OMB: Agencies must control credit cards

The Office of Management and Budget has directed agencies to strengthen internal controls over purchase cards and implement procedures to reduce fraud and abuse. The memo, dated April 15, comes after reports by the Government Accountability Office that federal employees wasted millions through the misuse of government credit cards.

OMB plans to update guidance under its Circular A-123 to fortify and expand internal controls in light of GAO’s findings, OMB Director Jim Nussle said.

Agencies must report to OMB by June 30 that they have established internal controls over federal charge cards and actions to fortify those safeguards. Actions could include a management plan for purchase cards, training for employees and inventories of small electronics bought with the cards that could easily be converted to personal use, he said.

OMB reminded agencies that they are responsible for taking appropriate administrative and disciplinary actions for charge card misuse. Agencies must report data on charge card use and performance results from management programs, including instances of misuse, to OMB on a periodic basis.

“This is a very serious issue that breaches the trust of the taxpayers as well as diminishes the significant benefits that are achieved through the federal charge card program,” Nussle said.

The purchase card program is critical to improving the acquisition process, Nussle said. In fiscal 2007, federal charge card transactions totaled more than $27 billion and saved an estimated $1.8 billion annually, he added.

About the Author

Mary Mosquera is a reporter for Federal Computer Week.

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