Possible U.S. Payments to Gun Smugglers Probed by Congress

(Updates with purpose of investigation in fourth paragraph.)

July 6 (Bloomberg) -- Congressional investigators looking into a U.S. law enforcement program to track guns shipped illegally to Mexico are examining whether government-paid informants were involved in smuggling weapons.

Representative Darrell Issa, a Republican from California, and Senator Charles Grassley, a Republican from Iowa, have been investigating a program run by the Bureau of Alcohol, Tobacco, Firearms and Explosives that allowed the illegal purchases in an effort to link the guns to drug cartels in Mexico.

"The evidence we have gathered raises the disturbing possibility that the Justice Department not only allowed criminals to smuggle weapons but that taxpayer dollars from other agencies may have financed those engaging in such activities," the two lawmakers wrote in a letter to Attorney General Eric Holder that was released today.

The ATF operation, called Fast and Furious, allowed guns to be illegally purchased in the U.S. as part of an effort to help law enforcement officials build cases against arms smugglers, according to a report in June by Grassley and Issa.

Two of about 2,000 guns that ATF allowed to be carried away were found at the Arizona murder scene of U.S. Border Patrol agent Brian Terry in December 2010, the report said.

Congressional investigators are looking into whether the Drug Enforcement Administration or Federal Bureau of Investigation paid any informants involved in gun smuggling, according to a congressional staff member who spoke on condition of anonymity and wasn't authorized to discuss the matter publicly.

'Real Indications'

Issa is chairman of the House Oversight and Government Reform Committee, and Grassley is the top Republican on the Senate Judiciary Committee. The lawmakers' letter to Holder said they had "very real indications" that the gun traffickers the ATF tried to identify were "already known to other agencies and may even have been paid as informants."

The letter also said acting ATF Director Kenneth Melson told congressional staff that his agency was not informed about certain activities of the FBI and DEA.

Chris Jakim, a spokesman for the DEA, said he wasn't aware of any payments to gun smugglers and that he was looking into the matter. Paul Bresson, a spokesman for the FBI, didn't immediately return a phone call seeking comment.

--Editors: Laurie Asseo, Jodi Schneider