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Testimony:
Before the Subcommittee on Criminal Justice, Drug Policy and Human
Resources, Committee on Government Reform, House of Representatives:
United States Government Accountability Office:
GAO:
For Release on Delivery Expected at 2:00 p.m. EDT:
Tuesday, July 12, 2005:
Combating Alien Smuggling:
The Federal Response Can Be Improved:
Statement of Richard M. Stana, Director, Homeland Security and Justice:
GAO-05-892T:
GAO Highlights:
Highlights of GAO-05-892T, a testimony before the Subcommittee on
Criminal Justice, Drug Policy and Human Resources, Committee on
Government Reform, House of Representatives:
Why GAO Did This Study:
Globally, alien smuggling generates billions of dollars in illicit
revenues annually and poses a threat to the nation’s security. Creation
of the Department of Homeland Security (DHS) in March 2003 has provided
an opportunity to use financial investigative techniques to combat
alien smugglers by targeting and seizing their monetary assets. For
instance, the composition of DHS’s largest investigative component—U.S.
Immigration and Customs Enforcement (ICE)—includes the legacy Customs
Service, which has extensive experience with money laundering and other
financial crimes. Another DHS component, U.S. Customs and Border
Protection (CBP) has primary responsibility for interdictions between
ports of entry. In summer 2003, ICE announced that it was developing a
national strategy for combating alien smuggling. This testimony is
based on GAO’s May 2005 report on the implementation status of the
strategy and investigative results in terms of convictions and seized
assets.
What GAO Found:
As of July 5, 2005, ICE had not finalized its strategy for combating
alien smuggling. ICE was adjusting the draft strategy to focus on the
southwest border and encompass all aspects of smuggling, aliens as well
as drugs and other contraband. In adjusting the strategy, ICE officials
stressed the importance of incorporating lessons learned from ongoing
follow-the-money approaches such as Operation ICE Storm, a multi-agency
task force launched in October 2003 to crack down on migrant smuggling
and related violence in Arizona. Also, the strategy’s effectiveness
depends partly on having clearly defined roles and responsibilities for
ICE and CBP, two DHS components that have complementary antismuggling
missions. CBP is primarily responsible for interdictions between ports
of entry and ICE for investigations that extend to the U.S. interior.
In this regard, ICE and CBP signed a memorandum of understanding in
November 2004 to address their respective roles and responsibilities,
including provisions for sharing information and intelligence.
Currently, however, there is no mechanism in place for tracking the
number and the results of referrals made by CBP to ICE for
investigation. CBP and ICE officials acknowledged that establishing a
tracking mechanism could have benefits for both DHS components. Such a
mechanism would help ICE ensure that appropriate action is taken on the
referrals. Also, CBP could continue to pursue certain leads if ICE—for
lack of available resources or other reasons—cannot take action on the
referrals.
In fiscal year 2004, about 2,400 criminal defendants were convicted in
federal district courts under the primary alien-smuggling statute, and
ICE reported seizures totaling $7.3 million from its alien-smuggling
investigations. For the first 6 months of fiscal year 2005, ICE
reported $7.8 million in seizures from alien-smuggling investigations.
A concern raised by ICE and the Department of Justice is the lack of
adequate statutory civil forfeiture authority for seizing real
property, such as “stash” houses where smugglers hide aliens while
awaiting payment and travel arrangements to final destinations
throughout the nation. However, Justice does not have a legislative
proposal on this subject pending before Congress because the
department’s legislative policy resources have been focused on other
priorities.
Aliens Held in “Stash” House in Southern California:
[See PDF for image]
[End of figure]
What GAO Recommends:
GAO’s May 2005 report recommended that (1) the Secretary of Homeland
Security establish a mechanism for tracking the results of referrals
made by CBP to ICE and (2) the Attorney General consider developing and
submitting to Congress a legislative proposal for amending the civil
forfeiture authority for alien smuggling. The departments agreed with
the recommendations.
www.gao.gov/cgi-bin/getrpt?GAO-05-892T.
To view the full product, including the scope and methodology, click on
the link above. For more information, contact Rich Stana at (202) 512-
8777 or stanar@gao.gov.
[End of section]
Mr. Chairman and Members of the Subcommittee:
I am pleased to be here today to discuss federal efforts to combat
alien smuggling. This transnational crime globally generates illicit
revenues estimated to total billions of dollars annually and is
recognized as a significant and growing problem that can pose a serious
threat to the security of the United States, a primary destination
country. Although it is likely that most aliens smuggled into the
United States seek economic opportunities, some are brought into the
United States as part of criminal or terrorist enterprises. This
concern has heightened since September 11, 2001. Creation of the
Department of Homeland Security (DHS) in March 2003 has provided new
opportunities to more effectively combat alien smuggling, particularly
in reference to using financial investigative techniques to target and
seize the monetary assets of smuggling organizations. For instance, the
department's largest investigative component--U.S. Immigration and
Customs Enforcement (ICE)--integrates the legal authorities and
investigative tools of the legacy Immigration and Naturalization
Service (INS) and the U.S. Customs Service, which has extensive
experience in combating money laundering and other financial crimes.
Another DHS component, U.S. Customs and Border Protection (CBP), has a
complementary antismuggling mission with primary responsibility for
interdictions between ports of entry. Given their complementary
antismuggling missions, CBP makes referrals to ICE on alien-smuggling
interdictions that may warrant further investigation.
At congressional hearings 2 years ago, in June and July 2003, ICE
officials testified that ICE was developing a national strategy to
dismantle criminal and terrorist organizations that smuggle or traffic
in people by tracing and stripping away their monetary assets. My
testimony today will address two principal questions:
* First, what is the implementation status of ICE's strategy for
combating alien smuggling, particularly regarding efforts to use
financial investigative techniques to follow the money trail and seize
the monetary assets of smuggling organizations?
* Second, since the creation of DHS and ICE, what results have been
achieved from alien-smuggling investigations in terms of prosecutions
and convictions, as well as seizures of smugglers' monetary assets?
My testimony is based on a report we issued in May 2005 to the House
Judiciary Subcommittee on Immigration, Border Security, and
Claims.[Footnote 1] Also, on July 5, 2005, we contacted ICE
headquarters to obtain an update on the implementation status of ICE's
strategy for combating alien smuggling.
Summary:
Although its development was announced as early as June 2003, ICE's
national strategy for combating alien smuggling had not been finalized
as of July 5, 2005. In the absence of a national strategy, ICE has used
various means to provide interim guidance to investigators. ICE
officials said the draft strategy was being adjusted to broadly cover
all aspects of smuggling, encompassing aliens as well as drugs and
other illegal contraband, and to focus initially on the southwest
border. In its official response to our report, DHS said "This narrowed
focus on the southwest border will allow ICE to review best practices
and evaluate lessons learned before an expanded nationwide strategy is
finalized." For example, DHS cited Operation ICE Storm as a strategic
model for antismuggling operations in other parts of the nation.
Operation ICE Storm is a multi-agency task force launched in October
2003 to crack down on migrant smuggling and related violence in
Arizona. Another reason for the strategy's continuing development
period is that the working relationship of ICE and CBP is still
evolving. The strategy's effectiveness depends partly on having clearly
defined roles and responsibilities for these two DHS components, which
have complementary antismuggling missions. In this regard, ICE and CBP
signed a memorandum of understanding in November 2004 to address their
respective roles and responsibilities, including provisions for sharing
information and intelligence. Currently, however, there is no mechanism
in place for tracking the number and the results of referrals or leads
made by CBP to ICE for investigation. Without such a mechanism, there
may be missed opportunities for identifying and developing cases on
large or significant alien-smuggling organizations. CBP and ICE
officials acknowledged that establishing a tracking mechanism could
have benefits for both agencies. Such a mechanism would help ICE ensure
that appropriate action is taken on the referrals. Also, CBP could
continue to pursue certain leads if ICE--for lack of available
resources or other reasons--cannot take action on the referrals. Our
May 2005 report recommended that the Secretary of Homeland Security
establish a referral-tracking mechanism. DHS agreed with our
recommendation. DHS said CBP and ICE, in consultation with Border and
Transportation Security, would work together to identify and implement
a solution to address our recommendation.
In fiscal year 2004, about 2,400 criminal defendants were convicted in
federal district courts under section 274 of the Immigration and
Nationality Act, the primary statute for prosecuting alien
smuggling.[Footnote 2] Further, for fiscal year 2004, ICE reported
seizures totaling $7.3 million from its alien-smuggling investigations-
-plus an additional $5.3 million generated by the state of Arizona
under Operation ICE Storm. ICE officials anticipate increased seizures
from alien-smuggling investigations in future years, as ICE more
broadly applies its financial and money-laundering expertise. For the
first 6 months of fiscal year 2005, for instance, ICE officials
reported seizures of $7.8 million. The officials said, however, that
there are competing demands for investigative resources and also noted
that alien-smuggling cases, in contrast to drug-trafficking cases, are
much less likely to result in large seizures of currency. But, even
absent seizures of money or other assets from alien smugglers, ICE
officials noted the importance of applying financial investigative
expertise in appropriate cases to determine the scope and operational
patterns of alien-smuggling organizations, identify the principals, and
obtain evidence to build prosecutable cases. Regarding potential
forfeitures in alien-smuggling cases, ICE and Department of Justice
officials said that a concern for investigators is lack of adequate
statutory civil forfeiture authority for seizing real property, such as
"stash" houses, used to facilitate the smuggling of aliens. According
to Justice, analysis of civil and criminal forfeiture statutes
generally has led the department to conclude that a statute that
provides only for criminal and not civil forfeiture of facilitating
property will be inadequate in such cases, and investigative experience
indicates that these cases are numerous. Justice officials noted,
however, that the department has not developed and submitted to
Congress a legislative proposal because the department's legislative
policy resources have been focused on other priorities. Our May 2005
report recommended that the Attorney General, in collaboration with the
Secretary of Homeland Security, consider developing and submitting to
Congress a legislative proposal, with appropriate justification, for
amending the civil forfeiture authority for alien smuggling. The
Department of Justice agreed with our recommendation and said it plans
to move forward with a proposal as GAO recommended.
Background:
By definition, alien smuggling (sometimes called people smuggling or
human smuggling) is transnational in that it involves more than one
country and also usually involves persons who have consented to be
transported to another country. This activity generally produces short-
term profits for the smugglers. That is, after the aliens reach their
final destinations, they have no continuing relationship with the
smugglers. In legal and diplomatic references, alien smuggling is
distinct from human trafficking, although both smuggling and
trafficking may have similarities or common elements. In human
trafficking, the criminality and human rights abuses--such as coercion
for prostitution, labor sweat shops, or other exploitative purposes and
servitude arrangements--may continue after the migrants reach the
United States in order to produce both short-term and long-term
profits. Whereas a trafficked person is a victim, an alien who consents
to be smuggled is subject to criminal processing and deportation.
Given the underground nature of alien smuggling, exact figures
quantifying the size or scope of this transnational crime are not
available. Nonetheless, estimates by the United Nations and the federal
law enforcement and intelligence communities indicate that people
smuggling is a huge and highly profitable business worldwide, involving
billions of dollars annually, and the United States is a major
destination country. People smuggling is a continuously growing
phenomenon, according to the International Criminal Police Organization
(Interpol). The types of smugglers can range from opportunistic
business owners who seek cheap labor to well-organized criminal groups
that engage in alien smuggling, drug trafficking, and other illegal
activities. Partly because of increased border monitoring by
governments, Interpol has noted that criminal networks increasingly
control the transnational flow of migrants. That is, willing illegal
migrants increasingly rely on the services of criminal syndicates that
specialize in people smuggling, even though traveling conditions may be
inhumane and unsafe.
Alien smuggling generally is prosecuted under section 274 of the
Immigration and Nationality Act, which prohibits knowingly or
recklessly bringing in, transporting, or harboring certain
aliens.[Footnote 3] Depending on the conduct charged, a conviction
under section 274 could result in a maximum penalty of 10 years'
imprisonment per alien smuggled. Moreover, significant enhanced
penalties are provided for some section 274 violations that involve
serious bodily injury or placing life in jeopardy. If certain
violations result in the death of any person, the convicted defendant
may be punished by imprisonment for any term of years or be subjected
to a death sentence.[Footnote 4] Other federal criminal statutes may
also be applicable. Specifically, alien-smuggling-related offenses are
among the list of Racketeer Influenced and Corrupt Organizations
predicate offenses (18 U.S.C. § 1961(1)) and also are included within
the definition of specified unlawful activity for purposes of the money-
laundering statute (18 U.S.C. § 1956). Further, criminal and civil
forfeiture statutes may apply to alien-smuggling cases.
Although ICE is a primary DHS component for investigating alien
smuggling, combating the smuggling of aliens into the United States can
involve numerous federal agencies, as well as the cooperation and
assistance of foreign governments. In addition to ICE, other relevant
DHS components are the Border Patrol (a "front-line defender"), which
is now part of CBP, and the U.S. Coast Guard, which is tasked with
enforcing immigration law at sea. Additionally, significant roles in
combating alien smuggling are carried out by Department of Justice
components, including the Criminal Division, the Federal Bureau of
Investigation (FBI), and U.S. Attorney's Offices, and Department of the
Treasury components, such as Internal Revenue Service (Criminal
Investigation) and the Financial Crimes Enforcement Network (FinCEN).
Further, Department of State components have significant roles. For
instance, the Bureau of Diplomatic Security--the law enforcement arm of
the State Department--is statutorily responsible for protecting the
integrity of U.S. travel documents. Perhaps the most coveted and sought
after travel documents in the world are U.S. passports and visas. Alien
smuggling and travel document fraud often are inextricably linked.
An interagency coordination mechanism to help ensure that available
resources are effectively leveraged is the National Security Council's
Migrant Smuggling and Trafficking Interagency Working Group, which is
cochaired by State and Justice. The Interagency Working Group has a
targeting subgroup, whose role is to identify for investigation and
prosecution the most dangerous international alien smuggling networks,
especially those that pose a threat to national security. Another
coordination mechanism is the Human Smuggling and Trafficking Center,
an interagency entity for disseminating intelligence and other
information to address the separate but related issues of alien
smuggling, trafficking in persons, and clandestine terrorist travel.
Although its establishment was announced in December 2000, the center
was not operational until July 2004.
The March 2003 creation of DHS, including its largest investigative
component (ICE), ushered in an opportunity for developing a strategy to
combat alien smuggling by, among other means, using financial
investigative techniques. Two months later, in May 2003, ICE used such
techniques to follow the money and prosecute the perpetrators of a
smuggling operation that had resulted in the deaths of 19 aliens in
Victoria, Texas. The Victoria 19 case has been cited by ICE as
representing a new model for fighting alien smuggling--a model that ICE
(1) subsequently used to launch a multi-agency task force (Operation
ICE Storm) in the Phoenix (Arizona) metropolitan area and (2)
reportedly was using to develop ICE's national "Antismuggling/Human-
Trafficking Strategy."
ICE's Strategy for Combating Alien Smuggling Not Yet Issued:
Although its development was announced as early as June 2003, a
national strategy for combating alien smuggling had not been finalized
and implemented by ICE as of July 5, 2005. During congressional
testimony,[Footnote 5] an ICE official said ICE was developing a
strategy that would address alien smuggling (and human trafficking) at
the national and international level because as in the war on
terrorism, the most effective means of addressing these issues is by
attacking the problem in source and transit countries to prevent entry
into the United States. In the absence of a national strategy to combat
alien smuggling, including investigating the money trail, ICE has used
various means to provide interim guidance to investigators. Such
guidance included, for instance, the formation of working groups with
members from various field offices and disciplines, as well as a
presentation at a March 2004 conference of special-agents-in-charge and
attachés. Moreover, ICE said it continues to provide guidance to the
field in the form of training seminars and managerial conferences.
Also, ICE indicated that it has posted guidance and policy memorandums
to the field on its Web site, which is available and accessible to
agents at their desktops for reference. According to ICE, the Web site
is regularly reviewed and updated to ensure that the most recent
guidance is available to the field. Additionally, ICE officials said
that headquarters staff routinely travel to field offices to review
ongoing undercover operations and large-scale investigations to help
ensure compliance with existing policies and priorities.
ICE officials indicated that the draft strategy was being adjusted to
broadly cover all aspects of smuggling--encompassing aliens, as well as
drugs and other illegal contraband--and to focus initially on the
Southwest border, between the United States and Mexico--the most active
area in terms of smuggling activity and open investigations. The
officials explained that ICE was developing a comprehensive southwest
border strategy, given the anticipated displacement of smuggling
activity to other areas along the border resulting from Operation ICE
Storm and its expansion statewide under the Arizona Border Control
Initiative. The officials explained that criminal enterprises tend to
smuggle not only people but also drugs, weapons, counterfeit trade
goods, and other illegal contraband. The ICE officials emphasized that
irrespective of whether smuggling involves aliens or contraband, ICE
can use similar investigative techniques for following the money trail.
Moreover, the officials said that, following a certain period of
implementation, the Southwest border strategy would be evaluated and
expanded into a nationwide strategy. The officials noted, for instance,
that although there is no one law enforcement strategy totally
effective in all areas of the nation, the methodologies applied in
Arizona with both Operation ICE Storm and the Arizona Border Control
Initiative would be evaluated and tailored for use in other parts of
the country.
The strategy's continuing development period is attributable partly to
organizational and training needs associated with integrating the
separate and distinct investigative functions of the legacy INS and the
U.S. Customs Service, following creation of DHS in March 2003. Also,
ICE and CBP--two DHS components with complementary antismuggling
missions--signed a memorandum of understanding in November 2004 to
address their respective roles and responsibilities, including
provisions to ensure proper and timely sharing of information and
intelligence. CBP has primary responsibility for interdictions between
ports of entry while ICE has primary responsibility for investigations,
including those resulting from alien smuggling interdictions referred
by CBP. Accordingly, sharing of information between the two components
is critical to achieving ICE's investigative objective of determining
how each single violation ties into the larger mosaic of systemic
vulnerabilities and organized crime. The ability to make such
determinations should be enhanced when DHS components have compatible
or interoperable information technology systems--which is a long-term
goal of an ongoing, multiyear project called the Consolidated
Enforcement Environment. Currently, however, there is no mechanism in
place for tracking the number and the results of referrals or leads
made by CBP to ICE for investigation, including even whether ICE
declined to act on the referrals. Without such a mechanism, there may
be missed opportunities for identifying and developing cases on large
or significant alien-smuggling organizations. For instance, if a
tracking mechanism were in place, CBP could continue pursuing certain
leads if ICE--for lack of available resources or other reasons--does
not take action on the referrals.
Prosecutions and Convictions Pursued in Alien-Smuggling Cases; Asset
Seizures Expected to Increase:
The principal federal statute used to prosecute alien smugglers is
section 274 of the Immigration and Nationality Act, which prohibits
knowingly or recklessly bringing in, transporting, or harboring certain
aliens. Under this statute, which is codified at 8 U.S.C. § 1324, about
2,400 criminal defendants were convicted in federal district courts in
fiscal year 2004. According to federal officials we interviewed, most
alien-smuggling prosecutions stem from reactive or interdiction-type
cases at the border, wherein in-depth investigations to follow a money
trail are not warranted.
However, during our field visits in September 2004 to Phoenix and
Houston, we asked U.S. Attorney's Office officials for their
observations regarding whether there has been an increasing emphasis on
the financial aspects of alien-smuggling investigations since the
creation of DHS and ICE. In Arizona, federal prosecutors emphasized
that Operation ICE Storm is a clear indication of ICE's efforts to
become more proactive in alien-smuggling investigations. Also, federal
prosecutors in Texas (Houston) said the money trail is being pursued
when appropriate, such as proactive cases involving smuggling
organizations that are based in the Far East (e.g., Thailand and
certain provinces in the People's Republic of China) and have networks
in Latin America and Mexico. The federal officials noted that
investigations of these cases may include FBI participation and the use
of undercover agents and electronic surveillance and may result in
assets being seized and suspects being charged with money laundering
and violations of the Racketeer Influenced and Corrupt Organizations
Act. More recently, in December 2004, ICE headquarters officials told
us that ongoing alien-smuggling cases in other areas of the nation--
Florida, Georgia, New York, and Washington--were also using financial
investigative techniques and are expected to result in asset seizures.
Because these cases were ongoing, the officials declined to provide
specific details, other than information already made available to the
public.
For fiscal year 2004, ICE reported seizures totaling $7.3 million from
its alien-smuggling investigations--plus an additional $5.3 million
generated by the state of Arizona under Operation ICE Storm. To obtain
additional perspectives on the results of alien-smuggling
investigations in terms of recovered funds or seized assets, we
contacted Treasury's Executive Office for Asset Forfeiture, which
provides management oversight of the Treasury Forfeiture Fund--the
receipt account for the deposit of nontax forfeitures made pursuant to
laws enforced or administered by the Internal Revenue Service-Criminal
Investigation and DHS components (including ICE, CBP, the U.S. Secret
Service, and the U.S. Coast Guard). The Treasury officials told us they
anticipate that ICE will have increased seizures in fiscal year 2005 or
later, as ICE further applies its financial and money-laundering
expertise to address alien smuggling. Similarly, ICE officials
anticipate increased seizures. In this regard, for the first 6 months
of fiscal year 2005, ICE reported seizures of $7.8 million from alien-
smuggling investigations.
As mentioned previously, alien smuggling globally generates billions of
dollars in illicit revenues annually, according to some estimates. How
much of the total involves aliens smuggled into the United States is
not known, although the United States is often a primary destination
country. Also, according to ICE officials, much of the U.S.-related
smuggling revenues either may not be paid in this country or, if paid
here, may be transported or transmitted abroad quickly. As such,
federal efforts to combat alien smuggling by following the money trail
frequently may present investigators and prosecutors with opportunities
and challenges related to identifying and seizing funds or assets not
located in the United States.
To help investigators and prosecutors meet the opportunities and
challenges associated with transnational crime, the United States has
negotiated and signed more than 50 bilateral mutual legal assistance
treaties (MLAT) with law enforcement partners around the world,
according to the Department of Justice. Such treaties--which are a
mechanism for obtaining evidence in a form admissible in a prosecution-
-provide for a broad range of cooperation in criminal matters, such as
locating or identifying persons, taking testimonies and statements,
obtaining bank and business records, and assisting in proceedings
related to immobilization and forfeiture of assets.
To get a sense of the extent to which federal law enforcement agencies
were using the MLAT process to follow the money trail abroad in alien
smuggling cases, we contacted Justice's Office of International
Affairs, which is responsible for coordinating the gathering of
international evidence and in concert with the State Department,
engages in the negotiation of new MLATs. According to the Deputy
Director, the number of outgoing requests for formal law enforcement
assistance in alien-smuggling cases is few in comparison with cases in
drug trafficking, money laundering, fraud, and various other offenses.
For matters considered to be alien-smuggling cases, the Deputy Director
noted that it would be very difficult to quantify the exact number of
requests made to foreign countries because, among other reasons, the
Office of International Affairs' database was not originally designed
to include a category of "alien smuggling."
Also, we asked ICE headquarters for information regarding use of MLAT
requests made in attempts to follow the money trail on alien-smuggling
investigations that have extended overseas. That is, we asked how many
MLAT requests were made in fiscal years 2003 and 2004, to which
countries, and what have been the results in terms of assets tracked or
seized. ICE's Office of Investigations' Asset Forfeiture Unit responded
that it had no way of determining the number of MLAT requests. ICE
officials noted, however, that none of ICE's reported seizures from
alien-smuggling cases in fiscal year 2004 ($7.3 million) and the first
6 months of fiscal year 2005 ($7.8 million) were made abroad.
Generally, regarding asset seizures and forfeitures, ICE officials
noted that there can be competing demands for investigative resources.
The mission of ICE's Office of Investigations--which has more than
5,000 agents in 26 field offices nationwide--encompasses a broad array
of national security, financial, and smuggling violations, including
narcotics smuggling, financial crimes, illegal arms exports, commercial
fraud, child pornography or exploitation, immigration fraud, and human
trafficking. ICE headquarters officials cautioned that alien-smuggling
cases, in comparison with drug cases, are much less likely to result in
seizures of money. The officials explained that almost all drug deals
are conducted in cash, and it is not unusual for law enforcement to
arrest criminals handling hundreds of thousands or even millions of
dollars in drug money. In contrast, the officials noted that alien-
smuggling fees per person generally involve less money and the alien
smuggler is not arrested with large cash amounts. However, even absent
the significant differences in amounts of seized money or other assets
from alien smugglers, ICE headquarters and field office officials
stressed the importance and utility of applying investigative expertise
for determining the scope and operational patterns of alien-smuggling
organizations, identifying the principals, and obtaining evidence to
build prosecutable cases.
Both criminal and civil forfeiture authority have limitations that
affect the government's ability to seize real property in alien
smuggling cases--particularly stash houses used by smugglers.[Footnote
6] Asset forfeiture law has long been used by federal prosecutors and
law enforcement as a tool for punishing criminals and preventing the
use of property for further illegal activity. In a criminal forfeiture
action, upon conviction, the defendant forfeits and the government
takes ownership of property that the defendant used to commit or
facilitate the offense or property that constituted the proceeds of the
illegal activity. Criminal asset forfeiture is rarely an option in
alien-smuggling cases for two reasons. First, because criminal asset
forfeiture is dependent on conviction of the defendant, it is not
available if the defendant is a fugitive, which alien smugglers often
are according to Justice. Second, because the stash house is often
rental property, it is rare that the property owner is convicted as it
is difficult to establish the owner's knowledge of the smuggling.
In contrast to criminal forfeiture, in a civil forfeiture action, the
government is not required to charge the owner of the property with a
federal offense. However, to forfeit property used to facilitate the
offense but purchased with legitimately earned funds, the government
must establish a substantial connection between the use of the property
and the offense. Once that connection is established, the government
can forfeit the house if the owner cannot show innocent ownership due
to the owner's willful blindness to the criminal activity. However,
taking civil action as an alternative to criminal action for real
property seizures is not an option in alien smuggling cases. Civil
forfeiture in alien smuggling cases is generally limited to personal
property such as vessels, vehicles, and aircraft and does not extend to
real property.[Footnote 7] Thus, the house used to hide the aliens and
conduct the alien-smuggling business could not be forfeited in a civil
forfeiture action. Civil forfeiture of real property is available in
cases where the house was used to conduct drug transactions, including
the storing of drugs and money, child pornography, and money
laundering.[Footnote 8] In the view of Justice and ICE, this statutory
distinction between alien smuggling and other criminal offenses is
inappropriate.
An amendment to the civil forfeiture authority, according to Justice,
would enhance federal efforts to dismantle smuggling organizations
because would-be defendants often are fugitives, which makes criminal
forfeiture unavailable. Also, a civil forfeiture authority for real
property used to facilitate alien smuggling would enable the government
to establish willful blindness arguments against landlords who hope to
profit from such ventures without becoming directly involved. However,
our May 2005 report noted that Justice does not have a legislative
proposal on this subject pending before Congress because the
department's legislative policy resources have been focused on other
priorities.
Expanding civil forfeiture authority in alien smuggling cases to
include real property used to facilitate the offense may raise
concerns, including the potential for abuse of this type of forfeiture
and the adequacy of protection for the rights of innocent property
owners. In 2000, several reforms were made to civil asset forfeiture
law to provide procedural protections for innocent property owners.
These reforms were part of a compromise that was developed over several
years by Congress, the executive branch, and interest groups. Some
observers felt that the legislation did not provide enough reforms and
protections, while others felt that it went too far and would curtail a
legitimate law enforcement tool.
Conclusions:
Creation of DHS in March 2003 has provided new opportunities to more
effectively combat alien smuggling, particularly in reference to using
financial investigative techniques to target and seize the monetary
assets of smuggling organizations. However, after more than 2 years,
the federal response to alien smuggling is still evolving, including
development and implementation of a strategy to follow the money trail.
Also evolving is the working relationship of ICE and CBP, two DHS
components that have the primary responsibility for investigating and
interdicting alien smugglers. Having clearly defined roles and
responsibilities for these components is important, given their
complementary antismuggling missions. In this regard, ICE's and CBP's
November 2004 memorandum of understanding did not address a mechanism
for tracking the number and the results of leads referred by CBP to ICE
for investigation. If a tracking mechanism were in place, CBP could
continue pursuing certain leads if ICE--for lack of available resources
or other reasons--does not take action on the referrals. As such, a
tracking mechanism would help to further ensure that large or
significant alien-smuggling organizations are identified and
investigated.
Federal law enforcement has concerns that efforts to dismantle alien-
smuggling organizations are constrained by the current absence of civil
forfeiture authority for real property used to facilitate the smuggling
of aliens. In contrast, for drug trafficking and various other criminal
offense categories, civil forfeiture authority is available for seizing
real property used to facilitate these crimes. According to Justice and
ICE, the absence of civil forfeiture authority for real property used
to facilitate the smuggling of aliens is inappropriate because law
enforcement is unable in many cases to seize stash houses where
smugglers hide aliens while awaiting payment and travel arrangements to
final destinations throughout the nation.
To enhance the federal response to alien smuggling, our May 2005 report
made two recommendations. Specifically, we recommended that:
* the Secretary of Homeland Security establish a cost-effective
mechanism for tracking the number and results of referrals by CBP to
ICE, and:
* the Attorney General, in collaboration with the Secretary of Homeland
Security, consider developing and submitting to Congress a legislative
proposal, with appropriate justification, for amending the civil
forfeiture authority for real property used to facilitate the smuggling
of aliens.
DHS and Justice expressed agreement with the respective recommendation.
DHS said CBP and ICE, in consultation with Border and Transportation
Security, would work together to identify and implement a solution to
address our recommendation. Justice said it plans to move forward with
a proposal as GAO recommended.
Mr. Chairman, this concludes my prepared statement. I would be happy to
respond to any questions that you or Members of the Subcommittee may
have.
Contact and Staff Acknowledgments:
For information about this testimony, please contact Richard Stana,
Director, Homeland Security and Justice Issues, at (202) 512-8777, or
stanar@gao.gov. Contact points for our Offices of Congressional
Relations and Public Affairs may be found on the last page of this
report. Other individuals making key contributions to this testimony
include Danny Burton, Grace Coleman, Frances Cook, Odilon Cuero, and
Kathleen Ebert.
FOOTNOTES
[1] GAO, Combating Alien Smuggling: Opportunities Exist to Improve the
Federal Response, GAO-05-305 (Washington, D.C.: May 27, 2005).
[2] Also, according to the Department of Justice, alien-smuggling-
related activity may have been prosecuted under a variety of other
federal criminal statutes covering, for example, passport fraud,
immigration document fraud, bribery of a public official, and
racketeering activity.
[3] See 8 U.S.C. § 1324. Also, as mentioned previously, alien-
smuggling-related activity may be prosecuted under a variety of other
federal criminal statutes covering, for example, passport fraud,
immigration document fraud, bribery of public officials, and
racketeering activity.
[4] There are various differences in penalty provisions applicable to
alien smuggling. For instance, there are mandatory minimum penalties
for certain violations of 8 U.S.C. § 1324(a)(2) but not for similar
violations of 8 U.S.C. § 1324(a)(1)(A). Also, enhanced penalties for
causing serious bodily injury or placing life in jeopardy apply to
violations of 8 U.S.C. § 1324(a)(1)(A) but not to similar violations of
8 U.S.C. § 1324(a)(2). Further, the death penalty or imprisonment for
life may be imposed for violations of 8 U.S.C. § 1324(a)(1)(A) in which
death results, but such penalties are not available for similar
violations of 8 U.S.C. § 1324(a)(2).
[5] Statement of Tom Homan, ICE Interim Resident Agent-In-Charge (San
Antonio, Tex.), at a hearing ("Deadly Consequences of Illegal Alien
Smuggling") before the Subcommittee on Immigration, Border Security,
and Claims of the Committee on the Judiciary, House of Representatives,
June 24, 2003.
[6] These houses sometimes are also referred to as "drop" houses or
"safe" houses where smugglers hide aliens while awaiting payment and
travel arrangements to final destinations throughout the nation.
[7] 8 U.S.C. § 1324(b).
[8] See 18 U.S.C. §§ 881, 981, 2254.