Metro Gang Strike Force members committed crimes by taking home property that had been seized during their police operations, the co-chair of a state panel that investigated the unit said Thursday.

Some 10 or 12 Strike Force members in the 34-member unit were implicated in the misconduct, and the information has been given to the FBI, which is conducting its own investigation, said Andy Luger, a former assistant U.S. attorney, who headed the panel with retired FBI agent John Egelhof.

The state inquiry into the disbanded Strike Force uncovered "substantial evidence of misconduct" that went well beyond revelations previously reported by news media or uncovered in earlier government investigations.

The panel's report, issued Thursday, said that Strike Force employees repeatedly took home seized property for personal use and that many of the seizures themselves were improper. Luger said he wouldn't name the accused officers because of the ongoing FBI investigation.

"It's going to be for the FBI and the United States attorney's office to determine, but when you take something home that doesn't belong to you, and you know it doesn't belong to you, it's a crime," he said.

The property included flat- and large-screen TVs, laptops and other computer equipment, electronics and recreational items such as water scooters.

Luger said that while "properly conducted, aggressive investigations can save lives," force officers "engaged in serious misconduct -- misconduct that was appalling and outrageous." The report said much of the force's activity had little to do with gang investigations.

State Public Safety Commissioner Michael Campion said that he was "disappointed, disturbed and troubled by the findings" and that his department will no longer fund crime task forces set up like the Strike Force.

He said he'd follow the panel's recommendation to appoint a Special Master to try to identify victims of the illegal tactics and return improperly seized money and property to their owners. About $1 million in seized funds is in Strike Force accounts.

Campion said he also plans, at the recommendation of the panel, to meet with law enforcement officials and prosecutors to create a new approach to investigating gangs across jurisdictional lines.

A state House and Senate legislative hearing on the Strike Force was expected to convene Wednesday.

Almost everyone the Strike Force stopped while saturating neighborhoods were minority group members, and officers seized their property and money even though they often were not gang members and officers didn't intend to try to get them prosecuted, the report said.

"Something went terribly wrong at the Metro Gang Strike Force, and it should not be allowed to happen again," the report said. It urged that any future strike force be tethered to a law enforcement agency, and if not, that prosecutors either run the unit or oversee the investigations.

The report praised the "hard and thorough work" of some force members but said others engaged in "unethical and highly questionable conduct."

The panel reviewed about 300 cases opened from 2006 to 2009, said Luger. Some property officers removed from the evidence room had been stolen by criminals and could have been returned to owners, the report said. One witness called the taking of property a "free-for-all."

Repeatedly, officers or their families paid nominal amounts to take items from the evidence room, including water scooters and a trailer, the report said.

Lots of property still missing

Campion created the panel in May after a critical report on the force by the Minnesota Legislative Auditor. Hours after that report was issued, force members were found shredding documents at the force's New Brighton offices, and officials suspended force operations. Campion permanently shut it down in July.

The panel lacked subpoena power, and most force members declined to be interviewed, Luger said

The report said that a lot of property that should still be in the evidence room was missing. Other seized things, including narcotics, never were entered into evidence but were found in the Strike Force offices, the report said.

The report told how a seized ice-fishing auger went missing. After the case was over, the owner wanted his auger back, but an officer had taken it home. "The officer in charge of the case threatened to obtain a search warrant [for] the home of the officer who took the auger," the report said. The auger was then anonymously returned to the force offices. The force returned the auger to the owner, saying it was 'slightly used,''' Luger said.

In another case, 20 watches potentially worth $2,000 were missing, and the case file contained a false statement that they were given to a jeweler for sale, the report said.

The report said the officers searched people's cell phones without warrants, photographed people -- including children -- who had no gang connections, and took property without search warrants.

Luger noted many gangs are ethnically based, and he declined to describe what the force did as racial profiling.

The panel said $10,781 in seized cash was missing, down from $18,000 noted by the Legislative Auditor in May.

Files included signed statements that evidence had been destroyed, when in fact it hadn't been, the report said.

Documents shredded in May were connected to numerous cases, according to the report. Officials that day found case files behind the headquarters in trash bins that were accessible to the public.

Self-professed 'money police'

Many files the panel examined lacked fundamental information about the cases, and other case files were simply empty, the report said.

Some officers referred to themselves as "money police," displaying conduct that would be "unthinkable" in their home agencies, the report said.

The panel found that the unit relied too heavily on forfeitures for revenue and said that forfeiture laws may need overhaul to prevent abuses. The panel also said the force lacked adequate external oversight, fostering a mentality that officers could do what they wanted.

Without supervision, much of the activity focused on minor drug enforcement. The report described cases where thousands of dollars were taken from people who were not drug dealers but possessed small amounts of marijuana.

The report said the unit lacked procedures and training to assure officers would resist the "temptation" to take items.

The Public Safety Department budgeted $110,000 for the three-month investigation, and has spent $90,000 so far, all on compensation for Luger and Egelhof, said spokesman Andy Skoogman.

Manila Shaver, West St. Paul police chief and chair of the force's advisory board, said it was premature to comment until the FBI finishes its probe.

Hennepin County Sheriff Rich Stanek said he'd been concerned about the force's evidence handling for months and backed the investigations. He said the FBI probe "needs to continue aggressively, and those responsible for this egregious misconduct leading to criminal activity should be prosecuted to the fullest extent of the law."

Minneapolis police Sgt. Jeff Jindra, a Strike Force supervisor, said the report was "just like a kick in the stomach'' because it taints all the officers' good work.

He disputed the findings of missing evidence, saying if investigators had talked to him he would have said that when a Minneapolis officer on the force seized something, it was put in the Minneapolis police property room and noted in a file at Strike Force headquarters. Seized cash went to the Strike Force property room, he said.

Said Luger: "The incomplete case files did not involve solely Minneapolis police ... cases. During our investigation, we requested from a number of police forces any Strike Force-related files ... We received some information from Minneapolis. It does not change our findings."

Staff writer David Chanen contributed to this report. Randy Furst • 612-673-7382