Criminal Debt:

Oversight and Actions Needed to Address Deficiencies in Collection Processes

GAO-01-664: Published: Jul 16, 2001. Publicly Released: Aug 16, 2001.

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The collection of outstanding criminal debt has been a long-standing problem for the federal government. Since October 1985, as reported in the U.S. Attorney's statistical reports, the balance of outstanding criminal debt has grown from $260 million to more than $13 billion. Currently, the receipting of collections and recordkeeping for criminal debt is primarily the responsibility of the U.S. Courts, while the Department of Justice is responsible for collecting criminal debt. This report reviews (1) the key reasons for the growth in reported uncollected criminal debt; (2) whether adequate processes exist to collect criminal debt; and (3) what role, if any, the Office of Management and Budget (OMB) and the Department of the Treasury play in monitoring the government's collection of criminal debt. GAO found that four key factors have contributed to the significant growth of uncollected criminal debt. These factors are (1) the nature of the debt, in that it involves criminals who may be incarcerated or deported or who have minimal earning capacity; (2) the assessment of mandatory restitution regardless of the criminal's ability to pay, as required by the Mandatory Victims Restitution Act of 1996; (3) interpretation by the Financial Litigation Units of payment schedules set by judges which limit collection activities; and (4) state laws that may limit the type of property that can be seized and the amount of wages that can be garnished. Financial Litigation Units do not always follow their policies and procedures to ensure that collection actions are prompt and adequate. The present management practices and processes do not ensure that offenders are deprived of their ill-gotten gains and that innocent victims are compensated for their losses to the fullest extent possible. Collection responsibilities continue to be divided between Justice and the courts, with neither having a central management oversight role. Neither OMB nor Treasury has identified the need to take an active oversight role in the collection of the growing balance of outstanding criminal debt.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: On May 2, 2005, Justice reported to the Senate Committee on Homeland Security and Governmental Affairs that it had established an interagency task force to respond to GAO's recommendation to establish such a task force that would develop a strategic plan to improve criminal debt collection. According to Justice, the Task Force on Improving the Collection of Criminal Debt is led by Justice's Office of Legal Policy and includes representatives of its Executive Office for United States Attorneys, the Administrative Office for U.S. Courts, the Office of Management and Budget, and the Department of the Treasury. The Task Force is working on a strategic plan to improve the collection of criminal debt, which will include (1) legislative proposals to give investigators and prosecutors new tools to track, secure, and collect offenders' assets for victim restitution; (2) new procedures for inter-agency coordination and cooperation in debt collection; and (3) new policies for efficient management, accounting, and reporting of debt owed and collected.

    Recommendation: Addressing the long-standing problems in the collection of outstanding criminal debt--including fragmented processes and lack of coordination--will require a united strategy among the entities involved with the collection process. Therefore, the Attorney General, the Director of the Administrative Office of the U.S. Courts (AOUSC), the Director of the Office of Management and Budget (OMB), and the Secretary of the Treasury should work together in the form of a joint task force to develop a strategic plan to improve the criminal debt collection mechanism among all entities involved in these processes. The strategy should address managing, accounting for, and reporting criminal debt. The strategy includes determining an approach for assessing collectibility of outstanding amounts so that a meaningful allowance can be reported and used for measuring debt collection performance and having OMB work with Justice and certain other executive branch agencies to ensure that these entities report and/or disclose relevant criminal debt information in their financial statements and subject such information to audit.

    Agency Affected: Department of Justice

  2. Status: Closed - Implemented

    Comments: On May 2, 2005, Justice reported to the Senate Committee on Homeland Security and Governmental Affairs that it had established an interagency task force to respond to GAO's recommendation to establish such a task force that would develop a strategic plan to improve criminal debt collection. According to Justice, the Task Force on Improving the Collection of Criminal Debt is led by Justice's Office of Legal Policy and includes representatives of its Executive Office for United States Attorneys, the Administrative Office for U.S. Courts, the Office of Management and Budget, and the Department of the Treasury. The Task Force is working on a strategic plan to improve the collection of criminal debt which will include (1) legislative proposals to give investigators and prosecutors new tools to track, secure, and collect offenders' assets for victim restitution; (2) new procedures for inter-agency coordination and cooperation in debt collection; and (3) new policies for efficient management, accounting, and reporting of debt owed and collected.

    Recommendation: Addressing the long-standing problems in the collection of outstanding criminal debt--including fragmented processes and lack of coordination--will require a united strategy among the entities involved with the collection process. Therefore, the Attorney General, the Director of the Administrative Office of the U.S. Courts (AOUSC), the Director of the Office of Management and Budget (OMB), and the Secretary of the Treasury should work together in the form of a joint task force to develop a strategic plan to improve the criminal debt collection mechanism among all entities involved in these processes. The strategy should address managing, accounting for, and reporting criminal debt. The strategy includes determining an approach for assessing collectibility of outstanding amounts so that a meaningful allowance can be reported and used for measuring debt collection performance and having OMB work with Justice and certain other executive branch agencies to ensure that these entities report and/or disclose relevant criminal debt information in their financial statements and subject such information to audit.

    Agency Affected: Department of the Treasury

  3. Status: Closed - Implemented

    Comments: On May 2, 2005, Justice reported to the Senate Committee on Homeland Security and Governmental Affairs that it had established an interagency task force to respond to GAO's recommendation to establish such a task force that would develop a strategic plan to improve criminal debt collection. According to Justice, the Task Force on Improving the Collection of Criminal Debt is led by Justice's Office of Legal Policy and includes representatives of its Executive Office for United States Attorneys, the Administrative Office for U.S. Courts, the Office of Management and Budget, and the Department of the Treasury. The Task Force is working on a strategic plan to improve the collection of criminal debt which will include (1) legislative proposals to give investigators and prosecutors new tools to track, secure, and collect offenders' assets for victim restitution; (2) new procedures for inter-agency coordination and cooperation in debt collection; and (3) new policies for efficient management, accounting, and reporting of debt owed and collected.

    Recommendation: Addressing the long-standing problems in the collection of outstanding criminal debt--including fragmented processes and lack of coordination--will require a united strategy among the entities involved with the collection process. Therefore, the Attorney General, the Director of the Administrative Office of the U.S. Courts (AOUSC), the Director of the Office of Management and Budget (OMB), and the Secretary of the Treasury should work together in the form of a joint task force to develop a strategic plan to improve the criminal debt collection mechanism among all entities involved in these processes. The strategy should address managing, accounting for, and reporting criminal debt. The strategy includes determining an approach for assessing collectibility of outstanding amounts so that a meaningful allowance can be reported and used for measuring debt collection performance and having OMB work with Justice and certain other executive branch agencies to ensure that these entities report and/or disclose relevant criminal debt information in their financial statements and subject such information to audit.

    Agency Affected: Executive Office of the President: Office of Management and Budget

  4. Status: Closed - Implemented

    Comments: On May 2, 2005, Justice reported to the Senate Committee on Homeland Security and Governmental Affairs that it had established an interagency task force to respond to GAO's recommendation to establish such a task force that would develop a strategic plan to improve criminal debt collection. According to Justice, the Task Force on Improving the Collection of Criminal Debt is led by Justice's Office of Legal Policy and includes representatives of its Executive Office for United States Attorneys, the Administrative Office for U.S. Courts, the Office of Management and Budget, and the Department of the Treasury. The Task Force is working on a strategic plan to improve the collection of criminal debt, which will include (1) legislative proposals to give investigators and prosecutors new tools to track, secure, and collect offenders' assets for victim restitution; (2) new procedures for inter-agency coordination and cooperation in debt collection; and (3) new policies for efficient management, accounting, and reporting of debt owed and collected.

    Recommendation: Addressing the long-standing problems in the collection of outstanding criminal debt--including fragmented processes and lack of coordination--will require a united strategy among the entities involved with the collection process. Therefore, the Attorney General, the Director of the Administrative Office of the U.S. Courts (AOUSC), the Director of the Office of Management and Budget (OMB), and the Secretary of the Treasury should work together in the form of a joint task force to develop a strategic plan to improve the criminal debt collection mechanism among all entities involved in these processes. The strategy should address managing, accounting for, and reporting criminal debt. The strategy includes determining an approach for assessing collectibility of outstanding amounts so that a meaningful allowance can be reported and used for measuring debt collection performance and having OMB work with Justice and certain other executive branch agencies to ensure that these entities report and/or disclose relevant criminal debt information in their financial statements and subject such information to audit.

    Agency Affected: Administrative Office of the United States Courts

  5. Status: Closed - Implemented

    Comments: With Treasury's assistance, Justice and the courts are identifying delinquent criminal debts that are eligible for referral to Treasury for collection action. As GAO reported in March 2004, during the first part of 2003, Justice, in cooperation with the U.S. Courts' clerk's offices, piloted the TOP process for criminal debts in four districts, resulting in inclusion of about $700,000 of criminal debts in TOP by the end of FY 2003. As of December 2003, 20 of the 43 districts eligible to submit criminal debts to TOP had either added criminal debts to TOP or were in the process of identifying criminal debts and sending out demand notices to debtors, which is necessary before a debt can be referred to TOP. As of December 2003, Justice had submitted 549 criminal debts, which have a total outstanding balance of about $1.4 million, to TOP and anticipated many more debts to be included in TOP over the next few months.

    Recommendation: In the interim, while the task force is being established, to help improve collections and stem the growth in reported uncollected criminal debt, the Secretary of the Treasury should, through the Treasury's Financial Management Service, assist the Department of Justice and the courts in identifying the types of delinquent criminal debt that would be eligible for referral to Treasury for collection actions.

    Agency Affected: Department of the Treasury

  6. Status: Closed - Implemented

    Comments: As GAO reported in March 2004, with regard to part 1 of this recommendation, EOUSA rolled out to all U.S. Attorney Offices a new version of its collections case tracking system. The new system allows for the tracking of all debt components in a single record for each debtor, thus eliminating the need to open multiple records to track collections for a single debtor. Also, many of the required fields, such as collection types and agency program codes, had been coded to eliminate duplicative data entry by the user. With regard to part 2 of the recommendation, GAO also reported in March 2004 that, according to a Justice official, the reconciliation of payment information between the Financial Litigation Units (FLU) and the courts was contingent on the Administrative Office of the U.S. Courts' (AOUSC) development and implementation of its new Civil/Criminal Accounting Module (CCAM). Before CCAM can be installed in each district, the courts and the FLU must undergo a comprehensive reconciliation process that will ensure accurate data is imported into the new system. In a letter from AOUSC dated 1/14/05, AOUSC stated that it had developed the Civil Criminal Accounting Module (CCAM), which will significantly reduce or eliminate duplicate data entry at the courts and Justice. In addition, AOUSC reported that it had implemented CCAM in 8 districts at the end of 2004, and the system is expected to be operational in the other 86 districts by 2006. Although this systems development and reconciliation process is a long-term initiative, Justice and AOUSC have taken significant actions toward this end. Finally, to respond to part 3 of the recommendation, Justice issued a Prosecutor's Guide in May 2003, which revised district guidance so FLU can take a more proactive role in monitoring collection efforts of probation offices. According to the guide, FLU's responsibilities for enforcement of restitution or a fine include coordination with probation offices while defendants are on supervision or probation to facilitate collection, mutual exchange of information, and providing advance notice to probation offices of collection methods.

    Recommendation: In the interim, while the task force is being established, to help improve collections and stem the growth in reported uncollected criminal debt, the Attorney General and the Director of the AOUSC should continue to work together to (1) reduce duplication of data entry for collections and disbursements, (2) require the Financial Litigation Units (FLUs) and the courts to periodically reconcile payment data recorded in their separate tracking systems, and (3) revise district guidance so that FLUs can take a more proactive role in monitoring collection efforts of probation offices.

    Agency Affected: Department of Justice

  7. Status: Closed - Implemented

    Comments: According to a response from AOUSC dated 1/14/05, AOUSC has continued to work with Justice to improve coordination concerning criminal debt collections. AOUSC has developed the Civil Criminal Accounting Module (CCAM), an enhancement to the court's previous accounting system. CCAM provides for the establishment of civil/criminal accounts, including (1) joint restitution; (2) the receipting of funds; (3) the allocation and disbursement of funds to a list of payees; (4) the calculating of interest and penalties on criminal accounts; and (5) the ability to track and monitor the status of civil and criminal debt. CCAM can also provide Justice with criminal debt data--both paper reports and electronic files--such as payment and balance information that will significantly reduce or eliminate duplicate data entry. CCAM was implemented in 8 district courts at the end of 2004 and is expected to be operational in the other 86 districts by 2006. Before CCAM is installed in each district, the courts and Justice's Financial Litigation Unit must undergo a comprehensive reconciliation process that will ensure accurate data is imported into the new system. Although implementing CCAM is a long-term initiative, AOUSC and Justice have taken significant actions to implement this recommendation.

    Recommendation: In the interim, while the task force is being established, to help improve collections and stem the growth in reported uncollected criminal debt, the Attorney General and the Director of the AOUSC should continue to work together to (1) reduce duplication of data entry for collections and disbursements, (2) require the Financial Litigation Units (FLUs) and the courts to periodically reconcile payment data recorded in their separate tracking systems, and (3) revise district guidance so that FLUs can take a more proactive role in monitoring collection efforts of probation offices.

    Agency Affected: Administrative Office of the United States Courts

  8. Status: Closed - Implemented

    Comments: In response to GAO's recommendation, in May 2003, Justice's Executive Office for United States Attorneys (EOUSA) took action by, among other things, issuing the Prosecutor's Guide to Criminal Monetary Penalties. This guide requires prosecutors to ensure that the responsible Financial Litigation Unit (FLU) receives all available information on a defendant's financial resources immediately following sentencing by performing the following steps: (1) forwarding a copy of the pre-sentence report to the FLU; (2) providing the FLU with any information or pleading in the government's file on a defendant's financial resources not obtained through the grand jury investigation; (3) filing a motion asking the court to order disclosure to the FLU of any information gathered by the grand jury and to make the disclosure as soon as it is ordered; and (4) ordering the transcript on any hearing in which a defendant's financial resources were discussed, such as a bond hearing, and forwarding the transcript to the FLU. According to a Justice official, case agents work directly with the prosecuting attorneys and share any information, including financial information, with the prosecutors before a judgment on a criminal case is issued. Further, once a judgment in a criminal case is issued, it generally is sent from the courts to the criminal prosecutor within one week and, once the prosecutor receives the judgment, the financial information is shared with the responsible FLU. By establishing policies and procedures to immediately share relevant financial information with the FLUs, Justice has improved the FLUs' ability to promptly assess offenders' assets and financial resources thereby facilitating the criminal debt collection process.

    Recommendation: In the interim, while the task force is being established, to help improve collections and stem the growth in reported uncollected criminal debt, the Attorney General should establish policies and procedures that require Justice investigating case agents and prosecuting attorneys to share relevant financial information with the FLUs within an established time frame after an offender is sentenced.

    Agency Affected: Department of Justice

  9. Status: Closed - Not Implemented

    Comments: According to Justice officials in January 2008, it is not practical for Justice to require their Financial Litigation Units (FLU) to document correspondence with case agents and prosecuting attorneys in its case files, including whether and why efforts were not coordinated. According to the officials, pre-sentence information, including any correspondence with case agents and prosecutors, can be captured in Justice's case tracking system; however, such actions are not taken on all cases. The officials stated that FLU personnel are required to prioritize their caseload, which involves considering, among other things, the amount of debt owed as well as known circumstances of the debtor. Due to the extremely large volume of cases and the shortage of FLU personnel, FLU staff generally work the larger, potentially more collectible cases. The officials stated that the FLUs will not correspond with case agents and prosecuting attorneys on many of the smaller cases because it is not cost beneficial to do so due to their limited resources and large workload, and the fact that they do not take such actions will not be noted in the case files. However, we continue to believe that requiring FLUs to document correspondence with case agents and prosecuting attorneys in the FLU files, including whether and why efforts were not coordinated, would improve debt collection processes at Justice.

    Recommendation: In the interim, while the task force is being established, to help improve collections and stem the growth in reported uncollected criminal debt, the Attorney General should require FLUs to document correspondence with case agents and prosecuting attorneys in the FLU files, including whether and why efforts were not coordinated.

    Agency Affected: Department of Justice

  10. Status: Closed - Implemented

    Comments: In response to GAO's recommendation, in September 2003, EOUSA issued a memorandum to Financial Litigation Supervisors and Financial Litigation Units (FLUs) requiring that each FLU establish policies and procedures to ensure that all FLU cases are effectively prioritized and enforced pursuant to a priority system. The memorandum contained guidance, including (1) factors to consider in assigning priority codes (e.g., the debtor's assets and income, type of debtor, type of debt, type of victim, complexity of the case); (2) default priority codes based on the amount of the debt; (3) information on setting review dates; and (4) implementation procedures, including a list of fields and codes to be used in Justice's new system for tracking debts and milestone dates for completion of the review and prioritization of all existing cases. According to the memorandum, effective October 1, 2003, (1) all new judgments should be prioritized using the priority system; (2) by December 31, 2003, FLUs should review all pre-existing judgments with an original debt balance of $1 million or more; (3) by March 31, 2004, FLUs should review all pre-existing judgments with an original debt balance of $100,000 to $999,999; and (4) by December 31 2004, to the extent resources permit, FLUs should review all remaining pre-existing judgments. Although priority-setting is currently a manual process, once Justice's new system has been updated, which according to the Justice official is scheduled for fiscal year 2004, the priority codes will be incorporated into the new automated priority process. By performing a collectibility analysis of the debts and prioritizing their debt collection efforts, FLUs can focus their limited resources on the most collectible debts, while also ensuring that all debts are periodically reviewed to determine their collectibility and whether they are accurately recorded in EOUSA's database.

    Recommendation: In the interim, while the task force is being established, to help improve collections and stem the growth in reported uncollected criminal debt, the Attorney General should require FLUs to use collectibility analyses to prioritize criminal debt collection efforts on debt types deemed through historical experience to be more collectible.

    Agency Affected: Department of Justice

  11. Status: Closed - Implemented

    Comments: In response to GAO's recommendation, in January 2002, the Director of the Executive Office for United States Attorneys (EOUSA) sent a memorandum to all U.S. Attorneys, all First Assistant U. S. Attorneys, and all Civil Chiefs. The memorandum generally noted the findings of GAO's 2001 report and encouraged each district to review its policies and procedures with respect to collecting and enforcing criminal debt in light of GAO's findings. The memorandum also offered the assistance of the districts' Financial Litigation Program Manager in implementing or improving criminal debt collection policies and procedures. According to an EOUSA official, EOUSA has also worked to reinforce current policies and procedures through developing and providing training materials to its staff involved in debt collection. In addition, EOUSA's periodical, DebtBeat, which is available to all USAOs, private counsels, and client agencies, regularly provides updates on debt collection issues, including any modifications to debt collection policies and procedures. By reinforcing current policies and procedures for criminal debt collection, Justice is strengthening its debt collector's knowledge of existing collection tools, and requirements and encouraging the prompt use of available collection actions to facilitate debt collection efforts.

    Recommendation: In the interim, while the task force is being established, to help improve collections and stem the growth in reported uncollected criminal debt, the Attorney General should reinforce current policies and procedures for entering cases into criminal debt tracking systems; filing liens; issuing demand letters, delinquent notices, and default notices; performing asset discovery work; using other enforcement techniques; and using event codes, including suspense codes.

    Agency Affected: Department of Justice

  12. Status: Closed - Implemented

    Comments: In response to GAO's recommendation, in May 2003, Justice's Executive Office for United States Attorneys (EOUSA) took action by issuing the Prosecutor's Guide to Criminal Monetary Penalties. Specifically, this guide, among other things, requires the Financial Litigation Units (FLUs) to issue a demand letter for payment of a debt for each case opened within 30 days of the judgment. By revising current policies to require the FLUs to issue demand letters within 30 days after judgment, Justice can promptly inform offenders of their debts and the penalties for not making payments, thereby increasing the incentive for the offenders to make prompt payments.

    Recommendation: In the interim, while the task force is being established, to help improve collections and stem the growth in reported uncollected criminal debt, the Attorney General should revise current policies for issuing demand letters, specifying when a demand letter should be sent and within what time frames.

    Agency Affected: Department of Justice

  13. Status: Closed - Implemented

    Comments: In response to GAO's recommendation, in May 2003, Justice's Executive Office for United States Attorneys (EOUSA) took action by issuing the Prosecutor's Guide to Criminal Monetary Penalties. The guide provides specific times frames for performing certain debt collection actions. For example, it requires that for each case opened for collection, the responsible FLU should, at a minimum, take the following steps within 30 days of the judgment: (1) open and record the case; (2) initiate the filing of a lien where possible; (3) issue a demand letter; and (4) conduct an initial assessment of the prioritization and collectibility of the case, which would include performing asset discovery work. The guide also states that the responsible FLU should provide notice to the defendant of any fine or restitution payment that is found to be delinquent or in default within 10 working days after the delinquency or default occurs. By establishing time frames for procedures related to criminal debt collection activities, Justice will ensure prompt action is taken to initiate collections for new criminal debt cases and encourage payments of outstanding criminal debt.

    Recommendation: In the interim, while the task force is being established, to help improve collections and stem the growth in reported uncollected criminal debt, the Attorney General should require FLUs to establish time frames for procedures related to criminal debt collection activities that do not currently have established time frames.

    Agency Affected: Department of Justice

  14. Status: Closed - Not Implemented

    Comments: According to Justice officials in January 2008, it is not practical for Justice to require its Financial Litigation Units (FLU) to document in their files instances where asset discovery work was not performed and why it was not performed. The officials stated that Justice has established a prioritization process, which involves considering, among other things, the amount of debt owed as well as known circumstances of the debtor. Due to the extremely large volume of cases and the shortage of FLU personnel, FLU staff generally work the larger, potentially more collectible cases. As a result, FLU staff will not perform asset discovery work on many of the smaller or less potentially collectible cases because it is not cost beneficial to do so due to their limited resources and large workload, and the fact that they do not take such actions will not be noted in the case files. However, we continue to believe that requiring FLUs to document in their files instances where asset discovery work was not performed and why it was not performed would improve debt collection processes at Justice.

    Recommendation: In the interim, while the task force is being established, to help improve collections and stem the growth in reported uncollected criminal debt, the Attorney General should require FLUs to document in their files instances where asset discovery work was not performed and why it was not performed.

    Agency Affected: Department of Justice

  15. Status: Closed - Implemented

    Comments: According to a Justice response dated July 20, 2005, currently, all mail received by the U.S. Attorneys Office, which would include copies of judgments in a criminal case, is date-stamped upon receipt and distributed to the FLUs.

    Recommendation: In the interim, while the task force is being established, to help improve collections and stem the growth in reported uncollected criminal debt, the Attorney General should establish a policy for the FLUs to date stamp when Judgments in a Criminal Case are received.

    Agency Affected: Department of Justice

  16. Status: Closed - Not Implemented

    Comments: The Mandatory Victims Restitution Act requires the U.S. Courts' Clerks' Offices to receive and disburse all criminal impositions, including all interest and penalties assessed on restitution orders. In this light, according to Justice officials, Justice's Executive Office for U.S. Attorneys (EOUSA) has been actively working with the Administrative Office of the U.S. Courts (AOUSC) to ensure the consistent and accurate assessment of interest and penalties in the future by means of implementation of the AOUSC's court-wide debt tracking system--Civil/Criminal Accounting Module (CCAM). Justice officials noted that EOUSA has provided all requested assistance to AOUSC so that CCAM will have the ability to not only accurately apply payments and track criminal debt, but also assess and report interest and penalties. As of January 2008, 46 of the 94 judicial districts have implemented CCAM. According to Justice officials, although CCAM implementation was initially scheduled to be completed in 2007, the CCAM rollout is now not expected to be completed until 2010. As of January 2008, Justice has no plans to revise its own interest and penalty policies because AOUSC's CCAM is taking over full responsibility for assessing and reporting interest and penalties associated with criminal debt. However, we continue to believe that revising interest and penalty policies so that interest and penalties are consistently assessed and reported would improve tracking of delinquent debt in districts that have not yet implemented CCAM.

    Recommendation: In the interim, while the task force is being established, to help improve collections and stem the growth in reported uncollected criminal debt, the Attorney General should revise interest and penalty policies so that interest and penalties are consistently assessed and reported.

    Agency Affected: Department of Justice

  17. Status: Closed - Implemented

    Comments: In response to GAO's recommendation, as of fiscal year 2003, Justice annually assesses each district based on established collection goals for that district. According to a Justice official, because of the differences in size of caseloads and types of cases worked, it does not make sense for Justice's Executive Office for United States Attorneys (EOUSA) to establish nationwide goals. Instead, each district establishes and is measured against its own collection goals. To assess debt collection performance and compliance with applicable guidance and regulations at each district, EOUSA uses (1) a goals-setting package, which includes instructions for completing goals based on each district's workload and collections; (2) a state-of-the-district report, which provides three years of detailed district-specific collection statistics to allow each USAO to evaluate its own collection activities based on historical experience; and (3) a compliance checklist, which provides the Financial Litigation Units with an opportunity to review their current policies and procedures to ensure compliance with EOUSA requirements. According to the Justice official, EOUSA works with each district to prepare these tools annually, and each district uses them to determine needed actions to improve criminal debt collection. By measuring criminal debt collection performance against established goals, Justice will be able to better analyze its collection capabilities, including strengths and weaknesses by district to improve its criminal debt collection program.

    Recommendation: In the interim, while the task force is being established, to help improve collections and stem the growth in reported uncollected criminal debt, the Attorney General should adequately measure criminal debt collection performance against established goals.

    Agency Affected: Department of Justice

  18. Status: Closed - Implemented

    Comments: According to a response from Justice on July 8, 2005, Justice has completed recommended revisions to its Financial Litigation Units' (FLUs) database, Tracking Assistance for the Legal Office Network (TALON). To capture certain information about the terms of fine and restitution orders and status of offender, on August 30, 2004, TALON was modified to include additional debtor status information fields, such as the debtor's term of incarceration, the term of supervised release, and the anticipated release dates of incarceration and supervision. Also, according to Justice's response, with regard to the FLUs' ability to allocate outstanding amounts between those amounts likely to be collected and those that are not likely to be collected, Justice's Executive Office for U.S. Attorneys established a process for the FLUs to assess the collectibility of a debt. Under the process, the FLUs prioritize debts by segregating them into categories that indicate when additional efforts to collect are not likely to be effective, e.g., the debtor is deported, the debtor has no ability to pay, or the debtor cannot be located. Once debts are prioritized, the FLUs can concentrate on the more collectible debts in inventory while reviewing other debts periodically to determine collectibility.

    Recommendation: In the interim, while the task force is being established, to help improve collections and stem the growth in reported uncollected criminal debt, the Attorney General should revise the FLUs' databases to (1) capture needed information such as terms of fine and restitution order, status of offender (expected release date from prison or probation) and (2) allow FLUs to allocate outstanding amounts between amounts likely to be collected and those that are not likely to be collected.

    Agency Affected: Department of Justice

  19. Status: Closed - Implemented

    Comments: In response to GAO's recommendation, Justice's Executive Office for United States Attorneys (EOUSA) assessed the Financial Litigation Unit's (FLU) human capital resources and training. According to a Justice official, although the EOUSA did not prepare a formal written assessment of FLUs' human capital resources, in early 2002, EOUSA assessed FLU human capital resources and determined that FLUs are understaffed and need more staff or contractors to perform debt collection activities. Nevertheless, the Justice official noted that EOUSA did receive funding, beginning in fiscal year 2002, through the Office for Victims of Crime (OVC) to support asset investigations in criminal debt collection cases. OVC provides 50 percent of the funding for asset investigators, with the remaining 50 percent to be funded through the Three Percent Fund. Therefore, half the asset investigators' time may be spent on post-sentencing criminal fine and restitution debt collection cases. The asset investigators' services are available through the Financial Litigation Investigator Program. Prior to fiscal year 2002, these investigators were limited to working solely on civil debts because funding for their time was exclusively through the Three Percent Fund. EOUSA also assessed the adequacy of its training with regard to debt collection activities, and as a result, it has worked to reinforce current policies and procedures by developing and providing training materials to its staff involved in debt collection. Moreover, EOUSA's periodical DebtBeat, which is available to all of the United States Attorneys Offices, regularly provides updates on debt collection issues, including any modifications to debt collection policies and procedures. By performing the assessment to determine whether the FLUs' human capital resources and training are adequate to effectively perform their collection activities, Justice has recognized the need for additional debt collection staff and have obtained additional staff through funding from OVC. It is extending training to its debt collection staff to encourage aggressive enforcement action.

    Recommendation: In the interim, while the task force is being established, to help improve collections and stem the growth in reported uncollected criminal debt, the Attorney General should perform an analysis to assess whether the FLUs' human capital resources and training are adequate to effectively perform their collection activities.

    Agency Affected: Department of Justice

  20. Status: Closed - Implemented

    Comments: In its response to agency comments in its July 2001 Criminal Debt report, GAO recognized that if AOUSC effectively implemented its revised guidance issued in September 2000 entitled "Criminal Monetary Penalties: A Guide to the Probation Officer's Role, Monograph 114," then reported weaknesses in the recommended areas were likely to be addressed. According to a response from AOUSC dated 1/14/05, Monograph 114 was distributed during its Judicial Conference in September 2000 and over 7,000 copies were subsequently sent to probation offices. It is also available electronically to probation staff on the judiciary's intranet site. In addition, the Federal Judicial Center updated its "Financial Investigation Desk Reference for U.S. Probation and Pretrial Services Officers" to assist officers in fully implementing the policies and procedures in Monograph 114. The Federal Judicial Center also worked with AOUSC staff and probation officers to produce a 2-hour satellite broadcast addressing implementation issues that first aired live in November 2000 and continued to air 2 or 3 times a month for several months on the Federal Judicial Television Network. In July 2004, the Federal Judicial Center and other financial crime experts presented a 4-part program that served as a refresher and supplemented principles outlined in Monograph 114. This training involved Federal Judicial Television Network broadcasts and follow-up web conferences. Since introduction of Monograph 114, AOUSC reports responding to a variety of technical questions from probation officers as districts moved to implement the monograph and new desk reference.

    Recommendation: In the interim, while the task force is being established, to help improve collections and stem the growth in reported uncollected criminal debt, the Director of Administrative Office of the U.S. Courts should ensure and monitor effective implementation of guidance for (1) developing pre-sentence reports, (2) establishing and monitoring offenders' compliance with installment schedules, (3) providing financial information reported in the pre-sentence report to the FLUs within an established time frame after sentencing, and (4) notifying FLUs within an established time frame before an offender is released from supervision.

    Agency Affected: Administrative Office of the United States Courts

  21. Status: Closed - Implemented

    Comments: According to a response from AOUSC dated 1/14/05, in accordance with Title 18, U.S.C. Section 3612(b)(2), the courts are required to provide a certified copy of the judgment to the U.S. Attorneys Office ten days following sentencing. Additionally, Monograph 114 instructs the courts to forward additional copies of the pre-sentence report and the judgment directly to the Financial Litigation Unit of the U.S. Attorneys Office.

    Recommendation: In the interim, while the task force is being established, to help improve collections and stem the growth in reported uncollected criminal debt, the Director of the Administrative Office of the U.S. Courts should revise guidance to encourage the clerk's office to provide a copy of the Judgment in a Criminal Case to both the FLU and the prosecuting attorney within the established time frame.

    Agency Affected: Administrative Office of the United States Courts

  22. Status: Closed - Implemented

    Comments: According to a response from AOUSC dated 1/14/05, when GAO's Criminal Debt report was issued in July 2001, 19 district courts were not receipting pre-MVRA restitution payments. AOUSC's Accounting and Financial Systems Division has actively pursued the issue with those courts and that number has now dropped to 6 districts. The AOUSC recently contacted all 6 district courts regarding the pre-MVRA cases. According to AOUSC, most courts are deeply concerned about the increased workload because significant budget cuts have adversely impacted court resources. Moreover, the district courts are not statutorily obligated to accept any of the pre-MVRA restitution cases. However, the AOUSC reports that it will continue working with the remaining courts to consolidate in one location at the district level all of the receipting and accounting for criminal cases. Furthermore, the CCAM implementation strategy requires courts to assume the responsibility for all pre-MVRA cases prior to deployment of CCAM, which is expected to be implemented in all districts by the end of 2006. AOUSC has taken significant actions to implement this recommendation.

    Recommendation: In the interim, while the task force is being established, to help improve collections and stem the growth in reported uncollected criminal debt, the Director of the Administrative Office of the U.S. Courts should continue to work with the clerk's offices to process all pre-Mandatory Victims Restitution Act (MVRA) restitution so that the same entity in all districts is responsible for receiving and disbursing pre-and post-MRVA restitution.

    Agency Affected: Administrative Office of the United States Courts

  23. Status: Closed - Not Implemented

    Comments: According to a response received from AOUSC in August 2006, the Criminal Law Committee discussed this recommendation and determined that revising the language in the Judgment in a Criminal Case forms as GAO recommended would be an unauthorized delegation of the court's authority because it would be inconsistent with cases in 10 Circuits that do not allow a district court to delegate authority to probation officers to establish repayment schedules. As a result, the Committee did not pursue this recommendation. However, in a subsequent meeting, the Committee voted unanimously to recommend to the Judicial Conference that it seek legislation that would provide that all criminal financial penalties be payable immediately and collected as non-dischargeable civil debts. In 2006, Senator Dorgan introduced S.3561, the "Restitution for Victims of Crime Act of 2006," which contained several provisions dealing with the payment of criminal monetary penalties, including the setting of minimum payments. However, this bill never became law. This legislation was again introduced during the 2007 congressional term as S.973, but again was not reported out of committee. According to AOUSC, it cannot take action on this recommendation without legislative authority. However, we continue to believe that actions should be taken to clarify that payment terms established by judges are minimum payments and should not prohibit or delay collection efforts.

    Recommendation: In the interim, while the task force is being established, to help improve collections and stem the growth in reported uncollected criminal debt, the Director of the Administrative Office of the U.S. Courts should revise the language in the Judgment in a Criminal Case forms to clarify that payment terms established by judges are minimum payments and should not prohibit or delay collection efforts.

    Agency Affected: Administrative Office of the United States Courts

  24. Status: Closed - Not Implemented

    Comments: According to a response from AOUSC received in August 2006, the judiciary takes the position that restitution disbursements should be made as frequently as possible to the beneficiaries. Each district court establishes its own policy for a minimum dollar threshold for disbursement. According to AOUSC, in many cases, it could take months or years to collect enough restitution to meet a pre-set threshold and maintaining that balance could itself become an administrative burden and expense. In addition, according to AOUSC, one purpose of restitution is to provide monetary compensation to victims for their loss or injury; however, another purpose of restitution is to provide non-monetary comfort to victims, symbolically signifying and demonstrating that a wrong was done to them and progress is being made to make amends. On that basis, AOUSC does not agree that it should establish a monetary threshold for disbursements and states that an arbitrary national standard would be counterproductive. However, during its review, GAO visited clerk's offices that set a low or no threshold amount for disbursing a check to a victim. At one location, checks were issued regularly for as little as 20 cents. GAO continues to believe disbursements in such small amounts are not cost-effective unless it is the final check to be issued to a victim.

    Recommendation: In the interim, while the task force is being established, to help improve collections and stem the growth in reported uncollected criminal debt, the Director of the Administrative Office of the U.S. Courts should establish cost-effective thresholds for disbursements made by check to victims for restitution payments.

    Agency Affected: Administrative Office of the United States Courts

 

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