPR’s memorandum. In interviews 

with the OIG, Sposato, Vail, and Colgate stated that they did not write any 

additional internal memoranda or keep any notes justifying or analyzing their 

decision to depart from DOJ OPR’s findings. 

D. FBI OPR’s Response to DOJ OPR 

FBI OPR responded to DOJ OPR’s memorandum on November 29, 2000, in 

a memorandum signed by Assistant Director DeFeo. In that memorandum, FBI 

OPR clarified that, while its standard for misconduct was the same as that utilized 

by DOJ OPR, it did not agree with DOJ OPR’s finding of misconduct with respect 

to Harp. It also stated that, while it had recommended that the issue of whether 

Mathews had committed misconduct by failing to conduct a full review of the 

evidence with respect to the approval of the rules of engagement should be 

reviewed, this recommendation indicated only that the evidence had reached a 

threshold at which it should be subject to disciplinary consideration and did not 

equate to a finding that Mathews had committed misconduct. Finally, FBI OPR 

disagreed with DOJ OPR’s assertion that the editing of the 302s by Walsh and 

Harp was well beyond the bounds of acceptable FBI practice. It stated that absent 

58
evidence establishing bad motive “by a clear preponderance,” FBI OPR would not 

impose discipline for such editing. 

E. Colgate’s Decision 

Colgate told the OIG that he reviewed the materials in this matter, including 

the DOJ OPR report, Jarcho’s report, the Sposato/Vail memorandum, DOJ OPR’s 

response, and FBI OPR’s response, and he concluded that he agreed with Vail and 

Sposato that no further discipline was appropriate. He told us that he did this for 

two reasons. First, he said he was concerned that the lower-level employees might 

be punished for the deeds of their retired superiors. He stated that his “gut” told 

him that there was a lot of “angst” over the fact that Potts and Coulson left the FBI 

without any punishment and that there was a sense that those who were still at the 

FBI should “pay for the sins of those who got away.” Second, he believed that 

many of the issues were performance rather than misconduct matters. He said that 

there was no question that serious discipline was appropriate for Potts and Coulson 

because they were the leaders of what took place at Ruby Ridge. But he did not 

believe that Harp and Mathews had committed misconduct. 

Colgate said that he tried to view the issue of intent as he thought the MSPB 

would view it. He said he believed that the management and culture at the FBI did 

not place an emphasis on internal investigations and that senior management was

well aware that the investigations were sloppy and that there were conflicts of 

interest involved. He stated that he saw the whole matter as sloppiness rather than 

as a conspiracy to “throw” an investigation. Colgate said that he saw his role as 

sorting through the evidence and taking a critical look at some of the conclusions. 

He said that, in deciding disciplinary matters, he generally defers to the 

assessments of the investigators who conducted the original inquiry, but that he is a 

“check point” to ensure a fair outcome. He said that he did not have any dispute 

with DOJ OPR’s factual findings, just with the conclusions that they drew from 

them. 

Colgate stated that he never seriously considered disciplining Freeh. He said 

that Freeh was a Presidential appointee and could have been removed at any time 

by the President. Colgate said that since Freeh had publicly admitted he made 

mistakes in the aftermath of Ruby Ridge, the President had all the information he 

needed to remove Freeh if he so chose. Colgate stated that he also was aware of 

the stormy relationship between Director Freeh and Attorney General Reno over 

the campaign finance investigation, and Colgate felt that a recommendation for 

59
discipline of Freeh by the Department would be seen as retaliation by Reno against 

Freeh. 

Colgate told the OIG that he made his decision independently, knowing that 

it would make many people unhappy. He said he was never pressured by any 

entity and that he tried to make the decision process an open one in which all 

parties had input. Colgate added that he has no bias for or against the FBI, but that 

he is sure that the FBI has viewed him as a “thorn in its side” over the years. 

Under Department procedures in matters involving a Department attorney, 

the deciding official must notify Associate Deputy Attorney General Margolis if he 

or she intends to depart from DOJ OPR’s recommended range of discipline.26 

Margolis met with Jarcho, Sposato, Vail, and DOJ OPR, and reviewed their 

submissions and a draft of Colgate’s decision. Margolis also met separately with 

Colgate about his draft decision. Margolis said he reviewed the decision using an 

“abuse of discretion” standard. Margolis said he does not substitute his own 

judgment of what would constitute an appropriate result; rather, he determines only 

whether the deciding official’s conclusions are unreasonable in light of the 

evidence. 

Margolis told the OIG that he told Colgate that he did not agree with his 

decision and could not endorse it. Margolis said he believed that it would have 

been better to have followed DOJ OPR’s practice of not requiring proof of intent in

order to find misconduct. However, Margolis said he was satisfied that Colgate 

had looked at the matter carefully, and Margolis also believed that Colgate had not 

abused his discretion in reaching the decisions he did. Therefore, Margolis did not 

have the case reassigned from Colgate to a new official to make the final 

disciplinary decisions. 

As a result, in a memorandum issued on January 3, 2001, Colgate reported 

his final decision. In the memorandum, Colgate stated that his staff thoroughly 

reviewed the DOJ OPR report and briefed him on the results. He stated that it was 

his conclusion at the end of that process that he did not concur with the DOJ OPR 

 

26 The applicable memorandum only mandates notification of Margolis when the official 

intends to depart from DOJ OPR’s recommended range of discipline for a DOJ attorney, not any 

other Department employee. No attorneys were involved in this matter. However, Margolis said 

that he became involved in reviewing the matter at Vail’s request and did not focus on the fact 

that the order did not apply. By the time he did realize it, he said that he was already deeply 

involved and decided to see the matter through. 

60
findings of misconduct and the resulting disciplinary recommendations. He stated 

that he consulted with both DOJ OPR and FBI OPR about his conclusions and 

received additional input from both. He stated that, because his recommendations 

were not consistent with those of DOJ OPR, he had notified Associate Deputy 

Attorney General Margolis of his decision. Colgate’s memorandum stated that, for 

the reasons outlined in the April 17, 2000, memorandum from Sposato and Vail, he 

had decided discipline was not warranted, and he declined to adopt the OPR 

findings of misconduct. He stated: 

My conclusion is based, in major part, upon my belief that, 

absent evidence of improper motive on the part of these individuals, 

shortcomings in their work products (if any) are typically dealt with 

through the performance management process, not through the

application of discipline. In these cases, I am unwilling to ascribe 

improper motive to the employees, who in my view simply saw the 

issues differently from their [DOJ] OPR counterparts and therefore 

do not believe discipline is warranted. 

As a result, no disciplinary action was taken against Harp for the 

allegations that he failed to ensure that the Walsh inquiry was complete 

and to supervise the production of accurate reports of interview. 

Similarly, no action was taken against Mathews for the allegation that he 

failed to properly recuse himself, for conducting an incomplete inquiry, 

and for making unsupported conclusions regarding the rules of 

engagement in his report in an attempt to insulate FBI leadership. Finally, 

the previously imposed discipline against Glenn and Rogers for their role 

in the promulgation of the rules of engagement was not rescinded. 

Finally, Colgate’s memorandum did not discuss Freeh or DOJ 

OPR’s recommendation that Freeh be criticized for poor judgment. 

Margolis told us that, after discussions with Vail and Sposato, he told 

Colgate that he should consider formalizing his implicit decision not to 

recommend discipline for Freeh. Colgate told us that he thought that was 

unnecessary and did not do so because Freeh had admitted his mistakes 

and because Colgate did not believe that he had jurisdiction over a 

Presidential appointee. 

On January 3, 2001, Margolis notified JMD and DOJ OPR that he had 

reviewed the material supplied to him by JMD and DOJ OPR and had concluded 

that the disposition proposed by Colgate “falls within [his] legitimate discretion.” 

61
Margolis stated that JMD could therefore proceed to resolve the pending matters 

along the lines proposed in Colgate’s memorandum. 

VIII. OIG Analysis 

We recognize that, at this point, there are well documented and strong 

disagreements about the disciplinary decisions ultimately reached in Ruby Ridge 

and that our independent assessment is unlikely to end the disagreements about the 

ultimate outcome. Numerous entities and individuals who were much closer to the 

events than we have weighed in with analysis and opinions, often reaching 

different conclusions. Nonetheless, we believe that there are important lessons to 

be learned from a review of the response to Ruby Ridge. 

First, there is almost nothing about Ruby Ridge that worked well. The 

incident itself was replete with poor performance, poor judgment, misconduct, and 

acts of clear obstruction to cover up the problems. The FBI’s initial investigation 

of the incident was at best grossly deficient and at worst intentionally slanted to 

protect the FBI and senior FBI officials. Subsequent investigations were more 

thorough, but the discipline process took so long and was so flawed that in the end, 

it is hard to say that a fair result was reached. 

The ultimate disciplinary decision for the subjects of the second round of 

investigations was removed to the Department specifically to avoid any further 

allegations that the FBI was covering up the misconduct of its senior officials. 

Nonetheless, in the end, because of what we believe to be flawed analysis on the 

part of JMD, the appearance that culpable senior officials had “gotten off” remains. 

There are no standards or internal Departmental regulations guiding a 

deciding official’s actions in discipline matters. In this case, JMD used a different 

standard to evaluate the evidence than did DOJ OPR and FBI OPR. As Colgate’s 

final memorandum made clear, JMD viewed the deficiencies as performance 

issues, not misconduct that required adverse action. DOJ OPR strongly objected, 

arguing that it is not necessary to find that the employee’s breach of duty was 

motivated by an improper purpose; rather, it is necessary only to find that the 

employee engaged in conduct while knowing that the natural consequences of that 

conduct would result in the breach of an obligation or standard. 

We, like DOJ OPR and FBI OPR, believe that it is not necessary to find a 

bad intent in order to impose discipline. Intent is a factor that may be considered 

when determining the appropriate discipline. Indeed, one of the factors relevant in 

determining a penalty, as outlined in the seminal case of Douglas v. Veteran’s

62
Administration, et al., 5 M.S.P.B.313 (April 10, 1981), is “whether the offense was 

intentional or technical or inadvertent, or was committed maliciously or for gain.” 

The fact that inadvertence could be a factor to be considered in determining a 

penalty is a clear indication that discipline, not just a poor performance evaluation, 

may be appropriate in cases where bad intent has not been proven. Also, the 

Department has imposed discipline in other cases where intentional misconduct 

was not shown. 

We also believe proof of intent should not be required because of the 

difficulty in proving the bad motive of any individual. Such proof is rarely direct 

and depends upon putting together circumstantial evidence. Where other credible 

evidence of misconduct exists, proof of intent should not be a requirement to 

impose discipline. In addition, treating poor performance only as a performance 

issue often means that significant neglect of duty will go unaddressed. By the time 

the misconduct investigation has been completed, the rating period will have 

passed and the employee’s neglect of duty will not be accounted for. Therefore, 

we believe that future cases should be based on a standard that does not require 

proof of a bad motive. 

Of course, even if JMD had used what we believe to be the appropriate 

standard, it is likely it would not have recommended discipline against Harp or 

Mathews. As expressed in JMD’s report, JMD was heavily influenced by the 

passage of time and the inability of the Department to discipline the individuals 

who many believed were the more culpable individuals. This factor – the 

disciplining official’s discomfort at imposing punishment on some individuals but 

not others – is present in other cases as well and can present a significant obstacle 

toward imposing discipline on mid-level managers. In general, senior officials are 

eligible for retirement and many escape punishment by retiring before the 

investigation is concluded. The appearance of a double standard is exacerbated 

when disciplining officials consider the absence of punishment for others as a 

mitigating factor when considering whether to discipline managers. We believe 

this should only be a significant factor when considering whether to discipline rank 

and file employees after more culpable managers have retired. 

In at least one other complex matter in which JMD officials were the 

deciding officials for discipline, JMD argued that the passage of time was a 

mitigating factor. We believe that this view creates problems for investigative 

entities, which are obligated to conduct thorough and complete investigations. 

Ruby Ridge, in particular, was delayed by actions of the subjects that arguably 

impeded the initial investigation and by a criminal investigation. If the efforts of 

63
the investigators are in the end going to be wasted unless the investigation is 

completed within a specific time frame, then investigating entities need to be 

informed of the time frame and given sufficient resources to meet it. 

We, like DOJ OPR, believe that Harp and Mathews should have been 

disciplined for failure to carry out their assigned duties – completing thorough and 

impartial inquiries – regardless of whether there was evidence of improper 

motivation. Moreover, like DOJ OPR, we believe that there was sufficient 

evidence in the record to sustain a finding that both men acted with an improper 

purpose. Harp acknowledged that the Walsh inquiry was incomplete but offered 

an explanation that DOJ OPR found lacked credibility. Moreover, Harp failed to 

notify anyone of the incompleteness of the inquiry. In our view, this fact, together 

with Harp’s conduct with respect to the editing of the 302’s, suggested, by a 

preponderance of the evidence, an improper purpose on Harp’s part. We also 

believe that Mathews’ failure to recuse himself despite his relationship with 

Coulson, taken together with his statements and the unsubstantiated findings in his 

report regarding approval of the rules of engagement, established by a 

preponderance of the evidence that Mathews conducted an inadequate 

investigation. 

With respect to changing previously imposed discipline, we believe that 

Colgate should have cleared Glenn’s record, as recommended by DOJ OPR. DOJ

OPR investigated the process by which the FBI made disciplinary decisions after 

the issuance of the Mathews report and found that those decisions were made 

based on the unsupported assertion that on-scene commanders were responsible for 

approving the rules of engagement. Given DOJ OPR’s findings that the rules of 

engagement were approved at the Headquarters level, we believe that the 

preferable course was for JMD to have taken action to correct a prior error in 

imposing discipline, regardless of the benefits of finality in the disciplinary process 

and the significant passage of time since the discipline had been imposed. 

However, while we do not agree with Colgate’s ultimate decisions, we 

believe they were made in good faith, after a careful review of the record. He had 

a difficult task that was unlikely to please everyone. Although we would have 

come out differently on the ultimate decisions he made, we do not believe he 

abused his discretion. Yet, we disagree with the basis for his decisions. 

We also believe that Colgate should have addressed the issue of Freeh’s 

conduct in Ruby Ridge. The issue was raised by both DOJ OPR and Jarcho and 

warranted explanation in Colgate’s final decision, even if the explanation was why 

Colgate did not believe that discipline was appropriate. Like DOJ OPR, we do not 

64
agree with the opinion in the Vail/Sposato memorandum that Freeh’s “judgments 

should not be the subject of discipline, no matter what others may think of them.” 

We agree with DOJ OPR that such a statement creates a type of immunity for the 

Director of the FBI and suggests that his decisions cannot be reviewed for either 

misconduct or poor judgment. We therefore believe that Colgate should have 

explicitly addressed Freeh’s role in the matter and explained his decision not to 

recommend any action regarding him.

Finally, although the ultimate decision in Ruby Ridge was made by JMD and 

not the FBI, we believe the effect of Colgate’s decision was to exacerbate further 

the perception of a double standard in discipline for senior FBI officials. This was 

likely worsened by the fact that Colgate’s decision rejected the lengthy and 

complex analyses in two separate reports by DOJ OPR and Jarcho with only a 

short, conclusory memorandum. In the end, the effect of his decision, particularly 

without sufficient explanation as to the reasoning and the evidence supporting it, 

was to feed the perception that several lower-level FBI employees were harshly 

disciplined and upper-level employees either retired or received no or light 

discipline. We believe this result contributed to the perception of a double 

standard of discipline in the FBI. 

IX. Bonuses and Promotions 

One aspect of Ruby Ridge and the Potts party investigation that has not been 

reviewed by the Department or FBI OPR was the promotions and bonuses given to 

FBI employees who were the subjects of internal Ruby Ridge investigations while 

the investigations were pending. While a presumption of innocence is usually 

appropriate while a subject is under investigation, rewarding a subject who is later 

found to have committed misconduct can result in adverse consequences. We 

believe the FBI should be mindful of the message it sends to both the investigators 

in a particular case and the rest of the FBI when subjects of investigation are 

promoted or receive bonuses or awards while under investigation. This is 

especially true where high-level officials are under investigation, because 

investigators may interpret the giving of an award as an indication that senior 

management has already judged the merits of the investigation. 

A number of FBI officials under investigation for the Ruby Ridge matter 

received promotions and bonuses while the investigation was pending. The most 

well known of these promotions was of Potts to Deputy Director – a promotion 

that Freeh later acknowledged was poor judgment on his part. Our review of other 

promotions and bonuses reveal additional issues of concern. 

65
Harp, Walsh, Mathews, Coulson, Kahoe, and Potts received either 

promotions or bonuses while under investigation for Ruby Ridge: 

• Harp was promoted to SAC in Cleveland in December 1995 after DOJ 

OPR had commenced its investigation into the inadequacy of earlier 

internal Ruby Ridge inquiries. The memorandum to the Director 

presenting the qualifications of the candidates for the Cleveland SAC 

position does not mention the ongoing investigation, although Freeh 

told us that he was aware of the investigation and its scope. In 

addition, Harp was given a cash award of $8,099 in November 1997 

while still under investigation for Ruby Ridge and an award of $14,208 

in October 1998 while under investigation for Ruby Ridge and for 

attendance at the Potts retirement party. 

• Walsh received a cash award of five percent of his salary while under 

investigation by DOJ OPR for Ruby Ridge. While under investigation 

by DOJ OPR and under criminal investigation by Stiles, he was 

promoted to SAC in San Francisco in December 1996. Freeh asked 

FBI OPR to check with DOJ OPR and Stiles regarding the promotion. 

DOJ OPR did not object, and Stiles would not comment. The 

memorandum to the Attorney General requesting approval for Walsh’s 

move to San Francisco did not indicate that Walsh was under 

investigation. 

• Mathews was promoted to an SES position in July 1995 after 

commencement of the DOJ OPR investigation into allegations that the 

internal inquiries of the original Ruby Ridge matter were inadequate. 

Mathews was promoted to SAC in New Orleans in June 1997 while 

still under investigation. 

• Kahoe was given a cash award of $7,126 in November 1993 during the 

initial Ruby Ridge investigation. He was promoted to SAC in 

Jacksonville, Florida, in June 1994 while under investigation. The FBI 

later proposed a 15-day suspension for Kahoe. He was removed from

the SAC position in October 1995 and pled guilty to obstruction of 

justice in October 1996. 

• Coulson was promoted to SAC in Baltimore in April 1993 while under 

FBI’s internal investigation of Ruby Ridge. He was given a cash 

award of $5,590 in November 1993 while still under internal 

investigation. Coulson was promoted to SAC in Dallas in September 

66
1994 before the Mathews report recommending discipline in the Ruby 

Ridge matter was complete. He was ultimately issued a letter of 

censure following issuance of the Mathews report. 

• Potts was promoted to Acting Deputy Director in 1994, prior to 

completion of the final internal FBI decisions about discipline in Ruby 

Ridge. He received a letter of censure in January 1995. Despite this 

censure, he was made Deputy Director in May 1995. 

We asked former Director Freeh about these promotions and bonuses. He 

told us that the fact that someone is under investigation was not necessarily enough 

for him to disapprove a bonus. He stated that in many cases he would approve a 

bonus and leave it to the Department of Justice to disapprove it if they wanted. 

Freeh stated that the Department was free to disapprove any of his 

recommendations and had access to the information that might cause them to do 

so. Freeh also stated that the various Ruby Ridge investigations dragged on far too 

long, and he believed that he could not “leave people hanging” in terms of career 

advancement. Freeh told us that he is a “strong believer in the presumption of 

innocence even as applied in an administrative process.” Freeh said that he spoke 

at length with FBI OPR Assistant Director DeFeo and felt that, given the facts 

developed by DOJ OPR to that point, it was not inappropriate to make personnel 

decisions regarding the subjects. Freeh stated that he repeatedly pushed the 

Attorney General to resolve Ruby Ridge one way or another. He also stated that 

he believed there had been insufficient diligence by the Department in resolving 

the matter. He told us that this delay put FBI employees in an intolerable position, 

especially employees like Harp and Mathews who were ultimately not disciplined 

by Colgate. Freeh added that he attempted to obtain relevant information about the 

facts of the investigation in making his decisions, but that the Department was 

reluctant to provide such information. Finally, he stated that there were many 

instances in which he did not make otherwise merited promotions because of a 

pending disciplinary inquiry. 

It is true that the investigations of Ruby Ridge were lengthy and that the 

disciplinary process was extraordinarily slow. However, Freeh testified before a 

Senate subcommittee in October 1995 about the wisdom of his promotion of Potts 

to Deputy Director despite the finding that Potts had mishandled the crisis. He 

stated at that time: “Looking back, I recognize that I was not sufficiently sensitive 

to the appearance created by my decision to discipline and simultaneously promote 

Mr. Potts.” See Hearing before the Senate Judiciary Committee, Subcommittee on

67
Terrorism, Technology and Government Information, October 19, 1995. The DOJ 

OPR Ruby Ridge report put the problem more strongly: 

We agree with the Director’s own statement that he exhibited 

poor judgment in promoting Potts, not just because he failed to

balance all the positive and negative factors, but because the 

promotions (both to Acting Deputy Director and to the full position) 

and their timing inevitably had the effect of sending a signal to the 

persons investigating the Ruby Ridge matter, that the Director had 

full confidence in Potts and that he might not be receptive to a 

report that strongly criticized the conduct of Potts. This action also 

sent a message to employees throughout the FBI, telling them that 

the Bureau was willing to overlook serious allegations of 

misconduct and even reward the subject of the allegations with a 

major promotion. Such a message inevitably had a damaging effect 

on the morale of the great majority of FBI personnel who take great 

pride in their integrity and in their adherence to high standards of 

professional conduct. 

We agree with DOJ OPR that the promotions of individuals while under 

investigation for serious misconduct were troubling. In 1993 it should have been 

obvious that there were significant issues involving FBI personnel and by 1995 an 

ongoing criminal investigation should have made it even clearer that the 

allegations against certain individuals were serious. Despite Freeh’s comment to 

the Senate subcommittee in October 1995 that he had not been sufficiently 

sensitive to appearances, he promoted Harp only two months later, followed by 

promotions for Walsh and Mathews. We believe that the FBI and Department 

components need to carefully consider whether to promote or grant awards to 

individuals who are under investigation. The Department should consider whether 

a Department official should approve awards and promotions for high-level 

individuals who are under investigation.27

 

27 FBI and Department officials are more sensitive to this issue now, since the Department 

routinely requests information from the OIG and OPR about whether senior FBI and other 

Department officials who are being considered for promotions and significant awards are under 

investigation. 

68
In addition, we have serious concerns about various conflicts of interest 

surrounding these promotions. First, Potts sat on the Career Board that made 

recommendations to the Director on the promotions of Kahoe and Coulson. Given 

that the Ruby Ridge investigation still was ongoing at the time, it is shocking that 

neither Potts nor the FBI thought it improper for Potts to be involved in 

considering the promotions of individuals who were also subjects of the 

investigation. In addition, Potts sat on the Career Board considering Walsh for 

promotion just six months after Walsh completed his report on Potts’ and others’ 

actions at Ruby Ridge. Potts also sat on the Career Board that considered the 

promotion of Harp to the SES level just five months after Walsh’s report, with 

great input from Harp, was completed. The appearance of a conflict should have 

been obvious. We asked Freeh about some of these conflicts. He responded that, 

in retrospect, Potts should not have been on those Career Boards. 

Indeed, we found that the FBI’s insensitivity to possible conflict issues was a 

common thread running through many cases. As noted previously, the FBI 

assigned Walsh and Mathews to investigate their friends. Also, Coyle was on the 

SES Board for the Potts party disciplinary matter. Although the FBI may believe 

that all personnel will attempt to act objectively even with respect to their close 

friends, we believe this view is not realistic and, in any case, such conflicts at a 

minimum feed the appearance of favoritism. 

69
CHAPTER SIX 

OIG RECOMMENDATIONS AND CONCLUSIONS 

CHAPTER SIX: OIG RECOMMENDATIONS AND CONCLUSIONS 

 We believe that the evidence showed that in several FBI disciplinary matters, 

including several important and well-known cases, senior managers were afforded 

different and more favorable treatment than less senior employees. Various factors 

contributed to this difference in treatment. 

 First, by law SES members cannot be suspended for less than 15 days. As a 

result, we believe that many SES managers at the FBI receive letters of censure 

when lower-level employees would receive short suspensions for similar conduct 

Second, during the FBI adjudication process, significant weight is given to 

the long and outstanding records of senior FBI managers when considering the 

Douglas factors. Because less senior employees may not have such lengthy 

records, this benefit may be weighted heavily in the favor of senior managers. 

Third, we believe that some of the specific cases that we examined indicate 

that SES Board members gave undue weight to the explanations of SES members 

who were subjects of investigations, possibly because of a reluctance to find that a 

fellow SES member “lacked candor.” 

Fourth, we were told that the former SES disciplinary system may have 

fostered a double standard because different decision-makers were on each 

disciplinary board that was convened, and the Board members had different levels 

of experience in handling personnel matters. As a result, the Board members’ 

approach often deviated from the strict precedential approach used by FBI OPR for 

non-SES employees. This problem was exacerbated by the fact that, prior to the 

changes in August 2000, FBI OPR did not submit factual findings or conclusions 

about misconduct to the SES Disciplinary Boards. The Boards therefore had 

considerable flexibility in interpreting the evidence presented to it. This led to the 

perception that in several cases, such as in the Potts retirement party matter, the 

Board manipulated the facts to achieve a lenient disciplinary result. 

Fifth, several individuals who sat on SES Disciplinary Boards told us that

they believed that a letter of censure for a senior manager is, in fact, a significant 

punishment that could effectively end a manager’s career. They did not believe 

that a letter of censure had the same effect on lower-level employees’ careers. We 

were unable to validate this perception or determine whether a letter of censure had 

a more serious impact on the career of a senior manager than a less senior FBI 

employee. However, we believe that the existence of this belief led some SES 

70
Board members to conclude that a letter of censure was an appropriate punishment 

for FBI managers, even though a harsher punishment would normally be given to 

lower-level FBI employees. 

Sixth, the ability of FBI employees to resign or retire during an investigation 

or at any time prior to having discipline imposed fed the perception that certain 

managers escaped punishment. This problem is exacerbated when the disciplining 

official factors in a pending retirement when determining punishment, as we saw in 

several cases of SES discipline that we reviewed. 

We believe that the August 2000 reforms to the FBI disciplinary system that 

abolished the two-track system will correct some of the problems with the former 

FBI SES disciplinary system. Discipline for SES and non-SES employees is now 

handled according to the same system. We believe this should help to alleviate 

some of the perception of a double standard of punishment. 

Moreover, in July 2001 the authority to investigate misconduct of FBI 

employees was changed. Prior to that time, the FBI investigated its own 

misconduct. Unlike in other DOJ components, the OIG could not investigate 

allegations of misconduct in the FBI or the Drug Enforcement Administration 

(DEA) absent specific permission from the Attorney General. In July 2001, the 

Attorney General expanded the OIG’s jurisdiction to investigate misconduct 

throughout the Department, including in the FBI and the DEA.28 This change was 

codified in statute in the DOJ Reauthorization legislation that was signed by the 

President on November 2, 2002. 

As a result, the OIG now investigates most allegations of misconduct against 

high-level FBI officials. We believe that the OIG’s involvement and oversight of 

the FBI will help ensure that misconduct by high-level FBI officials is not 

dismissed or treated more leniently than allegations against lower-level FBI 

employees. 

However, we believe that several additional issues should be considered by 

the FBI and the Congress to help reduce the reality or the perception of a double 

standard of discipline in the FBI. First, the current system of discipline provides 

for SES employees to have appeal rights to the FBI’s Inspection Division or a 

 

28 The one exception is that DOJ OPR continues to investigate allegations of misconduct 

involving Department attorneys or investigators where the allegations relate to the exercise of the 

authority of the attorney to investigate, litigate, or provide legal advice. 

71
Disciplinary Review Board. The Assistant Director of the Inspection Division or 

the Board may “independently redetermine the factual findings and/or the penalty 

imposed.” If a new penalty is imposed, however, it must be consistent with 

applicable precedent. Both the Assistant Director of the Inspection Division and 

the Board are required to document their findings in writing and provide the 

employee a written decision. But there is no requirement that the Assistant 

Director or the Board must provide written justification for their findings or 

explain why they are altering the disciplinary decision made by FBI OPR. 

We believe that a clear written justification explaining why the Assistant 

Director or the Disciplinary Review Board changed the disciplinary decision on 

appeal should be required. Also, any changes regarding factual findings or 

penalties should be accompanied by a written justification that explicitly describes 

the reasons for the changes. This would ensure that the judgment of the Assistant 

Director or the Board is not simply substituted for that of the decision-maker. 

Second we continue to have some concerns about the composition of the 

Disciplinary Review Boards because they still include only SES members. In

August 2000, the separate SES Disciplinary Review Boards for SES employees 

were eliminated, and discipline in all cases is now appealed to Boards that are 

composed of the Assistant Director of the Investigation Division, an SES member 

chosen by the subject, and an SES member chosen by lot. While this is a marked 

improvement on the previous system, it still results in all discipline being decided 

by Boards consisting solely of SES members. Because of this makeup, there is 

still the danger of a perception that SES employees who come before the Boards 

may be treated less harshly. We believe the FBI should consider options to 

alleviate this perception, such as including a non-SES member on the Boards or 

including someone from outside of the FBI, such as an official from the 

Department.29

Third, we believe that the FBI should have a full range of disciplinary 

options with which to discipline SES officials. The current legal restriction on the 

suspension of SES employees – that they can only be suspended for 15 days or 

 

29 In a response to a draft of this report, the FBI noted that one SES member of the 

Disciplinary Review Board is chosen by the employee appealing the discipline. The FBI also 

stated that the process would have some random observers from the non-SES ranks. We believe 

that this response does not go far enough, and that the Disciplinary Review Boards should not be 

limited solely to SES members and non-SES observers. 

72
more – ties the hands of deciding officials. The outcome is that SES employees 

often receive lesser punishments than deserved because the deciding official must 

choose between a letter of censure and a 15-day suspension. We think Congress 

should change this limitation. We note that such a revision is part of an FBI 

Reform Bill introduced by Senators Leahy and Grassley in February 2002.30 

Fourth, the FBI needs to ensure that any policy changes that are made with 

regard to appropriate discipline are properly disseminated to its employees and 

consistently applied. As we mentioned on page 15 of this report, in a 1996 SES 

case the FBI instituted a change in the standard discipline for the offense of losing 

a pager. However, this changed precedent was not consistently applied, and in 

several cases lower-level FBI employees received greater discipline than FBI 

managers for this offense. If there is a change of precedent, it needs to be 

uniformly enforced by the FBI. 

Fifth, the FBI must attempt to resolve the conflict between applying the 

Douglas factors and the “bright line” policy. In January 1994, Director Freeh 

issued a bulletin to all supervisors in the FBI about its standards of conduct and 

discipline. He stated that he had determined that the FBI had been too tolerant of 

certain types of behavior that are fundamentally inconsistent with continued FBI 

employment. He stated that he was drawing a “bright line” which would serve to 

put all employees on notice that he believed in the “simple truth that lying, 

cheating, or stealing is wholly inconsistent with everything the FBI stands for and 

cannot be tolerated.” He then set forward several examples of behavior for which 

employees could expect to be dismissed. These included lying under oath, voucher 

fraud, theft, and material falsification of investigative activity or reporting. 

However, the uneven application of this bright line policy seems to have 

increased the perception of a double standard. Some FBI senior managers 

involved in conduct that seemingly violated this policy, such as in the Potts party 

case, were only given letters of censure. A lack of uniformity in applying the 

bright line policy necessarily creates a suspicion that favoritism or “cronyism” is 

the reason that it is not being followed. We found, however, that managers were 

not the only FBI employees who benefited from a deviation from the strict 

requirements of the bright line policy. We found cases in which non-SES 

employees were punished but not terminated even when they had violated one of 

the bright line categories. We believe the FBI should determine whether it wants 

 

30 In its response to the draft of this report, the FBI stated that it also supports this change. 

73
to maintain a “bright line” policy or consider the employee’s history and mitigating 

and aggravating circumstances, as outlined in the Douglas factors. If the FBI 

chooses to follow its current bright line policy, it is important that it do so 

consistently.

31

Sixth, the FBI should consistently apply precedent from non-SES cases to 

SES disciplinary matters. FBI policy instituted in August 2000 states that “[t]he 

same standards for evaluating evidence will be consistently applied to all 

employees with due regard for the increased responsibilities and obligations of a 

senior executive.” We believe this should be interpreted as meaning that the 

discipline that is appropriate in non-SES cases not only be considered but in most 

cases should act as the minimum punishment that should be imposed in SES cases. 

Greater punishment may be warranted because a senior official presumably should 

exercise even stricter adherence to duty and ethical regulations.32 Lesser 

punishment may be warranted, but if so the reasons should be carefully 

documented. 

The expectation within the FBI’s rank and file appears to be that an SES 

employee should be disciplined in the same manner as a lower-level employee who 

engaged in similar conduct. If this expectation is not met, the suspicion of 

favoritism and cronyism arises. We recognize that in many cases, an SES 

employee will have had a long and successful history with the FBI, a factor that 

can be considered pursuant to the Douglas factors. Furthermore, the FBI’s 

investment in senior FBI executives in terms of training and experience is 

substantial. However, the FBI should not allow consideration of a manager’s 

record to routinely outweigh the equally important consideration that managers 

should be held to higher standards than other employees. 

 

31 In its response to the draft of this report, the FBI acknowledged that not all employees 

who violated the bright line policy are dismissed. It stated that it has established a working 

group on candor issues that will submit a final recommendation on this issue within six months. 

32 FBI policy states that in most instances penalties for violations of regulations will fall 

within a range of penalties set forth in the FBI’s Manual of Administrative Operations and 

Procedures. It states, however, that in an aggravated case a penalty outside of the range may be 

imposed. It cites as an example the case of a supervisor or FBI official who, because of his or 

her responsibility to demonstrate exemplary behavior, “may be subject to a greater penalty than 

is provided in the range of penalties.” 

74
Seventh, while the FBI manual clearly anticipates that an SES employee may 

be the subject of a greater penalty because of the employee’s leadership position, 

FBI decision-makers seemed to believe that a lesser penalty is acceptable because 

of the effect any penalty will have on the individual’s career. We have concerns 

about this justification because, in part, we had difficulty substantiating the claim 

that a letter of censure would have a significant impact on the career of a seniorlevel FBI employee. Furthermore, we believe that this rationale can be easily 

abused and could inevitably lead to managers being treated more leniently than 

other employees. We believe that it is better to discipline FBI employees based on 

the merits of the case and precedent, rather than using speculation regarding the 

impact on an individual’s career as a mitigating factor. 

Eighth, we encountered many instances where senior FBI employees retired 

while under investigation for misconduct, and the disciplinary process ceased. We 

believe the FBI should consider continuing the disciplinary process in certain 

cases, even when an FBI employee retires while under investigation, so that a final 

disciplinary decision is reflected in the employee’s personnel file. 

We recognize that retirement or resignation while the disciplinary process is 

ongoing is not limited to senior FBI employees. However, they are more likely to 

be in a position to retire, and we saw many instances where they did so to avoid 

discipline. Although we do not believe that FBI resources should be expended in 

all misconduct cases to reach a final disciplinary decision when the subject has 

retired, we believe that the FBI should consider doing so in some cases, 

particularly when some FBI employees have received discipline for their actions 

while others retired or resigned to avoid discipline in the same case. 

Ninth, we saw cases where individuals had received significant promotions 

or bonuses despite the fact that they were the subject of an ongoing investigation. 

This was especially pronounced in the Ruby Ridge case, where Potts was promoted 

to Deputy Director while under investigation and many other subjects received 

bonuses and promotions while under investigation. We believe that promotions 

and bonuses for individuals while under investigation for serious allegations of 

misconduct should be carefully considered, particularly when the allegations 

appear to be supported by significant evidence. 

Tenth, it is critical that the FBI establish guidelines for when FBI employees 

should be recused from participating in investigations or disciplinary decisions 

regarding other FBI employees. FBI policies do not provide clear guidance on this 

issue. Our interviews with FBI officials indicated that the FBI normally leaves it 

to individual employees to decide when to recuse themselves if they believe there 

75
76

 

is a reason why they cannot be impartial. We believe there should be a clearer 

approach to the question of conflicts and a recognition that the appearance of a 

conflict can be as damaging as an actual conflict of interest. We think it useful for 

the FBI to formulate a policy, available to all employees, describing guidance on 

this issue.33 

Eleventh, given the strong perception among FBI employees of the existence 

of a double standard and the fact that our review found evidence supporting that 

belief, we recommend that the FBI establish a mechanism to regularly review SES 

and non-SES discipline. For example, the FBI’s Inspection Division or the Justice 

Management Division could analyze samples of cases of senior managers 

compared to non-managers, with the results being reported to the OIG for an 

independent review. 

Finally, we recognize the difficulty in eliminating completely the perception 

that upper-level managers in the FBI are treated more favorably than their non-SES 

counterparts, particularly given the recent and well-known cases that we have 

described in this report. We believe the elimination of the SES Board should assist 

in the effort to equalize the treatment of all FBI employees, as should the OIG’s 

expanded jurisdiction in the FBI. But the FBI should continue to be mindful of the 

damage that is done when employees believe that the disciplinary system is 

unequal or unfair. We believe that the FBI should strive to reduce that concern, 

and we believe that full implementation of these recommendations will help the 

FBI address this serious issue. 

 __________________________ 

 Glenn A. Fine 

 Inspector General 

33 In response to the draft of this report, the FBI stated that it will develop a written recusal 

policy within six months.