Government Credit Card Abuse Bill Moves Forward

Last week, a House committee approved the Government Charge Card Abuse Prevention Act unanimously. Poised for a full House vote, the Act has already cleared the Senate.

The measure in intended to rectify some of the lax oversight and misuse of government-issued credit cards intended to pay for things like travel expenses and incidentals. Watchdog reports have been recording the card abuses for years.

One such example is what has been occurring at the U.S. Postal Service. Some senior officials have been using their government-issued credit cards to fund European vacations for family members, buy computers from Apple and make repeated purchases from "adult entertainment" stores. A USPS investigation revealed the failure to cancel some 2,491 credit cards issued to former employees.

"It is very frustrating that an organization that was $8.5 billion in the hole last year has not adopted a frugal culture," said Sen. Susan Collins (R-Maine), who tracks postal affairs, to The Washington Post. "The proper controls are not in place to either prevent or uncover frequent credit card abuses."

Even Sen. Thomas R. Carper (D-Del.) who is typically a supportive of postal leadership, weighed in, "I've told the new Postmaster General and his predecessor that he and other top postal executives need to do their part as well," he said in a statement, as reported by the The Washington Post. "If they are going to ask postal employees and customers to make sacrifices to save the Postal Service, then the postal leadership certainly has a responsibility to set a good example when it comes to frugality and basic financial management. In this case, they have clearly failed."

The bill would mandate that a periodic review of cardholder records be performed by federal agencies. Additionally, the bill would require new policies to be outlined regarding the number of cards issued, their credit line limits and who is eligible to make use of the cards. Regular training for cardholders and management would also be necessary. Should an employee retire, quit or transfer, the agency must then invalidate that individual`s card.

Further cost-cutting efforts included in the bill would obligate agencies, when reimbursing employees to travel expenses, to pay banks directly. This would eliminate potential interest charges by ensuring that travel tickets are paid for. Refunds for unused airline tickets would also be sought.

Lauren Palmer

Lauren Palmer is a freelance writer who is a regular contributor to a variety of online and print publications. Although she has much to say about many subjects, she specializes in topics pertaining to personal finance. She holds a bachelor’s degree from NYU in journalism.