WASHINGTON, DC – Today, U.S. Senator Rob Portman (R-OH), Ranking Member of the Senate Homeland Security and Governmental Affairs Committee, released a new report revealing significant issues with the State Department Trafficking in Persons (TIP) Office’s oversight of grant funds to the Global Fund to End Modern Slavery.
The report, titled The Program to End Modern Slavery: A Review of State Department Oversight of Human Trafficking Grant Recipients, shows how from 2017 to 2018, the TIP Office awarded $46 million in U.S. taxpayer dollars to a brand new entity with no prior experience in managing U.S. grant funds: the Global Fund to End Modern Slavery (or the “Global Fund”). As a result of the issues identified in this report, it is unclear if the $46 million in U.S. taxpayer dollars awarded to the Global Fund will make a long-term measurable difference in the fight against trafficking in persons.
Portman is the founder and co-chair of the Senate Caucus to End Human Trafficking. As the former Chairman of the Permanent Subcommittee on Investigations, he conducted a series of investigations on the trafficking of unaccompanied minors and the sex trafficking of children on the internet. He is the author of six federal anti-trafficking laws designed to better serve victims and help law enforcement end this horrific crime, including the high-profile Stop Enabling Sex Traffickers Act (SESTA) law.
“Human trafficking is a horrific, yet globally persistent crime,” Portman said. “The victims of human trafficking need our help, making it even more important that the federal government closely monitor the resources allocated to address this tragedy. This report shows how a lack of due diligence and oversight, and programmatic failures—both by the TIP Office and the Global Fund—led to poor management of U.S. taxpayer dollars and a lack of support and services for the intended recipients: victims of modern slavery.”
The report’s key findings include:
- It is unclear if the $46 million in U.S. taxpayer dollars awarded to the Global Fund will make a long-term measurable difference in the fight against trafficking in persons. A third-party review of the sub-awards made by Global Fund found some “mild or early signs of promise,” but the evaluation observed, “nothing conclusive can be said about early progress in reducing trafficking for any [Global Fund sub-awardee] project.” The review also found “serious concerns” with some of the Global Fund sub-awardees’ work.
- In 2017, the TIP Office awarded $25 million in U.S. taxpayer funds to a new entity with no record of success, the Global Fund. The TIP Office made this award through the Project to End Modern Slavery authorized by Congress, or “PEMS.” The Global Fund had minimal experience and infrastructure in place to manage federal grant funds. Global Fund leadership expressed to the Committee the initial cooperative agreement with the TIP Office was a “heavier lift” than they originally understood.
- The TIP Office approved sub-grant projects without adequate grant oversight procedures in place. Despite the unprecedented amount of PEMS funding awarded to Global Fund, the TIP Office did not establish standardized site visit procedures for sub-grantees. This lack of timely site visits on sub-grantees resulted in a failure to identify concerns with sub-grantee budgets during approval stages, and canceled or reduced certain sub-grants after the sub-grantees had already received funding and began work.
- The Global Fund received an additional $21 million in grant funds (or PEMS 2) from the TIP Office despite no evidence of success from the first round of funding. The TIP Office awarded the second tranche of $21 million to the Global Fund before the Global Fund had developed a successful track record of managing Federal funds. The TIP Office allocated $2.25 million of PEMS 3 funding to EnCompass LLC to evaluate Global Fund’s work under the PEMS grant in September 2017.
- The TIP Office inconsistently evaluated Global Fund sub-grantees’ application materials. TIP Office representatives told Committee staff they approved some “almost final but not quite final” sub-award budgets because they were eager to move forward to meet the award timelines. As a result, the TIP Office approved Global Fund sub-grantee projects without properly vetting them.
- After the Global Fund awarded U.S. taxpayer dollars to sub-grantees, the TIP Office issued a corrective action plan to the Global Fund addressing problems that the TIP Office did not discover until it conducted site visits of awardees. In total, the TIP Office issued ten recommendations following site visits to the Global Fund to improve its oversight over its sub-awardees.
- The TIP Office cancelled a Global Fund sub-awardee project in a way that may have left participants vulnerable. The TIP Office cancelled one project in the Philippines because of “comprehensive failings that could not be corrected.” The issues included a lack of knowledge regarding human trafficking monitoring and evaluation methods, suspect political connections, and a failure to follow U.S. laws regarding foreign assistance.
- The head of the TIP Office sat on the Global Fund Board of Directors and approved all Global Fund sub-grants. TIP Office officials told GAO auditors “they thought it was appropriate to exercise oversight through board participation, given the $46 million in funding awarded to [the Global Fund].” The Global Fund’s CEO, by contrast, told Committee staff that she did not want the Global Fund to appear to be a U.S. Government entity and was resistant to the idea of having a TIP Office representative on its Board.
- Global Fund sub-awardees failed to vet for human rights violations, or “Leahy vetting.” U.S. law prohibits the Federal government from providing assistance or training to any nation’s security forces that have perpetrated gross violations of human rights. Cooperative agreements between the TIP Office and the Global Fund for both PEMS 1 and 2 funding contain Leahy vetting requirements. One Global Fund awardee in the Philippines was providing training to military personnel without proper Leahy vetting. Another, in Vietnam, was found to have a “poor understanding” of Leahy vetting requirements, evidenced by local police being unwilling to participate in the sub-awardee’s program.
- A State Department commissioned evaluation of the Global Fund’s work raised questions about the success of Global Fund awardees’ work. While an August 2021 report from EnCompass LLC found “mild or early signs of promise” in the Global Fund’s work, it also observed certain awardees to be “less grounded” in anti-human trafficking practices, and others to have a “poor understanding” of U.S. law pertaining to funding foreign security forces. It also found that certain awardee approaches and methods did not “fully meet beneficiary needs” and “serious concerns” about prevalence estimates performed by awardees.
The report makes the following recommendations:
- The TIP Office should develop a standardized policy for site visits. A standardized site visit policy in a global program would allow for uniformity across the grantees. This should include standardized site visit training for TIP Office staff.
- The TIP Office should implement metrics for awarding future funding under PEMS that includes grantee past performance. The TIP Office awarded a second round of funding to the Global Fund without assessing its preliminary work. Any award of grant funds should include a review of basic metrics, including past performance and whether a grantee’s programs align with TIP Office mission goals.
- The TIP Office should develop guidance regarding cancelling a project versus issuing a corrective action plan. Although the TIP Office initiated corrective action plans on multiple Global Fund grantees, it only cancelled one project. According to the TIP Office, there is no standardized plan for when to cancel a project versus issuing a corrective action plan. This lack of guidance creates confusion for TIP Office staff, grantees, and oversight bodies when attempting to gauge program effectiveness and future steps.
- Congress should ensure future grant authorization legislation includes funding for program oversight. PEMS is an unprecedented funding effort by the United States to combat human trafficking. Congress should ensure no taxpayer dollars are wasted and allocate portions of existing funding for oversight and accountability of awarded funds.