Federal workers abuse purchase cards at public expense


PUBLIC HOLD-UP: Rep. John Mica, R-Fla., calls the level of Government Purchase Card spending “startling.” Two years after Congress tried to curb the practice, auditors report that purchases of personal items and services continues on the public dime.

By Kenric Ward | Watchdog.org

WASHINGTON, D.C. – Federal employees are running amok with government credit cards, making thousands of personal purchases at the public’s expense.

The ongoing spending spree — ranging from fitness centers and hair salons to movie theaters and Starbucks — came to light Tuesday during a congressional hearing on Capitol Hill.

Florida Republican Rep. John Mica, chairman of the Government Operations subcommittee, told Watchdog.org the level of unchecked spending via Government Purchase Cards was “startling.”

Inspectors at the Department of Homeland Security, the Environmental Protection Agency and the Department of Labor acknowledged widespread abuse and lack of controls.

After Hurricane Katrina in 2007, DHS audits found that the sprawling agency was exposed “to fraud and abuse in purchase card use.”

The run-up in questionable or illegal card use continues, investigators said.

In fiscal 2013, 9,700 DHS cardholders made $439 million in purchases, reported Anne Richards, assistant inspector general for audits at the agency. She said any purchase up to $3,000 is classified as a “micropurchase” subject to less scrutiny.

Richards concluded that DHS card use contains “inherent risks (that) cannot be eliminated.”

At the EPA, 94 percent of reviewed card transactions violated agency policies.

“In three instances, cardholders purchased gym memberships … totaling $2,867. Two of those purchases were for family memberships, and not just the EPA employee,” said Janet Kasper, director of contracts at EPA’s Office of Inspector General.

At the Department of Labor’s Job Corps program, 6,198 of 17,796 cards “were misused to purchase items such as consumer electronics, clothing and wireless telephone service,” said Elliot Lewis, assistant inspector general for the agency’s audit office.

Other improper card use, including buying movie tickets and other items online, were found at 98 of the 104 Job Corps centers reviewed.

All the charged expenses – including $12,000 in government card purchases at a single California Starbucks — happened after Congress passed 2012 legislation aimed at reining in card use.

Except for three firings and two resignations at a Jobs Corps center in Miami, the auditors did not report any punishment resulting from the illegal spending. No reimbursements were indicated.

Mica told Watchdog his committee would pursue ways to “further tighten the law.”

“It an unfortunate incidence of abuse,” Mica said, noting that the current law does not yet cover the Department of Defense.

Read a letter by Reps. Mica and Gerry Connolly, D-Va., requesting an investigation by the Government Accountability Office.

Kenric Ward is a national correspondent for Watchdog.org and chief of its Virginia Bureau. Contact him at (571) 319-9824. @Kenricward