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Summary

We initiated an audit of the Title XI loan guarantee program administered by the Maritime Administration (MARAD) at the request of the Senate Committee on Commerce, Science, and Transportation and the House Appropriations Committee. Our short-term objective is to assess the effect of the October 19, 2001, bankruptcy filing of American Classic Voyages Co. (AMCV) on its Title XI loan guarantees. Because of the filing, AMCV’s loan guarantees totaling over $367 million are now at risk. We will also perform a comprehensive review of the Title XI program, specifically to determine if (1) procedures for submitting, reviewing, approving, and monitoring selected Title XI loan guarantees comply with laws and regulations, and (2) these procedures are adequate and effectively implemented in order to protect the interests of the United States.