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The mission of the Prohibition Unit is to enforce the National Prohibition Act,1 the internal revenue laws imposing taxes upon intoxicating liquor and the liquor traffic, and the Harrison Narcotic Act.2

2. History

The legislative history of the acts that are the subject of this organization is briefly stated in the chapter describing the Bureau of Internal Revenue.3

In spite of the arguments brought before the Committee on Judiciary when the National Prohibition Act was under enactment, urging unified responsibility, the police duty of enforcement is imposed upon the Bureau of Internal Revenue, I while the prosecution of offenders is under the Department of Justice through district attorneys.

When the act had passed, the Commissioner of Internal Revenue assembled an organization committee, which recommended the creation of a new unit in the Bureau of Internal Revenue, one branch to enforce the penal and regulatory provisions of the law, and the other to supervise its administrative features covering commerce in nonbeverage liquors. On December 22, 1919, a permanent form of organization was effected, consisting of Legal, Executive, Field Force, Narcotic, Technology, and Audit and Statistics Divisions, with a field force of two classes of supervisory officers, known as supervising federal prohibition agents and federal prohibition directors, each with a force of subordinates operating under their immediate control. The states and territories of the United States were divided into twelve departments, each in charge of a supervising federal prohibition agent, with a mobile policing force of prohibition agents. In each state and in Hawaii and Porto Rico, there was a federal prohibition director. By a reorganization on August 1, 1921, the offices of said twelve supervising agents were abolished and their executive duties were transferred to the federal prohibition directors.

The Supplemental Act was passed principally to meet the situation created by the ruling of the Supreme Court 5 to the effect that certain revenue laws in reference to intoxicating beverages were repealed by the Volstead Act. Section 5 of the amending act was in effect a re-enactment of the provisions of such revenue laws.

1 Of October 28, 1919 (41 Stat. 305 [Comp. St. Ann. Supp. 1923, § 101384 et seq.]).

2 Of December 17, 1914 (38 Stat. 785), as amended by Internal Revenue Law of Feb.

24, 1919 (40 Stat. 1130 [Comp. St. Ann. Supp. 1919, § 6287g]).

3 See, also, Thorpe, Prohibition and Industrial Liquor.

4 Of November 23, 1921, c. 134, § 1 (42 Stat. 222 [Comp. St. Ann. Supp. 1923, § 10138%]).

5 U. S. v. Yuginovich, 256 U. S. 450, 41 S. Ct. 551, 65 L. Ed. 1043.

The permanent organization of the Prohibition Unit, at the time of its reorganization in the summer of 1925, embraced the Washington administration and a field organization. The former consisted of a Prohibition Commissioner; an Assistant Commissioner; a Chief Counsel, who conducted the law work of the unit through a Division of Interpretation and a Division of Litigation; and the Narcotic, Industrial Alcohol and Chemical, Audit, and Permit Divisions. The Field Service had three branches: (1) The Narcotic Branch, for which the country was divided into 15 divisions, with 279 narcotic agents; (2) the 51 Prohibition Directors, each representing a state or territory; and (3) a separate organization of Prohibition Agents, for which the country was divided into 19 divisions, with 873 general Prohibition Agents and 1,010 Federal Prohibition Agents.

The main feature of the reorganization policy of 1925 is the decentralization of authority and responsibility for prohibition enforcement, whereby, as announced by the Treasury. Department on June 23, 1925, "all control of alcohol, except the collection of the federal tax, is made the sole responsibility of the prohibition administrators representing the Commissioner of Internal Revenue." Such reorganization naturally results in a large diminution of detailed administrative work in Washington.

3. Distribution of Functions; Washington Administration

(a) Assistant Secretary of the Treasury in Charge of Customs,, Coast Guard, and Prohibition.-Represents the Department of the Treasury in its supervision over the Prohibition Unit; determines the policies of prohibition enforcement and narcotic control; passed upon the organization, and the appointment of personnel, thereof.

(b) Commissioner of Internal Revenue.-Next in authority by reason of the fact that the Unit is a part of the Bureau. He confers with the Assistant Secretary, above mentioned; sees that the latter's directions are carried out through the Unit, and especially through the administrators.

(c) Federal Prohibition Commissioner.-Has immediate supervision over the enforcement of the National Prohibition Acts and of the Harrison Narcotic Act, particularly to secure uniformity of policy, standardization, coordination, etc.

(d) Assistant Prohibition Commissioner.-Aids the Commissioner in the functions stated.

(e) Chief Counsel.-Acts as counsel to the Commissioner, and advises the legal officers of the various districts as to the interpretation of the law.

(f) Narcotic Division.-All work incident to the administration of the Harrison Narcotic Act and the permissive features of the Narcotic Drugs Import and Export Act is directed from this division, including the supervision of the work of the narcotic field force which is divided into 15 divisions, and which consists at the present time of 190 agents, inspectors, and field clerks.

(g) Industrial Alcohol and Chemical Division.-Conducts the chemical work of the Bureau of Internal Revenue in Washington and advises in the administration of title III of the National Prohibition Act, relating to the

production and use of industrial alcohol, certain features of the general internal revenue laws relating to bonded warehouses, and in connection with the concentration of distilled spirits.

(h) Audit Division.-The functions of this division comprise the assessment of taxes and penalties and the keeping of accounts relative thereto in all cases involving liquors and narcotics; action on claims in abatement or refund of taxes or penalties pertaining to liquor; briefing offers in compromise and consideration and recommendation of action thereto, where liability is incurred under bonds given to insure proper use of untax-paid pure or denatured alcohol procured by manufacturers or users; examination and audit of returns and accounts relating to and proper accounting of:

(1) Untax-paid spirits in government bonded warehouses or removed therefrom free of tax.

(2) Denatured alcohol shipped to or in possession of manufacturers, dealers, and users.

(3) Liquors in wineries, storerooms, breweries, and dealcoholizing plants. (4) Liquors dispensed on physicians' prescriptions.

(i) Permit Division.-Co-ordinates and standardizes the issuance of permits for the use and sale of intoxicating liquors under the National Prohibition Act, also covering the importation and exportation of intoxicating liquors; establishes standards for medicinal and toilet preparations and flavoring extracts.

4. Enforcement of Prohibition in the Field

Continental United States, Hawaii, and Porto Rico are divided into 24 districts, as shown in Chart 13. Each district is self-contained as to organization and authority. In other words, all business under the National Prohibition Act, both enforcement and permissive features, may be transacted in the appropriate district. The Prohibition Administrator thereof is the responsible authority, though of course an appeal from his decisions lies to his superiors in the Department of the Treasury and to the courts. The district is organized as follows:

(a) Prohibition Administrator.-Has full authority and responsibility for enforcement of the National Prohibition Act within his district and is responsible for the personnel thereof.

(b) Legal Adviser.-Advises the Administrator on legal matters; operates with government prosecuting agencies; supervises revocation proceedings, etc.

(c) Chief Chemist.-Supervises chemical analyses, etc.

(d) An Assistant Prohibition Administrator.-Advises the Administrator as to the granting or disapproval of applications under the permissive features of the Volstead Act; is charged with the duty of inspection, on applications for original permits or supplemental applications, through trained chemists, pharmacists, and inspectors.

(e) An Assistant Prohibition Administrator.-Administers the enforcement features, or title II, of the Volstead Act, through group heads, investigators, detectives, etc.

(f) Groups. The district is subdivided into local groups, each charged with the enforcement of the prohibition act in his territory. The geographical boundaries of the groups correspond with those of the federal judicial districts in which they are located, and the group head is located in the same city as the United States District Attorney ordinarily.

5. Hearings on Revocation Proceedings, etc.

Where a complaint is entered against a permittee for an abuse of the conditions of his permit, a citation will issue from the office of the Prohibition Administrator for the district within which the permit was operative, citing the permittee to appear for a hearing before some person named by the Administrator at a place within 50 miles of the place where the permit was to be used.

6. Organization

See Charts 10, 12, and 13.


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