DHS disputes GAO purchase card criticism

The Homeland Security Department is objecting to Government Accountability Office officials’ testimony that suggested DHS employees are frequently abusing government purchase cards.

The testimony, which GAO released July 19 in a report, argued that DHS has had weak controls on the cards, allowing agency employees to make purchases without proper authorization. DHS couldn’t account for some of the purchased items, and others were of questionable validity.

Some of the time period GAO examined -- June 13, 2005, through Nov. 12, 2005 -- included purchase card use in hurricane relief activities.

GAO’s report specifies that the agency did not attempt to identify or determine the full extent of fraud and abuse, but it cites some estimated percentages based on a statistical sample:

  • DHS did not properly authorize 45 percent of the transactions.
  • The department did not have evidence for 63 percent of the transactions that it received the goods or services.
  • 53 percent of the purchases did not give priority to designated sources.

The examples of possible fraud GAO cited included:

  • More than 100 laptop computers purchased by the Federal Emergency Management Agency are missing and presumed stolen.
  • More than 20 FEMA printers are missing and presumed stolen.
  • Three Coast Guard laptop computers are missing and presumed stolen.
  • Questionable purchases including a beer brewing kit, a 63-inch plasma TV, and training at golf and tennis resorts.

DHS wasted no time firing back. In a statement also issued July 19, the department said the instances of misuse that GAO cited make up 0.14 percent of all purchase card transactions. Of the $435 million DHS spent using the cards in 2005, only about $600,000 has been questioned, DHS wrote.

The department is investigating and disciplining the individuals who have misused cards, according to the statement.

DHS did not deny GAO's assertion that it has not implemented controls on the card program, but the department insisted that it has been working on strict and thorough guidelines that will be in effect within weeks. The guidelines will require officials other than the cardholder to preapprove purchases and verify that the department receives the goods or services.

DHS has recovered many of the items that GAO reported as lost or misplaced, according to the department’s statement. That includes 74 of 107 missing laptop computers, and two of three missing Global Positioning Systems. Of $268,000 worth of goods that GAO identified as unaccounted for, DHS has located $217,000 worth, it said.

And the 63-inch plasma-screen TV found unopened six months after it was purchased? "This screen was installed at the Mount Weather Emergency Operations Center," the facility senior DHS officials used as part of the agency's continuity-of-operations plan, according to the statement.


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