Government Credit Card Abuse
The Army has recognized a long-standing need to consolidate into a single document, existing guidance and policy covering the use and management of the Government Visa purchase card. The purpose of establishing this program was for reducing administrative costs and other burdens that the acquisition functions may impose on the Federal Government and the private sector. The VISA purchase card was adopted to replace the paper-based, time-consuming purchase order process, thereby eliminating procurement lead-time, providing transaction cost savings, reducing procurement office workload, and facilitating payment. Given the rapid growth of Visa card use, ensuring that key controls are in place over the program is critical to protecting the government from fraud, waste, and abuse.
Employees are to use the purchase card to pay for authorized government purchases, subject to an established transaction amount, billing cycle amount, and merchant code limitations. An authorized purchase is defined as a purchase that satisfies a bona fide requirement at a fair and reasonable price.
Employees are entrusted with the acquisition of Government property and are responsible for its proper custody, safekeeping, and accountability. Yet, there has been reported abuse of these credit cards by many employees.
An important factor to consider is that fraud is normally committed by or with the help of Government employees. There have been instances of employees creating or participating in the ownership of outside businesses for the purpose of committing fraud or abuse of the card through their ability to make buys with the card. There were five cases of fraud, which totaled over $660,000 of numerous purchases, made over a period of several months to more than two years. Items that were purchased for personal use in these cases included home improvement items from The Home Depot, numerous items from Wal-Mart, laptop computers,