NCPA - National Center for Policy Analysis

Some Employees Treat Federal Credit Cards as Their Own

October 18, 2002

It's a quiet little scandal: government employees charging personal items -- ranging from visits to bordellos to purchases at jewelry and electronics stores -- on government travel and credit cards meant only for official purchases.

The Bush administration has been cracking down on misuse of the cards -- and the clean-up efforts, at least at some agencies, have been successful.

  • So far, hundreds of thousands of accounts have been canceled, paychecks have been docked to pay unpaid bills and payments to thousands of businesses have been stopped.
  • The Office of Management and Budget says 7 percent of travel card accounts were delinquent as of July -- down from 13 percent as of January.
  • The Defense Department alone is canceling about 400,000 travel cards by the end of this month -- nearly 20 percent of the total issued by the federal government.
  • The Education Department blocked transactions to about 300 types of businesses to prevent use of cards for casino visits, limousine rentals, and veterinary services and other improper uses.

But OMB director Mitchell E. Daniels Jr. says that despite the progress, he is still not satisfied and that many agencies still had not brought credit card misuse under control.

As of May, there were 384,000 purchase cards and 2.2 million government travel cards in use.

Source: Associated Press, "Government Reduces Fraud in Agency Use of Credit Cards," New York Times, October 18, 2002.


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