YMCA of the Greater Houston Area, Inc.

The OIG audit found that the YMCA of Greater Houston had not met
one of the four grant goals as shown in the following table.

Grant Goal Status
Serve an average of 50 clients a year for the period
January 1, 2003, through December 31, 2005 Not met
Complete a needs assessment to identify gaps in
existing services and available resources Met
Implement a model trafficking victim services site Met
Develop a plan to sustain the project once OVC
funding ends Met

San Diego Region Anti-trafficking Task Force

The OIG audit found that the San Diego Task Force was not
accomplishing one of the 12 grant goals as shown in the following table.

Grant Goal Status
Develop a multidisciplinary Anti-Trafficking Task Force,
which will include representatives from local law
enforcement agencies throughout San Diego County,
federal agencies, the District Attorney's Office, the
U.S. Attorney's Office, and numerous local service

providers Met
Create a Focus Group comprised of representatives
from the Anti-Trafficking Task Force Met

Create a Legal Resource Group, comprised of
representatives from the U.S. Attorney’s Office, the
District Attorney’s Office, and representatives from law
enforcement agencies’ legal divisions to act as a
resource for law enforcement to educate investigators
on current legislation and new laws related to the
issue Met
Conduct specialized training related to the
identification of human trafficking victims for a
minimum of 200 law enforcement and 90 victim
service providers per year in San Diego County Met
Facilitate bi-monthly meetings with representatives
from participating local and federal law enforcement
agencies, the District Attorney's Office and the U.S.
Attorney's Office to discuss open investigations,
current and related cases, share investigative leads,
strategies and current trends, surveillance information,
trainings conducted, up-coming events, and to
highlight specific case information Met

43


Provide additional training and oversight of service provider and task force
grantees to ensure that they:

« Develop and implement steps to accomplish the unmet grant goals, where
practical;

« Submit FSRs containing accurate financial data;

e Submit progress reports in a timely manner;

Drawdown only the amount of federal cash needed to pay for actual or

anticipated costs within 10 days;

e Maintain support for costs claimed as matching funds;

¢ Claim only costs that are allowable and supported;

© Properly calculate and claim indirect costs; and,

e Effectively monitor sub-recipients.

The Office of Justice Programs agrees with the recommendation. The OJP has
consistently worked to improve grantee compliance and performance through training and
technical assistance, as well as enhanced oversight activities in FY 2007 and 2008. To
better assist grantees in meeting performance goals, OVC recently transferred over $1
million in trafficking funding, comprised of roll-over funding from previous fiscal years,
to support technical assistance and research and evaluation activities for both BJA and
OVC trafficking grantees. In addition, BJA and OVC have worked with OVC’s Training
and Technical Assistance Center (TTAC) to convene a working group of key personnel
from other Federal agencies with anti-human trafficking responsibilities, from October
2007 through March 2008, to identify key areas of needed technical assistance for task
forces and service providers, and to identify existing Federal resources that could be
leveraged to address training and technical assistance needs of trafficking grantees. The
findings of this working group will help shape the development of the work plan for the
funding recently transferred to the OVC TTAC.

In addition to these efforts, the OJP continues to provide grantees with training
opportunities through the Office of the Chief Financial Officer’s (OCFO) regional
Financial Management Training Seminars. The OVC requires that all of its grantees
receiving over $150,000 in trafficking grant funds attend one of the OCFO’s training
seminars. Further, the OJP’s Office of Audit, Assessment, and Management (OAAM)
released several training tools to assist grantees with meeting post-award requirements,
including a grant Process. oversight web page, which can be found at

/www.o}) ement, and on-line training
modules for OIP’s end-to-end, veh based Grant Management System (GMS), which can
be found at http://www.ojp.gow/gmscbt/. More importantly, by December 31, 2008, the
OAAM will develop a more in-depth, on-line training course for OJP grantees that
focuses on post-award grant management.

107


e analyzing the agreement funds spent by seven OVC service
providers to determine if the providers could account for the
amount of agreement funds spent on direct assistance to victims;
and

e interviewing service provider and task force officials to obtain their
views on the effectiveness of OJP’s human trafficking grant
programs.

Appendix I contains further details on the audit objectives, scope, and
methodology.

This audit report contains three finding sections. The first finding
discusses the design and management of the OJP grant programs. The
second finding discusses whether grantees administered the grants in
accordance with applicable laws, regulations, guidelines, and the terms and
conditions of the grant awards. The third finding discusses our assessment
of the effectiveness of the grant programs in aiding trafficking victims.


40 397970 SHT 4G TREMSeAMAM
THARD “2maRBos9 soiTaul.

SBI{oSjaRe Hrs eee ee


Consider whether the “trafficking victims saves” performance measure should be
eliminated. If not eliminated, establish procedures for taking prompt corrective
action when task forces are not meeting the “trafficking victims saves” performance
measure,

The Office of Justice Programs agrees with the recommendation. The OJP is in the
process of revising its human trafficking performance measures and exploring options for
collecting and reporting on such measures. By January 31, 2009, the OJP will develop
and implement procedures whereby the status of all victims who have been identified by
the BJA funded task forces as potential human trafficking victims in each investigation
will be monitored and reported.

Ensure that OVC service providers separately identify new victims who are assisted
during the semi-annual progress reporting period.

The Office of Justice Programs agrees with the recommendation. By January 1, 2009, the
OJP will work with the Office for Victims of Crime (OVC) Training and Technical
Assistance Center (TTAC), which developed OVC’s Trafficking Information
Management System (TIMS), to modify the system to make data collection clearer and
more streamlined. The OJP believes that modifying the TIMS is important because most
of the OVC’s grantees use this system to provide data for their semi-annual progress
reports, and OVC program specialists compare the data in the semi-annual progress
reports with information submitted in the TIMS to ensure consistency of the data.

Ensure the OVC service providers do not report as assisted those potential victims
who either disappear or were found to be ineligible before services are provided.

The Office of Justice Programs agrees with the recommendation. By January 1, 2009, the
OJP will provide additional guidance to the service providers as to the eligibility criteria
for OVC-funded assistance for victims of human trafficking. The OJP believes that
service providers should only count as assisted (for the purpose of reporting under
cooperative agreements with OVC) those victims who actually receive some sort of
OVC-funded service and who are determined, based on the information available at the
time of service or intervention, to have been eligible to receive such.

103


Refugee Women’s Network, Inc.

The Refugee Women’s Network claimed matching funds twice for the
same $8,463 invoice for pro bono attorney fees. The Refugee Women’s
Network also claimed $1,089 in matching funds for pro bono services for a
victim that was served by HHS and not by the Refugee Women’s Network.

When grantees fail to provide matching funds as required, the risk is
increased that the grantees may not be able to continue the program after
the federal funding ends. We recommend that OJP provide additional
training and oversight to all grantees to ensure they maintain support for
costs claimed as matching funds.

Expenditures

According to the OJP Financial Guide, allowable costs are those
identified by the applicable Office of Management and Budget circulars and
in the authorizing legislation for the cooperative agreements and grants. In
addition, costs must be reasonable, allocable, necessary to the project, and
comply with the funding statute requirements.

As shown in the following table, the OIG audits found that six of the
seven grantees claimed expenditures totaling $1,488,956 that, at the time
of the audits, were either not authorized; not properly classified and
supported; not accurately recorded; not reasonable, allocable, or allowable;
not necessary to the project; or not in accordance with applicable laws,
regulations, guidelines, and terms and conditions of the cooperative
agreements.

Summary of Questioned Direct Expenditures

Unallowable and

Unsupported

Service Provider Award Number Costs Claimed
Boat People S.O.S., Inc. 2003-VT-BX-KO09 $121,625
Heartland Alliance for Human Needs and 2003-VT-BX-K002 $369,359
Human Rights 2003-VT-BX-K003 $602,224
International Rescue Committee - Miami 2003-VT-BX-K0O11 $317,522
Mosaic Family Services, Inc. 2003-VT-BX-K005 $41,318
Refugee Women’s Network, Inc. 2004-VT-BX-K010 $15,788
YMCA of the Greater Houston Area, Inc. 2003-VT-BX-K007 $21,120
Total $1,488,956

Source: Data from Office of the Inspector General audit reports between April 2007 and

March 2008 (see Appendix III)

52



We interviewed officials at 11 BJA task forces and reviewed
documentation maintained by them to determine if the data reported for the
above performance measures was accurate. We found that most of the task
forces reported inaccurate data for each of the three performance measures.

Applications for Continued Presence

Trafficking victims may be granted “continued presence” by the
Attorney General, allowing them to stay in the country temporarily during an
investigation or prosecution. The victims can also apply for a T-visa, a
special 3-year visa for victims of trafficking, which allows them to apply for
legal permanent residence status at the end of the 3-year period. Unless
they are under age 15, victims must be willing to assist in every reasonable
way the investigation and prosecution of the trafficking case to qualify for
the T-visa.

According to a BJA official, the continued-presence performance
measure includes both applications for continued presence and applications
for T-visas if the T-visa application includes law enforcement endorsement
that the victim has cooperated in the investigation and prosecution of the
trafficker. The BJA official also told us that the number reported for the
continued-presence performance measure is an indicator of how effective
the human trafficking program is operating.

We found that as of June 30, 2007, the 42 BJA task forces had
reported 288 applications for continued presence. The low number of
continued presence applications when compared to the 2,128 potential
victims who the BJA records show the task forces identified during the period
suggests that only a small fraction of the victims identified subsequently
cooperated with law enforcement in the investigation and prosecution of
traffickers. Moreover, as shown in the following table, we analyzed the
performance data reported for 11 of the 42 task forces regarding the
number of continued presence applications filed on behalf of trafficking
victims and found that the BJA maintained inaccurate performance data for 8
of the 11 task forces. The BJA data was overstated for seven of the task
forces and understated for one task force. Overall, the BJA data was
overstated by 51 percent. Consequently, the task force grants were actually
less effective in identifying victims than indicated by the BJA data.

63


TABLE OF CONTENTS

INTRODUCTION
Background.
Prior Audits
OIG Audit Objectives and Approach....

Noe eB

FINDINGS AND RECOMMENDATIONG ...............:cccccccscesssceeeeeeeseeeeees 10

1. DESIGN AND MANAGEMENT OF OJP’S TRAFFICKING
GRANT PROGRAMS

Program Design 11
Award Process — Service Provider Agreements . 14
Award Process - Task Force Grants .........04 . 18
Accuracy of Performance Data..... . 21

Conclusion
Recommendations...

GRANTS
Goals and Accomplishments

Reporting.........000 . 45
Fund Drawdown ......sseceeeeeee - 47
Budget Management and Control . 48

Program INCOME ........esseeeeeeee : 50

Local Matching Funds.. 50
Expenditures .... 52
Indirect Costs. . 53
Monitoring Subrecipients........ 54
Accounting and Internal Controls . 55
Grantees’ and OJP’s Responses and Planned ‘Corrective Actions ‘to
Weaknesses Found During Previous Individual OIG Audits 56
Overall Administration of Grants . 59
Conclusion . 60
Recommendation .... . 60



APPENDIX V

Office of the Inspector General Analysis and Summary of
Actions Necessary to Close the Report

We provided the draft report to OJP for review and requested written
comments. OJP’s written response is included as Appendix IV of this report.
OJP agreed with all of our recommendations and proposed corrective action
appropriate to resolve the recommendations. However, OJP provided
supplementary comments regarding certain information related to
Recommendation 11. Before addressing the actions necessary to close the
report recommendations, we first address OJP’s supplementary comments.

In its response to Recommendation 11, OJP provided a discussion
regarding the difficulties it faces in trying to assess the reasonableness of
the number of victims and cost of services estimated by the service
providers. OJP stated that identification of trafficking victims is episodic in
nature, and it is not possible to anticipate the number of victims who may be
identified in a single case. OJP stated that it therefore has elected to pursue
a strategy from the inception of trafficking grant programs to focus goals
and objectives on building capacity to assist any victims identified and to
ensure that these victims are provided comprehensive services. OJP further
stated that the needs of a particular victim, and the subsequent costs, can
differ tremendously from one victim to the next. OJP stated that the audited
OVC service provider grantees have clearly met the overarching goal for the
establishment and administration of this grant program.

We agree that OJP focused many of the goals of its service provider
grants on building community capacity to assist identified victims. However,
as shown in our report, five of the six service provider grants that we
audited had one or more goals to provide services to a specific number of
victims and these goals were not met in five of the six grants we examined.
These results are summarized in the following table.

112


10.

11.

guidance requiring that OVC service providers to maintain written
documentation to support all services provided to trafficking victims.
The recommendation can be closed when we receive OJP’s additional
guidance to service providers regarding this issue.

Resolved. We recommended that OJP ensure the accuracy of the
number of trafficking victims reported by the service providers for
inclusion in the annual reports. OJP agreed and stated that it is
committed to ensuring that OVC service providers report data reflecting
the accurate number of eligible trafficking victims assisted during a
reporting period. OJP stated that to avoid confusion as to whom can be
served with OVC grant funds, in March 2008 the OJP, the Vermont
Service Center of the U.S. Department of Homeland Security, and the
Human Trafficking Prosecution Unit within the Civil Rights Division of
U.S. Department of Justice, issued written guidance to OVC service
providers that specifically outlined eligibility for services funded by OVC
trafficking grants. OJP also stated that by January 1, 2009, it will
develop additional and specific guidance to the OVC service providers on
aiding certified victims as well as requiring the OVC service providers to
maintain written documentation to support all services provided to
trafficking victims. The recommendation can be closed when we
receive:

e the March 2008 guidance issued by the OJP, the Vermont Service
Center of the U.S. Department of Homeland Security, and the
Human Trafficking Prosecution Unit within the Civil Rights Division
of the U.S. Department of Justice that outlined eligibility for
services funded by OVC trafficking grants; and

e the additional guidance that OJP plans to issue to service
providers by January 1, 2009, regarding this issue.

Resolved. We recommended that OJP establish procedures for use
during the award process on future service provider agreements to
determine whether the award amounts are reasonable in relation to the
anticipated number of victims to be assisted. OJP agreed with this
recommendation and stated that it is collecting information on costs
associated with serving victims of human trafficking through the OVC
Trafficking Information Management System. However, OJP stated that
this data will not be useful until the information from several years,
many different regions, and for many different types of human
trafficking cases has been collected and appropriately analyzed. In the
interim, OJP stated that for all the OVC trafficking awards that OJP
makes during fiscal year (FY) 2008 and in future years, OVC trafficking
118


recommendations and provided documentation to address the weaknesses
found. The OIG closed the audit report based on the documentation
provided.

Refugee Women’s Network, Inc.

The OIG audit identified significant deficiencies in 4 of the 10 areas
tested - goals and accomplishments, budget management and control, local
matching requirements, and expenditures. The OIG made six
recommendations to address the deficiencies. OJP agreed with five of the
six recommendations and provided planned or completed corrective actions
for the recommendations. OJP disagreed with the first recommendation to
deobligate the $97,686 that remained at the end of the initial grant period.
In its response to the OIG audit, the Refugee Women’s Network disagreed
with the recommendations related to deobligating the remaining grant funds,
remedying the $8,463 in overcharges for salaries and fringe benefits, and
establishing internal controls to safeguard federal funds. The Refugee
Women’s Network generally agreed with the remaining three
recommendations.

YMCA of the Greater Houston Area, Inc.

The OIG audit identified significant deficiencies in 3 of the 10 areas
tested - goals and accomplishments, reporting, and expenditures. The OIG
made seven recommendations to address the deficiencies. OJP agreed with
six of the seven recommendations and provided planned or completed
corrective actions for the recommendations. OJP disagreed with the
recommendation related to submitting progress reports in a timely manner.
In its response to the OIG audit, the YMCA generally agreed with six of the
seven OIG’s recommendations and provided planned or completed corrective
actions for the recommendations. However, the YMCA also disagreed with
the recommendation related to submitting progress reports in a timely
manner. The YMCA also provided additional comments and explanations
regarding some deficiencies reported by the OIG.

San Diego Region Anti-trafficking Task Force

The OIG audit identified significant deficiencies in 3 of the 10 areas
tested - goals and accomplishments, reporting, and budget management
and control. The OIG made five recommendations to address the
deficiencies. OJP agreed with all five recommendations and provided
planned or completed corrective actions for the recommendations. In its
response to the OIG audit, the San Diego Sheriffs Department generally

58


We analyzed 19 initial agreements and supplements awarded to 7

OVC Service Provider Agreements and

Supplements Awarded
Agreements | Supplements Amount
Solicitation Awarded Awarded Awarded
June 2002 13 i) $9,716,150
February 2004 ii 1 $5,876,826
January 2005 6 16 $8,660,182
April 2006 9 i¢) $4,049,237
2007%° 2 11 $3,404,273
Totals 41 28 $31,706,668

Source: Office for Victims of Crime service provider agreement

award documents

service providers and found a wide variance in the amount of funds awarded
compared to the number of victims each grantee anticipated serving. As

shown in the following table, the amount awarded per anticipated victim

ranged from a high of $33,333 to a low of $2,500.

OIG Analysis of Funds Awarded to Service Providers

Minimum
Victims Amount

Service Agreement to be Amount per

Provider Number Type Term Served Awarded Victim
Boat People 2003-VT-BX-KO09 Initial 36 Mo. 100 $1,896,535 $18,965
Boat People 2007-VT-BX-K003, Initial 18 Mo. 35 $325,000 $9,286
Coalition
Against
Slavery and
Trafficking 2004-VT-BX-K001 Initial 24 Mo. 30 $1,000,000 $33,333
Coalition
Against
Slavery and
Trafficking 2004-VT-BX-K001 | Supplement | 18 Mo. 30 $295,000 $9,833
Coalition
Against
Slavery and
Trafficking 2004-VT-BX-K001_| Supplement | 18 Mo. 30 $340,000 $11,333
Heartland
Alliance 2003-VT-BX-KO02 Initial 36 Mo. 100 $490,829 $4,908
Heartland
Alliance 2003-VT-BX-K003 Initial 36 Mo. 90 $673,568 $7,484
Heartland
Alliance 2003-VT-BX-K003_| Supplement | 33 Mo. 106 $500,000 $4,717

10 In FY 2007, OVC awarded 2 new agreements and 11 supplements to continue
funding under prior awards. No new solicitation was issued for FY 2007.

16



Award Award
Grantee Number Amount.

BJA Task Force Grants Eyelieg a
San Diego County (California) 2005-VT-Bx-0001 $448,134
Collier County (Florida) 2005-VT-BX-0002 $639,378
Cobb County (Georgia) Board of Commissioners 2005-VT-BxX-0003 $300,802
Metropolitan Police Department of the District of Columbia 2005-VT-BX-0004 $449,764
City of Atlanta (Georgia) 2005-VT-BX-0005 $450,000
Government of Territorial and International American Samoa 2005-VT-BX-0006 $337,500
Harris County (Texas) 2005-VT-BX-0007 $936,681
Hawaii Department of the Attorney General 2005-VT-BX-0008 $305,333.
City of Oakland (California) 2005-VT-BX-0009 $675,000
Phoenix Police Department (Arizona) 2005-VT-BX-0010 $450,000
City of Boston (Massachusetts) 2005-VT-BX-0011 $443,082
Seattle Police Department (Washington) 2005-VT-BX-0012 $950,000
County of Suffolk (New York) 2005-VT-BX-0013 $312,182
City of El Paso (Texas) 2005-VT-BX-0014 $450,000
City of Los Angeles (California) 2005-VT-BX-0015 $650,000
New Jersey Department of Law and Public Safety 2005-VT-BX-0016 $420,502
City of Austin (Texas) 2005-VT-BX-0017 $674,632
Nassau County (New York) 2005-VT-BX-0018 $450,000
San Francisco City and County Police Department (California) 2005-VT-BX-0019 $225,000
Connecticut Department of Public Safety 2005-VT-BX-0020 $448,983
Miami Dade County (Florida) 2005-VT-BX-0021 $450,000
City of San Jose (California) 2005-VT-BX-1155 $225,000
City of St. Paul (Minnesota) 2005-VT-BX-1156 $450,000
Colorado Division of Criminal Justice 2005-VT-BX-1158 $450,000
St. Louis Metropolitan Police Department (Missouri) 2005-VT-BX-1159 $328,959
City of Indianapolis (Indiana) 2005-VT-BX-1160 $450,000
Chicago Police Department (Illinois) 2005-VT-BX-1161 $450,000
County of Lee (Florida) 2005-VT-BX-1162 $450,000
City of Milwaukee (Wisconsin) 2005-VT-BX-1163 $192,770
New York City Police Department (New York) 2005-VT-BX-1165 $450,000
Municipality of Anchorage (Alaska) 2005-VT-BX-1166 $450,000
Multnomah County (Oregon) 2005-VT-BX-1167 $450,000
Las Vegas Metro Police Department (Nevada) 2006-VT-BX-0001 $369,572
Salt Lake City (Utah) 2006-VT-BX-0002 $450,000
City of Fort Worth (Texas) 2006-VT-BX-0003 $450,000
Erie County (New York) 2006-VT-BX-0004 $450,000
Louisiana Commission on Law Enforcement 2006-VT-BX-0005 $450,000
Bexar County Sheriff (Texas) 2006-VT-BX-0006 $406,862
City of Clearwater (Florida) 2006-VT-BX-0007 $450,000
City of Independence (Missouri) 2006-VT-BX-0008 $450,000
Dallas Police Department (Texas) 2006-VT-BxX-0009 $450,000
Northern Mariana Department of Public Safety (U.S. Trust Territory) 2006-VT-BX-0017 $448,083

Totals(42 Grants) $19,188,219

Combined Totals (83 Cooperative ‘Agreements

and Grants) $50,894,887

87



OIG Analysis of Trafficking Victims Reported as Assisted
by OVC Service Providers During Calendar Year 2003

Reported Number of
Victims Served
Recorded Verified
Service Provider in OVC’s by the
Records OIG
Boat People, S.O.S., Inc. 10 10
Heartland Alliance for Human Needs and Human Rights 26 17
International Rescue Committee - Miami 6 4
Mosaic Family Services, Inc. 40 2
YMCA of the Greater Houston Area, Inc. 4 1
Totals 86 34

Source: Office for Victims of Crime data and service provider records

In July 2005 the Department reported to Congress that 357 trafficking
victims were assisted by 17 OVC service providers during 2004.13 However,
according to the OVC summary data, the service providers assisted 306
trafficking victims during 2004. As shown in the following table, we
performed testing at 7 of the 17 service providers and found that the
number of victims reported was overstated for all 7 providers.

OIG Analysis of Trafficking Victims Reported as Assisted
by OVC Service Providers During Calendar Year 2004

Reported Number of
Victims Served
Recorded | Verified
in OVC’s by the
Service Provider Records OIG
Boat People, S.0.S., Inc. 27 5
Coalition to Abolish Slavery 67 25
Heartland Alliance for Human Needs and Human Rights 15 11
International Rescue Committee - Miami 15 12
Mosaic Family Services, Inc. 25 8
Refugee Women’s Network, Inc. 6 3
YMCA of the Greater Houston Area, Inc. 9 7
Totals 164 71

Source: Office for Victims of Crime data and service provider records

43 DOJ, Report to Congress on U.S. Government Efforts to Combat Trafficking in
Persons. Although the report was for FY 2004, the number of victims aided by OVC service
providers was reported for calendar year 2004.

23


International Rescue Committee - Miami

The OIG audit was unable to determine if the International Rescue
Committee drew down funds sooner than needed to meet immediate
expenditures because the grantee did not maintain sufficient records to trace
the details of the reimbursement requests to the accounting records.

Mosaic Family Services, Inc.

On June 9, 2004, Mosaic Family Services, Inc. drew down $40,000
when there was already over $16,000 cash-on-hand. After 10 days, the
grantee still had $49,000 cash-on-hand. The grantee had over $26,000
cash-on-hand for at least 28 consecutive days.

On July 7, 2004, Mosaic again drew down $40,000 with over $26,000
cash-on-hand. After 10 days, the grantee still had at least $61,000 cash-on-
hand. Mosaic had from $8,000 to $66,000 cash-on-hand for 85 consecutive
days.

On September 11, 2006, the grantee drew down $18,000 with over
$11,000 cash-on-hand, resulting in $24,103 in excess funds at the end of
the audit period of September 30, 2006. The grantee had over $23,000
excess cash-on-hand for 19 consecutive days after this drawdown. It was
not until October 19, 2006, 38 days after the drawdown on September 30,
2006, that the grantee wrote five checks totaling $21,639, which reduced
the excess cash-on-hand to $2,464.

When grantees drawdown federal grant funds sooner than needed to
meet immediate needs, the federal government loses the use of those funds
and the interest that they earn while on deposit with the U.S. Treasury. We
recommend that OJP provide additional training and oversight to all grantees
to ensure they draw down only the amount of federal cash needed to pay for
actual or anticipated costs within 10 days.

Budget Management and Control

The OJP Financial Guide requires that grant recipients establish and
maintain accounting systems and financial records to accurately account for
funds awarded and disbursed. The accounting system should assure that
funds are spent in conformance with the grant terms and conditions. The
Financial Guide also prohibits using funds received for one grant project to
support another, and therefore requires that accounting systems and
financial records reflect expenditures for each project separately. In
addition, the Financial Guide requires that grantees obtain advance approval

48


The conditions of the concept paper for the task force grants were generally
the same as in 2004.

As with the previous two solicitations, in April 2006 the OVC and BJA
issued a solicitation for both the service provider agreements and task force
grants with similar conditions. However, the 2006 solicitation also required
law enforcement applicants to provide data on the number of victims
identified during 2003, if available.

The following table shows the number and amount of the BJA task
force grants and supplements awarded under each solicitation.

BJA Task Force Grants and Supplements Awarded

Grants Supplements Amount

Solicitation Awarded Awarded Awarded
August 2004 22. io) $8,827,936
January 2005 10 ie) $4,121,729
April 2006 10 6 $6,238,554
Totals 42 6 $19,188,219

Source: Bureau of Justice Assistance data

We analyzed 14 initial grants and supplements awarded to 11 task
forces and found that none of the 11 law enforcement applicants provided
pre-grant data to establish a baseline of the number of “trafficking victim
saves” for measuring compliance with the 15-percent annual increase
requirement. Such baseline data generally did not exist because the task
forces were not in effect prior to receiving the grants. In the absence of
such baseline data, we asked a BJA official what the agency used to
establish a baseline to measure compliance. The BJA official told us that the
baseline used is the number of applications for “continued presence”
submitted during the first full year of the grant.’! The BJA official said that
the agency uses the continued presence applications as the baseline because
it is indicative of the victims who have been identified, certified, and referred
for comprehensive services. We asked the BJA official if the agency had
communicated to the task forces that it was using the number of continued
presence applications submitted as the basis for measuring compliance with
the “trafficking victim saves” performance measure. The BJA official said
that he was not aware of any written communication to the task forces on

11 The Attorney General is authorized to approve applications from aliens for
“continued presence” in the United States. The continued presence approval allows aliens
to remain in the United States for a period of time to assist law enforcement in the
prosecution of human traffickers.

19


grantees may be compensated for the cost of individual consultant services
that are reasonable and consistent with amounts paid for similar services in
the marketplace. When the rate exceeds $450 (excluding travel and
subsistence costs) for an 8-hour day, the grantees must obtain advance
written approval from the awarding agency.

The seven OIG audits found that four of the seven grantees had
significant deficiencies related to supporting the matching funds claimed
against the agreements.

Boat People S.0.S., Inc.

The Boat People claimed $294,575 in matching funds for pro bono
attorney fees but could not provide documentation to show the pro bono
work was for the human trafficking agreement. The Boat People also
claimed $57,433 in matching contributions for items that were not approved
by OJP. As of June 19, 2008, actions to remedy the $352,008 in questioned
matching funds had not been completed by OJP and the grantee.

Heartland Alliance

The Heartland Alliance claimed $70,580 in matching funds for salaries
and fringe benefits but could not provide activity reports or equivalent
documentation to show that personnel worked on the human trafficking
project. Heartland Alliance also claimed $63,009 in matching funds for pro
bono attorney fees that exceeded the $450 per 8-hour day limit. In
addition, Heartland Alliance claimed matching funds for $40,000 in pro bono
legal services but could not provide documentation to show the pro bono
work was for the human trafficking project. As of June 19, 2008, actions to
remedy the $173,589 in questioned matching funds had not been completed
by OJP and the grantee.

International Rescue Committee - Miami

The OIG audit questioned $157,940 that the International Rescue
Committee claimed in matching funds for three subrecipients because the
matching funds were used to match federal funds claimed that were
unsupported. The audit also questioned $5,397 that the International
Rescue Committee claimed in matching funds for direct assistance to eight
victims who were ineligible for the program. As of June 19, 2008, actions to
remedy the $163,337 in questioned matching funds had not been completed
by OJP and the grantee.

51


APPENDIX ITI

Department of Justice OIG Audits of Office for Victims
of Crime and Bureau of Justice Assistance
Human Trafficking Agreements and Grants

from April 2007 through March 2008

From April 2007 through March 2008, the OIG issued seven audit
reports related to OJP’s human trafficking program. Five of the seven OIG
audits evaluated individual cooperative agreements awarded by the OVC to
provide services to victims of human trafficking. One OIG audit evaluated
multiple cooperative agreements awarded to a single service provider. The
remaining OIG audit evaluated a human trafficking task force grant awarded
by the BJA. The OIG identified significant deficiencies during all seven audits
including that grantees:

e did not meeting project goals,

e claimed unallowable and unsupported expenditures,
e drew down funds sooner than needed, and

e did not properly monitor subrecipients.

The OIG questioned $2,914,257 in grant expenditures and
recommended $97,686 be put to better use.2® The OIG’s findings and
recommendations for the seven audits are detailed below.

Cooperative Agreements

The OVC awards cooperative agreements to nongovernmental
organizations to provide trafficking victims with comprehensive or
specialized services. Comprehensive services include such basics as food,
clothing, and shelter, as well as more proficient services such as legal
assistance and advocacy, medical services, and jobs skills training.
Specialized services are single services such as housing, legal assistance, or
medical care that are provided over a broad geographic area.

28 The $2,914,257 questioned included $375,000 that was for award number 2002-
WL-BX-0026 which was not a human trafficking service provider award as explained in
footnote 20,

88


14.

Establish an effective system for monitoring the BJA task forces to ensure that (1)
performance data reported by the task forces is accurate, and (2) task forces are
meeting the performance goals.

The Office of Justice Programs agrees with the recommendation. As previously stated in
our response to Recommendation Number 13, the newly released GMT requires that
grant and program managers monitor grants consistently across a set of core criteria and
requires grant and program managers to review performance measures for face validity
and analyze collection processes. In addition, the OJP is in the process of revising its
human trafficking task for performance measures and exploring options for better
collecting and reporting on such measures.

Issue additional guidance to all task force grantees regarding best practices to:

© Maintain supporting documentation for performance measure data reported
to the BJA,

e Establish a mechanism to track the data to be reported for each performance
measure, and,

© Verify the accuracy of performance data before submission to the BJA.

The Office of Justice Programs agrees with the recommendation. By January 31, 2009,
the OJP will develop additional, clearer guidance to all task force grantees regarding best
practices in maintaining supporting documentation; tracking data to be reported; and
verifying the accuracy of the data before reporting to BJA.

As the OJP revises its performance measures as previously stated in Recommendation
Number 1, the OJP will also develop a User’s Guide that provides clear guidance on
reporting data to BJA. BJA also plans to provide onsite technical assistance and guidance
to task force grantees in maintaining supporting documentation, tracking the data, and
verifying the accuracy of the data.

Thank you for your continued cooperation. If you have any questions regarding this

response, please contact LeToya Johnson, Deputy Director, Office of Audit, Assessment, and
Management — Audit and Review Division, on (202) 514-0692.

cc:

Beth McGarry
Deputy Assistant Attorney General
for Operations and Management

Domingo S. Herraiz, Director
Bureau of Justice Assistance

11

110


letters and/or T-visas for each identified victim.1® We reviewed
documentation maintained by Mosaic and interviewed Mosaic officials and
determined the following:

e Forty-eight of the 155 victims were certified by HHS as trafficking
victims prior to the OVC grant award. Mosaic was only authorized
to assist pre-certified victims under the OVC grant without specific
authorization from the OVC to do otherwise, which Mosaic did not
receive. After victims are certified by HHS, funding for continued
services should come from HHS.

e Six of the 155 victims were certified by HHS after the OVC grant
was awarded but before coming to Mosaic for services. Therefore,
these victims also should not have been assisted using the OVC
grant funds.

e Forty-six of the 155 victims had already received T-visas before
coming to Mosaic for services. We asked Mosaic officials for copies
of the HHS certification letters for these victims but Mosaic did not
have them. We asked a Mosaic official if the 46 victims were
certified before coming to Mosaic, but he did not know if they had
been certified because Mosaic had not contacted HHS regarding
their certification. Since these victims may also have been certified
before coming to Mosaic, we believe they also should not have been
assisted using the OVC grant funds until Mosaic had determined
whether or not they had been certified.

Mosaic officials told us that they were not aware that grant funds were
to be used only to assist pre-certified victims of human trafficking.
However, that requirement was contained in the grant solicitation and
Mosaic acknowledged in its grant application that the grant funds would be
used to assist pre-certified victims. In addition, Mosaic officials confirmed
that they did not determine if victims who received T-visa’s prior to coming
to Mosaic for services were pre-certified or certified. Mosaic officials told us
that it was the only service provider in the local geographic area that is able

38 A T-visa is a special 3-year visa for victims of trafficking which allows them to
apply for legal permanent residence status at the end of the 3-year period. However,
unless they are under age 15, victims must be willing to assist in every reasonable way in
the investigation and prosecution of the trafficking case to qualify for the T-visa. Intake
forms are used by case workers during initial interviews with potential victims to determine
if a person is a victim of human trafficking. Certification letters from HHS are issued to
trafficking victims to confirm that the victims have been certified and provide the dates of
certification.

29


Mosaic Family Services, Inc.

Mosaic Family Services, Inc. had a goal to provide services for up to
180 trafficking victims with case management, housing, legal aid,
psychological and medical aid, English language instruction, and
employment and referral assistance by the end of the original project date of
December 31, 2005. However, Mosaic reported serving 116 clients as of
December 31, 2005, 36 percent below the 180 victims anticipated. As of
June 30, 2007, Mosaic reported serving 128 victims, still 29 percent below
the anticipated number of victims. As explained in Finding 1, we found that
Mosaic could support only 55 victims as being helped as of
June 30, 2007. Mosaic inappropriately served victims who had been certified
by HHS before the OVC grant was awarded or before coming to Mosaic for
services. Mosaic also served victims who had received T-visas before
coming to Mosaic, but Mosaic had not contacted HHS to determine if the
victims were certified.

We asked Mosaic officials to explain why they had not achieved the
performance goal established in the grant application. A Mosaic official told
us that the goal was only an estimate and that Mosaic served all victims who
were referred to them for services. The Mosaic official also said that they
have no control over the number of victims referred.

Refugee Women’s Network, Inc.

The Refugee Women’s Network (RWN) had a goal to provide
comprehensive culturally and linguistically appropriate direct services for a
minimum of 99 pre-certified victims of trafficking during the 3-year life of
the award from July 2004 through June 2007. The RWN reported serving 39
victims as of June 30, 2007, 61 percent below the 99 victims anticipated. Of
these 39 victims, the RWN reported 35 were served as of December 31,
2006. However, as explained in Finding 1, we found that as of December
31, 2006, the RWN inappropriately counted 14 of the 35 victims reported
because it continued to report victims who had been identified and counted
as new victims in prior reporting periods.

RWN’s sub-grantee (Tapestri) provided the following explanation for
why it had not achieved the performance goal established in its grant
application.

e Tapestri officials believed they had not been successful in serving a
higher number of victims because of the reluctance of community
involvement. They said that immigrant and refugee community
members may have been reluctant to participate in outreach

71


e Three service providers did not maintain documentation to support
some of the victims it reported as served.

Inaccurate Data Regarding Victims Identified by Task Forces

As with the service providers, we identified significant inaccuracies in
the number of victims identified by the task forces. The Department's
May 2007 report to Congress was the first annual report to include data on
the potential trafficking victims identified by the BJA task forces. In that
report, the Department stated that the BJA task forces had identified 1,513
potential trafficking victims as of December 31, 2006. We performed testing
on records for 510 of the 1,513 reported victims and could verify only 157 of
the 510 as being victims as defined by the Trafficking Victims Protection Act.

Subsequent to the Department’s May 2007 report to Congress, the BJA
task forces submitted updated performance data to the BJA for the 6-month
period ending June 30, 2007. The BJA data showed that the task forces had
identified 2,128 potential trafficking victims as of June 30, 2007. We
performed testing on records for 620 of the 2,128 reported victims and could
verify only 234 of the 620 as being victims as defined by the Trafficking
Victims Protection Act.

Causes for Inaccurate Data Regarding Victims Identified by

Task Forces

To determine the causes for the Department's reporting of inaccurate
data regarding victims identified by the task forces, we interviewed the BJA
and task force officials and reviewed documentation related to victims
identified. We found the reasons for the inaccurate data included the
following:

e For one task force, the BJA inadvertently recorded the cumulative
amount of victims served since the beginning of the agreement in
January 2003 instead of recording just the number of victims
served during the 6-month period ending June 30, 2006.

e One task force under-reported the victims identified because of a
lack of communication between different members of the task
force.

e One task force had initially identified multiple victims in a case, but
only one victim was actually found by the police department. The
task force mistakenly reported the multiple victims initially
identified.

x


We performed audit work at OJP’s Office for Victims of Crime, the
Bureau of Justice Assistance, the Department’s Civil Rights and Criminal
Divisions, and at the OVC service providers and associated BJA task forces

listed in the following table.

OJP Service Provider Grantees

BJA Task Force Grantees

Boat People S.0.S., Inc., Falls Church,
Virginia

Metropolitan Police Department of the
District of Columbia, Washington, D.C.

Coalition to Abolish Slavery and
Trafficking, Los Angeles, California

City of Los Angeles, California

Heartland Alliance, Chicago, Illinois

Chicago, Illinois Police Department

City of Milwaukee, Wisconsin

International Rescue Committee,

Collier County, Florida

Miami, Florida
Miami Dade County, Florida
Dallas, Texas Police Department

Mosaic Family Services, Inc., Dallas,
Texas
City of Fort Worth, Texas

City of Atlanta, Georgia

Refugee Women’s Network, Inc.,
Decatur, Georgia
Cobb County, Georgia Board of
Commissioners

Harris County, Texas

YMCA of the Greater Houston Area, Inc.,
Houston, Texas
Source: Office of the Inspector General

Appendix I describes in more detail our audit objectives, scope, and
methodology.

This audit report contains three finding sections. The first finding
discusses the design and management of the OJP grant programs. The
second finding discusses whether grantees administered the grants in
accordance with applicable laws, regulations, guidelines, and the terms and
conditions of the grant awards. The third finding discusses our assessment
of the effectiveness of the grant programs in aiding trafficking victims.

OIG Results in Brief

OJP’s human trafficking grant programs have built significant
capacities to serve victims, but have not identified and served significant
numbers of victims. As initially designed, the program awarded cooperative
agreements to non-profit service providers that furnished victims with
services such as food, clothing, shelter, and legal assistance. OJP’s Office
for Victims of Crime began awarding agreements to service providers in
January 2003, and we found that service providers supplied services to
fewer than 500 victims during calendar years 2003 and 2004. As part of an


OIG Analysis of Trafficking Victims Reported as
Assisted by the OVC Service Providers from
January 2003 through June 2007

Reported Number of
Victims Served
Recorded | Verified
in OVC’s by the
Service Provider Records OIG
Boat People, $.0.S., Inc. 119 74
Coalition to Abolish Slavery and Trafficking 185 123”
Heartland Alliance for Human Needs and Human Rights 85 62
International Rescue Committee - Miami 56 50
Mosaic Family Services, Inc. 128 55
YMCA of the Greater Houston Area, Inc. 112 81
Totals 685 445

Source: Office for Victims of Crime data and service provider records
Causes for OVC’s Inaccurate Data

Through interviews with the OVC and service provider officials and
reviews of documentation related to victims served, we identified multiple
causes for the inaccurate data on victims served.

OVC Verification of Reported Numbers

The OVC performs onsite monitoring visits to the OVC service
providers. However, we found that the onsite monitoring visits are short in
duration — usually a day or two - and usually do not include verification of
the performance data reported in the progress reports. An OVC official told
us that the OVC does not have the time or staffing to verify the accuracy of
the performance data in the progress reports because of the large amount of
data that support the progress reports. At the conclusion of our audit, an
OJP official provided us an update on changes to OJP’s grant monitoring and
assessment efforts. According to the OJP official, these changes included:

e the creation in FY 2007 of the Program Assessment Division within
the Office of Audit, Assessment, and Management to conduct grant
program assessments or performance audits, create common
monitoring policies, and ensure monitoring efforts are effective;

17 Of the 123 victims that we counted as verified, 41 were actually victims reported
as served by a predecessor grantee (Little Tokyo) that works closely with the Coalition to
Abolish Slavery and Trafficking. OVC now combines the victims served by Little Tokyo with
those served by the Coalition to Abolish Slavery and Trafficking. We did not attempt to
verify the 41 victims reported by Little Tokyo.

26


that the questioned amount was for dental insurance which was allowable
under the grant budget category of health insurance. In its response to the
OIG audit, the Boat People objected to some of the report language that did
not have a significant effect on the reported deficiencies. In most cases, the
Boat People either agreed with the OIG’s recommendations and provided
planned or completed corrective actions to address the deficiencies, or
provided additional explanations for deficiencies identified by the OIG.

Heartland Alliance

The OIG audit identified significant deficiencies in 8 of the 10 areas
tested — reporting, fund drawdowns, budget management and control, local
matching requirements, expenditures, indirect costs, monitoring of
subrecipients, and accounting and internal controls. The OIG made 23
recommendations to address the deficiencies. OJP agreed with all 23
recommendations and provided planned or completed corrective actions for
the recommendations. In its response to the OIG audit, Heartland Alliance
generally agreed with the OIG’s recommendations and provided planned or
completed corrective actions for the recommendations. However, Heartland
Alliance also provided additional comments and explanations regarding some
deficiencies reported by the OIG.

International Rescue Committee - Miami

The OIG audit identified significant deficiencies in 8 of the 10 areas
tested — goals and accomplishments, reporting, fund drawdowns, budget
management and control, local matching requirements, expenditures,
indirect costs, and monitoring of subrecipients. The OIG made 17
recommendations to address the deficiencies. OJP agreed with 15 of the 17
recommendations and provided planned or completed corrective actions for
them. OJP disagreed with the recommendation regarding deobligation of
funds not used for direct assistance to victims and the recommendation for
the International Rescue Committee to issue a protocol for coordinating with
external agencies. OJP also disagreed in part with the recommendation
regarding unused housing services. In its response to the OIG audit, the
International Rescue Committee disagreed with all 17 recommendations, but
provided planned actions to resolve many of them.

Mosaic Family Services, Inc.

The OIG audit identified significant deficiencies in 4 of the 10 areas
tested - goals and accomplishments, fund drawdowns, expenditures, and
monitoring of subrecipients. The OIG made two recommendations to
address the deficiencies. Both OJP and Mosaic agreed with the

57


OIG Analysis of Law Enforcement and Other Officials
Provided Victim Identification Training
Reported by Task Forces as of June 30, 20077*

Victim Identification Training for Law
Enforcement and Other Officials Reported
as of June 30, 2007
Task
Force Verified
Progress BJA by the Overstated/

Task Force Grantee Reports Report OIG (Understated)
City of Atlanta, Georgia 19 14 19 (5)
Chicago, Illinois Police
Department 2,825 2,826 2 2,824
City of Milwaukee,
Wisconsin 2,178 2,178 1 2,177
Cobb County, Georgia
Board of Commissioners 1,297 1,297 584 713
Collier County, Florida 1,862 1,906 1,906 i)
Dallas, Texas Police
Department. 315 315 227 88
City of Fort Worth, Texas 494 494 418 76
Harris County, Texas 1,535 612 3,087 (2,475)
City of Los Angeles,
California 8,995 8,995 8,922 73
Metropolitan Police
Department of D.C. 3,341 3,341 oO 3,341
Miami Dade County,
Florida 4551 4,551 4,103 448

Totals 27,412 | 26,529 | 19,269 7,260

Source: Task force progress reports, Bureau of Justice Assistance summary report,
Office of the Inspector General interviews with Bureau of Justice Assistance and task
force officials, and Office of the Inspector General analyses of documents provided by
the task forces

For 2 of the 11 task forces, the performance data maintained by the
BJA was higher than reported in the task force progress reports. For two
other task forces, the performance data maintained by the BJA was lower
than reported. Both the BJA and task force officials provided the following
explanation for the differences.

BJA
e The BJA data for the Atlanta task force was understated by five law

enforcement or other officials because the task force reported in its
progress report for the period ending December 31, 2004, that five

24 ‘As explained in Footnote 19, the data presented for the Atlanta task force is as of
reporting period ending December 31, 2006.
66


MANAGEMENT OF THE OFFICE OF
JUSTICE PROGRAMS’ GRANT
PROGRAMS FOR TRAFFICKING
VICTIMS

U.S. Department of Justice
Office of the Inspector General
Audit Division

Audit Report 08-26
July 2008


e Remedy the $902,122 in questioned costs for the three agreements
resulting from salary expenditures that lacked adequate support.>+

e Remedy the $174,479 in questioned costs for the three agreements
resulting from fringe-benefit expenditures that lacked adequate
support.

e Remedy the $162,012 in questioned costs for two agreements
resulting from direct expenditures that lacked adequate support.

e Remedy the $63,009 in questioned costs for one agreement
resulting from pro-bono expenditures in excess of the maximum
daily allowable rate.

OJP agreed with all 23 recommendations and provided planned or
completed corrective actions for the recommendations. In its response to
the OIG audit, Heartland Alliance generally agreed with the OIG’s
recommendations and provided planned or completed corrective actions for
them.

International Rescue Committee - Miami

The OIG issued a March 2008 audit report on a cooperative agreement
awarded to the International Rescue Committee (IRC) in Miami, Florida.?2
The OIG also tested the accounting records to determine if reimbursements
claimed for costs under the award were allowable, supported, and in
accordance with applicable laws, regulations, guidelines, and the terms and
conditions of the agreement.

Among the deficiencies the OIG found the following:

e The IRC did not achieve the objectives pertaining to social services
and legal services because it did not serve 100 victims as

31 The $902,122 questioned included $220,170 that was for award number 2002-
WL-BX-0026 which was not a human trafficking service provider award as explained in
footnote 20.

32 U.S. Department of Justice, Office of the Inspector General, Office of Justice
Programs Office for Victims of Crime Services for Trafficking Victims Discretionary Grant
Program Cooperative Agreement Awarded to the International Rescue Committee, New
York, New York, Award Number 2003-VT-BX-K011, Audit Report GR-40-08-003 (March
2008).

92


and accurate information on the number of both potential and confirmed
human trafficking victims. The recommendation can be closed when we
receive OJP’s revised human trafficking performance measures and new
procedures for monitoring and reporting the status of all victims
identified by BJA task forces.

Resolved. We recommended that OJP ensure the BJA task forces
either exclude domestic trafficking victims when reporting the number
of victims identified under the Trafficking Victims Protection Act or
separately identify the domestic and alien victims in the numbers
reported. OJP agreed and stated that it is in the process of revising its
human trafficking performance measures and will take appropriate steps
to separately identify the domestic and alien victims in the numbers
reported. Specifically, OJP stated that it plans to collect information on
the residency status of all identified victims, categorizing them as either
Foreign (Undocumented Alien, Qualified Alien), Domestic (U.S. Citizen,
U.S. National, Permanent Resident), or Unknown. OJP stated that by
January 31, 2009, it will develop and implement procedures to ensure
that the BJA task forces collect information about whether a continued
presence application or T-visa application has been filed for each victim.
The recommendation can be closed when we receive OJP’s new
procedures separately identifying the domestic and alien victims in the
data reported by the BJA task forces.

Resolved. We recommended that OJP require the BJA task forces to
maintain documentation to support the number of trafficking victims
reported. OJP agreed and stated that it plans to emphasize the
importance and need to maintain documentation to support the number
of victims reported at the September 2008 human trafficking conference
in Atlanta, Georgia. OJP also stated that BJA recently developed an
“Immersion Program” among the funded task forces that allows the
three top performing task forces to provide hands-on technical
assistance and cross training to the other task forces. OJP stated that
to ensure that the BJA task forces maintain documentation, a unique
incident number will be assigned to each new case as it is reported to
OJP, and any victim information included for that case would be linked
to the unique incident number. As a result, documentation supporting
the number of trafficking victims will be readily available and easily
accessible for auditing and verification. The recommendation can be
closed when we receive:

e the agenda or outline for the September 2008 human trafficking
conference that shows maintenance of documentation to support
the number of victims reported as a discussion item;

115


Protection Efforts
OJP’s Office for Victims of Crime (OVC) awards cooperative agreements to
service providers to supply direct services to victims of trafficking.
OJP’s Bureau of Justice Assistance awards grants to state and local law
enforcement agencies to develop task forces that: (1) identify and rescue
victims of human trafficking, and (2) collaborate with service providers to
provide assistance to victims of trafficking.
The OVC offers victim support and education resources to trafficking victims
and victim service providers.
The OVC maintains a resource center that victim advocates and caregivers can
contact to obtain publications and tools to assist them in working with
trafficking victims.

Prosecution Efforts
The Civil Rights Division's Criminal Section enforces the involuntary servitude
and peonage statutes by working with the Federal Bureau of Investigation, the
United States Attorneys Offices, and the Criminal Division’s Child Exploitation
and Obscenity Section to investigate and prosecute cases of trafficking in
persons and worker exploitation.
The Civil Rights Division funds and staffs the national complaint line for
reporting of trafficking crimes.
Source: Department of Justice website and the Bureau of Justice Assistance

As shown above, the Office of Justice Programs’ (OJP) responsibility
related to human trafficking primarily involves awarding grants to establish
task forces that identify and rescue trafficking victims, and awarding
cooperative agreements to service providers that provide assistance such as
food, clothing, and shelter to trafficking victims. OJP’s Bureau of Justice
Assistance (BJA) provides grants for task forces and OJP’s Office for Victims
of Crime (OVC) awards the service-provider agreements.

OIG Audit Approach

The Department of Justice Office of the Inspector General (OIG)
initiated this audit to: (1) assess the adequacy of OJP’s design and
management of the human trafficking grant programs; (2) evaluate the
extent to which grantees have administered the grants in accordance with
applicable laws, regulations, guidelines, and terms and conditions of the
grant awards; and (3) assess the effectiveness of the grant programs in
assisting trafficking victims.

This audit also examined the Department’s protection efforts -
specifically the OVC’s program for awarding cooperative agreements to
provide direct services to trafficking victims and the BJA’s program for
awarding grants to develop task forces to identify and rescue trafficking
victims.


anticipated, and did not obtain 80 T-visas as anticipated for victims
of trafficking identified during the project period.

The IRC did not maintain supporting documentation for eight of the
clients enrolled to show how IRC staff determined the clients were
eligible for the program. The OIG questioned $17,536 for direct
assistance costs related to these eight clients as unsupported.

The IRC did not clearly identify the number of new clients in the
program progress reports. Moreover, the IRC did not clearly
identify the status of each client’s legal achievement of obtaining a
T-visa or other appropriate forms of immigrant relief in the progress
reports.

The IRC did not maintain sufficient records for an audit trail to trace
the details of the reimbursement requests to the accounting
records.

The IRC was unable to provide supporting documentation for client
housing costs. The OIG questioned $2,300 as unsupported costs
that the IRC claimed as direct costs for victim housing.

The IRC entered into agreements with subrecipients to provide
housing, medical, and legal services, for which the IRC paid them
nearly the full amounts budgeted in the agreement. However, the
subrecipients provided services to fewer victims than the budget
was established to support. The OIG questioned $297,686 of these
direct costs as unsupported.

The above findings related to direct costs had an effect on the
accuracy of the indirect costs as reported by the IRC. The IRC staff
told the OIG that they calculated the indirect costs for
reimbursement by using the base of direct costs multiplied by the
approved indirect cost rate. Therefore, the OIG questioned the
accuracy of the calculation of the indirect costs by $6,843 as well as
unsupported costs.

The above findings related to direct costs also had an effect on the
reporting accuracy of the local matching costs. Since the OIG
questioned client eligibility and costs paid to the subrecipients as
unsupported, the OIG also questioned an equal portion of the
related local match in the amount of $163,337.

93


Additionally, our audit work identified significant inaccuracies in the
performance data reported by both the service providers and the task
forces.

Additional discussion of the accuracy of the performance data reported
by the OVC service providers and the BJA task forces regarding the number
of victims identified and served is contained later in this report.

Award Process - Service Provider Agreements

The OVC awarded cooperative agreements to service providers based
on responses to four separate solicitations. The first solicitation issued in
June 2002 did not limit the funding that could be awarded to a service
provider. Under that solicitation, the award amounts varied depending on
the type of services to be provided and the anticipated number of trafficking
victims to be served. Service providers were required to submit proposals to
the OVC addressing selection criteria such as:

e details about the trafficking problem to be addressed in the service
provider’s area,

e measurable goals and objectives for meeting the needs of
trafficking victims,

e a strategy for accomplishing the goals and objectives including the
types of services to be provided to victims and the number of
victims for whom the services would be made available,

e the provider’s capability to accomplish the project objectives,

a plan for evaluating accomplishment of the project objectives, and

a detailed budget of the costs to implement the project objectives.

As part of their proposed budgets, service providers were required to
identify the total average projected cost of providing direct services to
victims based on a calculation of the number of victims anticipated to be
served, the average anticipated number and type of services to be provided,
and the average anticipated number of days services would be provided.

The OVC issued the second solicitation in February 2004. This
solicitation established a $1 million limit for each agreement. An OVC official
told us that the OVC established the limit so it could provide supplemental
funding to an increased number of service providers. From this and all

14


of the grant funds were used to provide direct assistance to victims.”°
Overall, the seven service providers used only $922,377 of the $8,435,891
(10.9 percent) in grant funds to provide direct assistance to victims. Four of
the seven providers used less than 10 percent of the grant funds to provide
direct assistance to trafficking victims as presented in the following table.

OIG Analysis of Direct Assistance to Victims
Provided by OVC Service Providers

Direct Percent
Federal Assistance Direct
Service Provider Funds Spent | to Victims Assistance

Boat People S.O.S., Inc. $1,896,535 $127,987 6.7%
Coalition to Abolish Slavery and
Trafficking $1,290,824 $261,227 20.2%
Heartland Alliance $1,336,786 $50,176 3.8%
International Rescue Committee
- Miami $1,635,850 $200,697 12.3%
Mosaic Family Services, Inc. $1,068,361 $61,288 5.7%
Refugee Women’s Network,
Inc. $470,155 $39,368 8.4%
YMCA of the Greater Houston
Area, Inc. $737,380 $181,634 24.6%

Totals $8,435,891 $922,377 10.9%

Source: Service provider expenditure and victim data

Officials from six of the seven service providers explained that much of
the direct services they supply to victims are consultations, legal assistance,
and other services provided by in-house staff or by outside consultants and
contractors. However, we found that the six service providers were not
required to and consequently did not account for how much of the grant
funds used for these purposes directly assisted victims. The six service
providers explained that much of the grant funds were used to perform
community outreach and training, and not direct assistance to victims.

Service Provider and Task Force Officials’ Views on OJP’s Human
Trafficking Grant Programs

During our audit work at 7 OVC service providers and 11 BJA task
forces, we interviewed 22 service provider officials and 43 task force officials
to obtain their views on the effectiveness of OJP’s human trafficking task
force program. Overall, officials generally believed that OJP’s grant

26 We analyzed expenditure data as of June 30, 2007, for five of the seven service
providers. The data for the Boat People S.O.S., Inc. was as of the end of the agreement on
December 31, 2006. The data for the Refugee Women’s Network, Inc. was as of the end of
the agreement on December 31, 2007.

73


However, the task force had no documentation to show the training
took place or how many officers received it.

Awareness Presentations Made to the Public

As part of the performance measures, the task forces are required to
report the number of public awareness presentations made to the public.
These presentations take many forms, such as television public service
announcements, Internet-based video presentations, and presentations to
groups such as the Rotary Club or other service organizations. The BJA
expected that the awareness presentations would: (1) increase the public
awareness of human trafficking, (2) result in the public reporting to law
enforcement more potential human trafficking situations, and (3) result in
the task forces referring more victims to service providers.

As shown in the following table, the BJA collected inaccurate
performance data on the number of awareness presentations made to the
public for 7 of the 11 task forces we tested. Five of the task forces
overstated the number of presentations and two task forces understated the
number of awareness presentations made. Overall, the BJA overstated the
number of awareness presentations made by 191 percent.

OIG Analysis of Awareness Presentations Made to the Public
Reported by Task Forces as of June 30, 20077°

Awareness Presentations Made to the Public
Reported as of June 30, 2007
Task
Force Verified
Progress BIA by the Overstated/
Task Force Grantee Reports Report OIG (Understated)

City of Atlanta, Georgia 1 ie) 1 (1)
Chicago, Illinois Police
Department 2 2 3 (1)
City of Milwaukee,
Wisconsin 10 10 2 8
Cobb County, Georgia
Board of Commissioners 2 2 2 i¢)
Collier County, Florida 62 63 63 0
Dallas, Texas Police
Department oO (e) it} (¢)
City of Fort Worth, Texas 8 8 8 {0}

?5 As explained in Footnote 19, the data presented for the Atlanta task force is as of
reporting period ending December 31, 2006, reporting period.
68


and consequently did not account for how much of the grant funds
used for these purposes directly assisted victims.

Conclusion and Recommendations

In general, we found that the design and management of OJP’s human
trafficking grant programs were effective in building capacities to serve
victims of human trafficking, but were not effective in: (1) identifying and
serving significant numbers of alien trafficking victims, (2) ensuring that
award amounts were consistent with the anticipated number of victims to be
served, and (3) ensuring that service providers and task forces reported
accurate performance data on victims identified and served.

In addition, in individual audits of 6 OVC service providers and 1 BJA
task force, the OIG found that they did not comply with the essential grant
requirements in 9 of the 10 areas tested. The deficiencies identified in these
audits are similar to the deficiencies found repeatedly in past audits of OJP
grants. While OJP and the grantees had initiated or agreed to initiate
corrective action to address most of the weaknesses we found in the
individual audits, we believe the weaknesses we identified were systemic
and warrant additional guidance and direction from the OVC and BJA to all
human trafficking grantees.

Finally, at the time of the audit the OVC and BJA had not established
an effective system for monitoring the OVC service providers and the BJA
task forces to ensure that: (1) service providers and task forces are
meeting performance goals, and (2) service providers can show the amount
of grant funds used to directly assist victims of human trafficking. However,
at the conclusion of the audit, an OJP official told us that they had
implemented actions to improve monitoring of the service providers and task
forces. While we did not evaluate these actions, we believe that, if fully
implemented, they could address some of the weaknesses we identified
during this audit.

Our audit work and findings resulted in 15 recommendations to
improve the management of the OVC service provider cooperative
agreements and the BJA task force grants. Our recommendations include
the following:

e Ensure that the BJA task forces either report only actual trafficking

victims identified, or report both actual and potential victims
identified.

xiv


2. ADMINISTRATION OF COOPERATIVE AGREEMENTS

AND GRANTS

From April 2007 to March 2008, the OIG issued five audit reports
examining individual OVC service provider cooperative
agreements, one audit report on multiple cooperative
agreements, and one audit report on a BJA task force grant. As
a result of the audits, OJP and the grantees had initiated or
agreed to initiate corrective action to address most of the
weaknesses found in the individual audits. However, we believe
that weaknesses identified in these audits reflect systemic issues
that need to be addressed by the OVC and BJA. These
weaknesses included goals and accomplishments of grants and
cooperative agreements, reporting, fund drawdowns, local
matching funds, expenditures, indirect costs, and monitoring of
subrecipients. The OVC and BJA need to take additional actions
to ensure that these systemic weaknesses are minimized by all
OVC service providers and BJA task forces.

As of November 2007, the OVC had awarded 41 cooperative

agreements and supplements to human trafficking service providers totaling
about $31.7 million and the BJA had awarded 42 human trafficking task
force grants and supplements totaling about $19.2 million. As shown in the
following table, from April 2007 through March 2008 the OIG issued five
audit reports on individual OVC service provider cooperative agreements,
one audit report on multiple cooperative agreements, and one audit report
on a grant awarded to a BJA human trafficking task force. A synopsis of
each audit report is contained in Appendix III of this report.

Human Trafficking Cooperative Agreements and Grants

Audited by the OIG from April 2007 to March 2008

Performance Period

Service Provider or Award
Task Force Award Number Amount From To

Service Provider Agreement Audits
Boat People S.0.S., Inc.
Falls Church, Virginia 2003-VT-BX-K009 $1,896,535 | 01/01/03 _| 12/31/06
Heartland Alliance for
Human Needs and 2003-VT-BX-K002 $490,829 | 01/01/03 12/31/05
Human Rights
Chicago, Illinois”? 2003-VT-BX-K003 $1,173,568 | 01/01/03 | 9/30/08

2° The audit of Heartland Alliance included award number 2002-WL-BX-0026 for
$375,000 that was awarded by OJP’s Office of Violence Against Women and was not a
human trafficking service provider agreement.

38



ACRONYMS

APD Atlanta Police Department

BJA Bureau of Justice Assistance

BPSOS Boat People S.0O.S., Inc.

CAST Coalition Against Slavery and Trafficking

CPD Chicago Police Department

Department__| Department of Justice

DPD. Dallas Police Department

FSR Financial Status Report

FWPD Fort Worth Police Department

GAO Government Accountability Office

GAT Grant Assessment Tool

GMT Grant Management Tool

HCSO Harris County (Texas) Sheriff's Office

HHS Department of Health and Human Services

IRC International Rescue Committee

LAPD Los Angeles Police Department.

MDPD - Miami Dade Police Department

MPD Milwaukee Police Department

MPDC Metropolitan Police Department of the District
of Columbia

OAAM Office of Audit, Assessment, and Management

OIG Office of the Inspector General

OJP Office of Justice Programs

Ove Office for Victims of Crime

RWN Refugee Women’s Network, Inc.

TIMS Trafficking Information Management System

TVPA Trafficking Victims Protection Act

YMCA Young Men’s Christian Association

80



agreed with the OIG’s recommendations and provided planned or completed
corrective actions for the recommendations.

Overall Administration of Grants

The systemic grant administration deficiencies identified in the seven
OIG audits of OJP human trafficking grantees are consistent with OJP’s weak
record of monitoring the approximately $2-$3 billion of grants it awards
each year. The OIG has repeatedly identified these deficiencies in previous
OIG reviews that raise questions about how effectively taxpayer grant funds
are being spent. For example, multiple OIG reviews have found that OJP
lacked adequate financial and programmatic oversight of its grant programs.
In addition, we have found that OJP has yet to develop consistent
mechanisms to assess the success of its grant programs. OIG audits
continue to identify varied deficiencies regarding OJP’s oversight of grant
programs, including difficulties in meeting grant objectives, improper use of
grant funds, problems in the grant closeout process, and poor measurement
of grant effectiveness.

At the conclusion of our audit, an OJP official provided us an update on
changes to OJP’s grant monitoring and assessment efforts. According to the
official, the changes included:

e the creation in FY 2007 of the Program Assessment Division within
the Office of Audit, Assessment, and Management to conduct grant
program assessments or performance audits, create common
monitoring policies, and ensure monitoring efforts are effective;

e the release in FY 2008 of the Grant Monitoring Tool that:
(1) captures documentation from all phases of a monitoring review;
(2) provides embedded tools and guidance necessary to conduct
monitoring; (3) requires that all on-site monitoring efforts include a
review of standard, key review elements and steps; (4) allows OJP
officials to identify and track monitoring findings and grantee
corrective actions; and (5) encourages a more thorough review of
grant programs against common programmatic, financial, and
administrative elements; and

e the use of the Trafficking Information Management System to
accumulate and report data related to the number of trafficking
victims identified and served.

While we could not evaluate these actions, if fully implemented they
could address some of the weaknesses we found during this audit. The
59


this issue. However, the official told us that the BJA has made presentations
to the task forces where this issue was discussed.

To determine if the task forces were complying with the requirement
to increase “trafficking victim saves” by 15 percent each year, we first
determined that 32 of the 42 task force grants had been in effect for at least
2 full years and therefore would permit a comparison of the second year’s
performance to the first year’s performance. For the other 10 task forces,
we determined the following:

e The 10 task forces had been in effect for 1 year as of June 30,
2007.

e Six of the 10 task forces reported submitting no applications for
continued presence during the first year of the grant. Therefore,
these 6 task forces would not have a measurable goal for the
second year of the grant.

e The remaining four task forces reported submitting only 1-3
applications for continued presence during the first year of the
grant.

Next, for the 32 task forces that had been in effect for at least 2 full
years as of June 30, 2007, we analyzed the continuing presence data
reported by the task forces for the first year the grant was in effect and
found the following:

e Seventeen of the 32 task forces reported submitting no applications
for continued presence during the first year of the grant.
Therefore, these task forces also would not have a measurable goal
for the second year of the grant.

e Ten of these 17 task forces also reported submitting no continued
presence applications for the second year of the grant. The
remaining seven task forces reported submitting from 2-8
continued presence applications during the second year of the
grant.

Finally, for the remaining 15 task forces that reported submitting
continued presence applications during the first year of the grant, we
analyzed the data reported for the first and second years of the grant and
found that only 4 of the 15 task forces met the requirement to increase
“trafficking victim saves” by 15 percent annually.

20


OIG Analysis of Trafficking Victims Reported as
Identified by the BJA Task Forces from
January 2005 through June 2007°°

Reported Number of!
Potential Victims
Identified
Recorded | Verified
in BJA’s by the
Task Force Grantee Records OIG
City of Atlanta, Georgia 216 4
Chicago, Illinois Police Department 4 10
City of Milwaukee, Wisconsin 0 0
Cobb County, Georgia Board of
Commissioners 10 0
Collier County, Florida 25 25
Dallas, Texas Police Department 62 64
City of Fort Worth, Texas 5 &}
Harris County, Texas 152 109 *
City of Los Angeles, California 62 13
Metropolitan Police Department of D.C. 62 ie)
Miami Dade County, Florida 22 6
Totals 620 234

Source: Bureau of Justice Assistance data and task force records

We sought to identify the causes for the Department's reporting of
inaccurate data regarding victims identified. We interviewed task forces
officials, obtained and reviewed documentation related to victims identified,
and interviewed BJA officials. Based on this work, we identified multiple
causes for the inaccurate data on victims identified.

City of Atlanta, Georgia

As of June 30, 2007, the BJA data indicated that the Atlanta Police
Department (APD) had identified 216 potential trafficking victims, but we
could verify that only 4 victims had been identified. According to a BJA
official, the BJA data incorrectly showed 216 victims reported by the APD
when it should have shown 123. The difference of 93 occurred because for
the 6-month period ending June 30, 2006, the BJA recorded the number
reported by the APD as 111 instead of the 18 victims actually reported by
the APD for that period. The BJA official told us that the bureau
inadvertently recorded in its victim tracking spreadsheet the cumulative

19 Our site work was conducted at the Atlanta task force before the June 30, 2007,
performance data was accumulated and reported. Therefore, the data presented for the
Atlanta task force is as of the reporting period ending December 31, 2006.

32


Additionally, by January 31, 2009, the OJP will develop and implement procedures
whereby the status of all victims who have been identified by the BJA funded task forces
as potential human trafficking victims in each investigation will be monitored and
reported. By employing a regularly updated incident based information system, the OJP
should be able to collect information on all identified potential victims as soon as an
investigation is initiated and track their status throughout the investigation. Initially, all of
these individuals would be recorded as potential victims but as the investigation uncovers
more evidence about the status of the victim, the BJA funded task forces will update
victim reports to indicate whether arrests are made or whether the victim is granted
Continued Presence or a T-visa. A summary sheet for each incident will allow task
forces to regularly update the status of the incident and victims to indicate whether they
are a confirmed victim of trafficking, not a confirmed victim of trafficking or whether
confirmation is pending. This will allow task forces to provide the most up-to-date and
accurate information on the number of both potential and confirmed human trafficking
victims.

Ensure the BJA task forces either exclude domestic trafficking victims when
reporting the number of victims identified under the Trafficking Victims Protection
Act or separately identify the domestic and alien victims in the numbers reported.

The Office of Justice Programs agrees with the recommendation. As stated in our
Tesponse to Recommendation Number 1, the OJP is in the process of revising its human
trafficking performance measures and will take appropriate steps to separately identify the
domestic and alien victims in the numbers reported.

Specifically, the OJP proposes to collect information on the residency status of all
identified victims, categorizing them as either Foreign (Undocumented Alien, Qualified
Alien), Domestic (U.S. Citizen, U.S. National, Permanent Resident), or Unknown. As
previously stated, by January 31, 2009, the OJP will develop and implement procedures
to ensure that the BJA task forces collect information about whether a continued presence
application or T-visa application has been filed for each victim.

101


10

11.

Ensure that the OVC service providers separately identify new victims
who are assisted during the semi-annual progress reporting period.

Ensure the OVC service providers do not report as assisted those
potential victims who either disappear or were found to be ineligible
before services are provided.

. Ensure that the OVC service providers verify whether victims who

received T-visas have been certified by HHS as trafficking victims before
they can receive services.

. Ensure the OVC service providers maintain sufficient documentation to

support the trafficking victims reported as assisted in the semi-annual
progress reports.

. Ensure the accuracy of the number of trafficking victims reported by the

service providers for inclusion in the annual reports.

Establish procedures for use during the award process on future service
provider agreements to determine whether the award amounts are
reasonable in relation to the anticipated number of victims to be
assisted.

37


14.

amount of grant funds used to assist victims of human trafficking. OJP
agreed and stated that its newly released GMT requires that grant and
program managers monitor grants consistently across a set of core
criteria. According to OJP, the GMT instructs grant and program
managers to check that a grantee has an adequate method for
collecting performance measurement data.

OJP also stated that the GMT now requires that grant and program
managers assess grantee performance goals when conducting on-site
monitoring, as well as through the GAT when conducting a desk review.
Finally, OJP stated that by January 31, 2009, the OAAM will schedule a
follow-up review of BJA and OVC human trafficking-related grant
recipients in order to ensure that issues identified in this report have
been appropriately addressed, and long-term improvement measures
have been implemented.

The recommendation can be closed when we receive documentation:

e showing that OJP’s Grant Management Tool requires grant and
program managers to review all grants against a set of standard
review categories to determine administrative and financial
compliance with grant management policies, procedures, and
regulatory requirements, as well as to evaluate the programmatic
progress and success of efforts funded through the grant;

e describing OJP’s improved version of the GAT; and

e showing the OAAM has schedule a follow-up review of BJA and
OVC human trafficking-related grant recipients and that the
reviews will cover at a minimum, the three deficiency areas
included in this recommendation.

Resolved. We recommended that OJP establish an effective system for
monitoring the BJA task forces to ensure that: (1) performance data
reported by the task forces is accurate, and (2) the task forces are
meeting the performance goals. OJP agreed and reiterated that its
newly released GMT requires that grant and program managers monitor
grants consistently across a set of core criteria and also requires grant
and program managers to review performance measures for face
validity and analyze collection processes. In addition, OJP stated that it
is in the process of revising its human trafficking task force performance
measures and exploring options for better collecting and reporting on
such measures. The recommendation can be closed when we receive
documentation showing that OJP’s:

122


number of victims since the beginning of the agreement in January 2003 for
the 6-month period ending June 30, 2006, instead of recording just the 18
victims served during the 6-month period.

After adjusting for the BJA’s inadvertent recording error, the APD
overstatement was reduced to 119 (123 victims reported compared to 4
verified). However, the APD did not have documentation to support the 119
victims reported. According to an APD official, a city of Atlanta official would
call her at the end of each reporting period and ask for the numbers to
report in the progress reports. However, the Atlanta official has since retired
and the APD official could not determine how that person arrived at the
number of victims identified and reported in the progress reports.

hi Illinois, Police De) ment (CPD

The BJA data indicated that the CPD had identified 4 potential
trafficking victims as of June 30, 2007, but we verified that 10 victims had
been identified. According to a CPD official, the police department under-
reported the six victims identified because of a lack of communication
between the CPD and other members of the task force. The CPD reported
only victims that it had identified, instead of victims identified by all the
members of the task force.

City of Milwaukee, Wisconsin

According to the BJA data, the Milwaukee Police Department (MPD)
had not identified any potential trafficking victims as of June 30, 2007, and
we verified this to be accurate. The MPD’s task force grant had been in
effect for 21 months as of June 30, 2007, and a task force official provided
the following reasons for why the MPD had not identified any potential
trafficking victims:

e The BJA only funded the MPD and did not provide funding for
federal law enforcement to participate in the task force.

e Milwaukee does not have a high number of immigrants coming into
the city, resulting in less likelihood that there are trafficking victims
in Milwaukee. Western Wisconsin is more likely to have labor
trafficking cases, but the BJA did not fund any task forces on that
side of the state.

e The BJA did not provide a protocol or tactical manual for the
implementation of task forces.

33


In this finding, we present additional performance data pertaining to
the human trafficking program by discussing:

e how the inaccurate performance data discussed in Finding 1
contributes to the ineffectiveness of OJP’s human trafficking grant
programs, and

e additional performance measures tracked by the BJA for the task
force grants and how the inaccuracy of that performance data
contributes to the ineffectiveness of OJP’s human trafficking grant
programs.

In the subsequent section, we examine the amount of direct assistance
actually provided to victims by the service providers.

Performance Data Reported by the OVC Service Providers and BJA
Task Forces

As noted earlier, the Department’s most recent human trafficking
report to Congress did not accurately reflect the number of victims aided by
the OVC service providers and identified by the BJA task forces as of
December 31, 2006. Also, the updated performance data submitted by the
service providers and the task forces for the 6-month period ending June 30,
2007, was also inaccurate. If the inaccurate performance data is not
corrected before the next annual report to Congress scheduled to be
submitted in the Fall of 2008, then Congress will again be presented with
data that overstates the effectiveness of OJP’s human trafficking grant
programs.

Over the more than 4 years of the program, service providers reported
assisting 1,924 trafficking victims as of June 30, 2007. However, our
analysis of the data reported by 7 of the 40 service providers found that the
service providers overstated the number of victims served by 54 percent.

As of June 2007, the BJA tracked performance data for the task forces
and planned to include the data in the next annual report to Congress due in
2008. That data includes the number of:

e continued presence applications filed on behalf of the victims,

e law enforcement and other officials who received training in the
identification of trafficking victims, and

¢ awareness presentations made to the public.
62


activities like training and focus groups due to the fear of
repercussions from community members involved in human
trafficking. Immigrant and refugee community members also may
have believed that there was no human trafficking within their
community. In addition, immigrant and refugee community
members may have believed there was a lack of law enforcement
officers in their community who were dedicated to investigating
human trafficking cases.

e Tapestri officials also told us that many victims are undiscovered
because of the lack of communication between local law
enforcement and the FBI.

YMCA of the Greater Houston Area, Inc.

The YMCA had a goal to serve an average of 50 clients a year for the
period January 1, 2003, through December 31, 2005, for a total of 150
anticipated clients. However, the YMCA reported serving 56 clients as of
December 31, 2005, 63-percent below the 150 victims anticipated. As of
June 30, 2007, the YMCA reported serving 112 victims, still 25-percent
below the anticipated number of victims. Further, as explained in Finding 1,
we found that the YMCA could support only 81 victims as eligible for support
using the OVC grant funds as of June 30, 2007. The YMCA inappropriately
counted victims who were certified by HHS before coming to the YMCA for
services or who were in the process of being certified by HHS.

YMCA officials said the goal was only an estimate, and the YMCA
initially used the grant funds to perform outreach, training, and awareness
presentations because an investigative partner had not been established to
refer victims to the YMCA. After the task force grant was awarded in
December 2004, the number of victims referred to the YMCA increased
significantly.

Direct Assistance to Victims

The OVC service provider grants furnish funding for personnel salaries
and fringe benefits, travel, equipment, consultants and contracts, supplies,
and other expenses. We found that service providers usually maintained
documentation to show the direct assistance provided to trafficking victims
such as costs for food, clothing, shelter, medical and dental care, and
transportation. We analyzed the grant expenditures and victims-served data
for seven OVC service providers and found that usually only a small amount

72


e the release in FY 2008 of the Grant Monitoring Tool that:
(1) captures documentation from all phases of a monitoring review;
(2) provides embedded tools and guidance necessary to conduct
monitoring; (3) requires that all on-site monitoring efforts include a
review of standard, key review elements and steps; (4) allows OJP
officials to identify and track monitoring findings and grantee
corrective actions; and (5) encourages a more thorough review of
grant programs against common programmatic, financial, and
administrative elements; and

e the use of the Trafficking Information Management System to
accumulate and report data related to the number of trafficking
victims identified and served.

While we could not evaluate these recent changes, if fully implemented
they could address some of the weaknesses we found during this audit.

Boat People S.0.S., Inc.

The OVC data showed that the Boat People had assisted 119 potential
trafficking victims as of June 30, 2007, but we could verify that only 74
victims had been served. A Boat People official told us that the number of
victims was overstated by 45 because after the victims were interviewed and
reported to the OVC, they either disappeared or were found to be ineligible
to receive services. An OVC official told us that it is appropriate to count
victims who disappeared because they were interviewed and determined to
be legitimate victims, and the fact that they disappeared does not change
their status as a victim. However, we found that the victims disappeared
before any services were actually provided and that by disappearing the
victims were not cooperating with law enforcement to help prosecute the
traffickers. Therefore, we disagree that these victims should be counted as
victims served under the program.

Coalition to Abolish Vi icki TT
According to the OVC data, CAST had assisted 185 potential trafficking
victims as of June 30, 2007, but we could verify that only 123 victims had
been served. The overstatement of 62 victims is explained as follows:
e CAST reported 53 victims who had been reported on previous
progress reports.

27


Service Provider Grant Goal Status

Boat People S.O.S., Inc. | Meet the needs of at least 20 clients by
the end of 2003, 30 by the end of 2004,

and _ 50 by the end of 2005 Met
International Rescue Develop and implement a 3-year
Committee - Miami program for 100 victims of trafficking
that addresses both short- and long- Not
term social service needs accomplishing
Mosaic Family Services, | Provide services for up to 180 trafficking
Inc. victims for case management, housing,

legal aid, psychological and medical aid,
English language instruction, and
employment and referral assistance by
the end of the original project date of

December 31, 2005 Not met
Refugee Women’s Provide comprehensive culturally and
Network, Inc. linguistically appropriate direct services

for a minimum of 99 pre-certified
victims of trafficking during the 3-year

life of the award Not met
Refugee Women’s Support victims’ rights, provide legal
Network, Inc. advocacy, and encourage prosecution of

traffickers for a minimum of 99 pre-
certified victims of trafficking during the

3-year life of the award Not met
YMCA of the Greater Serve an average of 50 clients a year for
Houston Area, Inc. the period January 1, 2003, through

December 31, 2005 Not met

While an important goal of the grant program is to build capacity to
serve victims, we believe it equally important to utilize that capacity to
actually serve victims. As noted in the report, the OVC awarded more than
$31 million to service providers under the human trafficking grant program.
Spending millions of dollars to build capacity to serve victims and then not
serving a significant number of victims is not an effective use of resources.

In its response, OJP also stated that it has concerns that
Recommendation 11 appears to recommend that the OVC trafficking
program specialists conduct independent cost assessments related to a
“supermarket cart” of services including case management, legal assistance,
medical services, mental health services, shelter, dental services, job
training, transportation, and English-as-a-Second-Language in every
geographical area covered by these grants. OJP stated that such an
assessment would be a costly and ineffective approach to a grant program
strategy that focuses on building overall community capacity to respond to
human trafficking victims as opposed to developing stipends to cover

113


e direct the YMCA to establish procedures to ensure that all
expenditures charged to the program are in accordance with the
program guidelines; and

e direct the YMCA to establish procedures to ensure that employee
salaries and fringe benefits charged to the program are verified as
correct, and ensure fringe benefits charged to the program can be
isolated and identified for each individual employee whose benefits
are charged to the program.

OJP agreed with six of the seven recommendations and provided
planned or completed corrective actions for them. OJP disagreed with the
recommendation related to submitting progress reports in a timely manner.
In its response to the OIG audit, the YMCA generally agreed with six of the
seven OIG’s recommendations and provided planned or completed corrective
actions for them. However, the YMCA also disagreed with the
recommendation related to submitting progress reports in a timely manner.

Grants

The BJA began awarding grants in FY 2005 to state and local law
enforcement agencies to develop task forces that identify and rescue victims
of human trafficking. In the grant audit listed below, the OIG reported on
compliance with essential award conditions pertaining to accomplishment of
grant objectives, accounting and internal controls, grant reporting, grant
drawdowns, budget management and control, local matching funds, grant
expenditures, program income, and monitoring of subgrantees.

San Diego Regional Anti-Trafficking Task Force

The OIG issued a January 2008 audit report for a grant awarded to the
County of San Diego, California.*° The OIG also tested the accounting
records to determine if reimbursements claimed for costs under the awards
were allowable, supported, and in accordance with applicable laws,
regulations, guidelines, and the terms and conditions of the grants.

36 U.S. Department of Justice, Office of the Inspector General, Office of Justice
Programs, San Diego Region Anti-trafficking Task Force Grant Awarded to the County of San
Diego, California, Audit Report GR-90-08-001 (January 2008).

97


medical needs, speak English, and may even have relatives that can help provide support.
Other victims may have catastrophic medical and mental health needs, speak no English,
and have no resources whatsoever. As we previously stated in Recommendation Number
6, the OJP is collecting information on costs associated with serving victims of human
trafficking through the OVC Trafficking Information Management System. However,
this data will not be useful until the information from several years, many different
regions, and for many different types of human trafficking cases, has been collected and
appropriately analyzed.

If a grantee provides most services “in-house,” costs may differ markedly from services
that are contracted out or are provided pro-bono. Costs and existing resources also differ
greatly from one geographic region to another. These funding vehicles are cooperative
agreements with numerous goals and objectives, but the ultimate and overarching goal is
that of building community capacity.

The OJP has concerns that the OIG appears to recommend that the OVC trafficking
program specialists conduct independent cost assessments related to a “supermarket cart”
of services ranging from case management to legal assistance to medical services to
mental health services to shelter to dental services to job training to transportation to
English-as-a-Second-Language, and so forth in every geographical area covered by these
grants. Such an assessment would be a costly and ineffective approach to a grant
program strategy that focuses on building overall community capacity to respond to
human trafficking victims, as opposed to developing stipends to cover services. Such a
recommendation also runs counter to the whole premise of this, and most other grant
programs: that a local community service provider knows far better than Federal
authorities what services and resources are available locally, including those that are low-
cost or free.

Nevertheless, in light of the OIG’s recommendation, OVC will implement the procedures
described above, including the programmatic hold special condition, to ensure that all
trafficking grantee contracts and sub-grants are reviewed to ensure that costs are
reasonable and strategically sound.

106


John Gillis, Director
Office for Victims of Crime

Marcia K. Paull
Chief Financial Officer

LeToya A. Johnson

Deputy Director, Audit and Review Division
Office of Audit, Assessment, and Management
Richard A. Theis

Audit Liaison

Department of Justice

12

111


MANAGEMENT OF THE OFFICE OF JUSTICE PROGRAMS’
GRANT PROGRAMS FOR TRAFFICKING VICTIMS

EXECUTIVE SUMMARY

Human trafficking is a form of modern-day slavery in which traffickers
lure victims, predominantly women and children, with false promises of good
jobs and better lives and then force the victims to work under brutal and
inhumane conditions.

In 1998, the President directed federal agencies to combat human
trafficking through a three-pronged approach to prevent trafficking, protect
victims, and prosecute traffickers. In 2000, Congress enacted the
Trafficking Victims Protection Act (TVPA) to combat human trafficking.

Responsibility for implementing U.S. anti-trafficking efforts
domestically and abroad is shared by the Departments of Justice, State,
Labor, Health and Human Services, and Homeland Security, as well as the
United States Agency for International Development. Each agency’s efforts
focuses on one or more of the three prongs of the government’s anti-
trafficking strategy. As shown in the following table, the Department of
Justice’s (Department) efforts involve all three prongs - prevention,
protection, and prosecution.

Department of Justice Efforts to
Combat Human Trafficking

Prevention Efforts
Prosecutors and other Department personnel assist in training local law
enforcement agencies, non-governmental organizations, and international
representatives on human trafficking issues.
The National Institute of Justice’s International Center supports research and
exchange of information by offering grants for academic research on trafficking
in persons and child exploitation.
The Office of Justice Programs’ (OJP) National Criminal Justice Reference
Service offers information to support research, policy, and program
development worldwide on various criminal justice issues, including
international trafficking.



The BPSOS claimed over $57,000 in local matching funds that were
not approved by OJP.

The OIG also found that BPSOS did not achieve many of the
agreement objectives including, establishing a rapid response team, creating
an annual directory of service providers, developing an advisory board, or
conducting the agreed upon number of seminars.

Among its 22 recommendations, the OIG urged the OVC to:

remedy the $90,296 of unapproved BPSOS and Ayuda
expenditures.

ensure that the grantee implements adequate procedures to
identify and monitor approved expenditures.

remedy the $152,583 questioned indirect costs.
remedy the $294,575 questioned pro bono legal local match.

ensure that the grantee implements a methodology for
appropriately allocating pro bono work to the grant.

OJP agreed with 21 of the 22 recommendations and provided planned
or completed corrective actions for them. OJP disagreed with the
recommendation to remedy the $2,800 in questioned dental and life
insurance costs and said that the questioned amount was for dental
insurance which was allowable under the budget category of health
insurance. In its response to the OIG audit, the Boat People objected to
some of the report language that did not have a significant effect on the
reported deficiencies. The Boat People either in most cases agreed with the
OIG’s recommendations and provided planned or completed corrective
actions to address the deficiencies, or provided additional explanations for
deficiencies identified by the OIG.

90


the grant. The grantee had not spent $97,686 in agreement funds at the
end of the initial agreement. Because the grantee’s budget substantially
overestimated the victims to be served, the audit determined it would not be
effective to provide the grantee a no-cost extension and allow it to spend the
remaining grant funds. Despite our concerns, subsequent to our issuing the
draft audit report, OJP issued a May 2007 grant adjustment notice that
provided the grantee a no-cost extension through December 31, 2007.

San Diego Region Anti-trafficking Task Force

The San Diego task force did not maintain an accounting system and
financial records that separately accounted for grant funds received and
disbursed. The San Diego County Sheriff's Department, which managed the
task force finances, commingled revenues and expenditures with other
grant-related revenues and expenditures without any unique accountability.
The task force also requested and received reimbursement for one position
that was not in the approved budget.

Because the deficiencies in this area did not indicate a systemic
problem among many of the grantees tested, and because recommendations
to correct these individual deficiencies had been or were being addressed by
OJP, we do not make additional recommendations in this report related to
these deficiencies.

Program Income

The OJP Financial Guide defines program income as income generated
by an agency-funded project. Program income must be used for the
purposes and under the conditions applicable to the award.

The OIG audits found that only two of the seven grantees received
Program income and both grantees properly used and accounted for it.

Local Matching Funds

The OJP Financial Guide requires that grantees use matching funds to
support a federally funded project and that the matching funds must be in
addition to, and therefore supplement, funds that would otherwise be made
available for the stated program purpose. Grantees can use cash or in-kind
contributions for the matching funds. Federal statute limits the federal funds
for the human trafficking project to 75 percent of the total project costs.

The local match requirement is 25 percent of the total costs. The Financial
Guide also requires grantees to maintain records that clearly show the
source, amount, and timing of all matching contributions. In addition,

50


Conclusion

We found that the OVC’s service provider agreements have built
significant capacities to serve victims, but have not resulted in significant
numbers of trafficking victims being identified and receiving assistance.
Moreover, the BJA’s task force grants, designed to identify additional
trafficking victims for referral to service providers, have not resulted in long-
term increases in the number of trafficking victims being assisted by the
OVC service providers. In addition, the number of victims reported as
benefiting from the service providers and identified by the task forces was
overstated. Further, the process used to award the service provider
agreements resulted in a wide variance in the amount of funds awarded
compared to the number of victims each grantee anticipated would be
identified and served. Also, the BJA did not ensure that: (1) task force
grantees established baselines to measure whether the task forces were
effectively increasing the number of “trafficking victim saves” each year, and
(2) the task forces actually met the “trafficking victim saves” performance
measure.

Recommendations
We recommend that OJP:

1. Develop and implement procedures to ensure that the BJA task forces
either report only actual trafficking victims identified, or report both
actual and potential victims identified.

2. Ensure the BJA task forces either exclude domestic trafficking victims
when reporting the number of victims identified under the Trafficking
Victims Protection Act or separately identify the domestic and alien
victims in the numbers reported.

3. Require the BJA task forces to maintain documentation to support the
number of trafficking victims reported.

4. Ensure the accuracy of the number of trafficking victims reported by the
task forces for inclusion in the annual reports.

5. Consider whether the “trafficking victims saves” performance measure
should be eliminated. If not eliminated, establish procedures for taking
prompt corrective action when task forces are not meeting the “trafficking
victim saves” performance measure.

36


APPENDIX II

Trafficking Cooperative Agreements and Grants
Awarded by OJP’s Office for Victims of Crime
and Bureau of Justice Assistance

Award Award

Grantee Number Amount
OVC Service Provider Cooperative Agreements :
Asian Pacific Islander Legal Outreach (California) 2003-VT-BX-K006 $1,152,230
Bilateral Safety Corridor Coalition (California) 2004-VT-BX-K006 $1,045,000
BOAT People S.O.S., Inc. (District of Columbia) 2003-VT-BX-K009 $1,896,535
BOAT People S.0O.S., Inc. (District of Columbia) 2007-VT-BX-K003 $325,000
Catholic Charities Archdiocese of San Antonio, Inc. (Texas) 2006-VT-BX-K013 $450,000
City of Indianapolis/Julian Center (Indiana) 2006-VT-BX-K002 $500,000
Civil Society (Minnesota) 2006-VT-BX-K004 $500,000
Coalition to Abolish Slavery and Trafficking (California) 2004-VT-BX-K001 $1,635,000
Guma’ Esperansa-Karidat (Commonwealth of Northern
Marianna Islands) 2006-VT-BX-K012 $449,793
Heartland Alliance for Human Needs and Human Rights (Illinois
and Neighboring Regions of the Midwest) 2003-VT-BX-K003 $1,173,568
Heartland Alliance for Human Needs and Human Rights (Eight
Midwestern States located more than 150 miles from Chicago,
Illinois) 2003-VT-BX-K002 $490,829
Hope House, Inc. (Missouri) 2006-VT-BX-K010 $450,000
International Institute of Boston (Massachusetts) 2004-VT-BX-K009 $1,033,109
International Institute of Buffalo, Inc. (New York) 2006-VT-BX-K015 $449,708
International Institute of Connecticut, Inc. 2006-VT-BX-K003 $500,000
International Institute of Metropolitan St. Louis (Missouri) 2006-VT-BX-KO05 $499,974
International Rescue Committee (Florida) 2003-VT-BX-K0O11 $2,026,660
International Rescue Committee (Arizona) 2003-VT-BX-K010 $1,480,285
International Rescue Committee (Washington) 2004-VT-BX-K007 $1,044,999
Justice Resource Institute, Project Reach (Eastern Seaboard
States and Texas) 2003-VT-BX-4004 $628,383
Little Tokyo Service Center (California) 2003-VT-BX-K001 $583,697
Massachusetts Mental Health Institute Trauma Center (15 East
Coast States, District of Columbia, and Texas) 2003-VT-BX-K004 $431,604
Metropolitan Battered Women’s Program (Louisiana) 2007-VF-GX-K001 $449,743
Mosaic Family Services, Inc. (Texas) 2003-VT-BX-KO0S $1,093,552
Mosaic Family Services, Inc. (Texas) 2006-VT-BX-K016 $774,996
New York State Office of Temporary and Disability Assistance 2004-VT-BX-K008 $500,000
Refugee Services of Texas 2006-VT-BX-K006 $545,000
Refugee Women’s Network, Inc. (Georgia) 2004-VT-BX-K010 $532,958
Safe Horizon, Inc. (Training and Technical Assistance)
(Throughout the U.S.) 2003-VT-BX-K012 $681,595
Safe Horizon, Inc. (Comprehensive Services) (New York) 2004-VT-BX-K002 $1,100,000
The Salvation Army Hawaiian and Pacific Island Division
(Hawaii, American Samoa, Guam, Commonwealth of Northern
Marianna Islands) 2006-VT-BX-K007 $700,000

85



FINDINGS AND RECOMMENDATIONS

1. DESIGN AND MANAGEMENT OF OJP’S TRAFFICKING
GRANT PROGRAMS

We found that OJP’s human trafficking grant programs have built
significant capacities to serve trafficking victims, but have not
identified and served significant numbers of victims. As initially
designed, the program awarded cooperative agreements to non-
profit service providers that supplied victims with services such
as food, clothing, shelter, and legal assistance. OJP’s Office for
Victims of Crime (OVC) began awarding agreements to service
providers in January 2003, and during the first 2 years assisted
only 480 victims. As an expansion of the program, in FY 2005
the Bureau of Justice Assistance (BJA) began awarding grants to
establish task forces intended to identify trafficking victims and
refer them to service providers. The task forces identified 490
additional victims during the 6-month period ending December
2005 and the number of victims aided as reported by the service
providers increased by about the same amount. However, the
number of victims reportedly being served soon declined to the
pre-task force levels of 196 victims for the 6-month period
ending December 2006. In addition, we found that the OVC’s
grant award process for service providers resulted in a wide
variance in the amount of funds awarded compared to the
number of victims each grantee anticipated serving. Further, we
found that both the service providers and task forces overstated
to OJP the number of victims reportedly served and identified.

This audit first evaluated the design of the human trafficking grant
programs and assessed the accuracy of performance data associated with
the program. We also evaluated the processes by which awards were made
to service providers and task forces operating within the program. In total,
we evaluated data regarding all 41 cooperative agreements awarded by the
OVC to 36 separate service providers and all 42 grants awarded by the BJA
to establish human trafficking task forces.

While the period of our review covered from the inception of the
awards in FY 2003 through FY 2007, not all service provider agreements and
task force grants were in effect during the entire review period. Therefore,
the number of service provider agreements and task force grants that we
reviewed varied depending on the period covered by the audit tests
performed. We also completed on-site work at 7 of the 41 OVC service

10


combating trafficking abroad or developed a way to gauge results
and target its overall assistance.

The Department of State assesses foreign governments’ compliance
with minimum standards to eliminate trafficking in persons, but the
explanations for ranking decisions in its annual Trafficking in
Persons Report are incomplete, and the report is not used
consistently to develop anti-trafficking programs.

The GAO recommended that the U.S. Secretary of State: (1) improve
information on trafficking, (2) develop and implement a strategy that
clarifies agencies’ roles and responsibilities and establishes a way to gauge
results abroad, and (3) clearly document the rationale and support for
country rankings.

In a July 2007 report, the GAO reported on: (1) key activities federal
agencies have undertaken to combat human trafficking crimes, (2) federal
efforts to coordinate investigations and prosecutions of these crimes, and
(3) how the BJA supported federally funded state and local human trafficking
task forces.* The GAO found the following:

Since the enactment of the TVPA in 2000, federal agencies have:
(1) investigated allegations of trafficking crimes, leading to 139
prosecutions; (2) provided training and implemented state and local
initiatives to support investigations and prosecutions; and

(3) established organizational structures, agency-level goals, plans,
or strategies.

Federal agencies have sponsored outreach and training to state and
local law enforcement, nongovernmental organizations, and the
general public through a toll-free complaint line, newsletters,
national conferences, and model legislation.

Some federal agencies have established special units or plans for
carrying out their anti-trafficking duties.

Federal agencies have coordinated across agencies on
investigations and prosecutions of trafficking crimes on a case-by-
case basis determined by individual case needs and established
relationships among law enforcement officials across agencies.

* U.S. Government Accountability Office, Human Trafficking: A Strategic Framework
Could Help Enhance the Interagency Collaboration Needed to Effectively Combat Trafficking
Crimes, GAO-07-915 (July 26, 2007), 3, 5-8.

6


The OIG reported on compliance with essential award conditions
pertaining to goals and accomplishments, reporting, fund drawdowns,
budget management and control, program income, local matching
requirements, expenditures, indirect costs, monitoring of subrecipients, and
accounting and internal controls.

Boat People S.0.S., Inc.

The OIG issued a July 2007 audit report on a cooperative agreement
awarded to the Boat People S.O.S., Inc. (BPSOS) in Falls Church, Virginia.*?
The OIG also tested the accounting records to determine if reimbursements
claimed for costs under the award were allowable, supported, and in
accordance with applicable laws, regulations, guidelines, and the terms and
conditions of the cooperative agreement.

The OIG found that the BPSOS and its subrecipient, Ayuda, charged to
the agreement over $700,000 in either unsupported or unallowable costs as
shown below.

e BPSOS and Ayuda claimed $90,296 of expenditures for items that
were not approved in the final budget. These expenditures included
miscellaneous expenses, advertising, software, work study stipend,
emergency assistance, and office insurance.

e¢ The BPSOS and Ayuda fringe-benefit costs contained numerous
calculation errors. Because of these errors and lack of supporting
documentation, the BPSOS and Ayuda could not support $77,588
and $36,272, respectively, of fringe benefit costs charged to the
agreement.

e The BPSOS’s method of allocating indirect costs to the agreement
resulted in the grantee claiming $152,583 in excess indirect costs.

e The BPSOS provided inadequate supporting documentation for local
match transactions, resulting in unsupported pro bono attorney fees
of $294,575.

29 U.S. Department of Justice, Office of the Inspector General, Office for Victims of
Crime Victims of Exploitation and Trafficking Assistance Grant Awarded to Boat People
S.0.S., Inc., Falls Church, Virginia, Award Number 2004-VT-BX-K009, Audit Report GR-30-
07-004 (July 2007).

89


victims to be served and did not make an independent assessment of the
reasonableness of the costs compared to the anticipated number of victims
to be served. According to an OVC official, when the solicitation was being
developed in 2002 the OVC knew little about the extent of the human
trafficking problem in the United States. The official told us that the initial
OVC solicitation was issued based on federal estimates that very large
numbers of victims were being trafficked into the United States annually.
The official added that no one really knew the numbers of victims who would
be found in a specific locale, and therefore the OVC had expected to receive
applications that covered large geographic regions. However, the official
said this did not happen. As a result, the amount of money provided to
service providers to assist victims varied greatly and OJP could not provide
evidence to show that the wide variance in award amounts per anticipated
victim was reasonable.

At the conclusion of the audit, an OVC official told us that the service
provider budgets were reviewed in detail and were often changed,
sometimes significantly, as a result of the financial reviews of the budgets.
However, the OVC official indicated that the budget review did not
specifically analyze the costs in relation to the victims that the grant
applicant anticipated serving. The OVC official said that the OVC never
awarded any grant based on the number of victims, but instead based the
awards on the costs associated with starting the grant program, building a
community-wide effort to address trafficking, and providing services to all
victims identified.

Award Process - Task Force Grants

The BJA task force grants were awarded based on responses to three
separate solicitations. The first solicitation was issued in August 2004 and
requested proposals for task force grants only. The solicitation established a
limit of $450,000 for each task force grant and required law enforcement
applicants to increase the number of “trafficking victim saves” by 15 percent
each year. The solicitation defined a “trafficking victim save” as an
individual recovered from a trafficking victim situation who has been
identified, certified, and referred for comprehensive victim services as a
result of program initiatives. The solicitation also required law enforcement
applicants to provide pre-program data on the number of victims identified
to establish a baseline for measuring compliance with the 15-percent annual
increase requirement.

In January 2005, the OVC and BJA issued the solicitation for joint
concept papers for both service provider agreements and task force grants.

18


OJP agreed with all five recommendations and provided planned or
completed corrective actions for them. In its response to the OIG, the San
Diego Sheriff’s Department generally agreed with the OIG’s

recommendations and provided planned or completed corrective actions for
them.

99


OJP agreed and stated that it has consistently worked to improve
grantee compliance and performance through training and technical
assistance, as well as enhanced oversight activities in FYs 2007 and
2008. OJP listed the following assistance and oversight activities in its
response.

OJP transferred over $1 million in trafficking funding to support
technical assistance and research and evaluation activities for
both BJA and OVC trafficking grantees;

OJP worked with the OVC’s Training and Technical Assistance
Center to convene a working group of personnel from other
federal agencies with anti-human trafficking responsibilities to
identify: (1) key areas of needed technical assistance for task
forces and service providers, and (2) existing federal resources to
address training and technical assistance needs of trafficking
grantees;

OJP provided grantees with training opportunities through the
Office of the Chief Financial Officer’s regional Financial
Management Training Seminars;

OJP released several training tools to assist grantees with meeting
post-award requirements, including a grant process oversight web
page and on-line training modules;

OJP issued guidelines for monitoring OJP grants and cooperative
agreements in FY 2007, making it possible for OJP grant and
program managers to monitor grants and cooperative agreements
consistently across OJP bureaus and offices;

OJP released the Grant Assessment Tool (GAT) in September 2007
to provide a common, organized framework and methodology for
systematically and objectively assessing risks associated with
grants and/or grantees; and

OJP implemented the funding freeze functionality within its Grants
Management System in FY 2007 to temporarily freeze payments
to an award recipient due to late submission of a progress report.

We note that while OJP had begun these initiatives or actions prior to
the OIG’s individual audits of service providers and task forces, the
initiatives and actions did not prevent the deficiencies found during the
OIG audits.

120


Mosaic Family Services, Inc.

The OIG audit found that the Mosaic Family Services, Inc. had not met
one of the four grant goals as shown in the following table.

Grant Goal Status
Provide services for up to 180 trafficking victims for
case management, housing, legal aid, psychological
and medical aid, English language instruction, and
employment and referral assistance by the end of the
original project date of December 31, 2005 Not met.
Conduct 30 outreach sessions to enlighten the general
community and other governmental and non-

| governmental agencies about human trafficking Met
Conduct three workshops to train service providers Met
Conduct 450 consultations with victims and providers
by phone or direct contact Met

Refugee Women’s Network, Inc.

The OIG audit found that the Refugee Women’s Network had not met
two of the five grant goals as shown in the following table.

Grant Goal Status
Provide comprehensive culturally and linguistically
appropriate direct services for a minimum of 99 pre-
certified victims of trafficking during the 3-year life of
the award Not met
Support victims’ rights, provide legal advocacy, and
encourage prosecution of traffickers for a minimum of
99 pre-certified victims of trafficking during the 3-year
life of the award Not met
Facilitate monthly meetings with federal and local
authorities, service providers, and community agencies
to develop a local collaborative network and facilitate a
coordinated community response to trafficking Met
Provide outreach to refugee and immigrant
communities through a minimum of 20 outreach
activities each year Met
Organize and facilitate training each year for 500 law
enforcement and other criminal justice personnel,

service providers, refugee and immigrant agencies, Ongoing
health care providers, and community members to and will
educate them about the rights and needs of victims of probably
trafficking be met

42


victims of human trafficking. In addition, eight clients were found not to be
victims of human trafficking. The OIG identified $97,686 in funds to be put
to better use and $15,788 in questioned costs. The OIG also identified
weaknesses in the subgrantee’s accounting practice.

The OIG made six recommendations to OJP including:

e deobligate $97,686 that remained unexpended at the end of the
initial award period,

e ensure that RWN and Tapestri established controls to ensure proper
compliance with local match requirements, and

e ensure that Tapestri established adequate internal controls to
safeguard federal funds.

OJP disagreed with the first recommendation to deobligate the
$97,686 that remained at the end of the initial agreement period. In its
response to the OIG audit, RWN disagreed with the recommendations
related to deobligating the remaining agreement funds, remedying $8,463 in
overcharges for salaries and fringe benefits, and establishing internal
controls to safeguard federal funds. RWN generally agreed with the
remaining three recommendations.

YMCA of the Greater Houston Area, Inc.

The OIG issued an April 2007 audit report on a cooperative agreement
awarded to the Young Men’s Christian Association (YMCA) of the Greater
Houston Area.*°> The OIG found that the YMCA was in compliance with the
essential agreement conditions except for the areas of reporting and
expenditures. The YMCA did not submit some progress reports in a timely
manner. In addition, the YMCA could not support $21,120 in costs charged
to the agreement.

Among the seven recommendations, the OIG urged the OVC to:

e remedy the $21,120 in unsupported questioned costs;

35 U.S. Department of Justice, Office of the Inspector General, Services for
Trafficking Victims Discretionary Grant Program Cooperative Agreement Awarded to the
YMCA of the Greater Houston Area, Award Number 2003-VT-BX-K007, Audit Report
GR-80-07-007 (April 2007).

96


recent OIG audits of OJP’s human trafficking grants identified many of the
same deficiencies as past OIG audits of OJP grants. As a result of these
continued deficiencies, the OIG has identified grant management as one of
the Department’s top management challenges for the past 6 years. While it
is important to efficiently award the billions of dollars in grant funds
appropriated by Congress annually, it is equally important that the
Department maintains proper oversight over the grantees’ use of these
funds to ensure accountability and to ensure that these funds are effective
and used as intended.

Conclusion

The OIG’s individual audits of the OVC service provider agreements
and a BJA task force grant found that they did not comply with the essential
grant requirements in 9 of the 10 areas tested. OJP and the grantees had
initiated or agreed to initiate corrective action to address most of the
weaknesses found in the individual audits. However, we believe that the
weaknesses identified in many areas were systemic and warrant additional
guidance and direction to all the OVC and BJA grantees to correct.
Recommendation
We recommend that OJP:

12. Provide additional training and oversight of service provider and task
force grantees to ensure that they: ‘

e develop and implement steps to accomplish the unmet grant goals,
where practical;

e submit FSRs containing accurate financial data;
e submit progress reports in a timely manner;

e drawdown only the amount of federal cash needed to pay for actual
or anticipated costs within 10 days;

e maintain support for costs claimed as matching funds;
e claim only costs that are allowable and supported;
e properly calculate and claim indirect costs; and

e effectively monitor subrecipients.
60


information included in the award documentation, service providers receiving
agreements in FYs 2003 and 2004 had anticipated helping at least 821
victims during calendar years 2003 and 2004, far more than the 480 victims
who were actually reported as receiving services. Moreover, the 480 victims
reported as served during the 2-year period was a small fraction of the
14,500 to 17,500 victims that the government estimated were trafficked into
the United States annually.” This estimate is significantly lower that the
estimate of 50,000 contained in the Trafficking Victims Protection Act of
2000.

Recognizing that few victims were being identified and assisted by the
service providers, OJP determined that it needed a more comprehensive
strategy that focused on improving detection and investigation that was
linked to the rescue and recovery of human trafficking victims. Therefore, in
2004 OJP’s BJA developed its Anti-Human Trafficking Task Force Initiative to
identify more trafficking victims. Under this initiative, the BJA provides
grant funds to state and local law enforcement agencies to establish anti-
trafficking task forces. According to an OJP official, OJP did not receive
additional appropriations to fund the task forces. Instead, OJP used about
half the funds initially intended for the service providers to fund the task
forces. The task forces were established to implement victim identification
and rescue operations and refer the victims to the service providers. From
FYs 2005 through 2007, the BJA awarded 42 anti-trafficking task force
grants and supplements totaling about $19.2 million.®

As part of the grants, the BJA required the task forces to submit semi-
annual progress reports that included performance data on the number of
potential trafficking victims identified, and the BJA maintained a summary of
that data.

The following chart presents the total number of new victims reported
as receiving benefits from service providers for semi-annual periods between
January 2003 and June 2007. For the same period, the chart presents the
total number of potential new victims reported as identified by the task
forces.

7 U.S. Department of Justice, Report to Congress from Attorney General Alberto R.
Gonzales on U.S. Government Efforts to Combat Trafficking in Persons in Fiscal Year 2004
(July 2005), 5.

® A supplement is when additional funds are provided under a previously awarded
grant to continue services under the initial grant or to perform additional services related to
the initial grant.
12


STATEMENT ON INTERNAL CONTROLS

In planning and performing our audit, we considered OJP's internal
controls for the purpose of determining our auditing procedures. The
evaluation was not made for the purpose of providing assurance on the
internal control structure as a whole. However, as shown below, we noted
certain matters that we consider reportable conditions under generally
accepted government auditing standards.”

Finding I

The OVC’s service provider agreements have built significant capacities
to serve victims, but have not resulted in significant numbers of trafficking
victims being identified and provided services. Moreover, the BJA’s task
force grants, designed to identify additional trafficking victims for referral to
service providers have not resulted in long-term increases in the number of
trafficking victims being assisted. In addition, the number of victims
reported as assisted by the service providers and identified by the task
forces was overstated. Further, the process used to award the service
provider agreements resulted in a wide disparity in the amount of funds
awarded compared to the number of victims that the grantees anticipated
would be identified and served. Also, the BJA did not ensure that corrective
actions were taken when task forces were not meeting the requirement to
increase “trafficking victim saves” by 15 percent annually.

Finding II

The OIG’s individual audits of the OVC service provider agreements
and a BJA task force grant found that the service providers and task force
did not comply with the essential grant requirements in 9 of the 10 areas
tested. The grantees and OJP agreed to take corrective actions to address
most of the weaknesses found in the individual audits. However, based on
our review of the individual audit results, we determined that the
weaknesses found during the audits were systemic in the areas of goals and
accomplishments, reporting, fund drawdowns, local match, expenditures,
indirect costs, and monitoring of subrecipients. Therefore, the OVC and the
BJA need to take additional actions to ensure that all the OVC and BJA
grantees minimize the occurrence of these weaknesses.

27 Reportable conditions involve matters coming to our attention relating to
significant deficiencies in the design or operation of the internal control structure that, in our
judgment, could adversely affect the ability of OJP to administer its human trafficking grant
programs.

78


Administration of Grants

From April 2007 to March 2008, the OIG issued five audit reports on
individual OVC service provider cooperative agreements, one audit report on
multiple cooperative agreements awarded to one service provider, and one
audit report on a BJA task force grant.? The OIG’s individual audits found
that the service providers and task force did not comply with the essential
grant requirements in 9 of the 10 areas tested. OJP and the grantees had
initiated, or agreed to initiate, corrective actions to address most of the
weaknesses found in the individual audits. However, we determined that the
weaknesses identified in the following seven areas were systemic and
warrant additional guidance and direction by the OVC and BJA for all its
human trafficking program grantees. In these audits we found the
following:

e Goals and Accomplishments - Six of the seven grantees had not
met or were not accomplishing one or more project goals.

e Reporting - Only one of the seven grantees had a significant
problem in submitting Financial Status Reports (FSR) in a timely
manner. However, three of the seven grantees submitted FSRs
containing inaccurate financial data. In addition, three of the seven
grantees had a significant problem in submitting program progress
reports in a timely manner.

e Fund Drawdowns - Three of the seven grantees drew down funds
too early to meet immediate needs, and one grantee did not
maintain adequate accounting records to determine if the funds
were drawn down appropriately.

e Local Match - Four of the seven grantees had significant
deficiencies related to supporting the matching funds claimed
against the agreements.

e Expenditures - Six of the seven grantees claimed expenditures
totaling $1,488,956 that, at the time of the audits, were either not
authorized; not properly classified and supported; not accurately
recorded; not reasonable, allocable, or allowable; not necessary to
the project; or not in accordance with applicable laws, regulations,
guidelines, and terms and conditions of the cooperative
agreements. As of June 19, 2008, OJP and the grantees had

3 A list of the OIG audits of the service provider agreements and task force grant
can be found in the table on pages 38 and 39 of this report.
xi


3. EFFECTIVENESS OF OJP’S GRANT PROGRAMS FOR HUMAN
TRAFFICKING VICTIMS

We found that OJP’s grant programs have not been effective at
identifying and serving significant numbers of alien trafficking victims.
As explained in Finding 2, the OVC service providers were generally
effective at conducting human trafficking-related outreach, training,
and service activities. However, as discussed in Finding 1, the
agreements and grants awarded to the service providers and task
forces have not resulted in the provision of services to a significant
number of victims. In addition, the OVC and BJA have not established
an effective system for monitoring the service providers and the task
forces to ensure that: (1) performance data reported by the service
providers and task forces is accurate, (2) the service providers and
task forces are meeting performance goals, and (3) service providers
can show the amount of grant funds used to directly assist victims of
human trafficking. While the service provider and task force officials
we interviewed generally believed the grant programs were worthwhile
for helping trafficking victims, the effectiveness of the programs is not
supported in the documented program results. Officials provided
insight into how program effectiveness could be enhanced, such as
improving communication and collaboration between the service
providers, task force members, and victims.

In Finding 1, we analyzed performance data for the 41 cooperative
agreements awarded by the OVC to 36 separate service providers and the
42 grants awarded by the BJA to establish task forces. While the period of*
our review covered from the inception of the awards in FY 2003 through
FY 2007, not all service provider agreements and task force grants were in
effect during the entire review period. Therefore, the number of service
provider agreements and task force grants that we reviewed varied
depending on the period covered by the test. The same is true for the tests
we conducted as part of this finding.

In Finding 1, we presented performance data for the OVC service
providers that showed they helped few victims during 2003 and 2004. OJP
recognized that few victims were being served and took steps to address the
problem. In FY 2005, the BJA began awarding grants to law enforcement
agencies to establish task forces to identify more victims and refer them to
the service providers. While the identification of victims by the task forces
initially led to a significant increase in the number of victims helped by the
service providers, subsequent data showed that the task forces have not
been effective at creating a sustained increase in the number of victims
served.

61


officials were trained but the BJA did not start tracking and
reporting performance data until the next progress reporting period
ending June 30, 2005.

e The BJA data for the Chicago task force was overstated by one due
to a mistake in counting.

e The Collier County, Florida, task force understated the training
numbers because of an error in counting participants.

e The Harris County, Texas, task force progress reports indicated that
1,535 officials were trained. However, the BJA’s data showed that
612 officials were trained. A BJA official told us that he could not
explain the difference in the numbers. He also said that the Harris
County, Texas, task force has not reported consistent numbers for
this performance measure and the task force continually revises the
numbers it reports.

Task Forces

e For five task forces (Chicago, Milwaukee, Dallas, Los Angeles, and
Washington, D.C.), overstatements occurred because the task
forces did not maintain supporting documentation to verify the
reported data.

e The Forth Worth task force overstatements occurred because it:
(1) did not maintain documentation to support 54 officials trained,
and (2) made a counting error by reporting 440 attendees when the
actual count was 418.

e An official from the Harris County, Texas, task force told us he had
compiled the numbers in his head, understating them. He then
reduced and reported the number of officers trained because he
thought the number was too high.

e An official from the Miami Dade task force told us that it overstated
the training numbers because it mistakenly did not report officers
who had been trained, transposed a number when recording the
number of officers trained, and reported training for fire department
personnel in the wrong progress report.

e The Cobb County, Georgia task force overstated the training
numbers because it counted officers believed to have received the
training from the Georgia Department of Human Resources.

67


Additionally, we found that the OVC’s agreement award process for
service providers resulted in a wide variation in the amount of funds
awarded per anticipated victim to be served by each agreement. From
FYs 2003 through 2007, the OVC awarded service providers 41 initial
cooperative agreements and 28 supplements totaling about $31.7 million.
We analyzed 19 initial agreements and supplements awarded to 7 service
providers and found a wide variation in the amount of funds awarded
compared to the number of victims each agreement recipient anticipated
serving. For example, one service provider received $1,896,535 to supply
services to an estimated 100 victims over the 3-year agreement period, or
$18,965 per estimated victim. Another provider received $490,829 to
service an estimated 100 victims over the 3-year agreement period, or
$4,908 per estimated victim. For the 19 agreements and supplements we
tested, the amount awarded per anticipated victim ranged from a high of
$33,333 to a low of $2,500.

We found that OVC officials generally relied on the service provider's
estimates of the number of victims who would benefit but did not make an
independent assessment of the reasonableness of the costs compared to the
anticipated number of victims. According to an OVC official, very little was
known about the nature and scope of human trafficking into the United
States in 2002 when the program was being developed. The initial OVC
grant solicitation was issued based on information from the State
Department that estimated large numbers of trafficking victims were
brought into the United States each year. The OVC official also told us that
no one really knew the number of victims that would be found in a specific
locale, and therefore the OVC had expected applications that covered large
geographic regions. However, the official said that this did not happen and
instead the OVC received applications for smaller geographic areas. As a
result, grant funds awarded to service providers for victim services varied
greatly, and OJP could not provide us with evidence to show that the wide
variance in award amounts per victim were reasonable.

At the conclusion of the audit, an OVC official told us that the service
provider budgets were reviewed in detail and were often changed,
sometimes significantly, as a result of the financial reviews of the budgets.
However, the OVC official indicated that the budget review did not
specifically analyze the costs in relation to the victims that the grant
applicant anticipated serving. The OVC official said that the OVC never
awarded any grant based on the number of victims, but based the awards
on the costs associated with starting the grant program, building a
community-wide effort to address trafficking, and providing services to all
victims identified.

vii


tested the accounting records to determine if reimbursements claimed for
costs under the agreement were allowable, supported, and in accordance
with applicable laws, regulations, guidelines, and the terms and conditions of
the agreement.

The OIG found that on multiple occasions, Mosaic drew down more
funds than needed from OJP to meet current expenses. In addition, Mosaic
could not support $41,318 in agreement expenditures. Further, Mosaic
performed infrequent monitoring of its two subrecipients.

The OIG recommended that the OVC:

e remedy the $41,318 in unsupported direct costs and personnel
expenses, and

e ensure Mosaic directed the Center for Survivors of Torture, a
subrecipient, to develop and implement a methodology for tracking
employee time spent working on the agreement.

Both OJP and Mosaic agreed with the recommendations and provided
documentation to address the weaknesses found. The OIG closed the audit
report based on the documentation provided.

Refugee Women’s Network, Inc.

The OIG issued a July 2007 audit report on a cooperative agreement
awarded to the Refugee Women’s Network, Inc. (RWN), in Decatur,
Georgia.** The OIG also tested the accounting records to determine if
reimbursements claimed for costs under the award were allowable,
supported, and in accordance with applicable laws, regulations, guidelines,
and the terms and conditions of the agreement.

The OIG found that RWN and its subgrantee, Tapestri, performed
required activities and were in the process of accomplishing three of the
cooperative agreement goals. However, the OIG found that two goals
apparently could not be met. Although RWN and Tapestri staff made efforts
to perform outreach and identify victims of human trafficking, they had
served only 21 potential victims, of whom only 5 had been certified as

34 U.S. Department of Justice, Office of the Inspector General, Office of Justice
Programs Office for Victims of Crime Services for Trafficking Victims Discretionary Grant
Program Cooperative Agreement Awarded to Refugee Women’s Network, Inc., Decatur,
Georgia, Award Number 2004-VT-BX-K010, Audit Report GR-40-07-005 (July 2007).

95


e The BJA data for the Miami Dade task force was overstated by one
victim due to a clerical error.

Task Forces

e Officials from four task forces (Atlanta, Chicago, Los Angeles, and
Harris County, Texas) told us that they did not maintain supporting
documentation to verify the reported data.

e An official from the Collier County, Florida, task force told us that it
mistakenly failed to include a continued presence application that
had been submitted.

e An official from the Washington, D.C., task force said that it
mistakenly reported continued presence applications for five victims
when none were actually submitted.

e An official from the Miami Dade task force said that it
inappropriately reported one continuing presence application in
three different progress reports, thus counting the application three
times instead of once. The official also said that the task force did
not report another continued presence application.

e An official from the Cobb County, Georgia task force told us that it
inappropriately reported submitting continuing presence
applications for two victims whose applications were actually
submitted by the local service provider.

Officials Trained to Identify Trafficking Victims

The BJA requires the task forces to report the number of law
enforcement and other officials trained to identify trafficking victims. The
BJA expected that, as a result of the training, more trafficking victims would
be identified and referred to the service providers, thus meeting the
requirements of the performance measure.

As shown in the table below, the BJA collected inaccurate performance
data on the number of law enforcement and other officials who received
training in identifying trafficking victims for 10 of the 11 task forces tested.
The BJA data was overstated for eight task forces and understated for two.
Overall, the BJA data was overstated 38 percent.

65


Heartland Alliance for Human Needs and Human Rights

The OIG issued a January 2008 audit report on multiple cooperative
agreements awarded to the Heartland Alliance in Chicago, Illinois.°° The
OIG also tested the accounting records to determine if reimbursements
claimed for costs under the awards were allowable, supported, and in
accordance with applicable laws, regulations, guidelines, and the terms and
conditions of the agreements.

The OIG found the following deficiencies:

e Heartland Alliance was unable to identify and account for, in total
and by budget category, which expenditures received federal
reimbursement.

e The grantee’s control over expenditures was inadequate to ensure
that expenses were allowable or properly supported. The OIG
identified $1,501,823 of federally reimbursed costs charged to the
agreements that were unallowable or inadequately supported.

e Match expenditures totaling $173,589 were unsupported or
unallowable.

e Weaknesses existed in Heartland Alliance’s procedures to report on
agreement activity, including determining, requesting, and
recording drawdowns, as well as filing timely and accurate financial
status reports.

Of the 23 recommendations addressed to OJP, the OIG urged it to:

e Ensure that Heartland Alliance establish procedures so that receipts
and expenditures are timely and accurately entered into the
agreement accounting records, and that requests for
reimbursements are based upon uncompensated expenditures to-
date.

30 U.S, Department of Justice, Office of the Inspector General, Office of Justice
Programs Legal Assistance for Victims Grant and Services for Human Trafficking Victims
Discretionary Grants Administered by the Heartland Alliance for Human Needs and Human
Rights, Chicago, Illinois, Award Numbers 2002-WL-BX-0026, 2003-VT-BX-K002, and 2003-
VT-BX-K003, Audit Report GR-50-08-002 (January 2008).

91


14. Establish an effective system for monitoring the BJA task forces to
ensure that: (1) performance data reported by the task forces is
accurate, and (2) the task forces are meeting the performance goals.

15. Issue additional guidance to all task force grantees regarding best
practices to:

maintain supporting documentation for performance measure data
reported to the BJA,

establish a mechanism to track the data to be reported for each
performance measure, and

verify the accuracy of performance data before submission to the
BJA.

76


Grant Goal Status
Conduct one town hall meeting per year in each city Substantially
represented in the Anti-Trafficking Task Force not met
Conduct a regional meeting with human trafficking
investigators from neighboring counties (Los Angeles
County, Orange County, Riverside County, Imperial
County, and San Bernardino County) Met
Develop a curriculum on human trafficking and have
the curriculum approved by enforcement agencies to Substantially

become part of the Trainers’ Bureau met
Identify, recruit, and train a minimum of three agents

or officers from local law enforcement agencies to Substantially
become part of the Trainers’ Bureau met.
Develop a 15-minute video on human trafficking to be

shown at police briefings Met

Develop and distribute a “Cheat Sheet” or “Quick
Reference Card” for law enforcement and service
providers on how to identify victims of human

trafficking and resources available Met
Develop and distribute a comprehensive training

bulletin on human trafficking for law enforcement Substantially
personnel met

The reasons provided by grantees for not accomplishing some grant
objectives varied. For example, officials from Tapestri, Inc., the Refugee
Women’s Network’s subrecipient, told us that they believe they had not been
successful in serving a higher number of victims for two reasons:

. «« (1) the reluctance of community involvement; immigrant and
refugee community members may be reluctant to participate in
outreach activities like trainings and focus groups due to fear of
repercussions from community members involved in this illegal activity
and due to a denial that human trafficking occurs within their
community; and (2) a lack of law enforcement officers dedicated to
investigate human trafficking cases.

Further, Tapestri officials said that many victims are undiscovered
because of the lack of communication between local law enforcement and
the Federal Bureau of Investigation (FBI) on what local law enforcement
should do when it discovers cases of suspected trafficking. The lack of
communication between local law enforcement and the FBI was also raised
in evaluations of the program performed by a contractor for the Refugee
Women’s Network and Tapestri.

44


e fund drawdowns
e local match
e expenditures

e indirect costs

monitoring of subrecipients
Goals and Accomplishments

The OVC and BJA solicitations generally required that goals and
objectives be addressed in funding applications, and be realistic, clearly
defined, and linked to the needs of trafficking victims. The solicitations
required applicants to include a statement of purpose describing expected
outcomes and achievements and state the project goals in clear and
measurable terms so that project staff could track the project’s progress.
The applicants were also required to provide project objectives that were
clearly defined, measurable, and stated as a list of quantifiable activities that
would assist applicants in achieving project goals.

The OIG audits found that six of the seven grantees had not met or
were not accomplishing one of more project goals.

Boat People S.0O.S., Inc.

The OIG audit found that the Boat People had not met four of the six
grant goals as shown in the following table.

Grant Goal Status
Meet the needs of at least 20 clients by the end of
2003, 30 by the end of 2004, and 50 by the end of
2005 Met
Conduct a community needs assessment survey Met
Establish a rapid response team Not met
Create a directory of trafficking victims assistance
providers Not met
Develop an advisory board that meets bi-monthly Not met
Conduct seminars to publicize information regarding
human trafficking victims assistance Not met.

40


Department of Justice Efforts to
Combat Human Trafficking

Prevention Efforts
Prosecutors and other Department personnel assist in training local law
enforcement agencies, non-governmental organizations, and international
representatives on human trafficking issues.
The National Institute of Justice's International Center supports research
and exchange of information by offering grants for academic research on
trafficking in persons and child exploitation.
The Office of Justice Programs’ (OJP) National Criminal Justice Reference
Service offers information to support research, policy, and program
development worldwide on various criminal justice issues, including
international trafficking.

Protection Efforts
OjJP’s Office for Victims of Crime (OVC) awards cooperative agreements to
service providers to supply direct services to victims of trafficking.
OJP’s Bureau of Justice Assistance awards grants to state and local law
enforcement agencies to develop task forces that: (1) identify and rescue
victims of human trafficking, and (2) collaborate with service providers to
provide assistance to victims of trafficking.
The OVC offers victim support and education resources to trafficking
victims and victim service providers.
The OVC maintains a resource center that victim advocates and caregivers
can contact to obtain publications and tools to assist them in working with
trafficking victims.

Prosecution Efforts
The Civil Rights Division's Criminal Section enforces the involuntary
servitude and peonage statutes by working with the Federal Bureau of
Investigation, the United States Attorneys Offices, and the Criminal
Division’s Child Exploitation and Obscenity Section to investigate and
prosecute cases of trafficking in persons and worker exploitation.
The Civil Rights Division funds and staffs the national complaint line for
reporting of trafficking crimes.
Source: Department of Justice website and the Bureau of Justice Assistance

Our audit examined the Department's protection efforts involving the
Office of Justice Programs’ (OJP) Office for Victims of Crime’s (OVC)
awarding of cooperative agreements to provide direct services to trafficking
victims and OJP’s Bureau of Justice Assistance’s (BJA) awarding of task force
grants to identify and rescue trafficking victims.

Cooperative Agreements and Grants

In FY 2003, the OVC began awarding cooperative agreements to
nongovernmental organizations to provide trafficking victims with


force. The net effect of the inaccuracies was a 225-percent overstatement in
the potential trafficking victims identified for the 11 task forces tested.

OIG Analysis of Trafficking Victims Reported
as Identified by BJA Task Forces
During Calendar Years 2005 through 2006

Reported Number of
Potential Victims
Identified
Recorded | Verified
in BJA’s by the
Task Force Grantee Records OIG
City of Atlanta, Georgia 216 4
Chicago, Illinois Police Department 2 5
City of Milwaukee, Wisconsin 0 ie)
Cobb County, Georgia Board of
Commissioners 1 (e)
Collier County, Florida 7 15
Dallas, Texas Police Department 31 22
City of Fort Worth, Texas 3 al
Harris County, Texas 131 104
City of Los Angeles, California 49 {0}
Metropolitan Police Department of D.C. 51 (0)
Miami Dade County, Florida 19 6
Totals 510 157

Source: Bureau of Justice Assistance data and task force records

The BJA task forces submitted updated performance data to the BJA
for the 6-month period ending June 30, 2007. The BJA plans to combine
this data with data for the 6-month period ending December 31, 2007, for
inclusion in the Department’s next report to Congress that should be
submitted in May or June 2008. We found the updated performance data
was inaccurate for 9 of the 11 task forces we tested with the data overstated
by 7 task forces and understated by 2 task forces. The net effect was a
165-percent overstatement of the number of potential trafficking victims
identified as shown in the following table.

31


Harris County, Texas

According to the BJA data, the Harris County Sheriff’s Office (HCSO)
had identified 152 potential trafficking victims as of June 30, 2007, but we
could verify that only 109 victims had been identified. An HCSO official
provided the following explanations for the overstatement of 43 victims. The
official told us that the HCSO did not maintain supporting documentation for
the victims identified and reported in the progress reports. The HCSO
official said that he consolidated and reported the number of victims
identified for each task force member, but he did not request or maintain
supporting documentation for what the task force members reported. The
HCSO official also said that the sheriff’s department reconstructed its
supporting records for what was reported on victims identified in preparation
for the audit, but had not requested supporting documentation for what the
other task force members reported.

ity of Los Angeles liforni

As of June 30, 2007, the BJA data indicated that the Los Angeles Police
Department (LAPD) had identified 62 potential trafficking victims, but we
could verify that only 13 victims had been identified. An LAPD official
provided the following explanation for the overstatement of 49 victims. The
official told us that the LAPD did not maintain supporting documentation for
the victims identified and reported in the progress reports. The official said
that the victims reported were identified by other task force members and
those task force members did not provide supporting documents.

Metropolitan Police Department of D.C. (MPDC)

According to the BJA data, the MPDC had identified 62 potential
trafficking victims as of June 30, 2007, but we could not verify that any
victims had been identified. An MPDC official told us the department over-
reported the 62 victims because it inappropriately reported U.S. citizens who
were involved in sex trafficking and who were referred to another non-
governmental organization.

Miami Da lorida

The BJA data indicated that the Miami Dade Police Department (MDPD)
had identified 22 potential trafficking victims as of June 30, 2007, but we
verified that only 6 victims had been identified. An MDPD official told us that
the overstatement occurred because the department inappropriately counted
victims who were U.S. citizens.

35


OIG Analysis of the Continued Presence Applications
Reported by Task Forces as of June 30, 20077"

Number of Applications for Continued
Presence Reported as of June 30, 2007
Task
Force Verified
Progress BJA by the Overstated/
Task Force Grantee Reports Report OIG (Understated)

City of Atlanta, Georgia i¢) 8 (0) 8
Chicago, Illinois Police
Department 2 2 (0) 2
City of Milwaukee,
Wisconsin (¢) (¢) oO i¢)
Cobb County, Georgia
Board of Commissioners 2 2 i¢)} 2
Collier County, Florida 4 4 5 (1)
Dallas, Texas Police
Department 1 1 1 i)
City of Fort Worth, Texas ie) ie) ie) 0
Harris County, Texas 123 123 104 19
City of Los Angeles,

| California 20 20 i) 20
Metropolitan Police
Department of D.C. 5 5 0) 5
Miami Dade County,
Florida 3 4 2 2

Totals 160 169 112 57

Source: Task force progress reports, Bureau of Justice Assistance summary report,
Office of the Inspector General interviews with Bureau of Justice Assistance and task
force officials, and Office of the Inspector General analyses of documents provided by
the task forces

For 2 of the 11 task forces, the performance data maintained by the
BJA was higher than reported by the task force progress reports. Both the
BJA and task force officials provided the following explanations for the
differences.

BJA

¢ A BIA official provided us with an e-mail from the Atlanta task force
that indicated that it had actually submitted eight continuing
presence applications even though it had erroneously reported none
in the progress report for the 6-month period ending June 30,
2006.

23 ‘As explained in Footnote 19, the data presented for the Atlanta task force is as of
reporting period ending December 31, 2006.
64


program specialists will review all contracts or sub-grants that
trafficking grantees fund for services or activities to ensure that costs
are reasonable and strategically sound. Additionally, a programmatic
hold specia! condition will be added in all award documents to ensure
that the review is conducted before funds are available to the grantee,
and the OVC will also include this review requirement in future
solicitations.

The recommendation can be closed when we receive the procedures
that OJP has established to:

e collect and analyze information on costs associated with serving
victims of human trafficking,

e review all contracts or sub-grants that trafficking grantees fund
for services or activities to ensure that costs are reasonable and
sound, and

e ensure that a programmatic hold special! condition is added in all
award documents to ensure that the review is conducted before
funds are made available to the grantee.

12. Resolved. We recommended that OJP provide additional training and
oversight of service provider and task force grantees to ensure that
they:

e develop and implement steps to accomplish the unmet grant
goals, where practical;

e submit FSRs containing accurate financial data;
e submit progress reports in a timely manner;

e draw down only the amount of federal cash needed to pay for
actual or anticipated costs within 10 days;

e« maintain support for costs claimed as matching funds;
e claim only costs that are allowable and supported;

e properly calculate and claim indirect costs; and

e effectively monitor subrecipients.

119


Ensure that the task forces and service providers can support the
trafficking victims reported as identified and served.

Develop a system to ensure that: (1) performance data reported
by the service providers and task forces is accurate, (2) the service
providers and task forces are meeting the performance goals, and
(3) the service providers track the amount of grants funds used to
assist victims of human trafficking.

Provide additional training and oversight of service providers and
task forces to help them: (1) accomplish unmet grant goals,

(2) submit accurate financial reports, (3) submit timely progress
reports, (4) draw down funds to meet immediate needs,

(5) maintain support for matching funds, (6) claim only allowable
and supported costs, (7) calculate indirect costs, and (8) monitor
subrecipients.

xv


To further improve grantee compliance, OJP stated that it is also
developing a standard Grant Monitoring Tool (GMT), which will be
required for use beginning on October 1, 2008, that will require grant
and program managers to review all grants against a set of standard
review categories to determine administrative and financial compliance
with grant management policies, procedures, and regulatory
requirements, as well as to evaluate the programmatic progress and
success of efforts funded through the grant. OJP also stated that its
Office of Audit, Assessment, and Management (OAAM) will develop a
more in-depth, on-line training course for OJP grantees that focuses on
post-award grant management. In addition to the GMT, OJP stated that
in FY 2008 it will issue an improved version of the GAT to act as both a
monitoring decision tool, as well as a format for conducting thorough
desk reviews. Finally, OJP stated that by January 31, 2009, the OAAM
will schedule a follow-up review of BJA and OVC human trafficking-
related grant recipients in order to ensure that issues identified in this
report have been appropriately addressed, and long-term improvement
measures have been implemented.

The recommendation can be closed when we receive documentation:

e showing that OJP’s Grant Management Tool requires grant and
program managers to review all grants against a set of standard
review categories to determine administrative and financial
compliance with grant management policies, procedures, and
regulatory requirements, as well as to evaluate the programmatic
progress and success of efforts funded through the grant;

e showing that the OAAM developed a more in-depth, on-line
training course for OJP grantees that focuses on post-award grant
management;

e describing OJP’s improved version of the GAT; and

e showing the OAAM has scheduled a follow-up review of BJA and
OVC human trafficking-related grant recipients and that the
reviews will cover at a minimum, the eight deficiency areas
included in this recommendation.

13. Resolved. We recommended that OJP establish an effective system for
monitoring the OVC service providers to ensure that: (1) performance
data reported by the service providers is accurate, (2) service providers
are meeting the performance goals, and (3) service providers track the

121


Performance Period

Service Provider or Award
Task Force Award Number Amount From To

International Rescue
Committee
Miami, Florida 2003-VT-BX-K011 $2,026,660 | 01/01/03 06/30/07
Mosaic Family Services,
Inc.
Dallas, Texas 2003-VT-BX-K005 $1,093,552 | 01/01/03 06/30/07
Refugee Women’s Network,
Inc.
Decatur, Georgia 2004-VT-BX-K010 $532,958 | 07/01/04 6/30/07

YMCA of the Greater
Houston Area
Houston, Texas 2003-VT-BX-KO07 $824,927 | 01/01/03 06/30/07

Subtotal $8,039,029

Task Force Grant Audit

San Diego Region Anti-
trafficking Task Force
San Diego, California 2005-VT-BX-0001 $448,134 | 12/01/04 05/31/09

Total $8,487,163

Source: Office for Victims of Crime and Bureau of Justice Assistance cooperative
agreement and grant files

During these audits, the OIG tested the grantees’ compliance with
essential award conditions pertaining to goals and accomplishments,
reporting, fund drawdowns, budget management and control, program
income, local matching requirements, expenditures, indirect costs,
monitoring of subrecipients, and accounting and internal controls. In
addition, the OIG tested the grantees’ accounting records to determine if
reimbursements claimed for costs under the awards were allowable,
supported, and in accordance with applicable laws, regulations, guidelines,
and the terms and conditions of the cooperative agreements and grants.

As discussed in the following sections, each of the audits identified
significant weaknesses. As a result of these weaknesses, the OIG audits
questioned $2,914,257 in grant expenditures and recommended $97,686 be
put to better use. We reviewed the OIG audits to determine if any of the
weaknesses identified were systemic. We considered weaknesses to be
systemic when three or more of the OIG audits found similar weaknesses for
a particular award condition area. For the 10 award condition areas tested,
we determined the weaknesses were systemic for the following seven areas:

e goals and accomplishments

e reporting
39


expansion of the program, in FY 2005 the BJA began awarding grants to
establish task forces to identify trafficking victims and refer them to service
providers. The task forces identified 490 additional victims during the 6-
month period ending December 2005, and the number of victims reported
by the service providers as being served increased accordingly to 465
victims.

However, by the next year the number of victims reported served
declined to the pre-task force levels, with 196 victims served for the
6-month period ending December 2006. In addition, the OVC’s grant award
process for service providers resulted in a wide disparity in the amount of
funds awarded for the number of anticipated victims to be served. Further,
we found that both the service providers and task forces overstated to OJP
the number of victims reportedly served and identified.

We also analyzed OJP’s administration of human trafficking grants and
found systemic weaknesses in its grant implementation. From April 2007 to
March 2008, the OIG issued five audit reports on individual OVC service
provider cooperative agreements, one audit report on multiple cooperative
agreements, and one audit report on a BJA task force grant. Those audits
demonstrated weaknesses in the areas of the established goals and
accomplishments for grantees, grant reporting, fund drawdowns, local
matching funds, expenditures, indirect costs, and monitoring of
subrecipients. The OVC and BJA agreed to take corrective action in response
to each of our individual grant audits, but we believe that these audits show
that the OVC and BJA need to take additional actions to ensure that these
weaknesses are addressed by all OVC service providers and BJA task forces,
not just the subjects of the individual audits we conducted.

Finally, as noted above we concluded that OJP’s human trafficking
grant programs have built significant capacities to serve victims, but have
not been effective at identifying and serving significant numbers of alien
trafficking victims. The OVC service providers were generally effective at
conducting human trafficking-related outreach, training, and service
activities. However, the agreements and grants awarded to service
providers and task forces have not resulted in services to a significant
number of victims. In addition, we found that the OVC and BJA had not
established an effective system for monitoring the OVC service providers and
the BJA task forces to ensure that: (1) performance data reported by the
service providers and task forces is accurate, (2) the service providers and
task forces are meeting performance goals, and (3) service providers can
show the amount of grant funds that are used to directly assist victims of
human trafficking.


e Non-federal matching contributions are identifiable.

The OIG audits found that one of the seven grantees did not maintain
an adequate accounting system and internal controls to properly account for
federal grant funds.

Heartland Alliance’s accounting system did not readily permit it to
consolidate grant expenditures and receipts by agreement. Rather,
Heartland Alliance relied on a manual process to consolidate expenditure
data on a monthly basis. As a result of the deficient accounting system and
lack of internal controls, the audit concluded that Heartland Alliance was
unable to adequately identify and account for specific expenditures
reimbursed by OJP.

Because the OIG audits did not identify systemic problems related to
accounting systems and internal controls, and because a recommendation to
correct this individual deficiency was being addressed by OJP, we do not
make additional recommendations in this report related to this deficiency.

Grantees’ and OJP’s Responses and Planned Corrective Actions to
Weaknesses Found During Previous Individual OIG Audits

For each of the seven individual OIG audits, we analyzed OJP’s and the
grantees’ responses to the reports’ findings and recommendations. Our
analysis determined that OJP generally agreed with 77 of the 82
recommendations and provided planned corrective actions to address the
deficiencies found during the individual audits. The grantees’ did not always
agree with the OIG’s reported deficiencies but generally agreed to
implement the OIG’s recommendations. In the following paragraphs we
present a brief summary of the grantees’ and OJP’s responses and planned
corrective actions to the OIG audits. Appendix III contains more detailed
information regarding OJP’s and the grantees’ responses and planned
corrective actions.

Boat People S.O.S., Inc.

The OIG audit identified significant deficiencies in 8 of the 10 areas
tested - goals and accomplishments, reporting, fund drawdowns, budget
management and control, local matching requirements, expenditures,
indirect costs, and monitoring of subrecipients. The OIG made 22
recommendations to address the deficiencies. OJP agreed with 21 of the 22
recommendations and provided planned or completed corrective actions for
the 21 recommendations. OJP disagreed with the recommendation to
remedy the $2,800 in questioned dental and health insurance costs and said

56


providers and 11 of the 42 BJA task forces. For some tests the on-site work
involved all 7 service providers and 11 task forces visited, while other tests
involved fewer service providers and task forces depending on the period
covered by our tests. The results of our testing are discussed in the
following sections.

Program Design

The OVC issued its first solicitation for awarding cooperative
agreements to service providers in FY 2002 and began awarding service
provider agreements in FY 2003. As shown in the following table, from
FYs 2003 through 2007 the OVC awarded 41 agreements to 36 separate
service providers. Forty of the 41 agreements were for comprehensive or
specialized services to trafficking victims while 1 was for training and
technical assistance.

OVC Agreements Awarded to Victim Service
Providers from FYs 2003 through 2007

Separate
Agreements | Service Amount
FY Awarded | Awarded _| Providers® |_Awarded®
2003 13 12 $13,071,711
2004 10 9 $9,366,599
2005 1 1 $1,074,147
2006 14 12 $7,169,468
2007 3 2 $1,024,743
All Years 41 36 $31,706,668

Source: Office for Victims of Crime’s Grants Management System

For all awards, the OVC required service providers to submit
semi-annual progress reports that included performance data on the number
of trafficking victims served. The OVC maintained a summary of the
performance data submitted which showed that service providers assisted
480 trafficking victims during calendar years 2003 and 2004. According to

5 In FY 2003, one service provider received two agreements. In FY 2004, the 10
service providers receiving agreements included 1 service provider that had received an
agreement in the previous year. In FY 2006, the 14 service providers receiving agreements
included 1 service provider that had received an agreement in FY 2003 and 1 service
provider that had received an agreement in FY 2004. In FY 2007, the three service
providers receiving agreements included one service provider that had received an
agreement in FY 2003.

6 The amount awarded includes the amount of the initial agreement and any
supplements to the initial agreements.

11


Summary of Questioned Indirect Costs

Unallowable and

Unsupported

Service Provider Award Number Costs Claimed
Boat People S.O.S., Inc. 2003-VT-BX-K009 $152,583
Heartland Alliance for Human Needs and 2003-VT-BX-K002 $50,147
Human Rights 2003-VT-BX-K003 $61,498
International Rescue Committee - Miami 2003-VT-BX-K011 $6,843
Total $271,071

Source: Data from Office of the Inspector General audit reports between April 2007 and
March 2008 (see Appendix III)

As of June 19, 2008, actions to remedy the $271,071 in questioned
indirect costs had not been completed by OJP and the grantees.

As for direct expenditures, when grantees are reimbursed federal
funds for indirect costs that are unallowable or unsupported, the risk
increases that grant funds are not being used to further the purpose of the
grant. We recommend that OJP provide additional training and oversight to
all grantees to ensure they properly calculate and claim indirect costs.

Monitoring Subrecipients

According to the Financial Guide, the primary recipient of grant funding
is responsible for monitoring any subrecipients to ensure that all fiscal and
programmatic responsibilities are fulfilled.

The OIG audits found that three of the five grantees that had grant
subrecipients had weaknesses in subrecipient monitoring.

Boat People S.O.S., Inc.

The OIG audit found that the Boat People implemented various
subrecipient monitoring activities, although those measures were not
adequate to ensure that its subrecipient properly charged costs to the
agreement. The Boat People entered into a collaborative Memorandum of
Understanding (MOU) with the subrecipient Ayuda. The MOU between the
Boat People and Ayuda required it to submit quarterly financial reports and
invoices to the Boat People for incurred expenses. The Boat People also
required that Ayuda submit semi-annual program reports. The OIG audit
found that Ayuda complied with conditions outlined within the MOU.
However, the OIG audit found that Ayuda charged to the grant $2,067 in
unallowable costs, and could not support $102,927 in expenditures.

54


e The San Diego Task Force submitted three of the four progress
reports tested from 2 to 6 months late.

When grantees do not submit timely progress reports, OJP grant
managers do not have up-to-date information regarding the grant activities
and the status of the objectives. We recommend that OJP strengthen its
oversight of all grantees to ensure they submit progress reports in a timely
manner.

Fund Drawdowns

The Financial Guide requires that grantees request funds when project
costs are incurred or anticipated. Grantees should time drawdown requests
to ensure that federal cash on hand is only the minimum needed to pay for
actual or anticipated costs within 10 days.

Three of the seven grantees audited by the OIG drew down funds too
early to meet immediate needs, and one grantee did not maintain adequate
accounting records to determine if the grantee drew down funds
appropriately.

Boat People S.O.S, Inc.

On March 9, 2005, and April 7, 2005, the Boat People requested
drawdowns for $71,750, and $91,353, respectively, based on estimates due
to the conversion to a new accounting system. The OIG audit found that
these drawdowns exceeded the minimum 10-day requirement by $19,569
and $21,314, respectively. The Boat People remedied these excess
drawdowns by offsetting the June 7, 2005 request by $40,883.

On January 3, 2006, the Boat People requested a drawdown for
$79,351. The OIG audit found that the drawdown exceeded the minimum
10-day requirement by $7,870. As of the June 30, 2006, reporting period,
the Boat People had not remedied approximately $6,900 of the $7,870
excess.

Heartland Alliance

The OIG audit identified at least four instances where Heartland
Alliance drew down more funds than it had expended.

47


OVC Agreements and BJA Grants for
the Human Trafficking Program Awarded
from FY 2003 through November 2007

Number Amount

Type Award Awarded Awarded
OVC Agreements” 41 $31,706,668
BJA Grants 42 $19,188,219
Total Agreements and Grants 83 $50,894,887

Source: The Office for Victims of Crime and the Bureau of
Justice Assistance

As shown in the following map, the OVC victim services agreements
and the BJA task force grants are widely distributed throughout the United

States and its territories.

Geographical Distribution of OVC Service Provider Agreements and
BJA Task Force Grants Awarded from FY 2003 through FY 2007

= oink
 seattio

/ @viattnemak County LW.

> Erie Cou Boston

Spee Por = Suffolk County, NY
in \ necticut Ga inty,
=e Dp baeee @ oo Nassau County, NY
ago ae ‘\New York Ci
San Francisco Boe Lake tity —— Chicago @ Philadelphia SO hew Soreny ity
Oeifene! Independencs Indianapolis @ PPAR Delaware
‘San Jose e e £ District of Columbia
rises coe St Louise -
Ne lee Angeies ; —Ciasiytie Oia Fein
Phoenix =
Hawaii @ san Diego Se Sobb|County @ :
Fort Worth Atlanta,
ic ‘@ Dallas
@American Samoa e é ;
E{ Paso Austing Louisiana za @Jacksonvilie
@ Northern Marianas (Saipan) et a Seiad
s e ,/ Houston Tampa @
Gu ; Lee County’
TM Collier County ©, tami ~Dade

@ Task Forces and Service Providers Co-located
@ Service Providers with No Funded Task Force
@ Service Providers Serving Multiple Task Forces or Other Jurisdictions

Source: Office for Victims of Crime

2 One of the 41 agreements totaling about $682,000 with the supplement was for
training and technical assistance. The other 40 agreements were for services to trafficking

victims.
4


At the conclusion of the audit, we discussed with OJP officials the
results of our analysis of the “trafficking victims saves” performance
measure. An OJP official said that, in retrospect, this performance measure
is not a reasonable assessment of the task force performance and therefore
should be eliminated. As of June 2008, however, the performance measure
had not been eliminated.

In summary, we found that the task force operations resulted in few
continuing presence applications being submitted for trafficking victims. In
addition, the majority of the task forces were not meeting the BJA’s
requirement to increase “trafficking victim saves” by 15 percent annually.

We asked a BJA official what actions the agency takes when it
determines that the task forces are not meeting the annual requirement to
increase “trafficking victim saves.” The BJA official told us that beginning in
2006 the BJA started providing technical assistance through phone
conversations, e-mails, or on-site visits to grantees that were having trouble
identifying victims and filing continued presence applications. The BJA
official said that the BJA had conducted only a limited number of site visits,
and he identified four site visits. However, only two of the four site visits
were conducted due to the task force having trouble identifying victims and
filing continued presence applications. The other two site visits were
conducted because the task force either was not meeting with the service
provider as expected or believed it was only to provide training and not
identify victims.

Accuracy of Performance Data

The Trafficking Victims Protection Act (TVPA) also required that the
Attorney General to submit annual reports to Congress beginning in
May 2004 regarding the government's actions to combat human trafficking.
One activity to be reported was the number of victims receiving services
under the TVPA by the Department of Justice. We analyzed the four annual
reports to Congress submitted from FYs 2004 through 2007 and found that
the number of victims reported as served was inaccurate in all four reports.
Overall, for the seven service providers we tested, the Department
overstated the number of victims served from calendar years 2003 through
2006 by 57 percent.

In addition, the latest data on victims served through June 2007 shows
54 percent more victims served than we were able to verify. An OJP official
told us that this data will not be reported to Congress until the Fall of 2008.
It is essential that actions are taken by the OVC to preclude inaccurate data
from being reported to Congress in future reports.
21


Heartland Alliance

The OIG audit found that the Heartland Alliance was working to
accomplish the seven grant goals of its two human trafficking grants as
shown in the following table.

Grant Goal Status
Ensure the protection of trafficking victims’ rights and
promote their safety during the initial discovery phase | Working to
of the trial accomplish
Assist trafficking victims to obtain appropriate legal Working to
remedies for which they are eligible accomplish
Provide integrated case management and social Working to
services accomplish
Provide health services for trafficking victims Working to
accomplish
Ensure the safety and protect the interests of child Working to
victims of trafficking accomplish
Identify new victims of trafficking Working to
accomplish
Educate law enforcement agencies, community
organizations, and the immigrant community on Working to
human trafficking accomplish

International Rescue Committee - Miami

The OIG audit found that the International Rescue Committee - Miami
was not accomplishing two of the five grant goals as shown in the following
table.

Grant Goal Status
Develop and implement a public education campaign
that will deliver critical, accurate, and balanced
information; and raise awareness at national, state,
and local levels Accomplishing
Conduct needs assessment research to explore the
social, emotional, health, and other needs of victims of
trafficking and enable the design of targeted program

services Accomplishing
Develop and implement a 3-year program for 100

victims of trafficking that addresses both short- and Not
long-term social service needs accomplishing

Research, design, and publish protocols on standards
of care, strategies for crisis intervention, and

emergency care Accomplishing |
Provide comprehensive legal case management and Not
representation for identified victims of trafficking accomplishing

41


However, the GAO reported that officials from the Departments of
Justice and Health and Human Services have identified the need to advance
and expand U.S. efforts to combat trafficking through more collaborative and
proactive strategies to identify trafficking victims.

The GAO also found, with regard to the task force grants awarded by
the BJA, that it had awarded grants to 42 state and local human trafficking
law enforcement task forces to support U.S. efforts to investigate trafficking
in persons. The GAO also noted that the BJA funded the development of a
train-the-trainer curriculum and a national conference on human trafficking
and took further steps to respond to task force technical assistance needs.

However, the GAO reported that task force members from the seven
task forces it contacted and DOJ officials identified continued and additional
assistance needs. The GAO also found that the BJA did not have a technical
assistance plan for its human trafficking task force grant program. The BJA
officials said they were preparing a plan to provide additional and proactive
technical assistance to the task forces, but had not received the necessary
approvals for the plan as of June 2007.

The GAO recommended that: (1) the Attorney General and the
Secretary of Homeland Security, in conjunction with the Secretaries of
Labor, State, and other agency heads, develop and implement a strategic
framework to coordinate U.S. efforts to investigate and prosecute trafficking
in persons; and (2) the Attorney General direct the Director of the BJA to
develop and implement a plan to help focus technical assistance on areas of
greatest need.

OIG Audit Objectives and Approach

The OIG initiated this audit to: (1) assess the adequacy of OJP’s
design and management of the human trafficking grant programs;
(2) evaluate the extent to which grantees have administered the grants in
accordance with applicable laws, regulations, guidelines, and terms and
conditions of the grant awards; and (3) assess the effectiveness of the grant
programs in assisting trafficking victims.

We performed audit work at OJP’s Office for Victims of Crime and the
Bureau of Justice Assistance, the Department's Civil Rights and Criminal
Divisions, and at the OVC service providers and associated BJA task forces
listed in the following table.


programs were worthwhile and valuable programs for helping trafficking

victims.

However, officials provided many comments regarding impediments

to program effectiveness and how the program could be improved. The
most common comments regarding impediments to program effectiveness
included:

Law enforcement had not identified and referred victims to service
providers. Most of the victims are referred by sources other than
law enforcement, such as calls received on hotlines; referrals from
other community organizations; or tips from friends, neighbors, or
associates of the victims.

Law enforcement had not designated enough officers to
investigate human trafficking cases.

The community is reluctant to get involved because of
the belief that human trafficking is not occurring within
their neighborhoods.

OJP is sending a message to law enforcement to focus only on
investigating sex trafficking cases, while labor trafficking cases are
ignored.

Law enforcement at the local and federal level has not
worked in a collaborative effort.

Victims are too afraid to cooperate with law enforcement because
they fear retaliation by the trafficker against family members and
because some victims think that U.S. law enforcement is corrupt.

Although domestic victims are more prevalent in the United States
than foreign victims, the grants do not allow the task forces to refer
domestic victims to service providers.

The program is under-funded.

Common comments we heard regarding ways program effectiveness
could be improved included the following:

Improve communication and collaboration between the service
providers, task force members, and victims.

Increase service provider and task force staffing.

74


e CAST did not maintain any documentation to support five victims
reported.

e CAST reported two victims who had been certified by the HHS
before coming to CAST. CAST was only authorized to serve pre-
certified victims under the OVC grant without specific authorization
from the OVC to do otherwise, which CAST did not get. After
victims are certified, funding for continued services should come
from HHS.

e CAST reported three victims who were dependents of certified
victims and should not have been reported as trafficking victims.

e CAST mistakenly did not report one victim.
Heartland Alliance

The OVC data showed that Heartland Alliance had assisted 85 potential
trafficking victims as of June 30, 2007, but we could verify that only 62
victims had been served. Heartland Alliance officials told us that the number
of victims was overstated by 23 because after the victims were interviewed
and reported to the OVC, they either disappeared or were found to be
ineligible to receive services.

International Rescue Commi I - Miami

The OVC data showed that IRC — Miami had assisted 56 potential
trafficking victims as of June 30, 2007, but we could verify that only 50
victims had been served. An IRC - Miami official said the overstatement of
six victims occurred because the service provider was confused on how to
report the number of victims served. The official told us that the IRC
continued to report five victims who had been identified and counted as new
victims in prior reporting periods, and also reported a case that was not an
OVC case.

Mosaic Family Servi I

The OVC data indicated that Mosaic had assisted 128 potential
trafficking victims as of June 30, 2007, but we could verify that only 55
victims had been served. Mosaic officials could not provide us with a list
showing the 128 victims reported as served through June 30, 2007.
However, in August 2007 Mosaic provided a list of 155 human trafficking
victims who had been assisted since the inception of the cooperative
agreement. We requested that Mosaic provide intake forms, certification

28


Awareness Presentations Made to the Public
Reported as of June 30, 2007
Task
Force Verified
Progress BJA by the Overstated/
Task Force Grantee Reports Report OIG (Understated)
Harris County, Texas 101 80 8 72
City of Los Angeles,
California 15 15 6 9
Metropolitan Police
Department of D.C. 36 41 0) 41
Miami Dade County,
Florida (¢) 50 te) 50
Totals 237 271 93 178

Source: Task force progress reports, Bureau of Justice Assistance summary report,
Office of the Inspector General interviews with Bureau of Justice Assistance and task
force officials, and Office of the Inspector General analyses of documents provided by
the task forces

For 3 of the 11 task forces, the performance data maintained by the

BJA was higher than reported by the task forces in their progress reports.
For 2 of the 11 task forces, the performance data maintained by the BJA was
lower than reported by the task forces in their progress reports. Both the
BJA and task force officials provided the following explanations for the
differences.

BJA

The BJA data for the Atlanta task force was understated by one
presentation due to a mistake.

A BJA official provided us with documentation to show that
subsequent to the Collier County, Florida, task force’s June 30,
2007, progress report, the task force notified the BJA that it had
understated the number of presentations in the progress report by
one. The BJA data included the additional presentation.

A BJA official could not explain why the BJA data for the Harris
County, Texas, task force was understated by 21.

The BJA data for the Washington, D.C. task force was overstated by
five because the task force provided imprecise numbers for this
performance measure in two of its progress reports, and BJA staff
recorded an incorrect number for this measure.

69


Heartland Alliance

The OIG audit found that Heartland Alliance reported to OJP that it had
federal expenditures of $490,829 for Grant Number 2003-VT-BX-K002 and
its ledger showed federal expenditures of $558,359 at the close of the grant
period. Similarly, for Grant Number 2003-VT-BX-K003, the grantee reported
to OJP that it had federal expenditures of $771,036 for the period ending
September 30, 2006, while the ledger as of that date showed federal
expenditures of $841,204. From these conditions, it appears the reported
expenditures for the two grants were understated by $137,698.

International Rescue Committ IRC) = Miami

The OIG audit reported that the IRC inaccurately prepared its FSRs
because the reports did not match the amounts shown in the general ledger.
As of September 30, 2006, the IRC reported total outlays as $1,142,360 on
the FSR, but recorded a smaller amount of $1,141,014 in its general ledger.
This difference was immaterial. However, as of June 30, 2007, the IRC
reported total federal outlays as $1,805,894 on the FSR, but the general
ledger reflected a smaller amount of $1,653,152. Consequently, for the
period ending June 30, 2007, the IRC apparently overstated expenditures by
$152,742.

OJP grant managers consider the financial data submitted by grantees
as important data for managing financial aspects of the grants. When
grantees submit inaccurate financial data to OJP, the risk that OJP grant
managers may make financial decisions based on flawed financial data is
increased. We recommend that OJP provide additional training and
oversight to all grantees to ensure they submit FSRs containing accurate
financial data.

Program Progress Reports

The seven OIG audits found that the following three grantees had a
significant problem in submitting program progress reports in a timely
manner.

e The Boat People submitted 5 of the 7 progress reports tested from
7 to 31 days late.

e The YMCA of Greater Houston submitted 3 of the 7 progress reports
tested from 1 to 80 days late.

46


e The BJA data for the Miami Dade task force was overstated by 50
because the BJA staff mistakenly used a number reported for
another performance measure when recording the data.

Task Forces

¢ Officials from four task forces (Milwaukee; Harris County, Texas;
Los Angeles; and Washington, D.C.) said that they did not maintain
supporting documentation to verify the reported data.

e An official from the Chicago task force told us that the task force
understated the number of presentations made due to a mistake.

e An official from the Collier County, Florida, task force told us that
the task force understated the number of presentations made
because of an error in counting the number of awareness
presentations made.

Achieving Performance Goals

As discussed in Finding 2, the OIG audits found that six of seven
grantees had not met one or more of the grant performance goals. A goal
that was most often not met was related to the number of victims aided by
the service providers. The audits found that four of the six service providers
tested had not aided the number of victims that they anticipated helping.

International Rescue Committee - Miami

The International Rescue Committee - Miami (IRC) had a goal to
develop and implement a 3-year program from January 2003 through
December 2005 for 100 victims of trafficking that addressed both short- and
long-term social service needs. However, the IRC reported serving only 41
victims as of December 31, 2005, 59 percent below the 100 victims
anticipated. Moreover, as of June 30, 2007, IRC reported serving only 56
victims, still 44-percent below the anticipated number. Further, as explained
in Finding 1, we found that the IRC could support only 50 victims served as
of June 30, 2007. The IRC continued to report five victims who had been
identified and counted as new victims in prior reporting periods, and
reported a case that was not overseen by the OVC.

An IRC official told us that meeting the goal was a difficult challenge,
although the number of trafficked persons identified by the IRC continues to
grow.

70


i.

As stated in our response to Recommendation Numbers 8 and 9, by January 1, 2009, the
OJP will develop additional and specific guidance to the OVC service providers that
specifies OJP’s policy on serving certified victims as well as requiring the OVC service
providers to maintain written documentation to support all services provided to
trafficking victims to ensure the accuracy of the number of trafficking victims reported by
the OVC service providers for inclusion in the annual reports.

Establish procedures for use during the award process on future service provider
agreements to determine whether the award amounts are reasonable in relation to
the anticipated numbers of victims to be assisted.

The Office of Justice Programs agrees with the recommendation. For all OVC trafficking
awards that OJP makes during fiscal year (FY) 2008 and in future years as funding is
appropriated, OVC trafficking program specialists will review all contracts or sub-grants
that trafficking grantees fund for services or activities to ensure that costs are reasonable
and strategically sound. Additionally, a programmatic hold special condition will be
added in all award documents to ensure that the review is conducted before funds are
available to the grantee and OVC will also include this review requirement in future
solicitations.

Human trafficking in the U.S. is a crime for which scant statistical data exists, especially
in the historical context of how many victims have been identified, the dynamics of the
trafficking cases, and the subsequent needs of the victims. The OJP, other Federal
authorities, and local service providers cannot accurately “anticipate” the number of
victims to be assisted during an 18 month or three year period in each geographic area, as
there is insufficient data to ascertain where traffickers will focus their efforts. The OJP is
also unaware of any tested, reliable models for estimating how and where traffickers in
humans will establish or expand their efforts. Because of the episodic nature of the
identification of trafficking victims (as well as the anticipated number of victims that may
be identified in a single case), the OJP has elected to pursue a strategy from the inception
of trafficking grant programs to focus goals and objectives on building the community
capacity to assist any number of victims that are identified and to ensure that these
victims are provided comprehensive services during the service period. This capacity
includes the ability of the grantee and the community to provide all needed services to
both male and female as well as adult and child victims of both sex and labor trafficking
before certification occurs. As the OIG report indicates, the audited OVC service
provider grantees have clearly met the overarching goal for the establishment and
administration of this grant program.

Grantee applications have used estimated number of victims to make budget projections,
but there is no “cookie cutter” approach to how any one grantee will provide services for
the victims of this emerging crime. The needs of a particular victim, and the subsequent
costs, can differ tremendously from one victim to the next. Some victims have no

105


Ina continuing commitment to improving grant oversight, the OAAM released new,
robust guidelines for monitoring OJP grants and cooperative agreements in FY 2007,
making it possible for OJP grant and program managers to monitor grants and
cooperative agreements consistently across OJP bureaus and offices, while preserving the
flexibility to monitor diverse programs and grant types effectively. To accomplish the
standards and requirements for on-site monitoring, the OAAM developed a standard
Grant Monitoring Tool (GMT), which will be required for use beginning on

October 1, 2008. The GMT requires grant and program managers to review all grants
against a set of standard review categories to determine administrative and financial
compliance with grant management policies, procedures, and regulatory requirements, as
well as to evaluate the programmatic progress and success of efforts funded through the
grant. :

In addition to the GMT, the OAAM released the Grant Assessment Tool (GAT) in
September 2007 to provide a common, organized framework and methodology for
systematically and objectively assessing risks associated with grants and/or grantees. The
GAT was used to assist in the development of the OCFO FY 2008 financial monitoring
plan and involves assigning a monitoring priority level to individual grants based ona
standard set of criteria. In FY 2008, an improved version of the GAT will be issued in a
Microsoft Access database format and has been enhanced to act as both a monitoring
decision tool, as well as a format for conducting thorough desk reviews. The OAAM has
worked closely with OVC in particular to include rating factors for human trafficking
grants.

Specifically to address late semi-annual progress reports, the OJP implemented the
funding freeze functionality within the GMS Progress Report module in FY 2007. The
module temporarily freezes payments to an award recipient due to late submission of a
progress report. After the award recipient submits a progress report and the OJP approves
it, the GMS module makes the funds available for drawdown. This new GMS feature,
which complements the funding freeze for late Financial Status Reports, has led to
increased grantee accountability and compliance with grant program reporting
requirements.

Finally, by January 31, 2009, the OAAM will schedule a follow-up review of BJA and
OVC human trafficking-related grant recipients in order to ensure that issues identified in
this report have been appropriately addressed, and long-term improvement measures have
been implemented.

108


subsequent solicitations, the OVC eliminated the requirements that service
providers include the number of victims anticipated to be served and the
need to identify the average projected cost of providing direct services to
victims based on a calculation of the number of victims anticipated to be
served. An OVC official told us that these requirements were eliminated
because the OVC believed the requirement was an exercise in futility in that
service providers could not control the number of victims referred to them.

In January 2005, the OVC and BJA issued a solicitation for joint
concept papers for both the service provider agreements and task force
grants. After the concept papers were reviewed by the OVC and BJA,
selected applicants were invited to submit full proposals. The concept
papers were to be submitted jointly by the law enforcement agency applying
for a BJA task force grant and the service provider applying for an OVC
service provider agreement. The solicitation further reduced the limit of the
service provider agreements to $500,000. According to an OVC official, the
OVC reduced the agreement limit because funding was reduced by 50
percent to support the BJA task force grants.

In April 2006, the OVC and BJA issued a solicitation for both the
service provider agreements and task force grants. The solicitation again
reduced the limit of service provider agreements, this time to $450,000.
According to an OVC official, the OVC’s goal was to provide supplemental
funding to an increased number of service providers.

The following table shows the number and amount of the OVC service
provider agreements and supplements awarded under each solicitation.

° A concept paper is similar to a proposal that would be submitted by an applicant in
response to a solicitation, except the concept paper includes a description of the estimated
costs rather than a detailed budget and budget narrative.

15


OIG Analysis of Trafficking Victims Reported as
Assisted by the OVC Service Providers from
January 2003 through June 2007

Reported Number of Trafficking Victims

Calendar Year Recorded Tested Verified
Covered by Report | Sent To in OVC’s by the by the

to Congress Congress Records OIG OIG

2003 200 174 86 34

2004 357 306 164 71

2005 692 661 256 187

2003 - 2006 1,775 1,618 684 435

Not Yet
2003 - June 2007 Reported? 1,924 685 445

Source: Annual Attorney General reports to Congress, Office of Victims of
Crime data, and service provider records

As shown in the preceding table, our tests of the number of victims
reported indicated that the OVC has significantly overstated the number of
victims actually served in its reports to Congress.

Causes for Inaccurate Data Regarding Victims Served

To determine the causes for the Department’s reporting of inaccurate
data regarding victims served, we interviewed OVC and service provider
officials and reviewed documentation related to victims served. We
determined that the reasons for the inaccurate data included the following:

Three service providers reported existing and new victims each
reporting period, and therefore the existing victims were counted
multiple times.

Two service providers reported victims who either disappeared or
were found to be ineligible by either the service provider or law
enforcement after being interviewed by the service provider.

One service provider reported victims who had been certified by the
Department of Health and Human Services (HHS) as trafficking
victims prior to the OVC grant award.

Two service providers reported victims who had been certified by
HHS after the OVC grant was awarded but before they came to the
service provider for help.

2

The next annual report to Congress is not due to be submitted until the Fall of

2008 and will cover performance data through December 2007.

ix


e Grant Management Tool requires grant and program managers to
review all grants against a set of standard review categories to
determine administrative and financial compliance with grant
management policies, procedures, and regulatory requirements,
as well as to evaluate the programmatic progress and success of
efforts funded through the grant; and

e revised procedures for collecting and reporting performance data
are adequate to ensure that performance data reported by the
task forces is accurate, and the task forces are meeting the
performance goals.

15. Resolved. We recommended that OJP issue additional guidance to all
task force grantees regarding best practices to:

e maintain supporting documentation for performance measure data
reported to the BJA,

e establish a mechanism to track the data to be reported for each
performance measure, and

e verify the accuracy of performance data before submission to the
BJA.

OJP agreed and stated that by January 31, 2009, it will develop
additional, clearer guidance to all task force grantees regarding best
practices in maintaining supporting documentation, tracking data to be
reported, and verifying the accuracy of the data before reporting to the
BJA. OJP also stated that as it revises its performance measures as
discussed under Recommendation 1, it will also develop a User’s Guide
that provides clear guidance on reporting data to the BJA. OJP further
stated that the BJA also plans to provide onsite technical assistance and
guidance to task force grantees in maintaining supporting
documentation, tracking the data, and verifying the accuracy of the
data.

The recommendation can be closed when we receive:

e OJP’s additional guidance to all task force grantees regarding best
practices in maintaining supporting documentation, tracking data
to be reported, and verifying the accuracy of the data before
reporting to the BJA;

123


to provide services to human trafficking victims, and therefore it did not turn
away potential victims of trafficking.

Refugee Women's Network, Inc.

The OVC data showed that the Refugee Women’s Network (RWN) had
assisted 35 potential trafficking victims as of December 31, 2006, but we
could verify only 21 victims. An RWN official told us that the overstatement
of 14 victims occurred because RWN continued to report victims who had
been identified and counted as new victims in prior reporting periods.

YMCA of the Greater Houston Area, Inc.

The OVC data showed that the YMCA had assisted 112 potential
trafficking victims as of June 30, 2007, but we could verify that only 81
victims had been served. YMCA officials could not explain why they over-
reported by 31 the number of identified victims in progress reports.
According to a YMCA official, the program managers responsible for
preparing the progress reports no longer worked at the YMCA, and
supporting documentation was not maintained for the numbers reported in
the progress reports. Although the YMCA provided us with a list of 110
victims, YMCA officials could not explain the difference between the 112
victims reported and the 110 victims on the list. However, we determined
that the YMCA inappropriately counted 28 of the 110 victims who were
certified by HHS before coming to the YMCA for services, and counted
another victim who had already submitted the paperwork to HHS to become
certified.

Inaccurate Data Regarding Victims Identified by BJA Task Forces

The Department did not begin reporting data on the potential
trafficking victims identified by the BJA task forces until the May 2007 report
to Congress. Although the BJA awarded the first task force grants in
FY 2005, the Department did not include task force performance data for
2005 in the June 2006 report to Congress because most of the grantees had
not received a clearance on their grant budget or completed acceptance of
the award locally until the end of the second reporting period. The
Department reported in May 2007 that the BJA task forces had identified
1,513 potential trafficking victims as of December 31, 2006. These potential
victims were reported by 36 BJA task forces. As shown in the following
table, we performed testing at 11 of the BJA task forces and found that the
number of potential victims reported was overstated for 8 task forces,
understated for 2 task forces, and correctly reported for the remaining task

30


Inaccurate Data Regarding Victims Assisted by Service Providers

Our audit work identified significant inaccuracies in the performance
data reported by the service providers. Beginning in May 2004, the
Department submitted annual reports to Congress regarding the
government's actions to combat human trafficking.’ In each report, the
Department reported on the number of trafficking victims who benefited
from the OVC service providers. We analyzed the data on victims served in
the four annual reports submitted to Congress between FYs 2004 and 2007,
and our analysis indicates that the actual number of eligible victims served
was usually significantly less than reported. The following table shows:

e the victim data reported to Congress each year,
e the victim data maintained by the OVC for each year,

e the number of reported victims for which we performed tests to
determine if the reported data was accurate, and

e the number of reported victims for which the service providers
could furnish documentation to verify that the victims were eligible
for services based on the Trafficking Victims Protection Act.

1 U.S. Department of Justice, Report to Congress from Attorney General
John Ashcroft on U.S. Government Efforts to Combat Trafficking in Persons in
Fiscal Year 2003, (May 1, 2004).

U.S. Department of Justice, Report to Congress from Attorney General Alberto R. Gonzales
on U.S. Government Efforts to Combat Trafficking in Persons in Fiscal Year 2004,
(July 2005).

U.S. Department of Justice, Attorney General’s Annual Report to Congress on U.S.
Government Efforts to Combat Trafficking in Persons Fiscal Year 2005, (June 2006).

U.S. Department of Justice, Attorney General’s Annual Report to Congress on U.S.
Government Efforts to Combat Trafficking in Persons Fiscal Year 2006, (May 2007).

viii


In June 2006 the Department reported to Congress that 692 trafficking
victims were assisted by 20 OVC service providers during 2005.1 However,
according to the OVC data, service providers assisted 661 trafficking victims
during 2005. As shown in the following table, we performed testing at 7 of
the 20 service providers and found that the number of victims reported was
overstated for 6 of the 7 providers.

OIG Analysis of Trafficking Victims Reported as Assisted
by OVC Service Providers During Calendar Year 2005

Reported Number of
Victims Served
Recorded | Verified
in OVC's by the
Service Provider Records OIG
Boat People, S.O.S., Inc. 60 41
Coalition to Abolish Slavery 39 21
Heartland Alliance for Human Needs and Human Rights 27. 16
International Rescue Committee - Miami 20 19
Mosaic Family Services, Inc. 51 38
Refugee Women’s Network, Inc. 16 16
YMCA of the Greater Houston Area, Inc. 43 36
Totals 256 187

Source: Office for Victims of Crime data and service provider records

In May 2007 the Department reported to Congress that 1,775
trafficking victims were assisted by 28 service providers from the inception
of the program in 2003 through December 2006.'> However, the OVC
summary data showed that service providers helped 1,618 trafficking victims
from the inception of the program in 2003 through December 2006. As
shown in the following table, we performed testing at 7 of the 28 service
providers and found that the number of victims reported was overstated for
all 7 providers.

44 U.S. Department of Justice, Attorney General’s Annual Report to Congress on U.S.
Government Efforts to Combat Trafficking in Persons Fiscal Year 2005 (June 2006).
Although the report was for FY 2005, the number of victims aided by OVC service providers
was reported for calendar year 2005.

15 U.S. Department of Justice, Attorney General’s Annual Report to Congress on U.S.
Government Efforts to Combat Trafficking in Persons Fiscal Year 2006 (May 2007).
Although the report was for FY 2006, the number of victims aided by OVC service providers
was reported for calendar year 2006.

24


Ensure that the OVC service providers verify whether victims who received T-visa
have been certified by HHS as trafficking victims before they can receive services.

The Office of Justice Programs agrees with the recommendation. By January 1, 2009, the
OJP will develop additional and specific guidance to the OVC service providers that
specifies OJP’s policy on serving certified victims and indicating that the service
providers that use grant funds to serve certified victims, without prior authorization from
OVC, will be required to return the funds to the OJP. Also, if allowable, OVC will
require its grantees to provide the circumstances, including certification status and
whether or not the U.S. Department of Health and Human Services has been contacted to
verify certification status, of each new trafficking victim that the service providers report
serving in their semi-annual progress reports (this is a new data reporting requirement that
is not currently part of the grantees’ applications). As previously stated, the OJP plans to
conduct a technical assistance workshop for the OVC service providers at the next human
trafficking conference, to be held on September 9-10, 2008, in Atlanta, Georgia.

Ensure the OVC service providers maintain sufficient documentation to support the
trafficking victims reported as assisted in the semi-annual progress reports.

The Office of Justice Programs agrees with the recommendation. In addition to the
guidance specified in our response in Recommendation Number 8, by January 1, 2009,
the OJP will also develop guidance requiring OVC service providers to maintain written
documentation to support all services provided to trafficking victims.

Ensure the accuracy of the number of trafficking victims reported by the service
providers for inclusion in the annual reports.

The Office of Justice Programs agrees with the recommendation. The OJP is committed
to ensuring that OVC service providers report data reflecting the accurate number of
eligible trafficking victims assisted during a reporting period (broken down by new
victims served and existing victims). At the outset, it is important to realize that some
OVC service providers have served individuals who, without question, are victims of
human trafficking in fact, but do not fall under the precise statutory eligibility criteria for
OVC-funded services — for example, victims who are certified prior to receiving
trafficking victim services. As such, to avoid confusion as to whom can be served with
OVC grant funds, the OJP, the Vermont Service Center of the U.S. Department of
Homeland Security and the Human Trafficking Prosecution Unit within the Civil Rights
Division of U.S. Department of Justice, issued written guidance to OVC service providers
in March 2008, that specifically outlines eligibility for services funded by OVC
trafficking grants.

104


comprehensive or specialized services.! Comprehensive services are direct
services provided by the grantee organization that include:

food,

shelter,

case management,

legal assistance and advocacy,

medical services,

mental health assessment and treatment,
job skills training,

transportation, and

interpretation services.

Specialized services are services such as housing, legal assistance, or
medical care that are provided over a broad geographic area.

In FY 2005, the BJA began awarding grants to state and local law
enforcement agencies to develop task forces to identify and rescue victims of
human trafficking. Details about the task force grants and why they were
awarded are contained in Finding 1 of this report. The task forces were
usually partnered with an OVC service provider and were required to refer
identified trafficking victims to the OVC service provider.

The following table shows the number and dollar value of the OVC
agreements and BJA grants awarded from FY 2003 through November 2007
under OJP’s human trafficking program. Appendix II contains a list of the
agreements and grants awarded, including the receiving organization, award
number, and award amount.

+ OJP primarily awards cooperative agreements and grants when the principal
purpose of the relationship between OJP and the recipient is the transfer of money or
anything of value to the eligible recipient to accomplish the public purpose of support as
authorized by federal statute. OJP uses a cooperative agreement when substantial
involvement is anticipated between OJP and the recipient during performance of the activity
funded. When such substantial involvement is not anticipated, OJP uses a grant as the
funding instrument. In this report we refer to the recipient of either a cooperative
agreement or grant as a grantee.




At the conclusion of our audit, OJP officials provided us an update on
changes to OJP’s grant monitoring and assessment efforts. According to an
OJP official, they created the Program Assessment Division in FY 2007 to
conduct grant program assessments, create common monitoring policies,
and ensure monitoring efforts are effective. In addition, at the beginning of
FY 2008, OJP released the “Grant Monitoring Tool” to enhance
documentation of monitoring reviews, provide improved tools and guidance
for monitoring, and improve the tracking of monitoring findings and grantee
corrective actions. OJP also expanded the use of the Trafficking Information
Management System to accumulate and report data related to the number of
trafficking victims identified and served. While we could not evaluate these
actions, if fully implemented they could address some of the weaknesses we
found during this audit.

In our report, we make 15 recommendations to assist OJP in
improving the management of its human trafficking grants to the OVC
service providers and BJA task forces.

Our report contains detailed information on the full results of our
review of OJP’s human trafficking grant programs. The remaining sections
of the Executive Summary summarize in more detail our major audit
findings.

OJP’s Design and Management of Grant Programs

Our audit found that OJP’s human trafficking grant programs have
built significant capacities to serve victims, but have not identified and
served significant numbers of victims. As initially designed, the program
awarded cooperative agreements to non-profit service providers that
furnished food, clothing, shelter, and legal assistance. OJP’s Office for
Victims of Crime began awarding agreements to service providers in
January 2003, and the service providers reported serving a total of 480
victims during calendar years 2003 and 2004.

Because of the low number of victims assisted by the service
providers, OJP determined that it needed a more comprehensive detection
and investigation strategy that was linked to the rescue and recovery of
human trafficking victims. In 2004, OJP assigned the BJA to reach out to
local law enforcement agencies to explore opportunities for collaboration
among federal, state, and local entities with the goal of improving the
identification of trafficking victims. The result was the implementation of the
BJA’s Anti-Human Trafficking Task Force Initiative. This initiative provides
grant funds to state and local law enforcement agencies to establish anti-
trafficking task forces that implement victim identification and rescue

Vv


e OJP’s procedures or guidelines for the Immersion Program that
show the importance and need for both accuracy in reporting and
maintaining documentation to support victims reported will be
reinforced during the task force technical assistance and training
sessions; and

e OJP’s procedures that require a unique incident number to be
assigned to each new trafficking case as it is reported to OJP, and
that victim information included for that case be linked to the
unique incident number.

Resolved. We recommended that OJP ensure the accuracy of the
number of trafficking victims reported by the task forces for inclusion in
the annual reports. OJP agreed and stated that as discussed under
Recommendation 3, it plans to emphasize the importance and need to
ensure accuracy of the number of victims reported at the September
2008 human trafficking conference in Atlanta, Georgia. OJP also stated
that with the development of the Immersion Program, it believes the
importance and need for both accuracy in reporting and maintaining
documentation to support victims reported will be reinforced. OJP
further stated that to ensure the accuracy of the number of trafficking
victims reported by task forces for inclusion in the annual reports, by
January 31, 2009, it will explore methods for implementing an ongoing
system of random audits of the data provided by the task forces. The
recommendation can be closed when we receive the documentation
requested for Recommendation 3 and OJP’s procedures for performing
random audits of the data provided by the task forces.

Resolved. We recommended that OJP consider whether the “trafficking
victim saves” performance measure should be eliminated, and if not
eliminated, whether it should establish procedures for taking prompt
corrective action when task forces are not meeting the “trafficking
victim saves” performance measure. OJP agreed and stated that it is in
the process of revising its human trafficking performance measures and
exploring options for collecting and reporting on such measures. OJP
stated that by January 31, 2009, it will develop and implement
procedures for monitoring and reporting on the status of all victims
identified by the BJA task forces. The recommendation can be closed
when we receive OJP’s revised human trafficking performance measures
and new procedures for monitoring and reporting the status of all
victims identified by BJA task forces.

116


¢ The IRC did not monitor its subrecipients by conducting periodic on-
site visits that included both programmatic and financial reviews, as
OJP had suggested.

Among the 17 recommendations, the OIG urged OJP to:

e Ensure grantees adjust strategic plans appropriately to address
their challenges in meeting objectives or deobligate funds to award
to other applicants.

e Ensure that the IRC consistently maintains more comprehensive
intake information in the social service case files to document the
victim’s eligibility at the time of enrollment.

e Ensure the IRC maintains support to trace reimbursement requests
to its accounting records.

e Remedy the unsupported costs of $297,686 related to housing,
legal services, and mental health services provided by the Salvation
Army, Florida Immigrant Advocacy Center, and Victim Services
Center.

e Remedy the unsupported costs of $163,337 related to local match
funds.

OJP agreed with 15 of the 17 recommendations and provided planned
or completed corrective actions for them. OJP disagreed with the
recommendation regarding deobligation of funds not used for direct
assistance to victims and the recommendation for the International Rescue
Committee to issue a protocol for coordinating with external agencies. OJP
also disagreed in part with the recommendation regarding unused housing
services. In its response to the OIG audit, the International Rescue
Committee disagreed with all 17 recommendations, but provided planned
actions to resolve many of them.

Mosaic Family Services, Inc.

The OIG issued an April 2007 audit report on a cooperative agreement
awarded to Mosaic Family Services, Inc., in Dallas, Texas.*? The OIG also

33 U.S. Department of Justice, Office of the Inspector General, Services for
Trafficking Victims Discretionary Grant Program Cooperative Agreement Awarded to Mosaic
Family Services, Inc., Award Number 2003-VT-BX-K005, Audit Report GR-80-07-006
(April 2007).

94


As of June 19, 2008, actions had been completed by OJP and the
grantees to remedy only $56,710 of the $1,488,956 in questioned direct
expenditures as shown below. Actions had not been completed by OJP and
the grantee to remedy the remaining $1,432,246 in questioned direct
expenditures.

Boat People S.O.S., Inc.

Subsequent to issuance of the audit report, the Boat People provided
documentation to support $1,449 of the $121,625 in questioned direct
expenditures.

Mosaic Family Services, Inc.

Subsequent to issuance of the audit report, Mosaic provided
documentation to support $40,659 of the $41,318 in questioned direct
expenditures. Mosaic reimbursed OJP the remaining $659 in questioned
direct expenditures.

YMCA of the Greater Houston Area, Inc.

Subsequent to issuance of the audit report, the YMCA provided
documentation to support $13,943 of the $21,120 in questioned direct
expenditures.

When grantees spend grant funds on unallowable items or cannot
provide documentation to support grant expenditures, the risk increases that
grant funds are not being used to further the purpose of the grant. We
recommend that OJP provide additional training and oversight to all grantees
to ensure they claim only costs that are allowable and supported.

Indirect Costs

The Financial Guide states that indirect costs are costs that are not
readily assignable to a particular project, but are necessary to the operation
of the organization and the performance of the project. The cost of
operating and maintaining facilities, depreciation, and administrative salaries
are examples of the types of costs that are usually treated as indirect.
Indirect costs should be charged to each agreement or grant based on
indirect cost rates approved by OJP.

As shown in the following table, the OIG audits found that, at the time
of the audits, three of the seven grantees claimed $271,071 in unallowable
or unsupported indirect costs.

53


OJP Service Providers

BJA Task Force Grantees

Boat People S.O.S., Inc., Falls Church,
Virginia

Metropolitan Police Department of the
District of Columbia, Washington, D.C.

Coalition to Abolish Slavery and
Trafficking, Los Angeles, California

City of Los Angeles, California

Heartland Alliance, Chicago, Illinois

Chicago, Illinois Police Department

City of Milwaukee, Wisconsin

International Rescue Committee,
Miami, Florida

Collier County, Florida

Miami Dade County, Florida

Mosaic Family Services, Inc., Dallas,
Texas

Dallas, Texas Police Department

City of Fort Worth, Texas

Refugee Women’s Network, Inc.,
Decatur, Georgia

City of Atlanta, Georgia

Cobb County, Georgia Board of
Commissioners

YMCA of the Greater Houston Area,
Inc., Houston, Texas

Harris County, Texas

To answer the audit objectives, we performed multiple steps that

included:

e reviewing laws, regulations, and other guidance for managing,
administering, and awarding cooperative agreements and grants for
human trafficking;

e interviewing OJP, OVC, BJA, and grantee officials responsible for
implementing the program;

e reviewing documentation related to the OVC cooperative
agreements and the BJA grants awarded from FY 2003 through
June 2007;

e evaluating the accuracy of performance data reported to Congress
for FYs 2003 through 2006;

e analyzing the results of OIG audits of six OVC service providers and
one BJA task force issued from April 2007 through March 2008;

e analyzing OJP’s and the grantees’ responses to the OIG audits to
determine if corrective actions had been taken or initiated for the
deficiencies found;


completed actions to remedy only $56,710 of the $1,488,956 in
questioned direct expenditures.

Indirect Costs — At the time of the audits, three of the seven
grantees claimed $271,071 in unallowable or unsupported indirect
costs. As of June 19, 2009, the grantees had not provided
documentation to support any of the questioned indirect costs.

Monitoring of Subrecipients —- Three of the five grantees with grant
subrecipients did not properly monitor the subrecipients.

These systemic deficiencies existed despite past OIG reviews of OJP
grant programs that found similar grant administration deficiencies. For
example, previous OIG audits have identified the following issues related to
OJP grant administration:

A significant number of grantees either did not submit required
financial and progress reports or did not submit them in a timely
manner.

OJP’s monitoring of grantee activities were deficient in various
areas, such as not sufficiently reviewing supporting documentation
for grant expenditures, not establishing performance goals for its
programs, not ensuring that grantees submit performance data to
demonstrate that grant monies were being used effectively and as
intended, and not properly closing grants in a timely manner.

Grant funds were not regularly awarded in a timely manner and
grantees were slow to spend available monies.

OIG audits of grants have resulted in significant dollar-related
findings.

As a result of the continued deficiencies identified by the OIG audits of
OJP grants, the OIG identified grant management as one of the
Department’s top management challenges for the past 6 years. As the OIG
noted in our November 2007 top management challenges report, while it is
important to efficiently award the billions of dollars in grant funds
appropriated annually by Congress, it is equally important that the
Department maintains proper oversight over the grantees’ use of these
funds to ensure accountability and to ensure that these funds are used as
intended.

xii


Trafficking Victims Reported as Assisted by OVC
Service Providers and Identified by BJA
Task Forces from January 2003 through June 2007

| 7
Jan. - June 2003
| July - Dec. 2003

| July - Dec. 2004

|
113 |
Jan. - June 2005 |

196 |B Service Providers

|TM Task Forces
July — Dec. 2005 2 $30 |
| Jan. - June 2006 473 |
| July - Dec. 2006) 482)

| Jan. - June 2007
| (') 200 400 600 800

Source: Victim data maintained by the Office for Victims of Crime and the
Bureau of Justice Assistance

Service providers reported identifying 68 new victims during January
through June 2003. The number of new victims reported as served
increased to 196 in the first half of 2005 when the task forces began
operation. In the second half of 2005, the task forces identified 490
potential victims and this apparently drove a sharp increase in victims to the
service providers, which reported serving 465 victims during the same
period. In subsequent periods, the task forces continued reporting newly
identified victims in the range of 473 to 591 per reporting period. However,
the service providers reported a steep drop in the number of victims served
during these same time periods. The number of victims reported as served
increased for the period ending June 30, 2007, although that increase may
be attributable to new agreements being awarded to 14 new service
providers during FYs 2006 and 2007. At the conclusion of the audit, we
discussed this concern with a BJA official. The official told us that the
difference between the number of victims identified by the task forces and
served by the service providers is largely attributable to the task forces
reporting on potential victims identified while the service providers reporting
actual victims served. We believe that the task forces should either report
actual victims identified instead of potential victims, or report both the actual
and potential victims identified.

Based on the reported data, we concluded that the program design
associated with the task forces has not resulted in a sustained increase in
the number of trafficking victims who benefit from service providers.

13


OVC Service Providers

BJA Task Forces

Refugee Women’s Network, Inc.,
Decatur, Georgia

City of Atlanta, Georgia

Cobb County, Georgia Board of
Commissioners

YMCA of the Greater Houston Area, Inc.,
Houston, Texas

Harris County, Texas

Grant Program Design and Management

To assess the adequacy of OJP’s design and management of the
cooperative agreement and grant programs, we performed the following

steps:

e We reviewed laws, regulations, guidelines, and terms and
conditions OJP had in place for managing, administering, and
awarding cooperative agreements and grants for human trafficking.

e We interviewed the OVC and BJA officials to determine how they
implemented the human trafficking grant programs.

e We obtained and reviewed documentation related to the OVC
cooperative agreements awarded to service providers and the BJA
grants awarded to task forces. As part of this review, we identified
the total scope of the OVC service provider agreements and task
force grants awarded from FYs 2003 through 2007.

e We obtained performance data related to victims served by the OVC
service providers and to victims identified by the BJA task forces
from calendar year 2003 through June 2007.

e We analyzed the reported service provider and task force
performance data to determine if the task forces were effective in
increasing the number of victims aided by the service providers on
a continuing basis.

e We obtained the Department's annual reports to Congress
submitted from FYs 2004 through 2007 on the government’s
actions to combat human trafficking. We compared the data
reported on trafficking victims aided by the service providers to
data maintained by the OVC to determine if the reported numbers
were accurate. We also performed further analysis at seven OVC
service providers to determine if the data on victims assisted was
accurately reported to the OVC by the service providers.

82


e OJP’s User’s Guide containing direction for task forces to report
performance data to the BJA; and

e documentation of the onsite technical assistance and guidance
provided by the BJA to the task forces for maintaining supporting
documentation, tracking performance data, and verifying the
accuracy of the data.

124


e Use a greater percentage of funding for assisting victims instead of
training and outreach.

e Redirect the BJA funding from task forces that are not identifying
victims to areas of the country where task forces and service
providers are identifying and serving victims.

e Provide better guidance to grantees, especially on reporting
requirements.

e Implement controls to prohibit people from abusing the T-visa
program by pretending to be human trafficking victims.

e Provide more funding to identify and serve victims.
Conclusion

We found that OJP’s grant programs have built significant capacities to
serve victims, but have not been effective at identifying and serving
significant numbers of alien trafficking victims. Initially, the OVC service
providers served far fewer victims than anticipated. OJP recognized that few
victims were being served and implemented an initiative to award grants to
establish task forces to identify and refer victims to service providers. While
the task forces have increased the number of potential victims identified, the
task forces’ work in identifying victims has not resulted in a sustained
increase in the number of victims aided by the service providers. The OVC
and BJA also need to improve monitoring of the OVC service providers and
the BJA task forces to ensure that: (1) performance data reported by the
service providers and task forces is accurate, (2) service providers and task
forces are meeting the performance goals, and (3) service providers can
show the amount of grant funds that are used to directly assist victims of
human trafficking.

Recommendations

We recommend that OJP:

13. Establish an effective system for monitoring the OVC service providers
to ensure that: (1) performance data reported by the service providers
is accurate, (2) service providers are meeting the performance goals,

and (3) service providers track the amount of grants funds used to
assist victims of human trafficking.

75


Effectiveness of the Grant Programs

We found that the OVC service providers were generally effective at
conducting human trafficking-related outreach, training, and service
activities. Similarly, the grant programs have built significant capacities to
serve victims, but have not been effective at identifying and serving
significant numbers of alien trafficking victims. As previously discussed, we
found that performance data for the OVC service providers showed they
served only 480 trafficking victims during calendar years 2003 and 2004.
OJP recognized that few victims were being served and, to address the
problem, awarded grants to law enforcement agencies to establish task
forces to identify more victims and refer them to the service providers.
While the identification of victims by the task forces initially led to an
increase in the number of victims helped by the service providers,
subsequent data showed that the task forces have not been effective at
consistently increasing the number of victims served.

In addition, at the time of our audit, the OVC and BJA had not
established an effective system for monitoring the OVC service providers and
the BJA task forces to ensure that: (1) performance data reported by the
service providers and task forces is accurate, (2) service providers and task
forces are meeting performance goals, and (3) service providers can show
the amount of grant funds used to directly assist victims of human
trafficking. For example, our audit found that:

e The OVC service providers we tested overstated the number of
trafficking victims serviced through June 2007 by 54 percent.

e The BJA task forces we tested overstated the number of trafficking
victims identified through June 2007 by 165 percent.

e The BJA task forces inaccurately reported performance data to the
BJA for three additional performance measures used by the BJA to
measure program effectiveness.

e Four of the six service providers tested had not assisted the number
of victims that they anticipated serving.

e Four of the seven service providers used less than 10 percent of the
awarded funds to provide direct assistance to trafficking victims.
Service provider officials said that much of the direct services they
supply to victims are consultations, legal assistance, and other
services provided by in-house staff or by outside consultants and
contractors. However, the service providers were not required to

xiii


APPENDIX I

Audit Objectives, Scope, and Methodology
Objectives

The objectives of this audit were to: (1) assess the adequacy of the
Office of Justice Programs’ (OJP) design and management of the grant
programs; (2) evaluate the extent to which grantees have administered the
grants in accordance with applicable laws, regulations, guidelines, and terms
and conditions of the grant awards; and (3) assess the effectiveness of the
grant programs for trafficking victims.

Scope and Methodology

We performed the audit in accordance with the Government Auditing
Standards and included tests and procedures necessary to accomplish the
objectives.

The audit covered human trafficking grant activities from January
2003, to April 2008. We performed audit work at OJP’s Office for Victims of
Crime (OVC) and the Bureau of Justice Assistance (BJA), the Department’s
Civil Rights and Criminal Divisions, and at the following OVC service
providers and associated BJA task forces.

OVC Service Providers BJA Task Forces
Boat People S.O.S., Inc., Falls Church, Metropolitan Police Department of the
Virginia District of Columbia, Washington, D.C.
Coalition to Abolish Slavery and City of Los Angeles, California

Trafficking, Los Angeles, California
Heartland Alliance for Human Needs and_ | Chicago, Illinois Police Department
Human Rights, Chicago, Illinois

City of Milwaukee , Wisconsin
International Rescue Committee, Miami, Collier County, Florida

Florida

Miami Dade County, Florida
Mosaic Family Services, Inc., Dallas, Dallas, Texas Police Department
Texas

City of Fort Worth, Texas

81


__ Total (41 Cooperative Agreements)

Award Award

Grantee Number Amount
OVC Service Provider Cooperative Agreements a Be pene As Ae ee
The Salvation Army (Nevada) 2006-VT-BX-K014 $449,997
The Salvation Army National Headquarters (Throughout the
U.S.) 2003-VT-BX-K008 $282,846
Salvation Army Western Territory (Alaska, California, Colorado,
Idaho, Montana, Nevada, New Mexico, Texas, Utah, and
Wyoming) 2005-VT-BX-K001 $1,074,147
Tapestri, Inc. (Georgia) 2007-VT-BX-K004 $250,000
Tides Center (Utah) 2006-VT-BX-K011 $450,000
U.S. Conference of Catholic Bishops (Oregon) 2004-VT-BX-K004 $667,237
U.S. Conference of Catholic Bishops, Inc. (Delaware, Maryland,
New Jersey, Pennsylvania) 2004-VT-BX-K003 $708,298
World Relief Corporation (Alabama, Arkansas, Florida,
Kentucky, Louisiana, Mississippi, Oklahoma, South Carolina,
North Carolina, Tennessee, Texas, Virginia, West Virginia) 2004-VT-BX-K005 $1,099,998
World Relief Corporation (Florida) 2006-VT-BX-K008 $450,000
YMCA of the Greater Houston Area, Inc. (Louisiana, Texas) 2003-VT-BX-K007 $1,149,927

$31,706,668

86



Require the BJA task forces to maintain documentation to support the number of
trafficking victims reported.

The Office of Justice Programs agrees with the recommendation. The OJP plans to
emphasize the importance and need to maintain documentation to support the number of
victims reported at the next human trafficking conference, to be held on September 9-10,
2008, in Atlanta, Georgia. Additionally, BJA recently developed an “Immersion
Program” among the funded task forces. The Immersion Program allows the three top
performing task forces to provide hands on technical assistance and cross training to their
peer task forces. Each of the three top performing task forces will host peer task forces,
one at a time, for a week of immersion learning. One of the learning objectives that will
be covered in detail in the Immersion Program will be “reporting and record keeping.” In
this segment, the importance and need for both accuracy in reporting and maintaining
documentation to support victims reported, will be reinforced.

As stated in our response to Recommendation Numbers 1 and 2, the OJP is in the process
of revising its human trafficking performance measures for the BJA funded task forces
for collecting and reporting on such measures. By January 31, 2009, the OJP will
develop and implement procedures whereby the status of all victims who have been
identified by the BJA funded task forces as potential human trafficking victims in each
investigation will be monitored and reported. Finally, to ensure that the BJA task forces
maintain documentation, a unique incident number will be assigned to each new case as it
is reported to OJP, and any victim information included for that case would be linked to
the unique incident number. Therefore, documentation supporting the number of
trafficking victims is readily available and easily accessible for auditing and verification.

Ensure the accuracy of the number of trafficking victims reported by the task forces
for inclusion in the annual reports.

The Office of Justice Programs agrees with the recommendation. As stated in our
response to Recommendation Number 3, the OJP plans to emphasize the importance and
need to ensure accuracy of the number of victims reported at the next human trafficking
conference, to be held on September 9-10, 2008, in Atlanta, Georgia. With the
development of the “Immersion Program”, the OJP believes the importance and need for
both accuracy in reporting and maintaining documentation to support victims reported,
will be reinforced.

To ensure the accuracy of the number of trafficking victims reported by task forces for
inclusion in the annual reports, by January 31, 2009, the OJP will explore methods for
implementing an ongoing system of random audits of the data provided by the task
forces.

102


from OJP when cumulative changes in the approved budget categories will
exceed 10 percent of the total award amount or when the project scope will
change.

The OIG audits found that five of the seven grantees had budget-
related weaknesses. However, the weaknesses were varied and did not
appear systemic.

Boat People S.O.S., Inc.

The OIG audit found that the Boat People and its subrecipient spent
$90,296 in cooperative agreement funds on expenditures that were not in
the approved budget. As of June 19, 2008, actions to remedy the $90,296
in questioned expenditures had not been completed by OJP and the grantee.

Heartland Alliance

The OIG audit found that the Heartland Alliance, without OJP approval,
transferred $82,027 between budget categories which exceeded the
allowable 10-percent limit of $37,500 by $44,527.27 As of June 19, 2008,
actions to remedy the $44,527 in questioned budget transfers had not been
completed by OJP and the grantee.

International Rescue Committee - Miami

The International Rescue Committee received an initial agreement for
3 years, a supplement to the initial agreement that extended the
performance period for 18 months, and a no-cost extension that extended
the performance period for 7 months. In its budget submission to OJP, the
grantee substantially overestimated the number of victims that it would
serve during the life of the grant. The grantee estimated that it would serve
100 victims during the 3-year grant period, but had actually served only 40
after 3 years and 9 months.

Refugee Women’s Network, Inc.

The Refugee Women’s Network received an agreement for 18 months
and a supplement to the agreement for an additional 18 months. The
grantee estimated that it would serve 99 victims during the 3-year grant
period, but actually served only 21 victims during the first 32-% months of

22 This deficiency was for award number 2002-WL-BX-0026 which was not a human
trafficking service provider award as explained in footnote 20.

49


Therefore, the audit recommended that the Boat People implement policies
and procedures for monitoring Ayuda’s financial activities.

Mosaic Family Services, Inc.

The OIG audit reviewed Mosaic’s written policies and procedures for
monitoring its two subrecipients and found them lacking specific instructions
for monitoring and guidelines for the frequency of such monitoring. The
audit found that one of the subrecipients had received brief inspections of 1
month's financial records - one in February 2004 and the other in July 2006.
The second subrecipient had not been inspected since
February 2004. After the auditors advised Mosaic that it needed to develop
and implement specific guidelines for more frequent and comprehensive
monitoring of the subrecipients, Mosaic provided the auditors with its new
procedures for monitoring its subrecipients. The auditors reviewed the
monitoring procedures and found them adequate.

International Rescue Committee - Miami

The OIG audit found that the International Rescue Committee had
established written policies and procedures on grants management that
included procedures for monitoring subrecipients. However, the grantee did
not ensure that subrecipient progress reports were accurate, did not perform
on-site monitoring visits to one of its three subrecipients, and did not
monitor its subrecipients’ compliance with single audit requirements.

When grantees fail to adequately monitor subrecipients, the risk
increases that the subrecipients’ performance may not further the purposes
of the grant. We recommend that OJP provide additional training and
oversight to all grantees to ensure they effectively monitor subrecipients.

Accounting and Internal Controls

The OJP Financial Guide requires that grantees establish and maintain
accounting and internal control systems to accurately account for funds
awarded to them. The accounting system should, among other things,
ensure that:

e Grant receipts and expenditures are identifiable and accounted for
properly;

e Grant expenditures are identifiable by approved budget categories;
and

55


3. EFFECTIVENESS OF OJP’S GRANT PROGRAMS FOR HUMAN
TRAFFICKING VICTIMS 0000.0... cccccecccceeeeeeeeeesseeeseeeneeaueaeseeenees 61
Performance Data Reported by the OVC Service Providers and BJA

Task Forces 62
Achieving Performance Goals.. 70
Direct Assistance to Victims 72
Service Provider and Task Force Officials’ Views on OJP’s Human

Trafficking Grant Programs 73
CONCIUSION .......000068 75
Recommendations... 75

STATEMENT ON COMPLIANCE WITH LAWS AND REGULATIONG..... 77

STATEMENT ON INTERNAL CONTROLS 78
ACRONYMS 2... ccc cc cece cece eeeeeeea eee eesaeeaaeseeseeeeneeeeeeaneenneeenegs 80
APPENDIX I - Audit Objectives, Scope, and Methodology ............. 81
APPENDIX II - Trafficking Cooperative Agreements and Grants

Awarded by OJP’s Office for Victims of Crime and Bureau of

Justice ASSISTANCE ..........c cece eeeeeceeeeeeeeeeseeeeeeeeeseeeaeeseesseeeueneeeee 85
APPENDIX III - Department of Justice OIG Audits of Office for

Victims of Crime and Bureau of Justice Assistance Human

Trafficking Agreements and Grants from April 2007 through

March 2008 00.0... cccceecceeseeeeeneeene serena eeeeeaeeeeenesenaeeeeeaeeeeeaeeesaneee 88
APPENDIX IV - Office of Justice Programs’ Response to the

Draft Audit Report ...............cccccccccssccsecneceeeeaeesseeeeeeneeeseeeeeeneeenee 100

APPENDIX V - Office of the Inspector General Analysis and
Summary of Actions Necessary to Close the Report...



We reviewed the Department’s 2007 annual report to Congress and
compared the data reported on trafficking victims identified by the
task forces to data maintained by the BJA to determine if the
reported numbers were accurate. We also performed further
analysis at 11 BJA task forces to determine if the data on victims
identified was accurately reported to the BJA by the task forces.

We evaluated the OVC service provider agreements for seven
service providers to determine if the agreement funds were
equitably distributed.

We evaluated the BJA task force grants for 11 task forces to
determine if they provided pre-grant data to establish a baseline of
the number of “trafficking victim saves” for measuring compliance
with the requirement to increase “trafficking victim saves” by 15
percent annually.

Administration of Grants

To evaluate the extent to which grantees administered the cooperative
agreements and grants in accordance with applicable laws, regulations,
guidelines, and terms and conditions of the grant awards, we performed the
following steps:

We obtained the results of OIG audits of six OVC service providers
and one BJA task force issued from April 2007 through March 2008.
Details of these audits are contained in Appendix III.

We analyzed the results of the seven audits to identify systemic
deficiencies in the areas of goals and accomplishments, reporting,
fund drawdowns, budget management and control, program
income, local matching requirements, expenditures, indirect costs,
monitoring of subrecipients, and accounting and internal controls.

We analyzed OJP’s and the grantees’ responses to the OIG audits to
determine if corrective actions had been taken or initiated for the
deficiencies found.

Grant Program Effectiveness

To assess the effectiveness of the grant programs for trafficking
victims, we performed the following steps.

83


Prior Audits

Several previous audits by the Department of Justice Office of the
Inspector General (OIG) and the Government Accountability Office (GAO)
have reported on the Department’s anti-trafficking efforts. These audits are
summarized below.

Office of the Inspector General

From April 2007 through March 2008, the OIG issued audit reports on
five cooperative agreements awarded by the OVC to provide services to
victims of human trafficking, one audit report on multiple cooperative
agreements, and one audit report on a human trafficking task force grant
awarded by the BJA. The seven audits identified significant deficiencies in
the OVC’s and BJA’s oversight of the grants and the grantees’ use of the
funds, such as grantees: (1) not meeting project goals, (2) claiming
unallowable and unsupported expenditures, (3) drawing down funds sooner
than needed, and (4) not properly monitoring subrecipients. As a result of
these and other deficiencies, the OIG questioned $2,914,257 in grant
expenditures and recommended $97,686 be put to better use. Finding 2
and Appendix III of this report contain more details about the results of
these audits.

Government Accountability Office

In a July 2006 report, the GAO reported on the United States’
international anti-trafficking efforts by examining: (1) estimates of the
extent of global trafficking, (2) the government’s strategy for combating the
trafficking problem abroad, and (3) the Department of State’s process for
evaluating foreign governments’ anti-trafficking efforts.? The GAO’s findings
included the following:

e The government’s estimates that 600,000 to 800,000 persons are
trafficked across international borders annually were questionable.
The accuracy of the estimates was in doubt because of
methodological weaknesses, gaps in data, and numerical
discrepancies.

e While federal agencies had undertaken anti-trafficking activities, the
U.S. government had not developed a coordinated strategy for

3 U.S. Government Accountability Office, Human Trafficking: Better Data, Strategy,
and Reporting Needed to Enhance U.S. Antitrafficking Efforts Abroad, GAO-06-825 (July 18,
2006), 2-4.
5


e Services providers do not understand that they need to contact law
enforcement when they identify a victim.

e There is no clear leader in the task force.

e There is inadequate collaboration between state and federal law
enforcement.

nt rgi commissioners

The BJA data indicated that the Cobb County task force had identified
10 potential trafficking victims as of June 30, 2007, but we could not verify
that any victims had been identified. According to a Cobb County task force
official, none of the 10 victims identified should have been reported because
the victims were identified by the service provider and not by the task force.

Collier County, Florida

The Collier County, Florida Sheriff’s Office had identified 25 potential
trafficking victims as of June 30, 2007, and we verified this to be accurate.

Dallas, Texas, Police Department (DPD)

As of June 30, 2007, the BJA data indicated that the DPD had
identified 62 potential trafficking victims, but we verified that 64 victims had
been identified. A DPD official told us that when she was preparing a list of
identified victims for us, she realized that she had mistakenly under-
reported the number of victims identified. The official said that she planned
to contact the BJA to make corrections to the previously reported data.

ity of Fort W

The BJA data showed that the Fort Worth Police Department (FWPD)
had identified five potential trafficking victims as of June 30, 2007, but we
could verify that only three victims had been identified. A FWPD official told
us that the police department over-reported the number of victims because
it initially had identified three victims in a case, but only one victim was
found when the FWPD conducted a raid on the location. The official stated
that the remaining two victims had been moved to another location prior to
the raid.

34


Finding III

OJP’s grant programs have built significant capacities to serve victims,
but have not been effective at identifying and serving significant numbers of
alien trafficking victims. Initially, the OVC service providers assisted far
fewer victims than anticipated. OJP recognized that few victims were being
served and implemented an initiative to award grants to establish task
forces to identify and refer victims to the service providers. While the task
forces have increased the number of potential victims identified, the task
forces’ work in identifying victims has not resulted in a sustained increase in
the number of victims aided by the service providers. The OVC and BJA
have not established an effective system for monitoring the OVC service
providers and BJA task forces to ensure that: (1) performance data
reported by the service providers and task forces is accurate, (2) the service
providers and task forces are meeting the performance goals, and (3) a
significant portion of the funds provided to service providers are used to
directly assist victims of human trafficking.

Because we are not expressing an opinion on OJP's overall internal

control structure, this statement is intended solely for the information and
use of OJP in managing its human trafficking grant programs.

79


Service
Provider

Agreement
Number

Type

Term

Amount
Awarded

Amount
per
Victim

International
Rescue
Committee -
Miami

2003-VT-BX-KO11

Initial

36 Mo.

100

$1,731,660

$17,317

International
Rescue
Committee -
Miami

2003-VT-BX-KO11

Supplement

18 Mo.

Application
Did Not
Specify

$295,000

Could Not
Determine

Mosaic
Family
Services,
Inc.

2003-VT-BX-KO0S

Initial

36 Mo.

180

$799,586

$4,442

Mosaic
Family
Services,
Inc.

2003-VT-BX-KO0S

Supplement

18 Mo.

90

$293,966

$3,266

Mosaic
Family
Services,
Inc.

2006-VT-BX-K016

Initial

36 Mo.

180

$449,996

$2,500

Mosaic
Family
Services,
Inc.

2006-VT-BX-K016

Supplement

18 Mo.

Application
Did Not
Specify

$325,000

Could Not
Determine

Refugee
Women’s
Network

2004-VT-BX-K010

Initial

18 Mo.

60

$311,708

$5,195

Refugee
Women’s
Network

2004-VT-BX-K010

Supplement.

18 Mo.

39

$221,250

$5,673

YMCA of
Greater
Houston

2003-VT-BX-KO07

Initial

36 Mo.

150

$529,927

$3,533

YMCA of
Greater
Houston

2003-VT-BX-KO07

Supplement.

18 Mo.

30

$295,000

$9,833

YMCA of
Greater
Houston

2003-VT-BX-K007

Supplement

18 Mo.

30

$325,000

$10,833

Source: Service provider applications and Office for Victims of Crime award documents

All of the service provider agreements, except for the first Heartland
Alliance agreement (2003-VT-BX-K002), were for comparable
comprehensive services to victims, outreach, and training. We found that
the OVC officials generally accepted the service provider’s estimates of the

17



Resolved. We recommended that OJP ensure that the OVC service
providers separately identify new victims who are assisted during the
semi-annual progress reporting period. OJP agreed and stated that by
January 1, 2009, it will work with the Office for Victims of Crime (OVC)
Training and Technical Assistance Center, which developed OVC’s
Trafficking Information Management System (TIMS), to modify the
system to make data collection clearer and more streamlined. The
recommendation can be closed when we receive OJP’s modifications to
the TIMS and documentation on how those modifications will ensure
that the OVC service providers separately identify new victims who are
assisted during the semi-annual progress reporting period.

Resolved. We recommended that OJP ensure the OVC service
providers do not report as assisted those potential victims who either
disappear or were found to be ineligible before services are provided.
OJP agreed and stated that it believes that service providers should only
count as assisted those victims who actually receive some sort of
OVC-funded service and who are determined to have been eligible to
receive such services. OJP stated that by January 1, 2009, it will
provide additional guidance to the service providers on the eligibility
criteria for OVC-funded assistance for victims of human trafficking. The
recommendation can be closed when we receive OJP’s additional
guidance to the service providers regarding this issue.

Resolved. We recommended that OJP ensure that the OVC service
providers verify whether victims who received T-visas have been
certified by the U.S. Department of Health and Human Services (HHS)
as trafficking victims before they can receive services. OJP agreed and
stated that by January 1, 2009, it will develop additional guidance for
the OVC service providers on aiding certified victims and indicating that
service providers that use grant funds to serve certified victims without
prior authorization from OVC will be required to return the funds to the
OJP. OJP also stated that, if allowable, the OVC will require grantees to
provide the circumstances, including certification status and whether or
not HHS was contacted to verify certification status of each newly
reported trafficking victim. The recommendation can be closed when —
we receive OJP’s additional guidance to service providers regarding this
issue.

Resolved. We recommended that OJP ensure the OVC service

providers maintain sufficient documentation to support the trafficking

victims reported as assisted in the semi-annual progress reports. OJP

agreed and stated that in addition to the guidance specified in its

response to Recommendation 8, by January 1, 2009, it will develop
117


INTRODUCTION

Human trafficking is a form of modern-day slavery in which adults and
children are bought, sold, and held against their will in sexual slavery and
involuntary servitude. Human trafficking deprives people of their human
rights and freedoms, increases global health risks, and fuels organized
crime. Victims also suffer physical and emotional abuse, rape, threats,
document theft, and death.

Background

In 1998, the President directed federal agencies to combat human
trafficking through a three-pronged approach to prevent trafficking, protect
victims, and prosecute traffickers. In 2000, Congress enacted the
Trafficking Victims Protection Act (TVPA) to combat human trafficking.
Through two reauthorization acts, one in 2003 and the other in 2005,
Congress reauthorized the TVPA through fiscal year (FY) 2007. As of
March 2008, congressional reauthorization beyond FY 2007 was pending.

The TVPA defines victims of “severe” forms of trafficking as those
persons subject to: (1) sex trafficking in which a commercial sex act is
induced by force, fraud, or coercion, or in which the person induced to
perform such acts is under age 18; or (2) the recruitment, harboring,
transportation, provision, or obtaining of a person for labor or services,
through the use of force, fraud, or coercion, for the purpose of subjection to
involuntary servitude, peonage, debt bondage, or slavery. A victim need not
be physically transported from one location to another to be a human
trafficking victim. The TVPA provides that an alien, who is identified as a
victim of a severe form of trafficking in the United States and meets
additional conditions, is eligible for special benefits and services.

The Departments of Justice, State, Labor, Health and Human Services,
and Homeland Security share responsibility for implementing the U.S.
government's anti-trafficking efforts domestically and abroad. Each agency
focuses on one or more prongs of the three-prong approach to anti-
trafficking - prevention, protection, and prosecution. As shown in the
following table, the Department of Justice’s (Department) responsibility
addresses all three prongs.


Another service provider, the International Rescue Committee - Miami,
repeatedly identified in its progress reports that it was having difficulty
meeting the goal related to serving victims. This provider planned to
continue training, outreach to the public, and work more intensely with law
enforcement and community organizations, to help increase the number of
victims referred to it for services.

While the grantees reported program accomplishments in their semi-
annual progress reports, OJP’s system for monitoring the progress reports
was not effective in ensuring that accomplishment shortcomings were
detected and corrected. When grantees fail to accomplish the goals of the
grant, the risk of not identifying and serving significant numbers of victims is
increased. Therefore, we believe that OJP should develop and implement
steps to identify when grantees do not accomplish their stated goals and
take actions to help the grantees accomplish unmet goals, where practical.

Reporting

The OJP Financial Guide requires grantees to submit to OJP two types
of reports: Financial Status Reports (FSR) and program progress reports.
FSRs provide information on funds spent and the unobligated amounts
remaining for the grants.*! The Financial Guide requires that grantees
submit the FSRs within 45 days after the end of each calendar quarter.
Program progress reports provide information on the status of funded
activities. The Financial Guide requires that grantees submit the progress
reports within 30 days after the end of each semiannual reporting period.

Financial Status Reports

The seven OIG audits found that only one of the seven grantees had a
significant problem in submitting FSRs in a timely manner. However, three
of the seven grantees submitted FSRs containing significantly inaccurate
financial data.

Boat People S.0.S., Inc.

The Boat People did not include the grant’s indirect cost on the FSRs.
Therefore, the FSRs’ reported costs were understated by $61,535.

21 Grant funds are obligated when a valid purchase order or requisition is issued to
cover the cost of purchasing an authorized item on or after the begin date of the grant and
up to the last day of the grant period.

45


services. OJP also stated that such a recommendation also runs counter to
the whole premise of this and most other grant programs: that a local
community service provider knows far better than federal authorities what
services and resources are available locally, including those that are low-cost
or free.

OJP’s concern regarding Recommendation 11 misconstrues our
recommendation. This recommendation, as are all our recommendations, is
designed to correct the causes of specific deficiencies identified during the
audit. In this instance, the audit found that among the service providers
tested, a wide disparity existed in the amount of funds awarded per
estimated victim to be served. While OVC officials generalized about the
reasons such disparities could exist, the officials could not explain the
specific reasons for the disparities because when making the awards the
OVC did not analyze the grantee’s budget in relation to the estimated
number of victims to be served. Therefore, the OVC could not demonstrate
that the funds awarded were reasonable for the number of victims to be
served. Consequently, we made a specific recommendation that OJP
develop procedures to determine whether the award amounts are
reasonable in relation to the anticipated number of victims to be assisted.
Failure to provide reasonable assurance that funds awarded are
commensurate with the number of victims to be served results in a costly
and potentially ineffective program. As noted, the OVC has awarded more
than $31 million to service providers, but very few victims have actually
been served. Therefore, we believe it is essential that the OVC do more to
ensure the awarded funds are reasonable in relation to the anticipated
number of victims to be assisted.

The following is our analysis of OJP’s response to our specific
recommendations.

Status of Recommendations:

1. Resolved. We recommended that OJP develop and implement
procedures to ensure that the BJA task forces either report only actual
trafficking victims identified, or report both actual and potential victims
identified. OJP agreed and stated that it is in the process of revising its
human trafficking performance measures for the BJA task forces. OJP
also stated that by January 31, 2009, it will develop and implement
procedures for monitoring and reporting the status of all victims
identified by the BJA task forces. OJP plans to regularly update the
status of trafficking incidents and potential victims to indicate whether
or not the victims’ status is pending or confirmed. OJP stated that this
regular update will allow the task forces to provide the most up-to-date

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The OIG found the following deficiencies:

The Sheriff’s Department maintained an accounting system and
financial records that did not always separately account for grant-
related expenditures and revenue.

The Sheriff’s Department charged an unauthorized position to the
grant.

The Sheriff's Department did not always submit timely progress
reports.

The Sheriff's Department was not meeting the grant objectives laid
out by OJP as it relates to investigating human trafficking cases as
well as identifying and caring for victims of human trafficking.

The OIG recommended that OJP:

Ensure that the grantee has appropriate controls in place to ensure
that all grant-related transactions are properly posted under the
unique grant-designated fund number to avoid commingling
expenditures and revenue with those of other grants or projects.

Ensure that the Sheriff’s Department does not claim extra overtime
pay resulting from charging the higher salaried sergeant position to
the grant rather than the lower salaried deputy position that is
included in the OJP-approved grant budget.

Ensure that the Sheriff's Department submits the required semi-
annual progress reports within the allowable timeframe.

Ensure that the grantee applies its focus for the remainder of the
grant toward fulfilling the program objectives relating to
investigations of human trafficking cases as well as the
identification and care of human trafficking victims.

Ensure that the Sheriff’s Department, in its semi-annual progress
reports to OJP, continually and accurately reports on the number of
human trafficking victims identified through task force efforts,
providing sufficient detail with regard to the efforts that have been
presented in identifying and properly handling the victims of such
investigations.

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APPENDIX IV

Office of Justice Programs’ Response
to the Draft Audit Report

US. Department of Justice

Office of Justice Programs

Office of the Assistant Attorney General

Washington, D.C. 20531

MUL 18 2008
MEMORANDUM TO: Glenn A. Fine
Inspector General
United States Department of Justice

THROUGH: Raymond J. Beaudet
Assistant Inspector General for Audit
Office of the Inspector General
United States Department of Justice

FROM: Jeffrey L. Sedgwi cA
Acting Assistant ‘General,

SUBJECT: Response to Office of the Inspector General’s Draft Audit Report,
Management of the Office of Justice Programs’ Grant Programs
Sor Trafficking Victims

This memorandum provides a response to the recommendations directed to the Office of
Justice Programs (OJP) included in the Office of the Inspector General’s (OIG’s) draft audit
report entitled, Management of the Office of Justice Programs’ Grant Programs for Trafficking
Victims. The report contains 15 recommendations and no questioned costs directed to the OJP.

In general, the Office of Justice Programs agrees with the draft audit report
recommendations, and is fully committed to implementing corrective actions to strengthen our
administration of the human trafficking grant programs. For ease of review, the draft audit report
recommendations are restated in bold and are followed by our response.

L Develop and implement procedures to ensure that the BJA task forces either report
only actual trafficking victims identified, or report both actual and potential victims
identified.

The Office of Justice Programs agrees with the recommendation. The OJP is in the
process of revising its human trafficking performance measures for the Bureau of Justice
Assistance (BJA) funded task forces and is exploring options for collecting and reporting
‘on such measures. As such, the OJP is considering that the BJA fund task forces collect
detailed incident level data rather than the current aggregate level metrics.

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operations and refer the victims to service providers usually funded by OJP
grants.

From FYs 2005 through 2007, the BJA awarded 42 grants and
supplements totaling about $19.2 million to establish anti-trafficking task
forces. As shown in the following graph, the task forces appeared initially to
identify significant numbers of potential trafficking victims, and this more
than doubled the number of victims assisted by the service providers.
However, while the task forces continued to identify potential victims, the
actual number of victims served has dropped off dramatically since calendar
year 2005.

Trafficking Victims Reported as Assisted by
OVC Service Providers and Identified by BJA
Task Forces from January 2003 through June 2007

Jan. - June 2003
July — Dec. 2003
| Jan. - June 2004
July - Dec. 2004
Jan. - June 2005
July — Dec. 2005
Jan. - June 2006
|guly - Dec. 2006
Jan. - June 2007
|

193 Wie Seni eh ii |
196 |@Service Providers
|
@ Task Forces
s'330

591
() 200 400 600 800

Source: Victim data maintained by the Office for Victims of Crime and the
Bureau of Justice Assistance

Even with the work of the task forces, the service providers are
reaching a small fraction of the victims believed to be trafficked into the
United States each year. According to the Trafficking Victims Protection Act
of 2000, an estimated 50,000 victims were trafficked into the United States
annually. This initial estimate has significantly decreased. The
Department’s July 2005 report on U.S. Government Efforts to Combat
Human Trafficking in Persons in Fiscal Year 2004, indicates there are an
estimated 14,500 to 17,500 human trafficking victims brought into the
United States annually. Based on the reported data, the task force
operations have not resulted in a large number of trafficking victims being
served by the service providers.

vi


STATEMENT ON COMPLIANCE WITH
LAWS AND REGULATIONS

As required by the Government Auditing Standards, we tested OJP’s
processes, controls, and records to obtain reasonable assurance that OJP
complied with laws and regulations that, if not complied with, could have a
material effect on OJP’s ability to effectively manage its human trafficking
related cooperative agreements and grants. Compliance with laws and
regulations applicable to OJP’s reporting of such statistics is the
responsibility of OJP management. An audit includes examining, on a test
basis, evidence about compliance with laws and regulations. The specific
laws and regulations we reviewed included the relevant portions of:

¢ Trafficking Victims Protection Act of 2000, Pub. L. No. 106-368
(2000);

e Trafficking Victims Protection Reauthorization Act of 2003,
Pub. L. No. 108-193 (2003);

e Trafficking Victims Protection Reauthorization Act of 2005,
Pub. L. No. 109-164 (2006); and

e OJP Financial Guide.

Except for instances of non-compliance identified in the Findings and
Recommendations section of this report, OJP complied with the laws and
regulations cited above. With respect to those activities not tested, nothing
came to our attention that caused us to believe that OJP was not in
compliance with the laws and regulations cited above.

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This problem — the number of victims reported to Congress not
matching the number reported by the OVC service providers and the number
supported in the service providers’ files - occurred for each report we tested,
as shown below in each discussion and ensuing table.

Inaccurate Data Regarding Victims Assisted by OVC Service Providers

In May 2004 the Department reported to Congress that 200 trafficking
victims were assisted by 9 OVC service providers during 2003.2, However,
as discussed in the first section of this finding on “Program Design,”
summary data maintained by the OVC showed the service providers assisted
a total of 174 trafficking victims during 2003 (68 victims in the first
semiannual period and 106 in the second period). To test the accuracy of
the reported number of victims, we reviewed the victim case files maintained
by the service providers and interviewed service provider officials. Our
testing included assessing whether:

e the service providers maintained documentation to show that
services were provided to the victims reported;

e the number of reported victims for the reporting period included
only new victims instead of counting victims that had previously
been reported; and

e the service providers reported only victims that were eligible to be
served. Ineligible victims include those that are certified by the
Department of Health and Human Services (HHS) before coming to
the service provider, or that disappear before any services are
provided and therefore do not cooperate with law enforcement in
the prosecution of the traffickers.

As shown in the following table, we performed testing at five of the
nine service providers and found that the number of victims reported was
overstated by four of the five providers.

12 U.S. Department of Justice, Report to Congress from Attorney General John
Ashcroft on U.S. Government Efforts to Combat Trafficking in Persons in Fiscal Year 2003
(May 1, 2004). Although the report was for FY 2003, the number of victims aided by OVC
service providers was reported for calendar year 2003.

22


Establish an effective system for monitoring the OVC service providers to ensure
that (1) performance data reported by the service providers is accurate, (2) service
providers are meeting the performance goals, and (3) service providers track the
amount of grants funds used to assist victims of human trafficking.

The Office of Justice Programs agrees with the recommendation. As previously stated in
our response to Recommendation Number 12, the newly released GMT requires that
grant and program managers monitor grants consistently across a set of core criteria.
Specifically, the GMT requires grant and program managers to review performance
measures, for face validity and analyze collection processes.

The GMT instructs grant and program managers to check that a grantee has an adequate
method for collecting performance measurement data, by reviewing and analyzing
whether:

There is an automated or manual system for data collection?

© There are known data limitations?

« Data are used to guide program determinations? (What is working or not
working)?

e There is an independent party testing data collection and reporting processes?
How (what method)? and

«For grantees that make sub-awards, is there a process in place for onsite
monitoring by the grantee reporting the data? (Grantee would ask questions
similar to above while at sub-grantee onsite).

In addition, the GMT now requires that grant and program managers assess grantee
performance goals when conducting on-site monitoring, as well as through the GAT
when conducting a desk review. As previously stated in our response to
Recommendation Number 12, by January 31, 2009, the OAAM will schedule a follow-up
review of BJA and OVC human trafficking-related grant recipients in order to ensure that
issues identified in this report have been appropriately addressed, and long-term
improvement measures have been implemented.

10

109


We analyzed all performance data reported by the 7 OVC service
providers and 11 BJA task forces.

We interviewed officials from the OVC, the BJA, the OVC service
providers, and the BJA task forces to determine the reasons for
inaccurate performance data.

We obtained and analyzed data to determine whether the OVC
service providers achieved the performance goals stated in their
agreement applications.

We analyzed the agreement funds spent by the seven OVC service
providers to determine if they could account for the amount of
agreement funds spent on direct assistance to victims.

We interviewed service provider and task force officials to obtain

their views on the effectiveness of OJP’s human trafficking grant
programs.

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OIG Analysis of Trafficking Victims Reported as
Assisted by OVC Service Providers During
Calendar Year 2003 through 2006

Number of Victims
Served
Recorded | Verified
in OVC’s by the
Service Provider Records OIG

Boat People, S.O.S., Inc. 119 74

Coalition to Abolish Slavery 168 1067¢
Heartland Alliance for Human Needs and Human Rights 77 56
International Rescue Committee - Miami 50 44
Mosaic Family Services, Inc. 124 54
Refugee Women’s Network, Inc. 35 21
YMCA of the Greater Houston Area, Inc. 111 80
Totals 684 435

Source: Office for Victims of Crime data and service provider records

Subsequent to the Department’s May 2007 report to Congress, the
OVC service providers submitted updated performance data to the OVC for
the 6-month period ending June 30, 2007. The OVC summary data showed
that the service providers assisted 1,924 trafficking victims from the
inception of the program in 2003 through June 30, 2007. The OVC will
combine this data with data for the subsequent 6-month period ending
December 31, 2007, for inclusion in the Department’s next report to
Congress, which should be submitted in the Fall of 2008. We found the
updated performance data was overstated for all six service providers we
tested. Overall, the six service providers overstated the number of
trafficking victims helped by 54 percent, as shown in the following table.

16 Of the 106 victims that we counted as verified, 41 were actually victims reported
by a predecessor grantee (Little Tokyo) that works closely with the Coalition to Abolish
Slavery and Trafficking (CAST). The OVC now combines the victims served by Little Tokyo
and CAST. We did not attempt to verify the 41 victims reported by Little Tokyo.

25