ATF Headquarters Ran Fraud to Fund Undercovers

Unable to spend appropriated funds on some agency priorities, agents ran an operation, under direct verbal control of headquarters, to sell off stolen property (cigarettes and tobacco). They didn’t do this as a smuggling sting as they have done before, but to raise money secretly for further clandestine, off-the-books and outside-the-law operations. The New York Times received the leak (probably as a result of the Mob War of Succession between the Ron Turk and Tom Brandon “families” in ATF HQ):

How that arrangement began is unclear. Ryan Kaye, an A.T.F. supervisor, testified that the [slush fund] was created “as a result of verbal directives from the A.T.F. program office and other headquarters officials.” Mr. Kaye’s full statement is sealed, but excerpts are cited in one publicly available document.

Verbal directives, i.e. “commit nothing to writing,” are not a standard or remotely legal way of doing any undercover operation. They are, in fact, a crime.

We smell the Chief Counsel’s Office, ATF’s equivalent of the Ninth Ring of Perdition. The only other ATF agent publicly identified as involved in the years-long fraud is one Thomas Lesnak, since retired, but dozens of ATF officials seem to have been involved — and, possibly, to have profited.

The operation came to light because the ATF and its informants cheated a group of tobacco farmers out of $24 million, for which the victims are now suing. At least $1M of the farmers’ money was skimmed by the ATF on behalf of each of two of the ATF’s paid informants, Jason Carpenter and Christopher Small. The whereabouts of the other $22 million are unknown at this time — spent on undercover operations, pocketed by agents or supervisors, or some combination of the above, most likely.

The Obama Justice Department fought a battle to keep the corruption trial out of the press, and until something happened in January, the New York Times went along.

It gets better… the government denies all wrongdoing, and have gotten a rubber-spined judge to seal nearly all documents in the case. But somehow the IRS has decided that they ought to make an example of the cheated farmers in this case: by demanding they pay taxes on the money the ATF stole from them. Read The Whole Thing™.

It seems like this is a case made for the appointment of a Special Prosecutor.

11 thoughts on “ATF Headquarters Ran Fraud to Fund Undercovers

  1. Tom Stone

    I can remember when the USA made a pretense of respecting the Rule of Law in those long ago days when we had the best politicians money could buy.


    From a foreigners perspective it looks like your federal law enforcement agencies are turning feral, with Fast and Furious being the best example. It must be tough as a citizen when your cops turn out so regularly to be organised criminal organisations with the gummint running interference for them.

  3. Sommerbiwak

    The ATF seems to have peeked into the CIA’s play book for raising funds. Tobacco is a drug after all.

    But the IRS wanting to tax the money taken from the farmers is real icing on the cake.

    Trump shouldn’t “drain the swamp”. He should flood it, as the District of Columbia has been built in the middle of a swamp along the Potomac river.

  4. jim h

    I’m trying, unsuccessfully, to envision exactly what happened that compelled the IRS to believe it was entitled to tax money on this. I’m also really interested to see/hear about a special ethics investigation on the judge.

    makes me wonder what sort of shenanigans were being pulled on gun owners/makers too. if the tobacco stuff netted 24 million, you *know* the fines, fees, and lawsuits levied on the People of the Gun really raked it in.

  5. Boat Guy

    Cue Inspector Renault.
    Flooding the District is a great idea. Flush all of those bastards out into the Atlantic.

  6. Buckaroo

    If one assumes that the NYT is a propaganda tool of the Deep State, one wonders what the motivation is for pursuing this story. Has Deep State decided that the ATF is no longer a reliable tool, and needs to be put under the authority of a different agency? Here’s betting they try to shoehorn it under the FBI’s JTTF, which is basically the CIA’s domestic operation.

    1. John M.

      Meh. Occam’s razor: Obama’s not president anymore, and Trump is. Ergo, executive branch incompetence, corruption and scandal is once again news fit to print.

      -John M.

  7. Cap'n Mike

    The powers that be at BATFE appear to be heading the famous words of Boston Ward Boss Martin Lomasney

    “Never write if you can speak; never speak if you can nod; never nod if you can wink.”

  8. Keith

    Then you would face a court order from the EPA to stop the action because it would endanger some snail or some such.

    Every legal gun owner buy one box of there favorite ammo for there favorite gun and….

    I fully suspect the folks at ATF talked to there BFF’s in the IRS over lunch and said “It would be nice if your agency would give us a little cover here.” or some such.

    Keep your powder dry and your faith in God.

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