WASHINGTON – A reform effort that Senator Chuck Grassley’s been pushing for nearly 10 years became law today with the President’s signature on Grassley legislation that will require federal agencies to put new controls on government charge cards and enforce more stringent penalties for violations by federal employees.
Grassley first introduced a bill to secure better management controls for government charge cards in 2003. The measure enacted today was cosponsored by Senator Joe Lieberman of Connecticut and Senator Susan Collins of Maine.
“It shouldn’t take a decade for Washington to do everything possible to stop federal workers from purchasing kitchen appliances, jewelry and cruises, and even paying the tab at gentlemen’s clubs and legalized brothels, but Washington is an island surrounded by reality,” Grassley said. “Perseverance paid off for this reform effort. By putting some common-sense controls into the law, we can make certain the federal bureaucracy improves the way it responsibly manages the use of these cards just like a private business would.”
Problematic use of government charge cards, first at the Department of Defense and then at the Department of Housing and Urban Development, the U.S. Forest Service, the Federal Aviation Administration, and elsewhere, was revealed by Grassley’s oversight work. Over the years, the nonpartisan Government Accountability Office also documented fraudulent, questionable and overly expensive purchases with these cards.
Along with new controls and penalties, including dismissal, the legislative overhaul also will increase scrutiny of card usage with regular independent risk assessments and audits to identify fraud and improper use.
Safeguards and internal controls included in the Government Charge Card Abuse Prevention Act are:
• performing credit checks for travel card holders and issuing restricted cards for those with poor or no credit to reduce the potential for misuse;
• maintaining a record of each cardholder, including single transaction limits and total transaction limits so agencies can effectively manage their cardholders;
• implementing periodic reviews to determine if cardholders have a need for a card;
• properly recording rebates to the government based on prompt payment, sales volume, etc.;
• providing training for cardholders and managers;
• utilizing effective systems, techniques, and technologies to prevent or catch improper purchases;
• establishing specific policies about the number of cards to be issued, the credit limits for certain categories of cardholders, and categories of employees eligible to be issued cards;
• invalidating cards when employees leave the agency or transfer;
• establishing an approving official other than the purchase card holder so employees cannot approve their own purchases;
• reconciling purchase card charges on the bill with receipts and supporting documentation;
• reconciling disputed purchase card charges and discrepancies with the bank according to the proper procedure;
• making purchase card payments promptly to avoid interest penalties;
• retaining records of purchase card transactions in accordance with standard government record keeping policies;
• utilizing direct payments to the bank when reimbursing employees for travel card purchases to ensure that travel card bills get paid;
• comparing items submitted on travel vouchers with items already paid for with centrally billed accounts to avoid reimbursing employees for items already paid for by the agency;
• submitting refund requests for unused airline tickets so the taxpayers don’t pay for tickets that were not used; and
• disputing unauthorized charges and tracking the status of disputed charges to proper resolution.