DOD Excess Property:

Risk Assessment Needed on Public Sales of Equipment That Could Be Used to Make Biological Agents

GAO-04-15NI: Published: Nov 19, 2003. Publicly Released: Dec 23, 2003.

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Due to continuing concerns about bioterrorism and the potential for future anthrax attacks, GAO was asked to audit controls over public sales of excess Department of Defense (DOD) biological equipment and chemical and biological protective clothing that could be used to produce and disseminate biological warfare agents. GAO used a case study approach to determine (1) the extent to which DOD is selling biological equipment and protective clothing that can be used to make and disseminate biological agents and (2) whether existing federal regulations and guidance in DOD policies and procedures address the risk of public sales of these items.

Many items needed to establish a laboratory for making biological warfare agents were being sold on the Internet to the public from DOD's excess property inventory for pennies on the dollar, making them both easy and economical to obtain. Although production of biological warfare agents requires a high degree of expertise, public sales of these DOD excess items increase the risk that terrorists could obtain and use them to produce and deliver biological agents within the United States. Further, the possibility that bacillus anthracis (anthrax) and other biological source agents could have fallen into the wrong hands due to poor controls at laboratories handling biological agents, as previously reported by GAO and other federal investigators, calls for an assessment of the national security risk posed by public sales of excess DOD biological laboratory equipment and protective clothing. As requested, GAO established a fictitious company and purchased over the Internet key excess DOD biological equipment items and related protective clothing necessary to produce and disseminate biological warfare agents. In total, GAO spent about $4,100 to purchase these new and usable excess items, with a total original acquisition cost of $46,960. GAO's investigation of several buyers of the biological equipment items found that they exported them to countries, such as the Philippines, Egypt, and the United Arab Emirates, for transshipment to other countries--some of which may be prohibited from receiving exports of similar trade security controlled items. Neither federal regulations issued by other agencies nor DOD policies generally restrict DOD from selling the case study biological equipment items to the general public. Further, DOD units did not always follow the department's January 2003 policy for restricting chemical and biological protective suits and related gear--masks, hoods, boots, boot coverings, and gloves--to DOD use only. While our audit focused on DOD sales, the case study items are available from other sources, indicating a broader problem.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: On February 11, 2004, DOD finalized its policy, which also updates the Defense Demilitarization Manual (DOD 4160.21-M-1). The policy states that DOD has determined that items, including those with any content of 900 nanometers or more of IR reflectant, to be of a sufficiently critical and sensitive nature to require demilitarization prior to release from DOD control. Items with less than 900 nanometer of IR reflectant are no longer subject to demilitarization or export controls.

    Recommendation: To ensure that DOD units are adhering to established DOD policy that restricts designated chemical and biological protective clothing, such as jackets, trousers, masks and filters, hoods, gloves, boots, and boot covers, from release outside DOD, the Secretary of Defense should direct the Director of the Defense Logistics Agency to establish appropriate criteria and finalize and issue a policy for restricting the disposition of clothing items with infrared (IR) reflectant properties.

    Agency Affected: Department of Defense

  2. Status: Closed - Not Implemented

    Comments: In September 2004 DLA provided us with a list of numerous contacts made to state law enforcement agencies and others, including a May 4, 2004, notice that strongly advised that the defective suits be returned to DOD for disposal. On November 1, 2004, DLA provided GAO a report of excess DOD clothing items, including 71 defective BDOs that state law enforcement agencies returned to DOD for disposal from September 20, 2003, through October 2004. In addition, GAO's online query and analysis of DOD excess property inventory data identified returns of 66,715 defective BDOs from DOD units, DOD contractors, and others between October 1, 2003, and April 6, 2005.

    Recommendation: To ensure that DOD units are adhering to established DOD policy that restricts designated chemical and biological protective clothing, such as jackets, trousers, masks and filters, hoods, gloves, boots, and boot covers, from release outside DOD, the Secretary of Defense should direct the Director of the Defense Logistics Agency to contact local law enforcement agencies and other DOD special program recipients and confirm that they have returned to DOD all defective Battle Dress Overgarments (BDO) that they have received.

    Agency Affected: Department of Defense

  3. Status: Closed - Implemented

    Comments: In response to GAO's recommendation, the Defense Reutilization and Marketing Service (DRMS) issued new guidance for Compliance Assessment reviews and the Defense Logistics Agency (DLA) conducted Staff Assistance Visits to monitor DRMS reviews and provide assurance that excess chemical and biological protective clothing and other items are properly controlled. While the DRMS operational reviews are focusing on controls over chemical and biological protective clothing, the DLA Compliance Assessment Reviews are covering all items requiring demilitarization controls. Both DLA and DRMS have initiated these reviews and the DLA Executive Director, Distribution and Reutilization Policy is monitoring the status and results of the reviews. In addition, Defense Reutilization and Marketing Offices (DRMO) have updated their Quarterly Self Assessments to reflect specific questions targeted at compliant handling of nuclear, biological, and chemical items and items with infra-red reflectant properties. GAO confirmed that these reviews have been implemented.

    Recommendation: To ensure that DOD units are adhering to established DOD policy that restricts designated chemical and biological protective clothing, such as jackets, trousers, masks and filters, hoods, gloves, boots, and boot covers, from release outside DOD, the Secretary of Defense should direct the Director of the Defense Logistics Agency to establish mechanisms such as periodic audits to provide assurance that excess chemical and biological protective clothing is being properly controlled.

    Agency Affected: Department of Defense

  4. Status: Closed - Implemented

    Comments: On November 12, 2003, DLA and the Joint Service Nuclear Biological Chemical Defense Equipment Assessment Program group developed and issued new procedures for controlling these excess items and disseminated a message to all the military services informing them of the new control process for nuclear, biological, and chemical property items, specific disposition instructions, and the requirement that all excess chemical and biological property and equipment be turned in under their assigned national stock numbers (NSN). In addition, DLA established a DEMIL Code Integrated Process Team (IPT) in October 2003 to assess the DEMIL coding process. The Demilitarization Coding Management Office was tasked to identify systemic, service-peculiar problems with coding. The IPT will meet with the military service DEMIL coordinators March 23, 2004, to identify coding discrepancies and develop a plan of action to correct them. Recurring problems with proper identification of property by NSN is on the meeting agenda. Also, DRMS has established on its Web site an interactive communication tool that allows DRMS employees to query the system on Infrared Reflectant/nuclear, biological, and chemical assets. The Web page serves as an information conduit to the field activities as changes occur.

    Recommendation: To ensure that DOD units are adhering to established DOD policy that restricts designated chemical and biological protective clothing, such as jackets, trousers, masks and filters, hoods, gloves, boots, and boot covers, from release outside DOD, the Secretary of Defense should direct the Director of the Defense Logistics Agency to consider additional improvements to controls over the assignment of demilitarization codes to these restricted items, particularly those items that are purchased locally and have local stock numbers.

    Agency Affected: Department of Defense

  5. Status: Closed - Implemented

    Comments: In a February 11, 2004, letter to Chairman Shays, the DLA Executive Director, Distribution and Reutilization Policy, stated that its liquidation sales contractor returned all textiles to Defense Reutilization and Marketing Service (DRMS) control in October 2003. To more securely control future disposition of these items, DRMS, in conjunction with the Joint Service Nuclear Biological Chemical Defense Equipment Assessment Program (JSNBCDEAP), is in the process of establishing more regional "Textile Clearing Houses" that are designed to sort textile assets to identify and segregate co-mingled NBC clothing and equipment. After going through the clearing house process, remaining textiles will be sorted by national stock number. Assets identified as NBC will remain property of the JSNBCDEAP. Other assets will be turned in at the Defense Reutilization and Marketing Offices, co-located with the regional Textile Clearing Houses for proper disposition. The first Textile Clearing House was established at the DRMO in Columbus, Ohio in December 2003. The second clearing house was established at the Norfolk Virginia DRMO in February 2004. Additional clearing houses are scheduled for Texarkana, Texas; Barstow, California; Okinawa and Sagami, Japan; Hawaii, Guam, and Kaiserslautern, Germany. GAO's monitoring of DOD liquidation contractor Internet sales has not identified continuing improper sales of DOD chemical and biological protective clothing.

    Recommendation: To ensure that DOD units are adhering to established DOD policy that restricts designated chemical and biological protective clothing, such as jackets, trousers, masks and filters, hoods, gloves, boots, and boot covers, from release outside DOD, the Secretary of Defense should direct the Director of the Defense Logistics Agency to require and confirm that Government Liquidation, LLC returns all restricted DOD-use-only excess chemical and biological protective clothing in its possession to DOD.

    Agency Affected: Department of Defense

  6. Status: Closed - Implemented

    Comments: In response to GAO's work, DOD performed a risk assessment, which determined and established appropriate controls over excess laboratory equipment. DOD also discontinued the sale of chemical and biological protective suits and related gear to the public--actions which should significantly reduce the associated national security risk.

    Recommendation: The Secretary of Defense should direct the Assistant Secretary of Defense for Homeland Defense, in consultation with DOD's scientific community, the Department of Homeland Security, and the Department of Health and Human Services, perform a risk and vulnerability assessment to determine what controls are needed over excess DOD property that could be used to establish a laboratory to make biological warfare agents. The risk and vulnerability assessment should (1) focus on the adequacy of controls throughout the excess property disposal process, including the effectiveness of demilitarization management controls, (2) recognize that current End Use Certificate controls and export licenses are ineffective preventive controls, and (3) consider the full range of DOD excess property items that could be used to produce and disseminate biological warfare agents. Further, in developing appropriate controls, consideration should be given to prohibiting sale or release to the public of specific types of excess biological equipment that pose the most significant risk.

    Agency Affected: Department of Defense

  7. Status: Closed - Implemented

    Comments: In response to GAO's recommendation, on December 19, 2003, DOD sent a memorandum to all state coordinators and law enforcement agencies that warned of dangers associated with using certain chemical protective or battle dress overgarment (BDO) suits and provided the national stock numbers associated with these suits. The Memorandum strongly recommended that these BDO chemical and biological protective suits be used for "Training Purposes Only" or returned to the Defense Reutilization and Marketing Service and stated that death or serious injuries could occur if the suits are not used for intended purposes. The memorandum stressed that all state coordinators must ensure that these protective suits will be used for training purposes only and that they should not be mistaken for serviceable suits.

    Recommendation: To ensure that DOD units are adhering to established DOD policy that restricts designated chemical and biological protective clothing, such as jackets, trousers, masks and filters, hoods, gloves, boots, and boot covers, from release outside DOD, the Secretary of Defense should direct the Director of the Defense Logistics Agency to send to law enforcement agencies and others that may have received defective BDOs the same level of warning that was provided to DOD units.

    Agency Affected: Department of Defense

 

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