Mexican legislators also have asked for a joint U.S-Mexico examination.
Known within the multi-agency federal task force as Operation Fast and Furious, the undercover investigation culminated in January with 34 people being charged in a 53-count indictment that included drug smuggling and money laundering allegations. When the Justice Department announced the arrests in January, they revealed that hundreds of firearms had been traced to crimes, including 195 weapons that were seized by authorities in Mexico.
Grassley’s examination revealed sharp disagreement within the ATF field office about how the investigation was run.
“ATF leadership did not allow agents to interdict the weapons in this case,” Grassley said. “Instead agents simply monitored the purchases of ‘suspect guns’ and entered them into a database of firearms ‘suspected to eventually be used in criminal activity.’ ”
Stemming the flow of guns to Mexico, where most firearm ownership is outlawed, has been a priority of the Obama administration, which otherwise has been deeply conflicted about federal gun policy.
“We are trying to work our way through more effective mechanisms to prevent straw purchasers from buying caches of weapons [and] transporting them across the border,” Obama said last week in a news conference with Mexico President Felipe Calderon.
But the administration was dealt setback last month when the House voted to block an ATF plan to track the bulk sales of assault weapons along the border. Under the proposal, gun dealers would have to report to the ATF when someone purchased two or more rifles that have a caliber higher than .22 and a detachable magazine.
The dispute over Fast and Furious within the ATF’s Phoenix field division occurred after some veteran agents argued there was ample evidence to make arrests while supervisors pressed to watch suspects longer to in order to catch the ringleaders.
One ATF agent, John W. Dodson, told Senate investigators that he warned that someone could get killed with the weapons they were letting “walk.” Dodson said he was told, “In order to make omelettes, you have to break a few eggs.”
The controversy came to Grassley’s attention after border agent Brian Terry, 40, was gunned down in December while patrolling the border. Two assault rifles on an ATF watch list as part of Fast and Furious were found nearby, but both have been ruled out as the murder weapon, officials said.
Another federal agent, Immigration and Customs Enforcement agent Jaime Zapata, was shot in February while traveling on business from Mexico City to Monterrey. Guns seized after the killing were linked to three men arrested in Texas. The men had been under investigation by the ATF and U.S. Drug Enforcement Administration, court records show.
The frustrations of agents began appearing anonymously on Web sites. Anti-ATF bloggers sympathetic to the militia movement picked up the allegations late last year, dubbing the scandal “Project Gunwalker” and alleging ATF agents let guns “walk” to boost the numbers of U.S. weapons recovered in Mexico. The bloggers theorized that the ATF wanted high numbers to gain support for an assault-weapons ban.
The ATF strategy was defended by Andre Howard, owner of Lone Wolf Trading Co. in Arizona, which cooperated with the ATF and sold the weapons found near Terry.
“It appears that any state or federal agency charged with said tasks are damned if they do, and damned if they don’t,” Howard said.
Defense attorney Dick DeGuerin said the controversy has had an impact on the criminal investigation into one of his clients, Carter’s Country, a prominent Houston area chain that had sold assault weapons to an extensive gun-trafficking ring.
In an echo of the Fast and Furious case, DeGuerin said that Carter’s Country had dozens of guns traced to Mexico, because in the past few years, the retailer was told by the ATF to go ahead with sales of assault weapons and then report the serial numbers later to the ATF.
Last week, a prosecutor called DeGuerin to say the investigation was being dropped.
“We stood to embarrass them, meaning the ATF, for being hypocritical, two-faced, and turning against the very people who were trying to help them,” DeGuerin said.