Specifically, the study (1) determined the costs of undercover operations, including both direct and indirect costs, (2) ascertained the costs of specific Group I undercover operations which were completed and did not have litigation pending, (3) identified the nature and extent of legal claims and settlements resulting from FBI undercover operations, and (4) traced the financial arrangements of five undercover operations. It also reviewed the FBI's guidelines for funding undercover operations. During fiscal years 1979-81, the FBI spent about $10.8 million for identified undercover operations. This amount excludes the costs of salaries for undercover agents, which could not be determined from available records. It also excludes the costs, still being incurred, of litigating and settling claims and lawsuits resulting from undercover operations. Six lawsuits involving claims of $18.4 million had been settled for about $1.1 million as of December 31, 1982. At that date, 16 claims for about $333.4 million were pending. The guidelines the FBI has established to control funding for undercover operations appear to conform to the approved (by the General Accounting Office) accounting system design; however, limited access to detailed cost information prevented an assessment of how effectively the guidelines are being implemented. Appended is a breakdown of expenditures by field office and case name. (Author summary modified)