Following an inquiry to ATF by Senator Charles Grassley and Congressman Darryl Issa, the OIG conducted an investigation into the Bureau of Alcohol, Tobacco, Firearms and Explosives' (ATF) decision to permit William McMahon, then DAD of ATF's Office of Professional Responsibility and Security Operations (OPRSO), to engage in full-time outside employment with JPMorgan Chase (JPMorgan) during 2012 while still employed full-time by ATF. McMahon is no longer an ATF employee. The OIG reviewed ATF'sapproval of McMahon's outside employment, as well as the approval of his proposed use of sick leave and annual leave for a period of several months through the date of his retirement eligibility.

The investigation found that McMahon's supervisor, Julie Torres, who was the Assistant Director of OPRSO at the time, exercised poor judgment and failed to responsibly perform her duties when she approved McMahon's request to engage in outside employment, and when she separately approved his written request to use sick leave after having already approved his written request to engage in full-time employment with JPMorgan beginning in the same month. Among other reasons, Torres's action approving McMahon's use of extensive leave knowing that it was being done in order to gain sufficient tenure to obtain law enforcement retirement benefits and that McMahon planned to retire at the end of the leave period violated an ATF order that prohibits the use of "terminal leave." In addition, Torres should not have approved the use of sick leave without reconciling the obvious conflict between McMahon's written outside employment request and his sick leave request.

The OIG found that ATF Deputy Director Thomas Brandon, who was not made aware by Torres of McMahon's intention to use sick leave while engaged in outside employment, nevertheless approved McMahon's use of annual leave for the several months leading up to McMahon's retirement in violation of ATF's prohibition on terminal leave. The OIG also found that Brandon should have recognized the Significant issues raised by McMahon's outside employment request, regardless of the type of leave he intended to use, particularly given that McMahon's conduct in Operation Fast and Furious was under review by the OIG.

The OIG also found that ATF's then-Deputy Chief Counsel and Deputy Designated Agency Ethics Official, Melanie Stinnett, exercised poor judgment and failed to responsibly perform her duties by approving McMahon's outside employment request. Stinnett has retired from ATF.

On November, 27, 2012, following ATF's cancellation of his leave and revocation of his approval to work for JPMorgan, McMahon was removed from ATF for his continued unauthorized outside employment, absence without leave, and insubordination. ATF and McMahon resolved issues arising from these actions in litigation, which did not result in McMahon returning to duty at ATF. On March 12, 2014, the OIG provided its ROI to ATF for appropriate action.

ATF has informed us that Torres retired on May 31, 2014, and that the ATF Director verbally counseled Brandon and included like comments in his mid­ year review.