DOD Excess Property: Enhanced Controls Needed for Access to Excess Controlled Property
Published: 2017-07-18T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: Since 1991, DOD has reported transferring more than $6 billion worth of its excess controlled and non-controlled personal property to more than 8,600 federal, state, and local law enforcement agencies through the LESO program, which is managed by DLA. According to DOD, about 4 to 7 percent of the total excess property transferred is controlled property, which typically involves sensitive equipment and items that cannot be released to the public.
The National Defense Authorization Act of 2016 included a provision that GAO conduct an assessment of DOD's excess property program. This report addresses the extent to which (1) DLA has taken actions to enhance processes, including internal controls, related to its transfers of excess controlled property; and (2) DLA has addressed the statutory requirement to maintain a public Internet site that provides transparency about controlled property transfers and about the recipients of such property. GAO reviewed DOD policies and procedures, interviewed cognizant officials, and conducted independent testing of LESO's application and DLA's transfer process.
section_title: What GAO Found
paragraphs: The Defense Logistics Agency (DLA) has taken some actions and is planning additional actions to address identified weaknesses in its excess controlled property program. However, internal control deficiencies exist for, among other things, ensuring that only eligible applicants are approved to participate in the Law Enforcement Support Office (LESO) program and receive transfers of excess controlled property. DLA is establishing memorandums of understanding with participating federal agencies intended to, among other things, establish general terms and conditions for participation, revise its program application to require additional prospective participant information, and plans to provide additional online training for participating agencies that is expected to begin in late 2017. However, GAO created a fictitious federal agency to conduct independent testing of the LESO program's internal controls and DLA's transfer of controlled property to law enforcement agencies.
Through the testing, GAO gained access to the LESO program and obtained over 100 controlled items with an estimated value of $1.2 million, including night-vision goggles, simulated rifles, and simulated pipe bombs, which could be potentially lethal items if modified with commercially available items (see photos). GAO's testing identified that DLA has deficiencies in the processes for verification and approval of federal law enforcement agency applications and in the transfer of controlled property, such as DLA personnel not routinely requesting and verifying identification of individuals picking up controlled property or verifying the quantity of approved items prior to transfer. Further, GAO found that DLA has not conducted a fraud risk assessment on the LESO program, including the application process. Without strengthening DLA and LESO program internal controls over the approval and transfer of controlled property to law enforcement agencies, such as reviewing and revising policy or procedures for verifying and approving federal agency applications and enrollment, DLA lacks reasonable assurance that it has the ability to prevent, detect, and respond to potential fraud and minimize associated security risks.
Examples of Controlled Property Items Obtained
DLA maintains a public Internet site to address statutory requirements to provide information on all property transfers to law enforcement agencies. DLA's public Internet site shows all transferred property, and, as of April 2017, in response to GAO's findings, has included a definition of controlled property to distinguish for the general public what items are considered controlled.
section_title: What GAO Recommends
paragraphs: GAO is making four recommendations to DLA, including strengthening internal controls over the approval and transfer of DOD excess controlled property to law enforcement agencies, and conducting a fraud risk assessment to institute comprehensive fraud prevention and mitigation measures. DOD concurred with all four recommendations and highlighted actions to address each one.

section_title: Letter
paragraphs: The Law Enforcement Support Office (LESO) program, also known as the  1033 program in reference to the section of the law authorizing it, allows  for the transfer of personal property to federal and state agencies,  including small arms and ammunition, determined to be in excess of the  needs of the Department of Defense (DOD) and suitable for use by the  agencies in law enforcement activities. Since 1991, DOD has reported  transferring more than $6 billion worth of its excess controlled and non- controlled personal property to more than 8,600 federal, state, and local  law enforcement agencies. According to DOD, approximately 4 to 7  percent of the total excess property items transferred to law enforcement  agencies is controlled; the remaining percentage of excess property is  non-controlled. Controlled items are typically sensitive in nature, cannot  be released to the general public, and require specific actions to ensure  proper disposal. Examples of controlled items available through the  LESO program include night-vision goggles, thermal imaging equipment,  specialized printers, and explosive ordnance detonation robots, as well as  certain high-visibility items, such as small arms, High Mobility  Multipurpose Wheeled Vehicles (HMMWVs), Mine‐Resistant Ambush  Protected Vehicles (MRAPs), and aircraft. Non-controlled property  includes items without military attributes, such as certain medical  supplies, office furniture, and tents.
Over the past 15 years, we have examined DOD’s excess property  reutilization program and reported deficiencies, including unauthorized  parties obtaining excess controlled property and internal control  breakdowns with regard to security of sensitive excess military  equipment. We have made 24 recommendations aimed at enhancing  internal controls over DOD’s disposal and accountability of its excess  property and improving the overall economy and efficiency of DLA’s  reutilization program, including better coordination regarding data  reliability and strengthening management oversight, accountability, and  physical inventory control. The department has implemented 22 of the 24  recommendations. Likewise, the DOD Office of Inspector General has  reported on internal control deficiencies, such as the distribution of  excess property to law enforcement agencies without the accountability  necessary to ensure that the released property had the proper  authorization. The Inspector General has made a number of  recommendations, which the department has implemented.
Section 1051(f) of the National Defense Authorization Act (NDAA) for  fiscal year 2016 included a provision for us to conduct an assessment of  DOD’s excess property program, which is managed by the Defense  Logistics Agency (DLA). This report addresses the extent to which (1)  DLA has taken actions to enhance processes, including internal controls,  related to its transfers of excess controlled property; and (2) DLA has  addressed the statutory requirement to maintain a public Internet site that  provides transparency about controlled property transfers and about the  recipients of such property. In appendix I, we also include survey and  case study information on how federal, state, and local law enforcement  agencies reported using and benefiting from excess controlled property  transferred to them through the LESO program in accordance with the  purposes of the program, including enhancement of counterdrug,  counterterrorism, and border-security activities.
For objective 1, we reviewed DOD, DLA, and LESO program policy and  guidance on LESO program processes for transferring controlled  property, including conditions of transfer, monitoring, training,  accountability, and disposal of controlled property obtained through the  LESO program. We tested the department’s internal controls and  control activities related to LESO program enrollment and application.  Specifically, our investigators posed as a fictitious federal law  enforcement agency and, using publicly available resources, created a website describing the agency’s activities. We completed the LESO  program application, submitted it to LESO officials, and corresponded by  email with LESO program staff to respond to their follow-up questions.  We also compared DLA and LESO practices to those identified in GAO’s  A Framework for Managing Fraud Risks in Federal Programs (hereafter  cited as the Fraud Risk Framework). Issued in July 2015, GAO’s Fraud  Risk Framework is a comprehensive set of leading practices that serves  as a guide for program managers to use when developing efforts to  combat fraud in a strategic, risk-based manner. Additionally, we  conducted a survey of 15 participating federal law enforcement agencies  as well as 53 state coordinators who had controlled property transferred  to their offices through the LESO program during calendar years 2013,  2014, and 2015 to gain an understanding of their use of the LESO  program. We selected these calendar years because they were the last  three complete years prior to our audit work. For federal law enforcement  agencies, we selected major recipients of LESO controlled property,  which were all the agencies within the top four federal departments  whose law enforcement components had received controlled property  from the LESO program during calendar years 2013, 2014, and 2015.  For state coordinators, we included all state coordinators from states and  U.S. territories. The overall response rate for the survey of federal law  enforcement agencies was 87 percent (13 of 15), and the overall  response rate for the survey of state coordinators was 94 percent (50 of  53). Further, we conducted non-generalizable case studies of five states:  Arizona, Georgia, Maryland, Michigan, and Texas. We selected these  states based on quantity, type, and initial acquisition value of controlled property received through the LESO program as well as geographic  dispersion. For each case study we interviewed officials from selected  federal, state, and local law enforcement agencies to gain an  understanding of how property is transferred to them, including how they  screen for, obtain, and dispose of DOD excess controlled property. We  interviewed officials from DLA Disposition Services, who have oversight  over the LESO program, as well as officials from LESO headquarters who  manage the program, to gain an understanding of LESO program policies  and processes for transferring its excess controlled property to law  enforcement agencies.
For objective 2, we reviewed the statutory requirement, interviewed  officials from LESO headquarters to obtain updates on the  implementation status of the Internet site, and analyzed the capabilities of  the Internet site, including the fields it contained and the searches that  can be performed using it. We compared the information in and  capabilities of the Internet site with the statutory requirements to provide  publicly available information in a transparent manner about controlled  property transferred and the recipients of such property. We also  interviewed officials from LESO headquarters to obtain updates on the  status of DLA’s implementation. Appendix II describes our objectives,  scope, and methodology in greater detail.
We conducted this performance audit from January 2016 to July 2017 in  accordance with generally accepted government auditing standards.  Those standards require that we plan and perform the audit to obtain  sufficient, appropriate evidence to provide a reasonable basis for our  findings and conclusions based on our audit objectives. We believe that  the evidence obtained provides a reasonable basis for our findings and  conclusions based on our audit objectives. We conducted our related  investigative work in accordance with investigative standards prescribed  by the Council of the Inspectors General on Integrity and Efficiency.
subsections: section_title: Background
subsections: section_title: Overview of the LESO Program
paragraphs: Pursuant to a series of laws passed since 1989, DOD is authorized to  undertake actions intended to enhance the effectiveness of domestic law  enforcement agencies through direct or material support. DLA  Disposition Services administers the LESO program, managing the  transfer of DOD’s excess controlled and non-controlled property to  federal, state, local, and tribal law enforcement agencies. According to  DLA policy, to participate in the program, a law enforcement agency must  be a federal, state, or local government agency whose primary function is  the enforcement of applicable federal, state, and local laws and whose  sworn compensated law enforcement officers have powers of arrest and  apprehension. According to LESO program data, as of August 2016,  there were over 8,600 federal, state, and local law enforcement agencies  participating in the program. Of these, approximately 96 percent were  state and local law enforcement agencies and approximately 4 percent  were federal law enforcement agencies. LESO program data also shows  that during calendar years 2013 through 2015, approximately two-thirds  of DOD excess controlled property items had been transferred to state  and local agencies, and one-third had been transferred to federal  agencies, as shown in Table 1.
The data also showed that as of August 2016 the majority of the law  enforcement agencies (76 percent) participating in the program have 50  or fewer full-time sworn officers, as shown in figure 1, and that  approximately 30 percent of state and local law enforcement agencies  active in the program had 10 or fewer sworn officers.
section_title: LESO Program Processes
paragraphs: State and local law enforcement agencies work first through their  Governor-appointed state coordinator to obtain excess property through  the LESO program from DLA. As specified by DLA policy, state  coordinators must sign a memorandum of agreement (MOA) with DLA,  which outlines, for example, general terms and conditions for state  coordinators and state and local law enforcement agencies to provide  accountability and oversight of the LESO program. Further, LESO  program guidance requires state coordinators to develop a State Plan of  Operation outlining how the program will be managed in their state, and  each participating state or local law enforcement agency must sign the  plan, attesting to the terms and conditions of the program. According to  LESO officials, unlike state and local agencies, federal law enforcement  agencies work directly with the LESO program office. As of December  2016, the LESO program office finalized a memorandum of  understanding (MOU) that it plans to sign with participating federal  agencies. According to the MOU, it will establish DLA’s authority as the  owner of the program and, among other things, establish general terms  and conditions. Figure 2 provides additional details on LESO program  stages and processes for federal and state and local law enforcement  agencies.
Law enforcement agencies submit property requests electronically—after  viewing available items online or in person while at a Disposition  Services’ site. According to LESO officials, they manually review all  property requests forwarded from state coordinators for state and local  law enforcement agencies, as well as requests submitted directly from  federal agencies, for final approval or denial. LESO officials told us they  look for detailed justifications, including who will use the property and  how, when reviewing requests for approval. For certain items, such as  aircraft, vehicles, and weapons, law enforcement agencies are required to  answer additional questions and provide additional documentation, such  as their training plan(s) and how the items will be secured. According to  LESO officials, they follow statutory direction in U.S. Code title 10 which  authorizes preference be given to property requests indicating that the  use of the property will be for counterdrug, counterterrorism, and border- security activities. LESO officials also stated that a request for excess  property may be denied for a variety of reasons, including if the request  was not detailed enough or if the law enforcement agency has met its  allowed allocation for certain property. For example, according to program  documentation, for small arms, only one type is allocated for each  qualified full-time or part-time officer; for HMMWVs, only one vehicle is  allocated for every three officers; and for MRAPs, only one vehicle is  allocated per law enforcement agency. However, according to LESO  officials, most denials are because a requested item has already been  awarded.
section_title: DLA Disposition Service Sites
paragraphs: When DOD declares items as excess to its needs, the property is turned  into a DLA Disposition Services site and can be made available for  transfer to DOD components and other eligible recipients, including  approved LESO participants. According to program documentation,  when an application to participate in the LESO program is approved, an  Authorization Letter for Property Screening is generated and forwarded to  the state coordinator or federal agency. If the approved participant is a  state law enforcement agency, the state coordinator will provide the  participant with the letter of authorization. The letter of authorization that  includes, for example, the full name of the law enforcement agency, DOD  activity address code, telephone number, address, and digital signatures,  must be on the centralized file maintained by DLA prior to the arrival of  the person picking up the property and be dated less than one year from  the current date. The screening authorization lists individuals eligible to  search, view and request property on behalf of their participating law  enforcement agency, including physical on-site screening. The DLA  Disposition Services’ site uses the information on this letter to contact an  agency, if needed, to coordinate the direct pickup of property. Direct  pickup for allocated property may be made by an individual with a valid  identification and the appropriate DOD authorization form that is signed  by the authorized individual listed in the screener letter.
section_title: Federal Interagency Law Enforcement Equipment Working Group
paragraphs: The President issued Executive Order 13688, Federal Support for Local  Law Enforcement Equipment Acquisition, January 16, 2015, to better  coordinate federal support for the acquisition of certain federal equipment  by state, local and tribal law enforcement agencies. The Executive Order  also established a Federal Interagency Law Enforcement Equipment  Working Group (hereafter the Working Group). In May 2015, the Working  Group issued a report that included a list of prohibited equipment not  eligible for acquisition by law enforcement agencies and a list of  controlled equipment identified by category of equipment that may be  acquired by law enforcement agencies after submitting additional  information such as a detailed justification for each requested item of  controlled equipment. Further, the Working Group developed 13  programmatic and policy recommendations to improve federal equipment  acquisition programs, including that the members of the Working Group  form a permanent Federal Interagency Law Enforcement Equipment  Working Group, calling for this permanent working group to meet  regularly to support oversight and policy development functions for  controlled equipment programs.
section_title: DLA Has Taken Some Actions to Address Weaknesses in Its Excess Controlled Property Program, but Deficiencies Exist in Processes for Verifying and Approving Applications and Property Transfer
paragraphs: DLA has taken some actions and plans additional actions to address  identified weaknesses in its excess controlled property program. DLA has  revised its policy and procedures, is developing additional training, and is  establishing MOUs for the LESO program with participating federal law  enforcement agencies. However, DLA confirmed, and our independent  testing of the LESO program’s internal controls identified, deficiencies in  the processes for the verification and approval of federal law enforcement  applications and the transfer of controlled property.
subsections: section_title: DLA Has Taken Actions and Is Planning Additional Actions to Address Identified Weaknesses in Its Transfer Process
subsections: section_title: Revisions to Policy and Procedures, Compliance Reviews, and LESO Program Application
paragraphs: DLA has taken some steps to address identified weaknesses in its  processes for transferring and monitoring its excess controlled property  through revisions to its policy and procedures on the management,  oversight, and accountability of the LESO program. Such revisions were  made, in part, because of recommendations made by the DOD and DLA  Offices of Inspector General. The DOD and DLA Offices of Inspector  General conducted four audits of the LESO program between 2003 and  2013 that identified more than a dozen recommendations, such as to:  develop and implement written standard operating procedures that  include, for example, criteria for approval and disapproval of law  enforcement agency property requests; strengthen policy and procedures  on disbarring law enforcement agencies and state coordinators that do  not comply with LESO program conditions; improve oversight and  accountability of property; use the automated processing system for  requisitioning, approving, and issuing items; and further develop  procedures for the issuance, transfer, turn-in and disposal of LESO  property. We found the department had taken the following actions to  enhance its transfer process through revisions to policy and procedures:  transitioned full management responsibility of the LESO Program to  DLA Disposition Services in 2009; developed LESO Program Standard Operating Procedures in 2012  and updated them in 2013;  transitioned to a new data system, Federal Excess Property  Management Information System in 2013 after identifying that the old  system was not capable of post-issue tracking;  revised the DLA instruction that provides policy, responsibility, and  procedures for DLA’s management responsibilities of the LESO  program in 2014 and 2016; and  revised LESO program processes in 2016 to incorporate  recommendations made by the Federal Interagency Law Enforcement  Equipment Working Group, such as defining executive order- controlled property or prohibiting schools K-12 from participating in the  program.
Additionally, according to LESO officials, they conduct Program  Compliance Reviews every two years for all states and territories with  state and local law enforcement agencies enrolled in the LESO program.  LESO officials, in consultation with the state coordinator, select a sample  of state and local law enforcement agencies for site visits to physically  verify all controlled property in their possession, by serial number. We  observed the LESO Program Compliance Review at numerous locations  in one state. Moreover, in 2017, LESO program officials revised their  program application to create two applications—one for federal law  enforcement agencies and the other for state and local law enforcement  agencies. The application for federal agencies requires additional  information from prospective federal applicants, such as certification that  their agency meets the LESO definition of a government law enforcement  agency and attesting that the agency that they represent is a legitimate  law enforcement agency. Likewise, the application for state and local  agencies was also revised to include a similar certification of eligibility and  attestation.
section_title: Agencies Reported the Need for More Training on LESO Program Policies and Procedures, and DLA Has Taken Action to Develop Additional Training
paragraphs: During our review, officials at participating law enforcement agencies— federal, state, and local—reported the need for more training on LESO  program policies and procedures, and DLA is in the process of  developing this additional training through an online training tool. Our  analysis of the responses to our surveys and case study interviews with  federal, state, and local law enforcement agencies showed that (1) not all  participating agency officials had received training on all aspects of the  LESO program, including its policies and procedures; and that (2) officials  wanted more training to better understand, for example, LESO program  processes, such as the turn-in or transfer of controlled property.
Our analysis of the responses to our survey of select federal law  enforcement agencies showed that training had not been regularly  provided. For example, 10 of the 13 respondents to the federal survey  stated that either they did not receive training from LESO or they did not  know if their agency had received any training from LESO regarding the  LESO program. LESO officials told us that they have not regularly  provided training to federal law enforcement agencies in the past, with  training mainly provided to the state coordinators participating in the  LESO program. Survey results of federal law enforcement agencies also  showed that officials generally stated that training on the LESO program  would be beneficial. For example, 9 of the 13 respondents to the federal  survey stated that refresher training provided by LESO would be  beneficial to their agency. Table 2 shows the types of refresher training  that most federal law enforcement agencies in our survey stated would be  beneficial to their agency.
Furthermore, officials we interviewed from state and local law  enforcement agencies reported different experiences about the  availability and accessibility of training on policies and procedures of the  LESO program from their state coordinators and stated that they would  benefit from additional training on policies and procedures, such as on  returning property to DLA. For example, an official from one law  enforcement agency we interviewed told us that it took 8 months to  receive training from his state coordinator upon joining the program.
Our analysis of the results from our survey of state coordinators showed  that nearly three-fourths of the state coordinators reported that they do  not provide mandatory training on LESO program policies and procedures  to state and local law enforcement agencies within their state. We also  found that state coordinators varied in the types of training they provided  on LESO program policies and procedures. For example, our analysis  found that 40 percent (18 of 45) of responding state coordinators reported  that they do not provide in-person refresher or annual training and 15  percent (7 of 46 responding to the question) reported that they do not  provide training aids or reference aids (i.e., PowerPoint format). The  majority of state coordinators (94 percent) reported they would find  additional LESO training modules helpful. Table 3 shows our analysis of  the survey responses on the topics state coordinators indicated that  additional training would be useful. See Appendix IV for additional details  on the results regarding training from our survey.
LESO provides some training aids on program policies and procedures  on their program website for federal, state and local agencies. LESO also  provides training to state coordinators at an annual training seminar, and  then, according to program guidance, state coordinators are to train state  and local law enforcement agencies in their states. However, over the  course of our review, DLA officials stated that they recognize the need to  enhance aspects of training and are in the process of developing an  online training tool, which is expected to be established in late 2017.  Specifically, LESO program officials stated that they are enhancing  training by working to establish an online training tool that will assist in  providing specific information and training modules on LESO program  policies and procedures to federal law enforcement agencies and that  state coordinators can provide to state and local law enforcement  agencies in their states. Some training modules have been completed  and published on LESO’s website, such as a quick-start guide. Other  training modules that are planned include, for example, a guide for  returning controlled property for proper disposal, among other program  policies and procedures. We acknowledge that DLA to date has taken  action on the issue by recognizing the need for additional training,  assigning a lead, and developing a quick start tool. However, it is too  early to evaluate whether the actions taken and the developed and  planned training will address the issues our survey and case studies  identified.
section_title: DLA Is Establishing MOUs with Federal Law Enforcement Agencies
paragraphs: DLA is establishing MOUs with federal law enforcement agencies. Until  2016, DLA lacked a mechanism to establish the general terms and  conditions of the participating federal law enforcement agencies, such as  restrictions on further transfer or sale of controlled property. According to  DLA and LESO officials, LESO officials had discussed taking steps to  develop a MOU in past years for federal law enforcement agencies,  similar to those of state and local agencies. DLA expedited and  completed the development of a MOU in December 2016, in part,  because federal law enforcement agencies began contacting the LESO  program office regarding gaining visibility over items transferred to their  respective agencies including subordinate agencies and their field offices  and had questions regarding who was authorized to screen and request  property for their agency. These inquiries were in part a result of our effort  to confirm which federal agencies, including their subordinate agencies,  had received excess controlled property, and some of them did not know  that their subordinate agencies had obtained excess controlled property  through the LESO program. In our survey of 15 federal law enforcement  agencies, completed in October 2016, we found federal law enforcement  officials were unaware of the extent to which their agency requests and  receives DOD-controlled property through the program. For example, 5  of the 13 federal survey respondents reported they either did not  internally track or did not know if their agency internally tracked DOD- controlled property obtained by their field offices through the LESO  program.
As of April 2017, DLA and LESO officials had sent the MOU to all  participating federal law enforcement agencies and 7 had been signed.  LESO program officials told us they have assigned a LESO official to lead  the federal agency aspect of the LESO program, including assisting DLA  Disposition Services in finalizing the MOUs and establishing designated  points of contact at all participating federal agencies’ headquarters. For  example, according to LESO officials, LESO is working with designated  points of contact at the federal agencies to establish a more centralized  approval process to increase federal agencies’ visibility over property  requests submitted by federal agency field offices, prior to the requests  being approved by LESO officials. DLA officials estimated that MOUs will  be established with all participating federal agencies by mid-2017. Given  that the MOUs have either been recently established or are in the process  of being finalized with some federal agencies, it is too early to evaluate  the effect of the MOUs in improving the management of the LESO  Program. See Appendix V for additional details on the results of the  survey of federal law enforcement agencies.
section_title: DLA Has Deficiencies in Its Processes for Verifying and Approving Applications and Transferring Property and Has Not Conducted a Risk Assessment
subsections: section_title: DLA Has Deficiencies in Its Processes for Verifying and Approving Federal Agency Applications
paragraphs: Our independent testing of the LESO program’s internal controls  identified deficiencies in the processes for verification and approval of  federal law enforcement agency applications. Specifically, our  investigators, posed as authorized federal law enforcement agency  officials of a fictitious agency, applied and were granted access to the  LESO program in early 2017. In late 2016, we emailed our completed  application to the LESO program office. Our application contained  fictitious information including agency name, number of employees, point  of contact, and physical location. We also created mail and e-mail  addresses, and a website for our fictitious law enforcement agency using  publicly available resources. All correspondence, including follow-up  questions regarding our application, was conducted by email with LESO  officials. For example, after reviewing our initial application, LESO officials  informed us that we needed to revise specific information on the  application and resubmit it, indicating that when we did so we would be  approved to participate in the program. In early 2017, we resubmitted our  application and soon thereafter we were notified that our fictitious law  enforcement agency was approved to participate in the LESO program.  LESO officials also emailed us to request confirmation of our agency’s  authorizing statute; in response, our investigators provided fictitious  authorizing provisions presented as a provision in the U.S. Code. At no  point during the application process did LESO officials verbally contact  officials at the agency we created—either the main point of contact listed  on the application or the designated point of contact at a headquarters’  level—to verify the legitimacy of our application or to discuss establishing  a MOU with our agency.
According to DLA policy, DLA is responsible for ensuring the successful  implementation of the LESO program and for issuing program policy,  procedures, and guidance in agency instructions and manuals.  However, DLA’s internal controls for verifying and approving federal  agency applications and enrollment in the LESO program were not  adequate to prevent the approval of a fraudulent application to obtain  excess controlled property. LESO’s reliance on electronic  communications without actual verification does not allow it to properly  vet for potentially fraudulent activity. For example, DLA did not require  supervisory approval for all federal agency applications, or require  confirmation of the application with designated points of contact at the  headquarters of participating federal agencies. Additionally, at the time  we submitted our application, DLA officials did not visit the location of the  applying federal law enforcement agency to help verify the legitimacy of  the application. However, after our briefing of DLA officials in March 2017  on the results of our investigative work, DLA officials stated they took  immediate action, and in April 2017 have visited 13 participating federal  law enforcement agencies. Further, DLA has not reviewed and revised  the policy or procedures for verifying and approving federal agency  applications and enrollment in the LESO program. Without reviewing and  revising the internal controls in policy or procedures for verifying and  approving federal agency applications and enrollment in the LESO  program, DLA and LESO management will lack reasonable assurance of  the legitimacy of applicants before transferring valuable, and in some  cases potentially lethal, controlled property.
section_title: DLA Did Not Routinely Request and Verify Identification of Individuals Picking Up Controlled Property or Verify the Quantity of Approved Items Transferred
paragraphs: Our independent testing of DLA’s internal controls also identified  deficiencies in the transfer of controlled property, such as DLA personnel  not routinely requesting and verifying identification of individuals picking  up controlled property or verifying the quantity of approved items prior to  transfer. Our investigators, after being approved to participate in the  LESO program, obtained access to the department’s online systems to  view and request controlled property. We subsequently submitted  requests to obtain controlled property, including non-lethal items and  potentially-lethal items if modified with commercially available items. In  less than a week after submitting the requests, our fictitious agency was  approved for the transfer of over 100 controlled property items with a total  estimated value of about $1.2 million. The estimated value of each item  ranged from $277 to over $600,000, including items such as night-vision  goggles, reflex (also known as reflector) sights, infrared illuminators,  simulated pipe bombs, and simulated rifles. Our investigator scheduled  appointments, visited three Disposition Service sites, and obtained the  controlled property items, as shown in Figure 3.
Using fictitious identification and law enforcement credentials, along with  the LESO-approved documentation, our investigator was able to pass  security checks and enter the Disposition Service warehouse sites.  Personnel at two of the three sites did not request or check for valid  identification of our investigator picking up the property. According to DLA  guidance, direct pickup of allocated property may be made by an  individual with a valid identification and the appropriate DOD authorization  form that is signed by the authorized individual listed in the letter.
DLA has not ensured compliance that on-site officials routinely request  and verify valid identification of the individual(s) authorized to pick up  allocated property from the LESO program, as required by the guidance.  However, DLA officials acknowledged they could take additional steps to  ensure compliance with the requirements in the handbook. If DLA does  not ensure that Disposition Services on-site officials routinely request and  verify valid identification, then DLA will lack reasonable assurance that  controlled property is transferred to authorized individuals.
Furthermore, although we were approved to receive over 100 items and  the transfer documentation reflects this amount, we were provided more  items than we were approved for. The discrepancy involved one type of  item—infrared illuminators. We requested 48 infrared illuminators but on- site officials at one Disposition Services site provided us with 51 infrared  illuminators in 52 pouches, of which one pouch was empty. Additionally,  we found that one Disposition Services site had a checklist as a part of  their transfer documentation for their personnel to complete. The checklist  required manual completion of a number of items, including quantity,  date, and who fulfilled the order. The other two Disposition Services sites,  including the site that transferred the wrong quantity, did not include this  checklist with the transfer documentation we received. DLA guidance  states that accountability records be maintained in auditable condition to  allow property to be traced from receipt to final disposition. Also, the  Standards for Internal Control in the Federal Government state that  management may design a variety of transaction control activities for  operational processes, which may include verifications, reconciliations,  authorizations and approvals, physical control activities, and supervisory  control activities. Additionally, DLA has guidance that describes  procedures for managing and handling, among other things, sensitive,  and pilferable controlled inventory items but does not specifically  address all items that are transferred to law enforcement agencies.  Without guidance that specifically requires DLA Disposition Services’ on- site officials to verify the type and quantity of approved items against the  actual items being transferred prior to removal from the sites, then DLA  will lack reasonable assurance that the approved items transferred are  appropriately reflected in their inventory records.
section_title: DLA Has Not Assessed Its Fraud Risks or Identified Internal Control Deficiencies to Prevent Fraud
paragraphs: While DLA has taken some steps, mostly in early 2017, to address  identified deficiencies in the LESO program, DLA lacks a comprehensive  framework for instituting fraud prevention and mitigation measures.  During the course of our review, DLA revised the LESO program  applications by requiring applicants to sign an attestation that the agency  that they represent is a legitimate law enforcement agency. Further, DLA  officials stated they are more carefully reviewing the legitimacy of some  information on the application such as email addresses and physically  visiting federal agencies that enter into MOUs with the LESO program.  However, as previously discussed, we identified internal controls  weakness in the policy or procedures for verifying and approving federal  agency applications and enrollment as well as weakness throughout the  process from approval to the actual transfer of the items to the agencies,  which indicates that DLA has not examined potential risks for all stages of  the process.
Standards for Internal Control in the Federal Government note that  management should remediate identified internal control deficiencies on a  timely basis, assess fraud risk by considering the potential for fraud when  identifying, analyzing, and responding to risks, and analyze and respond  to identified fraud risks so that they are effectively mitigated.  Additionally, according to GAO’s Fraud Risk Framework, effective fraud  risk managers collect and analyze data on identified fraud schemes, use  these lessons learned to improve fraud risk management activities, and  plan and conduct fraud risk assessments that are tailored to their  programs. The framework states there is no universally accepted  approach for conducting fraud risk assessments since circumstances  among programs vary. However, per leading practices, assessing fraud  risks generally involves five actions: (1) identifying inherent fraud risks  affecting the program, (2) assessing the likelihood and effect of those  fraud risks, (3) determining fraud risk tolerance, (4) examining the  suitability of existing fraud controls and prioritizing residual fraud risks,  and (5) documenting the program’s fraud risk profile. In conducting the  fraud risk assessment, the framework identifies that managers should  develop and document an antifraud strategy which describes, among  other things, existing fraud control activities as well as any new control  activities a program may adopt to address residual fraud risks. The DLA  Office of Inspector General has an investigation ongoing, but DLA Office  of Inspector General officials told us that a number of internal control  weaknesses were identified and several recommendations were made to  DLA that if implemented could help to mitigate future potential fraud risks.  As such, DLA has begun to examine some risk associated with the LESO  program. During our March 2017 meeting with DLA officials, they  acknowledged that they have not conducted a fraud risk assessment on  the LESO program, to include the application process, and as such, has  not designed or implemented a strategy with specific control activities to  mitigate risks to the program. Conducting such an assessment could  have program-wide improvements, including strengthening the controls to  verify the legitimacy of state and local law enforcement agencies. If DLA  conducted a fraud risk assessment on the LESO program, to include the  application process, and designed and implemented a strategy with  specific internal control activities to mitigate assessed fraud risks, DLA  would be more effective in preventing, detecting, and responding to  potential fraud and security risks.
section_title: DLA Maintains a Public Internet Site with Data on Property Transfers, Including Information on Excess Controlled Property
paragraphs: The National Defense Authorization Act for Fiscal Year 2016 included a  provision for DOD to create and maintain a publicly available Internet site  that provides information on the controlled property transferred and the  recipients of such property. DOD was required to include all publicly  accessible unclassified information pertaining to the request, transfer,  denial, and repossession of controlled property, among other items, on  the website.
DLA maintains information on the controlled and non-controlled items on  the LESO program homepage and has links to Excel documents about its  property transfers. The property transfer lists, which date back to 1991,  are updated quarterly according to LESO officials, and include information  about the transfer of all excess property transferred to federal, state, and  local law enforcement agencies. In September 2016, in response to the  statutory requirement, LESO officials added the following information to  their LESO program homepage, and plan to include this information on  the LESO program homepage for future property transfers:
Pending transfer requests for property reclassified as controlled  property by the Law Enforcement Equipment Working Group,  pursuant to Executive Order 13688;
Shipments (transfers), including non-controlled and controlled  property, including justification language submitted by the law  enforcement agencies; and
Cancellations, including reasons for denial, broken out by three  categories: state coordinator, LESO headquarters, or system denial.
During the course of our audit work, we determined that the information  on DLA’s Internet site did not distinguish between controlled versus non- controlled items. Specifically, DLA’s information on its Internet site did not  distinguish for the general public which items were considered controlled  versus non-controlled property because the information was not displayed  in a transparent format that is clearly understandable by the general  public. DLA provided the demilitarization codes, which are used to identify  controlled and non-controlled items, but the general public would need to  have an understanding of demilitarization codes to identify which items  were controlled based on those codes. Furthermore, as of March 2017,  DLA’s Internet site did not provide a definition to explain that property with  demilitarization code B, for example, is considered controlled whereas  property with demilitarization code A is considered non-controlled.  However, after we briefed DLA officials in April 2017 on the results of our  audit, DLA officials took immediate action and added a definition of  controlled property to their Internet site to distinguish for the general  public what items are considered controlled.
section_title: Conclusions
paragraphs: DLA transfers excess controlled property to thousands of federal, state,  and local law enforcement agencies that request approval to participate in  the LESO program. DLA has taken some actions and plans additional  actions to address identified weaknesses in its excess controlled property  program, including changes in program policy and providing training.  However, our investigators tested the LESO program’s internal controls  by creating a fictitious agency allowing us to gain access to the program  and to obtain over 100 controlled property items valued at about $1.2  million. DLA’s internal controls were not adequate to prevent the approval  of a fraudulent application and DLA has not reviewed and revised the  policy or procedures for verifying and approving federal agency  applications and enrollment in the LESO program. Without reviewing and  revising the internal controls in policy or procedures for verifying and  approving federal agency applications and enrollment in the LESO  program, DLA and LESO management will lack reasonable assurance of  the legitimacy of applicants before transferring valuable, and in some  cases potentially lethal, controlled property.
Moreover, our investigative work found DLA has not ensured compliance  that officials at DLA Disposition Services’ sites routinely request and  verify valid identification of the individual(s) authorized to pick up  allocated property from the LESO program. Without improving internal  controls, DLA will lack reasonable assurance that its Disposition Services  on-site officials are transferring controlled property to authorized  individuals. Controlled items in the wrong hands—items such as  simulated rifles and pipe bomb trainers—could result in criminal activities,  including terrorism or illegal sale or transfer of items. Additionally, we  found that on-site officials did not verify the quantity of approved items  prior to transfer. If DLA does not issue guidance that requires DLA  Disposition Services on-site officials to verify the type and quantity of  approved items against the actual items being transferred prior to removal  from the sites, then DLA will lack reasonable assurance that the approved  items transferred are appropriately reflected in their inventory records.  Correct accounting, according to DLA guidance, for all excess property by  DLA Disposition Services’ sites is critical as non-compliance can result in  property being misappropriated with potentially severe consequences.  Finally, we found that DLA lacks a comprehensive framework for  instituting fraud prevention and mitigation measures that would allow it to  examine potential risks for all stages of the process from application to  transfer of excess controlled property to legitimate law enforcement  agencies. If DLA conducted a fraud risk assessment for all stages of the  process, DLA would be more effective in preventing, detecting, and  responding to potential fraud and security risks.
section_title: Recommendations for Executive Action
paragraphs: We are making four recommendations to enhance the department’s  transfer of its excess controlled property.
To strengthen LESO program internal controls for the application and  enrollment of federal agencies, we recommend the Under Secretary of  Defense for Acquisition, Technology and Logistics direct the Director of  DLA to review and revise policy or procedures for verifying and approving  federal agency applications and enrollment. For example, such steps  could include LESO supervisory approval for all federal agency  applications; confirmation of the application with designated points of  contact at the headquarters of participating federal agencies; or visiting  the location of the applying federal law enforcement agency.
To help ensure controlled property is picked up by authorized individuals,  we recommend that the Under Secretary of Defense for Acquisition,  Technology and Logistics direct the Director of DLA to ensure compliance  that on-site officials responsible for the transfer of items at Disposition  Services’ sites request and verify valid identification of the individual(s)  authorized to pick up allocated property from the LESO program.
To help ensure the accurate quantity of approved items is transferred, we  recommend that the Under Secretary of Defense for Acquisition,  Technology and Logistics direct the Director of DLA to issue guidance  that requires DLA Disposition Services on-site officials to verify the type  and quantity of approved items against the actual items being transferred  prior to removal from the sites.
To strengthen LESO program internal controls, we recommend that the  Undersecretary of Defense for Acquisition, Technology, and Logistics  direct the Director of DLA to conduct a fraud risk assessment to design  and implement a strategy with specific internal control activities to  mitigate assessed fraud risks for all stages relating to LESO’s transfer of  excess controlled property to law enforcement agencies, consistent with  leading practices provided in GAO’s Fraud Risk Framework.
section_title: Agency Comments
paragraphs: We provided a draft of this report to the Department of Defense (DOD) for  review and comment, and written comments are reproduced in Appendix  IX. DOD concurred with all four recommendations and highlighted the  actions it was taking to address each recommendation. Regarding the  first recommendation, DOD stated DLA had reviewed and revised the  procedures for verifying and approving federal agency applications and  now requires federal agency headquarters to assign a point of contact  and sign a memorandum of understanding (MOU). In addition, DOD  noted DLA is updating policy to reflect the revised procedural changes. In  regards to the second and third recommendations, while DLA has policies  requiring on-site officials to request and verify identification from all  customers and to verify the type and quantity of approved items being  transferred prior to removal from sites, DOD stated DLA will conduct  additional training on the processes to all DLA Disposition Services Field  sites by October 1, 2017. Regarding our fourth recommendation, DOD  noted DLA will conduct a fraud risk assessment and implement a strategy  to mitigate assessed fraud risks by April 1, 2018.
We are sending copies of this report to the appropriate congressional  committees, the Secretary of Defense; the Director, Defense Logistics  Agency; the Secretaries of the Army, the Navy, and the Air Force; and the  Commandant of the Marine Corps. In addition, the report is available at  no charge on the GAO website at http://www.gao.gov.
If you or your staff have any questions about this report, please contact  Zina Merritt at (202) 512-5257 or merrittz@gao.gov or Wayne McElrath at  (202) 512-2905 or mcelrathw@gao.gov. Contact points for our Offices of  Congressional Relations and Public Affairs may be found on the last page  of this report. GAO staff members who made key contributions to this  report are listed in appendix X.
section_title: Appendix I: Law Enforcement Agencies Reported Various Uses and Benefits from the Transfer of the Department of Defense’s (DOD) Excess Controlled Property
paragraphs: Federal, state, and local law enforcement agencies reported various uses  and benefits from the receipt of DOD’s excess controlled property through  the Law Enforcement Support Office (LESO) program.
subsections: section_title: Reported Uses of DOD Excess Controlled Property for Law Enforcement Activities
paragraphs: Federal law enforcement agencies and state coordinators in our survey— as well as officials we interviewed from federal, state, and local law  enforcement agencies—reported various uses of DOD excess controlled  property for law enforcement activities. The reported uses included  enhancing counterdrug, counterterrorism, and border-security activities.  Also, law enforcement agencies reported using DOD’s excess controlled  property for other law enforcement activities, such as search and rescue,  natural disaster response, surveillance, reaching barricaded suspects,  police training, and the serving of warrants. For example, the Bureau of  Indian Affairs reported they have used vehicles to support its Office of  Justice Services’ drug unit during marijuana eradication and border  operations by providing transport to agents over inhospitable terrain in  mountainous and desert environments. Also, Texas law enforcement  officials reported that the San Marcos and Hays County police  departments used their issued Mine Resistant Ambush Protected (MRAP)  vehicles to rescue more than 600 stranded people from floodwaters in  October 2015. In another example, the Los Angeles County Sheriff’s  Department reported that it used a robot to remove a rifle from an  attempted murder suspect who had barricaded himself. Table 4 includes  additional examples reported to us on the use of excess controlled  property.
section_title: Reported Benefits from Receiving Excess Controlled Property through the LESO Program
paragraphs: Federal, state, and local law enforcement agencies and state  coordinators also reported various benefits from receiving DOD excess  controlled property through the LESO program. The benefits were  reported in survey results and identified through our case studies. Table 5  provides examples of the reported benefits.
section_title: Appendix II: Objectives, Scope, and Methodology
paragraphs: This report addresses the extent to which the Defense Logistics Agency  (DLA) has: (1) taken actions to enhance processes, including internal  controls, relating to its transfers of excess controlled property; and (2)  addressed the statutory requirement to maintain a public Internet site that  provides transparency about controlled property transfers and about the  recipients of such property. We also include survey and case study  information collected between April 2016 and October 2016 on how  federal, state, and local law enforcement agencies reported using and  benefiting from excess controlled property transferred to them through  DLA’s Law Enforcement Support Office (LESO) program in accordance  with the purposes of the program, including enhancement of counterdrug,  counterterrorism, and border-security activities in appendix I. For the  report, we relied on the Department of Defense (DOD) definition of  controlled property as outlined in DLA and LESO program policy and  guidance. We also confirmed the definition with LESO program officials.
For objective one, we reviewed DLA and LESO program policy and  guidance on LESO program processes for transferring controlled  property, including DLA instructions, LESO program standard operating  procedures, and memorandums of agreement between LESO and  participating states, which set forth the terms and conditions of transfer,  monitoring, training, accountability, and disposal of controlled property  obtained through the LESO program. In addition, we reviewed Executive  Order 13688, Federal Support for Local Law Enforcement Equipment  Acquisition (Jan. 16, 2015) and interviewed members from the permanent  Federal Interagency Law Enforcement Equipment Working Group  regarding additional federal requirements for participating law  enforcement agencies to obtain specific types of controlled property. We  compared the additional federal requirements in the Executive Order to  DLA policy, guidance, and processes to gain an understanding of how  DLA has incorporated and implemented such requirements.
We also reviewed DOD policy, including DLA Instruction 4140.11,  Department of Defense 1033 Program (December 22, 2016), and prior  issuances, to gain an understanding of policy, responsibility, and  procedures regarding the administration, management, oversight and  implementation of the department’s LESO program. We reviewed the  LESO program standard operating procedures, which outline legislative,  policy, and procedural guidance; program eligibility criteria; requisitioning  procedures; property accountability; property transfers and the return  process; program compliance reviews; annual inventories; and training;  as well as guidance specific to aircraft, watercraft, tactical vehicles, and  weapons. Further, we reviewed the memorandums of agreement,  between LESO and participating LESO state coordinators, which outlines  the general terms and conditions that each participating state agree to  regarding the management, oversight, and implementation of the LESO  program to participating law enforcement agencies within the state. We  analyzed DLA Electronic Freedom of Information Act Library data from  calendar years 2013, 2014, and 2015 to gain an understanding of the  controlled property that was transferred to federal, state, and local law  enforcement agencies.
Additionally, we requested and analyzed data from DLA’s automated  information system on controlled property transferred to federal, state,  and local law enforcement agencies. To assess the data, we interviewed  relevant DLA and other agency officials who have direct knowledge of the  LESO program about the steps taken to ensure the quality and accuracy  of data. We determined that the data were sufficiently reliable for the  purposes of our methodology as well as for background and context  purposes.
We tested the department’s internal controls and control activities related  to LESO program enrollment and application after identifying a case of an  unauthorized or ineligible agency gaining access to the LESO program  and being awarded controlled property early in our review. Our  investigators posed as a federal law enforcement agency and, using  publicly available resources, created a fictitious website describing that  agency’s activities. We completed the application paperwork, submitted it  to LESO officials, and corresponded by email to answer follow-up  questions. We provided a fictitious statute as a means to legitimize our  agency, were approved to participate in the program, and given access to  the LESO program systems. We reviewed available controlled property  and submitted requests for a variety of items located at four Disposition  Service sites. After our requests for controlled property were approved,  we corresponded with officials at the Disposition Service sites to arrange  for pickup of the property. Our investigators visited three eastern U.S.  Disposition Service sites, presented the appropriate paperwork, and  obtained possession of the controlled property items.
We also compared DLA and LESO practices to those identified in GAO’s  A Framework for Managing Fraud Risks in Federal Programs (hereafter  cited as the Fraud Risk Framework). The Fraud Risk Framework has  the following components: commit to combating fraud, assess fraud risk,  design and implement a strategy for mitigating risk, and evaluate  outcomes. We selected leading practices from the component of assess  fraud risk because the use of these practices could be objectively verified.  Issued in July 2015, GAO’s Fraud Risk Framework is a comprehensive  set of leading practices that serves as a guide for program managers to  use when developing efforts to combat fraud in a strategic, risk-based  manner. The framework describes leading practices for (1) establishing  an organizational structure and culture that are conducive to fraud risk  management; (2) assessing the likelihood and effect of fraud risks; (3)  developing, documenting, and communicating an antifraud strategy,  focusing on preventive control activities; and (4) collecting and analyzing  data from reporting mechanisms and instances of detected fraud for real- time monitoring of fraud trends, and use the results of monitoring,  evaluations, and investigations to improve fraud prevention, detection,  and response.
Additionally, we conducted two surveys—one with federal law  enforcement agencies that were major recipients of LESO controlled  property and the other with state coordinators. First, for federal law  enforcement agencies, we selected the top four federal departments  whose law enforcement agencies had received controlled property from  the LESO program during calendar years 2013, 2014, and 2015. These  departments were the U.S. Department of Justice, U.S. Department of  Homeland Security, U.S. Department of the Interior, and the United  States Department of Agriculture. This accounted for approximately 99  percent of both the total initial acquisition value and the quantity of  controlled property distributed to federal law enforcement agencies from  calendar years 2013 through 2015. To gain an understanding of how  federal law enforcement agency headquarters manage and oversee the  LESO program, we developed and distributed a survey to the responsible  officials at the headquarter level of all 15 law enforcement agencies within  the four selected departments that received DOD-controlled property from  calendar years 2013 through 2015. The selected agencies were:
Bureau of Alcohol, Tobacco, Firearms and Explosives, U.S.
Drug Enforcement Administration, U.S. Department of Justice;
Federal Bureau of Investigation, U.S. Department of Justice;
Federal Bureau of Prisons, U.S. Department of Justice;
Federal Protective Service, U.S. Department of Homeland Security;
Transportation Security Administration, U.S. Department of Homeland
Bureau of Indian Affairs, U.S. Department of the Interior
Bureau of Land Management, U.S. Department of the Interior
U.S. Customs and Border Protection, U.S. Department of Homeland
U.S. Fish and Wildlife Service, U.S. Department of the Interior
U.S. Forest Service, United States Department of Agriculture
U.S. Immigration and Customs Enforcement, U.S. Department of
U.S. Marshals Service, U.S. Department of Justice;
U.S. National Park Service, U.S. Department of the Interior; and
U.S. Secret Service, U.S. Department of Homeland Security.
The survey asked about the excess control property program’s  accountability, policy and guidance, and the requests and justifications  made for excess property.
We worked with a survey specialist, a communications analyst, and  subject matter experts from LESO to develop this survey. To ensure that  the questions were clear, comprehensible and technically correct, we  conducted one expert review of our draft survey with LESO officials, and  one pre-test of our draft survey with federal headquarters staff from the  Bureau of Alcohol, Tobacco, Firearms and Explosives, Department of  Justice. During the pre-test, which was conducted in person, we read  the instructions and each survey question aloud and asked the Bureau of  Alcohol, Tobacco, Firearms and Explosives officials to tell us how they  interpreted the question. We then discussed the instructions and  questions with officials to identify any problems and potential solutions by  determining whether (1) the instructions and questions were clear and  unambiguous, (2) the terms we used were accurate, (3) the survey was  unbiased, (4) the survey did not place an undue burden on the officials  completing it. We noted any potential problems and modified the survey  based on feedback from the expert reviewers and pre-tests, as  appropriate. We sent an email to selected federal agency headquarters  beginning on September 1, 2016, notifying them about the topics of our  survey and when we expected to send the survey. We sent the self- administered Microsoft Word form and a cover email to 15 federal agency  headquarters on September 6, 2016, and asked them to complete the  survey and email it back to us within 2 weeks. We closed the survey on  October 31, 2016. We received 13 completed responses for an overall  response rate of 87 percent.
To gain an understanding of how state coordinators manage the LESO  program within their state, we developed and distributed a survey to the  53 state coordinators participating in the program, including the 49 states  and the territories of Guam, Northern Marianas Islands, Puerto Rico, and  the U.S. Virgin Islands that participate in the program. For example, our  survey questions were focused on basic background information, LESO  policies and training, process and accountability of the property received,  and ways in which controlled property was used by law enforcement  agencies. We worked with a survey specialist and a communications  analyst to develop the survey. To ensure that the questions were clear,  comprehensible and technically correct, we conducted four pre-tests of  our draft survey with state coordinators and state points-of-contacts from  four states. During the pre-tests conducted by teleconference, we read  the instructions and each survey question aloud and asked the state  coordinators and state points of contact to tell us how they interpreted the  question. We then discussed the instructions and questions with officials  to identify any problems and potential solutions by determining whether  (1) the instructions and questions were clear and unambiguous, (2) the  terms we used were accurate, (3) the survey was unbiased, (4) the  survey did not place an undue burden on the officials completing it. We  noted any potential problems and modified the survey as appropriate. We  sent the self-administered Microsoft Word form and a cover email to the  state coordinators on September 20, 2016, and asked them or their  designated state points of contact to complete the survey and email it  back to us within 2 weeks. We closed the survey on October 31, 2016.  We received 50 completed responses for an overall response rate of 94  percent.
The practical difficulties of conducting any survey may introduce errors,  commonly referred to as non-sampling errors. For example, differences in  how a particular question is interpreted, the sources of information  available to respondents, how the responses were processed and  analyzed, or the types of people who do not respond can influence the  accuracy of the survey results. We took steps in the development of the  survey, the data collection, and the data analysis to minimize these non- sampling errors and help ensure the accuracy of the answers that were  obtained. For example, a survey specialist designed the survey, in  collaboration with our staff who have subject matter expertise. Then, as  noted earlier, the draft surveys were pre-tested to ensure that questions  were relevant, clearly stated, and easy to comprehend, and in the case of  the federal agency survey we conducted an expert review. Data were  manually extracted from the Microsoft Word form into an Excel  spreadsheet and that data entry accuracy was verified. We examined the  survey results and performed analyses to identify inconsistencies and  other indications of error, and addressed such issues as necessary.  Quantitative data analyses and a review of open-ended responses were  conducted by our staff who have subject matter expertise. Results of  select survey questions can be found in Appendix I, IV and V.
Further, we conducted non-generalizable case studies of five states:  Arizona, Georgia, Maryland, Michigan, and Texas. We selected these  states based on quantity, type, and initial acquisition value of controlled  property received during calendar years 2013, 2014, and 2015 as well as  geographic dispersion. We selected these calendar years because they  were the last three complete years prior to our audit work. First, for each  state, we met and interviewed the state coordinator and when applicable,  each state’s point of contact(s), to discuss roles and responsibilities in  managing and overseeing the LESO program within each state. Second,  we selected at least one federal, state, local, and university law  enforcement agency within each case study state. To help ensure that we  obtained the input of a broad range of law enforcement agencies, we  selected specific agencies for our case study based on the size, type, and  location of the agency, how much controlled property was received by  quantity and initial acquisition value, as well as specific types of controlled  property during calendar years 2013, 2014, and 2015. Selected law  enforcement agencies accounted for large and small percentages as well  as different types of controlled property received within each state. For  example, we selected law enforcement agencies that received weapons,  tactical vehicles, and aircraft, as well as night-vision equipment and other  miscellaneous items. We met with law enforcement officials from the  selected federal, state, local, and university law enforcement agencies to  discuss the LESO program and to gain an understanding of the transfer  process, including how they screen for, obtain, and dispose of DOD  excess controlled property.
Further, we reviewed LESO’s program policy to gain an understanding of  how LESO ensures accountability of controlled property through an  annual inventory and certification process and to gain an understanding  of the program compliance review process in which LESO officials visit  select law enforcement agencies within each state to verify all controlled  property. We accompanied a LESO performance compliance review team  as its members conducted their review in the annual program compliance  review in Georgia. We attended the LESO-led in-brief and out-brief with  the Georgia state coordinator and his team, as well as accompanied them  to seven law enforcement agencies in Georgia to physically verify the  serial numbers of controlled property. Additionally, we also analyzed  survey responses, as previously discussed, from federal law enforcement  agencies and state coordinators regarding DLA’s processes for  transferring controlled property and training on LESO program policies  and processes. We interviewed officials from DLA Disposition Services,  who have authority over the LESO program, as well as officials from  LESO headquarters who manage the program, to gain an understanding  of LESO program policies and processes for transferring its excess  controlled property to law enforcement agencies, including past and  planned program enhancements. We also interviewed these officials to  gain an understanding of how law enforcement agencies are trained on  LESO program policies and procedures. We also met with officials from  select law enforcement agencies, as previously discussed, to gain an  understanding of LESO program processes, including how they screen  for, obtain, and dispose of DLA excess controlled property,  enhancements made to the program, and how they are trained on LESO  program policies and processes. We selected these law enforcement  agencies based on a number of factors, including range of quantity of  items, total acquisition value, and item type. We reviewed training  materials provided by LESO and attended the 15th annual training  seminar provided to state coordinators. Finally, we visited two Disposition  Service sites in the United States to observe their processes for disposing  of excess property received from the military services. We selected the  two Disposition Service sites based on geographic location and personnel  availability.
For objective two, we reviewed the statute requiring DOD to develop and  maintain an Internet site that provides information on the controlled  property transferred to gain an understanding of the statutory  requirements regarding the contents of the website, such as to include all  publicly accessible unclassified information pertaining to the request,  transfer, denial, and repossession of controlled property, among other  items. Additionally, we analyzed the capabilities of the DLA website,  including the fields it contained and the searches that can be performed  using it. We compared the information in and capabilities of the website  with the statutory requirements to provide publicly available information  on controlled property transferred and the recipients of such property in a  transparent manner. We also interviewed officials from LESO  headquarters to obtain updates on the status of DOD’s implementation of  the Internet site.
Also, appendix I of this report includes survey and case study information  collected between April 2016 and October 2016 on how federal, state,  and local law enforcement agencies reported using and benefiting from  excess controlled property transferred to them through DLA’s LESO  program in accordance with the purposes of the program, including  enhancement of counterdrug, counterterrorism, and border-security  activities. Additionally, we analyzed survey responses pertaining to the  reported use of controlled property. For each case study, we interviewed  law enforcement officials from federal, state, and local law enforcement  agencies to discuss the transfer process and how controlled property  transferred to them through the LESO program is used by their law  enforcement agencies, including whether it had enhanced their  counterdrug, counterterrorism, and/or border-security operations. The manner in which law enforcement agencies used controlled property  items was self-reported, and we have made no assessment of the  agencies’ reported use.
Table 6 lists the offices that we visited or contacted during our review.
We conducted this performance audit from January 2016 to July 2017 in  accordance with generally accepted government auditing standards.  Those standards require that we plan and perform the audit to obtain  sufficient, appropriate evidence to provide a reasonable basis for our  findings and conclusions based on our audit objectives. We believe that  the evidence obtained provides a reasonable basis for our findings and  conclusions based on our audit objectives. We conducted our related  investigative work in accordance with investigative standards prescribed  by the Council of the Inspectors General on Integrity and Efficiency.
section_title: Appendix III: Legislative Actions and Key Dates in the History of the Law Enforcement Support Office (LESO) Program
paragraphs: Since 1989, the Department of Defense (DOD) has been authorized to  undertake actions intended to enhance the effectiveness of domestic law  enforcement agencies through direct or material support. Table 7 includes  legislative actions and key dates in the history of the LESO program.
section_title: Appendix IV: Select Survey and Case Study Results Regarding Training on Law Enforcement Support Office (LESO) Program Policies and Procedures
paragraphs: Survey results from select federal law enforcement agencies and LESO  program state coordinators as well as interviews with law enforcement  agencies in our case studies, between April 2016 and October 2016,  identified that not all participating agency personnel have received  training on all aspects of the LESO program, including its policies. In our  survey of select federal law enforcement agencies, training had not been  regularly provided to participating federal law enforcement agencies. For  example, 3 of the 13 respondents to the federal survey reported that their  agency had received training from LESO; the remaining 10 respondents  to the federal survey stated that either they did not receive training from  LESO or they did not know if their agency had received any training from  LESO regarding the LESO program. LESO officials told us that they have  not regularly provided training to federal law enforcement agencies in the  past, with training mainly provided to the state coordinators participating  in the LESO program. Survey results of federal law enforcement agencies  also showed that officials generally stated that training on the LESO  program would be beneficial. For example, 9 of the 13 respondents to the  federal survey stated that refresher training provided by LESO would be  beneficial to their agency. In addition, officials from federal agencies’ field  offices in our case studies generally stated that training provided by  LESO would be beneficial to them in participating in the LESO program  and that they wanted more training to better understand, for example,  LESO program processes, such as the turn-in or transfer of controlled  property. Officials from federal field offices in our case studies also  generally stated that they were mostly self-taught on the LESO program.
According to LESO officials, LESO funds and provides an annual training  seminar that includes training on LESO policies and procedures for state  coordinators. LESO officials stated that as a part of this annual training  they direct state coordinators to train participating law enforcement  agencies, and state coordinators have discretion to establish their own  training. However, our survey results showed that nearly three-fourths of  the state coordinators reported that they do not provide mandatory  training on LESO program policies and procedures to law enforcement  agencies. Also, we found that state coordinators varied in the types of  training they provided on LESO program policies and procedures to law  enforcement agencies in their state, as shown in table 8. For example,  our survey found that 40 percent (18 of 45) of responding state  coordinators reported that they do not provide in-person refresher or  annual training and 15 percent (7 of 46 responding to the question)  reported that they do not provide training aids or reference aids (i.e.,  PowerPoint format).
The majority of state coordinators reported they found LESO training  “helpful”, as shown in table 9.
However, the majority of state coordinators also reported they would find  LESO training modules helpful, as shown in table 10.
Moreover, officials from state and local law enforcement agencies in our  case studies reported different experiences about the availability and  accessibility of training on policies and procedures of the LESO program  from their state coordinators and stated that they would benefit from  additional training on policies and procedures, such as on returning  property to DLA. For example, an official from one law enforcement  agency in our case study told us that it took 8 months to receive training  from his state coordinator upon joining the program. In another example,  an official stated that he received little formal training from his state  coordinator or from LESO officials; rather, he was trained by his  predecessor when he was assigned to manage the LESO program for his  law enforcement agency. In contrast, for example, an official from another  law enforcement agency stated that he attended mandatory training with  his state coordinator upon joining the LESO program to learn how to set  up an account and screen for items and that his state coordinator is  responsive when questions arise.
As noted in this report, DOD is enhancing its processes for the transfer of  excess property by developing additional training for participating law  enforcement agencies on LESO program policies and procedures by  establishing an online training tool. According to DLA officials, the online  training tool will assist in providing specific information and training  modules on LESO program policies and procedures to federal law  enforcement agencies, and state coordinators can provide the training to  law enforcement agencies in their states. DLA officials estimated the  training tool would be completed in mid-2017.
section_title: Appendix V: Select Survey Questions from Federal Law Enforcement Agency Respondents on Their Use of the Law Enforcement Support Office (LESO) Program
paragraphs: In our survey of 15 federal law enforcement agencies, completed in  October 2016, we found that the majority (11 of 13) stated that their  agency either had no memorandum of understanding (MOU) or did not  know if their agency had a MOU with the Department of Defense (DOD)  regarding the LESO program. Also, the majority (11 of 13) reported that  the LESO program office had not provided, or they did not know if the  LESO program office had provided, any policy or guidance to their  agency on program roles and responsibilities regarding the LESO  program, as shown in Table 11. Moreover, the majority (7 of 13) reported  that their agency did not have any standard operating procedures, or  standard practices outlined in policy or guidance that apply to DOD  LESO-controlled property, as shown in Table 11.
The majority of the federal survey respondents stated that their agency  had not provided any policy or guidance, or training, on topics related to  the LESO program to their field locations that use the program. Table 12  shows the federal survey respondents and whether or not their agency  provided policy or guidance, or training was provided on the listed topics.
Additionally, tables 13, 14, and 15 provide survey results regarding  federal law enforcement agency interactions with LESO, whether their  agency had a process for requesting and obtaining controlled property,  and their familiarity with the LESO program’s processes for transferring  controlled items.
section_title: Appendix VI: Law Enforcement Support Office (LESO) Program Federal Law Enforcement Application, Revised as of March 2017
paragraphs: Figure 4 shows the application form on LESO’s website for federal law  enforcement agencies.
section_title: Appendix VII: Law Enforcement Support Office (LESO) Program’s State and Local Law Enforcement Application, Revised as of March 2017
paragraphs: Figure 5 shows the application on LESO’s website for state and local law  enforcement agencies.
section_title: Appendix VIII: Law Enforcement Support Office (LESO) Program’s Law Enforcement Application, as of 2016
paragraphs: Figure 6 shows the 2016 version of the application on LESO’s website for  law enforcement agencies.
section_title: Appendix IX: Comments from the Department of Defense
section_title: Appendix X: GAO Contacts and Staff Acknowledgments
subsections: section_title: GAO Contacts
section_title: Staff Acknowledgments
paragraphs: In addition to the contacts named above, Marilyn Wasleski, Gary Bianchi,  and Helena Wong (Assistant Directors), Laura Czohara (Analyst-in- Charge), Martin de Alteriis, Robert Graves, Pamela Harris, Jason Kelly,  Amie Lesser, Barbara Lewis, Felicia Lopez, Maria McMullen, George  Ogilvie, Richard Powelson, Ray Rodriguez, Martin Wilson, and Samuel  Woo made key contributions to this report.
section_title: Related GAO Products
paragraphs: GAO, Excess Personal Property: DOD Should Reassess the Priorities of  Its Disposal Process. GAO-16-44. Washington, D.C.: January 29, 2016.
DOD Excess Property: Control Breakdowns Present Significant Security  Risk and Continuing Waste and Inefficiency. GAO-06-943. Washington,  D.C.: July 25, 2006.
DOD Excess Property: Control Breakdowns Present Significant Security  Risk and Continuing Waste and Inefficiency. GAO-06-981T. Washington,  D.C.: July 25, 2006.
DOD Excess Property: Management Control Breakdowns Result in  Substantial Waste and Inefficiency. GAO-05-729T. Washington, D.C.:  June 7, 2005.
DOD Excess Property: Management Control Breakdowns Result in  Substantial Waste and Inefficiency. GAO-05-277. Washington, D.C.: May  13, 2005.
Defense Inventory: Control Weaknesses Leave Restricted and  Hazardous Excess Property Vulnerable to Improper Use, Loss, and Theft.  GAO-02-75. Washington, D.C.: January 25, 2002.