US card audit finds 'abuse and waste'

23 April 2008
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24 April 2008

Lingerie, iPods and internet dating are among items charged to purchasing cards by US government officials.

An audit of transactions made between July 2005 and June 2006, worth around $14 billion (£7.1 billion), found 41 per cent failed to meet basic controls. Just under half of payments worth over $2,500 (£1,265) had the correct authorisation.

Senators Carl Levin and Norman Coleman said although purchasing cards had reduced administration and made savings of $1.8 billion (£911 million), there were still concerns the use of cards left the government open to fraud, waste and abuse.

"At a time of increased economic pressures, and a feeling that government spending is out of control, the American people should not be expected to tolerate wasteful and abusive spending of their tax dollars," said Coleman.

The study also found the number of items bought and then reported "missing" or stolen was $1.8 billion (£911 million). Card frauds included a lavish $13,000 (£6,578) dinner for 81 people - including $3,000 (£1,517) of alcohol; a NASA administrator who ordered two iPods to store data, which were then personally engraved and used to store his own music and video; a postmaster who subscribed to two internet dating services over 15 months; and £360 ($182) of lingerie bought from Seduccion Boutique.

"Too many government employees have viewed purchase cards as their personal line of credit," said Coleman. "It's time to cut up their cards and start over. The basic rules for authorising purchases and accounting for goods and services are not that difficult."

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