Thoughts on IRS Web Page titled "How criminal investigations are initiated" (11/13/24)

The IRS has a web page titled “How criminal investigations are initiated, here” (last reviewed or updated 8/20/24 and visited 11/13/24). It is a “lite” introduction to the topic. I found the concluding “claim” interesting: 

Conviction

The ultimate goal of an IRS Criminal Investigation prosecution recommendation is to obtain a conviction - either by a guilty verdict or plea. Approximately 3,000 criminal prosecutions per year provide a deterrent effect and signals to our compliant taxpayers that fraud will not be tolerated.

Notice how the subject shifts from the first sentence to the second. The first sentence talks about conviction (as does the heading). The second sentence talks about prosecutions which is not the same as convictions unless the implication is that there is a 100% conviction rate. (The conviction rate is not 100% which I address later in this blog post.)

The IRS offers these statistics in its annual Data Book, Table 26 currently titled “SOI Tax Stats - Criminal Investigation Program, by Status or Disposition - IRS Data Book Table 26,” here (last reviewed or updated 8/20/24; viewed 11/13/24). Here is a screenshot of the 2023 Table 26:

Note that the indictments and informations were 1,676, the total for legal source and illegal source financial crimes. The 2022 numbers were 1,670 for legal and illegal source prosecutions. So, the claim of 3,000 prosecutions is incorrect based on the IRS numbers. However, the above statistics are for prosecutions from investigations by IRS CI. Tax prosecutions may come from other sources (e.g., government investigations other than from IRS CI in which tax crimes may be added to nontax crimes for prosecution reasons). So, such nontax prosecutions may account for the difference of about 1,300.

IRS Criminal Tax Statistics (4/3/17)

The IRS has issued its 2016 Data Book.  The pdf for the Databook is here.  I have extracted here the part under the heading "Collections, Penalties and Criminal Investigations."  In this extraction, there are two pages of graphics and information and then the next pages offer the following tables:

• Table 16. Delinquent Collection Activities, Fiscal Years 2015 and 2016
• Table 17. Civil Penalties Assessed and Abated, by Type of Tax and Type of Penalty, Fiscal Year 2016
• Table 18. Criminal Investigation Program, by Status or Disposition, Fiscal Year 2016

IRS CI also offers its Fiscal Year 2016 statistics here and its cumulative statistics for the years 2007 - 2016, here.

I have been extracting tax crimes data from both the IRS Annual Data Book and annual report of statistics since 2005 and offer it here.  I have been keeping in a spreadsheet a subset of these statistics since 2005 (note that I have two years not included in the IRS offering linked above).  The spreadsheet is here.  Here are the cumulative statistics for 2005-2016 and for 2012-2016:

FROM THE IRS DATA BOOK
LEGAL SOURCE STATISTICS
		2005-2016	2012-2016
1	Indictments	12,353	6,801
2	Convictions	10,850	6,093
3	Percentage Convicted (l. 2 / l. 1)	87.8%	89.6%
4	Sentenced	10,583	5,842
5	Incarcerated	8,396	4,642
6	Percentage Incarcerated (l. 4 / l. 5)	79.3%	79.5%
FROM THE IRS CI WEBSITE STATISTICS:
EXCLUDING FINANCIAL CRIMES
		2005-2016	2012-2016
1	Indictments	17,072	8,695
2	Sentenced	15,012	7,544
3	Percentage Sentenced (l. 2 / l. 1)	87.9%	86.8%

I have not tried to reconcile these statistics (I am sure it is in differences in the data in each set.)  I infer, however, that, for the mainstream tax crime, the conviction rate is far less than the general conviction rate of 95% touted by DOJ Tax.  Of course, some tax crimes are charged without an IRS investigation, but DOJ Tax would have to have one hell of a conviction rate on those crimes to move the overall conviction rate up from the convictions obtained from CI investigations -- again, if only mainstream tax crimes are considered.  And, in any event, at least from my practice, the tax crimes cases that I have been involved with have involved CI investigations except in two prominent instances.  For most tax practitioners doing this type of work, the cases will generally progress from an IRS CI investigation (which would cause the ultimate results to be in the CI statistics), although they may stop for some investigation by the grand  jury (in which case they would also be in the CI statistics).

I would appreciate hearing by comment or email from those having more knowledge of how DOJ Tax calculates its statistics and the differences between the IRS statistics and the DOJ Tax statistics.

IRS CI Publishes Annual Report and Some Statistics (4/15/15)

IRS CI has issued its annual report.  IRS Criminal Investigation, Annual Business Report: Fiscal Year 2014 Operations, here.  Many of the key statistics appear also on the IRS CI website here.  For further drill down by program, see here, and the 10-year statistics are here.  The IRS Data Book presents annual statistics in a different but very useful format, here.

I have been keeping data drawn primarily from the IRS statistics.  I attach my latest spreadsheet here (zip file).  I have links in the spreadsheet to show the sources for the data.

The most interesting spreadsheet is Sheet1.  The data in Sheet1 indicate that for legal source prosecutions over the period from 2005 though 2014, the conviction rate is 84.7%.  (That is convictions over indictments for legal source prosecutions.) I won't try to correlate that the DOJ Tax's claims of a 95% (or thereabouts) conviction rate.  I know DOJ Tax's claims relates to all crimes it prosecutes and not just legal source tax crimes and DOJ Tax may prosecute some crimes not accounted for in the IRS data.

The conviction rate substantially increased in 2014, but (i) the single year numbers do not as easily smooth out year to year differences in the components (year of indictment and year of conviction) as do multi-year numbers and (ii), even focusing on 2014, there was a larger number of indictments in 2013 over 2012 and 2014, so the larger number of indictments in 2013 may have disproportionately contributed to the convictions in 2014.

More on Conviction Rates in Tax Cases (5/12/13)

I have had several blogs on statistics, sometimes quoting the famous quote attributed to Benjamin Disreali that "There are three kinds of lies: lies, damned lies, and statistics."  Those various blogs may be viewed under the key word statistics below, here.

In some of the blogs I have questioned DOJ Tax's claims over the years of a 95% conviction rate in the tax prosecutions it brings.  Today, I address that issue again.

This past week, the IRS released its Annual Business Report on Fiscal Year 2012 National Operations, here.  That report has some statistics for 3 years that are consistent with the IRS data book, Table 18 which may be accessed here for the years back to 1995.  More about that in a minute.

On p. 4 of the 2012 Annual Report, the following statement appears:

Conviction rate is the percentage of convictions compared to the total number of convictions, acquittals, and dismissals. The conviction rate for FY 2012 is 93.0%, 0.3% more than the FY 2011 rate (92.7%).

This claim of 92.7% for 2011 and 93.0% for 2012 is not materially different from DOJ Tax's claims of a 95% conviction rate.  So, I will refer to the claims as a 95% conviction rate claim.

My first reaction was that perhaps I have been wrong to question such a high conviction rate, since, although not backed with data, the IRS's indicated methodology for calculating the conviction rate seemed sound.  But, being the skeptic, I decided to dig deeper.  I therefore offer the following analysis from the IRS's own detailed data for a longer number of years to see if I could get to the same or roughly the same indicated conviction rate.  My analysis below summarizes the more detailed analysis in a spreadsheet I offer for download here (a zip file).

DOJ Tax Budget Request: Promo Piece with Some Statistics (9/19/12)

I am not sure exactly when this came out.  The pdf copy I have says that it was created in February 2012, so I am behind in getting to it.  In any event, here it is.  Department of Justice 2013 DOJ Tax Division FY 2013 Congressional Budget, here.

Key excerpts related to criminal tax enforcement that has been blogged frequently here (some footnotes omitted):

[*1] 

To help achieve uniformity in nationwide standards for criminal tax prosecutions, the Tax Division’s criminal prosecutors authorize almost all grand jury investigations and prosecutions involving violations of the internal revenue laws. Alone or in conjunction with Assistant United States Attorneys, Tax Division prosecutors investigate and prosecute these crimes. In the last few years, the Division has authorized between 1,300 and 1,800 criminal tax investigations and prosecutions per year. 

Improving Voluntary Compliance. The Tax Division’s success rate in its litigation – more than 90% – has an enormous effect on voluntary tax  compliance. fn2 By law, the IRS cannot make public the fact of an IRS audit, or its result. By contrast, the Tax Division’s important tax litigation victories receive wide media coverage, leading to a significant multiplier effect on voluntary compliance. fn3 Efforts of the IRS and the Tax Division are having a positive effect on voluntary compliance. According to the most recent survey by the IRS Oversight Board, 87 percent of those surveyed think it is “not at all” acceptable to cheat on taxes. fn4 Also, the Commissioner’s Voluntary Disclosure Initiative, timed to coincide with the Division’s ongoing criminal and civil enforcement concerning unreported offshore accounts, resulted in an unprecedented number of taxpayers, almost 15,000, attempting to “return to the fold” and paying back taxes, interest and penalties due that will likely total in at least the hundreds of millions of dollars. As an integral part of the IRS’s enforcement efforts, the Tax Division is partially responsible for the IRS’ ability to collect over $2 trillion in taxes each year. fn5

IRS CI Statistics (9/18/12)

I just reviewed the IRS CI statistics web page, Like Share Print Enforcement Statistics - Criminal Investigation (CI) Enforcement Strategy, here, and revised my Federal Tax Crimes text to reflect those statistics.

Below is the revised excerpt of the text of my book.  I omit the table in the excerpt below but note that in the text I condense the columns to include only the years 2008-2011.  For those wanting a spreadsheet of the table, I provide it here in excel format with the derived percentages  The following text omits the footnotes:

B. Statistics 

Benjamin Disreali once mused that “there are lies, damned lies, and statistics.” Here are some statistics as presented on the IRS web page: 

TABLE OMITTED (BUT SEE DOWNLOAD HERE). 

The conviction rate is quite high.  The data is not presented for convictions, but it is for sentencing.  Since convictions result in sentencing, I derive over this 4 year period a conviction rate on Tax Investigations (not including Other Financial Crimes) of 89%.  However, DOJ Tax prosecutes more tax and tax related crimes than those referred by the IRS, and as recently as 2007, DOJ Tax claimed a conviction rate on the whole subset at 97%.  I am skeptical as to that percentage, but the conviction rate (whatever it is precisely) is high.

DOJ Tax Promo Piece to House Oversight Subcommittee (6/1/12)

Kathryn Keneally, the recently anointed AAG Tax, has promoted the Tax Division's efforts and accomplishments before a House subcommittee on oversight.  See Statement of Kathryn Keneally, Assistant Attorney General, Tax Division, before the Subcommittee on Courts, Commercial and administrative Law Committee on Judiciary, U.S. House of Representatives, Regarding Oversight of the Tax Division (May 31, 2012), here.

Here are excerpts related to criminal tax matters that are the focus of this blog:

Tax Division prosecutors authorize and prosecute cases after determining that there is a reasonable probability of conviction based on the existence of sufficient admissible evidence to prove all of the elements of the offense charged.  

 * * * * 

Criminal Investigation and Prosecution 

Criminal Trial In addition to our extensive civil practice, the Tax Division authorizes all prosecutions arising under the federal tax laws except for excise taxes and criminal disclosure violations. In most cases, Division attorneys either conduct or supervise these prosecutions, often in partnership with prosecutors from the United States Attorneys' Offices. The Division's twin criminal goals are to prosecute criminal tax violations and to promote uniform nationwide criminal tax enforcement. In many cases, the Tax Division receives requests from the IRS to prosecute violations after the IRS has completed an administrative investigation. In other cases, the IRS asks the Tax Division to authorize grand jury investigations to determine whether prosecutable tax crimes have occurred. Tax Division prosecutors review, analyze, and evaluate referrals to ensure that uniform standards of prosecution are applied to taxpayers across the country. In the past few years, the Division has authorized between 1,300 and 1,800 criminal tax investigations and prosecutions each year. After tax charges are authorized, cases are handled by a United States Attorney's Office, by a Tax Division prosecutor, or by a team of prosecutors from both. Tax Division prosecutors also conduct training for IRS criminal investigators and Assistant United States Attorneys, and provide advice to other federal law enforcement personnel, such as the DEA and the FBI.

The crimes investigated and prosecuted by the Tax Division include attempts to evade tax, willful failure to file returns, and submission of false returns, as well as other conduct designed to violate federal tax laws. The crimes may be committed by individuals, business entities, or tax preparers and professionals. These cases often encompass tax crimes where the source of the individual or business income is earned through legitimate means -- as examples, a restaurateur who skims cash receipts; a self-employed individual who hides taxable income or inflates deductions; or a corporation that maintains two sets of books, one reporting its true gross receipts and the other -- used for tax purposes -- showing lower amounts. Prosecutions in these cases often receive substantial attention in the local and national media, and convictions remind law-abiding citizens who pay their taxes that those who cheat will be punished.

Moneyball on Go-Forwards - Show Me the Data (5/12/12)

I had a comment posted today here as follows:

Many Americans Abroad Surprised by Tax Code's Nasty Bite
http://nyti.ms/JFY6x9
From the above article
FBAR forms filed in 2009 276,386
filed in 2011 618,134

The commenter was referring to statistics in the following article: Brian Knowlton, Many Americans Abroad Surprised by Tax Code's Nasty Bite (NYT 5/10/12), here.

I will use a separate blog entry to respond to this data.  My response is in the form of a question to which I hope readers will respond, particularly readers with some experience with criminal tax practice.

I suspect that the bulk of the delta filers between 2009 and 2011 (app 340,000, including the first time filers in 2010) are had accounts prior 2010 who did not join OVDI or do a quiet disclosure.  Let's just say that 250,00 of them are first time filers in 2010 or 2011 who had accounts in prior years but did not join OVDI or make a quiet disclosure.  They are the go-forward data set.

How many do you think will be (a) investigated criminally for past years or (b) prosecuted for past years?

Keep in mind that DOJ Tax CES prosecutes at most, say, 3,000 tax cases (max) of all sorts every year.

And, a related question, how do you think the IRS will investigate civilly -- well audit, even if not civilly (sorry for the pun -- in enough detail to consider significant civil penalties?  Keep in mind in this regard that well-advised taxpayers doing a go-forward will have self-selected a data set in which the IRS will not be able to assert or sustain significant penalties in the bulk of the cases.  And, if the IRS perceives that, will it nevertheless divert major resources -- which are limited and will take away from other enforcement efforts -- to chase down relatively small penalties?  Finally, keep in mind that the FBAR penalties the IRS asserts after this major audit enforcement initiative would then have to be followed by more civil litigation enforcement than either DOJ Tax or the Courts likely have otherwise uncommitted resources to handle.

IRS Statistics - General and Criminal Specific (3/27/12)

The IRS has published a new data book, the 2011 Data Book, here, with all sorts of interesting statistics relating to its revenue enforcement function.  There is all sorts of good data about the number of returns filed in the aggregate and by category, the number of audits in the aggregate and by category and other fun data facts.

The table of most interest to the readers is Table 18, titled Criminal Investigation Program, by Status or Disposition, Fiscal Year 2011.  A separate pdf of that table is here.  It is short table with footnotes and self-explanatory, so rather than summarize it here, I just recommend clicking the link and reading it.

For IRS Criminal Investigation statistics, see here, with further links to more detailed statistics.

Plea Bargains Generally and in Tax Cases; Moneyball (3/24/12)

In two cases, the Supreme Court has recognized the central role of plea bargaining in the criminal system and held the the right to effective assistance of counsel extends to advising the client in plea negotiations.  Missouri v. Frye, ___ U.S. ___, 2012 U.S. LEXIS 2321 (2012), here (failure to advise the defendant of a time-limited plea offer by the prosecutor); and Lafler v. Cooper, ___ U.S. ___, 2012 U.S. LEXIS 2322 (2012), here (providing the defendant highly questionable advice to reject a proffered plea and go to trial instead).  In an earlier case, the Court had anticipated this broader holding the context of a plea agreement where the attorney failed to advise the defendant of the collateral immigration consequences of the plea.  Padilla v. Kentucky, 559 U. S. ___, ___ (2010), here.

The crux of the holdings is (Missouri v. Frye):

The State's contentions are neither illogical nor without some persuasive force, yet they do not suffice to overcome a simple reality. Ninety-seven percent of federal convictions and ninety-four percent of state convictions are the result of guilty pleas. See Dept. of Justice, Bureau of Justice Statistics, Sourcebook of Criminal Justice Statistics Online, Table 5.22.2009, http://www.albany.edu/ sourcebook/pdf/t5222009.pdf (all Internet materials as visited Mar. 1, 2012, and available in Clerk of Court's case file); Dept. of Justice, Bureau of Justice Statistics, S. Rosenmerkel, M. Durose, & D. Farole, Felony Sentences in State Courts, 2006-Statistical Tables, p. 1 (NCJ226846, rev. Nov. 2010), http://bjs.ojp.usdoj.gov/content/pub/pdf/fssc06st.pdf; Padilla, supra, at ___ (slip op., at 15) (recognizing pleas account for nearly 95% of all criminal convictions). The reality is that plea bargains have become so central to the administration of the criminal justice system that defense counsel have responsibilities in the plea bargain process, responsibilities that must be met to render the adequate assistance of counsel that the Sixth Amendment requires in the criminal process at critical stages. Because ours "is for the most part a system of pleas, not a system of trials," Lafler, post, at 11, it is insufficient simply to point to the guarantee of a fair trial as a backstop that inoculates any errors in the pretrial process. "To a large extent . . . horse trading [between prosecutor and defense counsel] determines who goes to jail and for how long. That is what plea bargaining is. It is not some adjunct to the criminal justice system; it is the criminal justice system."  Scott & Stuntz, Plea Bargaining as Contract, 101 Yale L. J. 1909, 1912 (1992). See also Barkow, Separation of Powers and the Criminal Law, 58 Stan. L. Rev. 989, 1034 (2006) ("[Defendants] who do take their case to trial and lose receive longer sentences than even Congress or the prosecutor might think appropriate, because the longer sentences exist on the books largely for bargaining purposes. This often results in individuals who accept a plea bargain receiving shorter sentences than other individuals who are less morally culpable but take a chance and go to trial" (footnote omitted)). In today's criminal justice system, therefore, the negotiation of a plea bargain, rather than the unfolding of a trial, is almost always the critical point for a defendant. 

To note the prevalence of plea bargaining is not to criticize it. The potential to conserve valuable prosecutorial resources and for defendants to admit their crimes and receive more favorable terms at sentencing means that a plea agreement can benefit both parties. In order that these benefits can be realized, however, criminal defendants require effective counsel during plea negotiations. "Anything less . . . might deny a defendant effective representation by counsel at the only stage when legal aid and advice would help him.'" Massiah, 377 U. S., at 204 (quoting Spano v. New York, 360 U. S. 315, 326 (1959) (Douglas, J., concurring)).

TIGTA Report on the State of IRS CI (10/17/11)

In August, TIGTA released its report titled Trends in Criminal Investigation’s Enforcement Activities Showed Improvements for Fiscal Year 2010, With Gains in Most Performance Indicators (Ref: 2011-30-068 7/25/11), here. I have finally found time to look at the report, which is an annual report on key areas of priority and statistics for IRS' Criminal Investigation ("CI"), the IRS division charged with investigating tax crimes. CI has other criminal investigation responsibilities, but after the Webster Report in the late 1990s, has been tasked with using more of its resources on criminal tax investigation and, within that category, legal source criminal tax investigations. The notion for focusing more on legal source criminal tax investigation is that that is where the IRS can get the most benefit from its limited resources in terms of supporting the overall tax system. Obtaining and publicizing legal source tax convictions will likely have much more ripple effect on compliance than with obtaining and publicizing illegal source tax convictions.

Most of the report is about statistics, usually presented in graph form (called figures). I caution readers to heed Benjamin Disreali's caution that: "There are three kinds of lies: lies, damned lies and statistics."

DOJ Tax Web Site Touts DOJ Tax and IRS Juggernaut on Foreign Financial Accounts (9/20/11)

DOJ Tax has a new web page titled "Offshore Compliance Initiative," here.  The page touts DOJ Tax's efforts and the strategic timing of efforts with IRS's offshore compliance initiatives (OVDP 2009 and OVDI 2011).    However, the claim of the eclipse of the tax efficient secret Swiss bank account may be exaggerated.

DOJ Tax touts the statistics as follows:

The prosecution results so far have been encouraging: To date, approximately 150 grand jury investigations of offshore-banking clients have been initiated, of which 30 cases have been charged, with 24 guilty pleas having been entered, 2 convicted after trial, and 4 awaiting trial. A number of facilitators who helped clients hide assets offshore at UBS and other banks have been indicted, resulting in ten bankers and two attorneys being charged and awaiting trial, and one advisor being charged and convicted. In addition, grand jury investigations have been opened into eight additional offshore banks across the world.

Statistics are always dicey things. The 150 grand jury investigations is new public information, but it is unclear what exactly the number means. Does the 150 refer to the number of "targets" or to the number of investigations with some of them having more than one target? And, the statistics I show for the prosecutions (see my spreadsheet available from the page in the right column) do not match DOJ Tax's number of prosecutions (30 cases, but that may be because a case can have more than one defendant and some involving offshore account and/or FBAR prosecutions that I count may did not arise out of the initiative). In any event, the numbers are impressive.

TRAC November Statistics

TRAC has November statistics for prosecutions and convictions of interest to readers of this blog:

Prosecutions on cases referred by IRS

Convictions on cases referred by IRS

White collar crime prosecutions

White collar crime convictions

State of IRS Criminal Investigations

I previously blogged here the TIGTA annual state of the universe on IRS's Criminal Investigation Function (that report is here). I supplement with some bullet points of interest (all relating to FY 2009 unless otherwise indicated:

1. CI spent , stated as a percentage,of "52.4 percent of its time on legal source tax and 72 percent on total tax investigations, both at a 10-year high." Those familiar with how statistics lie (or at least are misleading, should have some questions) may be able to question the desired conclusion from these statistics.

2. "[T]he number of legal source tax investigation initiations increased by 13.3 percent and the number of tax-related initiations increased by 14.4 percent. In addition, the percentage of all initiations that were legal source tax and tax-related increased by 1.3 and 2.5 percentage points, respectively. "

3. I found this statistic interesting because I now represent someone who should not have been investigated in the first place (fairly typical of my clients).  In this case, the IRS listened to an informant with misinformation and was unable to assess the credibility of the informant.  Here is the statistic: "the FY 2009 average of 413 days to discontinue a legal or illegal source investigation exceeded the 386 day average in FY 2008 by 7 percent." Draw your own conclusions as to the bare numbers of days the IRS' futzes around with bull shit investigation (OK, that's too harsh). But at least some of those being investigated should not have been in the first instance and it seems to me a bit harsh for subject them to an IRS criminal investigation for 413 days is just about 412 days too many. (OK, I will compromise at, say, 206 days too many). That period (whatever it is) is a period of unnecessary anxiety and costs that are, well, let's just say unfair.

4. "The number of subjects convicted of legal source tax crimes increased 2 percent from FY 2008 and has increased 17.5 percent since FY 2004."

5. "The overall publicity rate for prosecutions in FY 2009 was 81.9 percent." "Research suggests that higher levels of criminal sentences lead to greater tax compliance." And, just what research would that be? TIGTA does not identify the research.

6. CI "did not meet the long-term goal noted above or its revised conviction goal for FY 2009 of 2,135, reporting that it received only 2,105 convictions." And, here is what it says about that (footnotes omitted):

Despite not meeting some of its goals, the Division exceeded its FY 2009 goal of 4,000 by initiating 4,121 subject investigations. The FY 2009 initiations represent a 9.9 percent increase over the FY 2008 total of 3,749. In addition, the number of subject investigations open in inventory increased 7.7 percent over the FY 2008 total of 3,691 investigations. According to the FY 2009 Business Performance Review (BPR) document, the Division plans to complete 3,900 investigations and obtain 2,135 convictions in FY 2010. Division management expects that the 9.9 percent increase in initiations it experienced this fiscal year will provide for a future increase in completions and resulting convictions. Since the Division reported that it takes, on an average, less than 1 year (341 days) to refer a case for prosecution, n18 we believe the anticipated increase in initiations will likely result in an increase in completions and may allow the Division to meets it completion goals next fiscal year.

7. And here's the discussion of fraud referrals.

. The number of fraud referrals received by the Division decreased for a second consecutive year. The Division reported receiving 505 fraud referrals in FY 2009, a 13.4 percent decrease from the 583 received in FY 2008, and a 19.2 percent decrease from the FY 2005 high of 625. n25 Since fraud referrals remain a viable and important source of legal source tax investigations, we are concerned that the number of fraud referrals received has trended downward since FY 2005. During a February 2010 meeting, the Chief, Criminal Investigation, advised that this trend may change in the future since the operating divisions now have a performance commitment relating to fraud referrals.

What exactly is the "performance commitment related to fraud referrals?"

TIGTA Report of IRS Enforcement Activities for FYE 2000 - 2008

TIGTA has produced its annual report on IRS Enforcement Activites. The report is here and the highlight report is here. The report presents key enforcement data is useful charts that help understand the year to year changes in the data. I may have some additional comment later, but wanted to get the report and the highlights out to readers as soon as possible.

The following is from the highlight report:

TIGTA previously reported that from FY 2006 to FY 2007 several key performance measures showed improvement. For example, the numbers of subject investigations initiated, completed, and recommended for prosecution all showed improvement.

In FY 2008, the Criminal Investigation Division (the Division) continued to demonstrate efficiencies processing investigations. For example, the number of days needed to close legal and illegal source investigations decreased by 2.9 percent from the previous year. However, some key performance measures that had improved the previous year declined: the number of subject investigations initiated decreased nearly 11 percent; the number of subject investigations completed decreased 5.3 percent; and direct investigative time showed a slight decrease.
TIGTA believes that one of the causes for the decreases in the numbers of subject investigations initiated and subject investigations completed was the continued rise in pipeline inventory (a subject investigation that has been recommended for prosecution and the subject has not been convicted or acquitted, or the investigation has not been dismissed) and the resources needed to address it. Pipeline inventory has steadily increased over the past 6 years and now stands at a 9-year high of 4,118 subject investigations. FY 2008 is the second consecutive year where there were more subject investigations in the pipeline than open subject criminal investigations. More direct investigative time is being spent to prepare investigations in the pipeline for adjudication instead of initiating new investigations.

Division management believes this is a positive trend since successful prosecutions generate publicity, foster deterrence, and enhance voluntary compliance. For FY 2009, the Division indicated that it would place a greater emphasis on the reduction of the pipeline inventory, which may result in even fewer investigations being initiated and completed during the upcoming year. TIGTA is currently conducting a separate review to evaluate the growth in pipeline inventory and to identify any potential actions that can be taken in the future to reduce the resources devoted to this area.
TIGTA believes another cause for the decreases in subject investigations initiated and completed is the continued loss of experienced special agents to attrition faster than they can be replaced. The number of special agents is currently at its lowest level in 30 years. The Division attributes this to its budgets being relatively flat in recent years, which have put pressure on its ability to replace agents lost through attrition because of the need to fund yearly salary increases.

TIGTA’s concern noted last year about the net loss of experienced special agents negatively impacting productivity was realized during FY 2008. During FY 2009, the Division plans to hire 192 special agents, but the new, inexperienced agents may not have a significant impact on the FY 2009 performance goals.