Federal Employees Use Government Credit Cards at Casinos, Racetracks

Audit finds DOT has poor oversight over its travel card program

credit cards
• September 23, 2014 2:25 pm


Department of Transportation (DOT) employees use government credit cards for cash advances at casinos and racetracks, according to a report by the Office of Inspector General (OIG).

Employees misused their government-issued travel cards in 2012, racking up $2.1 million in charges for personal items, and more than $180,000 in unauthorized cash advances while they were not on business trips.

The audit, released last week, examined the travel card program, which employees are authorized to use on hotels, transportation, and meals during government travel. The OIG found that the DOT does not have effective policies in place to prevent the government credit cards from being misused. In fact, the agency has no policy prohibiting employees from taking cash advances out at casinos.

"While reviewing cash advance transactions, we identified cash advances collected at casinos," the OIG said. "While DOT’s Travel Card Policy does not preclude cardholders from taking cash advances at casinos, this presents another opportunity for abuse to occur."

The OIG examined 218 cash advances that were taken at casinos, and found 27 were made by employees not on official travel.

In one example, a Federal Aviation Administration (FAA) employee collected $492 in cash advances from his government credit card at a casino in Shawnee, Okla.

A former OIG employee was also able to use his travel card, despite leaving the agency more than two years before. The employee cashed $488 out at casinos. In both instances the cash advances were repaid, and the OIG employee’s account has since been closed.

The cards are also used at racetracks. "Between October 2011 and June 2012, an FAA cardholder collected seven cash advances totaling $719 while not on Government travel," the OIG said. "On one occasion, this employee obtained a $104 cash advance on a race day at an Alabama Superspeedway."

In all, the OIG estimated that $183,000 in cash advances were improper, as they were not related to government travel.

The audit also found that government credit cards are used on personal items, such as groceries.

Cases cited by the OIG include a Federal Motor Carrier Safety Administration employee using his card for a $550 purchase at a recreational vehicle resort in Tampa, Fla., and an FAA employee making a "$97 supermarket purchase at a store located 18 miles from her residence."

A total of $2.1 million of DOT travel credit card transactions were spent for employee’s personal use and unrelated to government business.

The DOT does not have adequate oversight over cash advances made through its travel card program. Government officials did not detect any of the 24 "excessive" cash advances identified by the OIG.

The agency has access to a system that tracks potential abuse of cash advances, but employees do not use it because "DOT’s Travel Management Policy does not require them to do so."

"DOT has effective controls to prevent cardholders from making purchases at businesses that do not provide transportation, lodging, or meals and to minimize delinquent cardholder accounts," the OIG said. "However, excessive or unauthorized cash advances and instances of travel card misuse are going undetected because DOT lacks robust internal controls to prevent these transactions."

"Specifically, while DOT’s Travel Card Policy prohibits such misuse, it does not specifically require program officials to monitor for excessive cash advances, which increase the risk that cash advances are used for non-Government travel expenses," they said.

The OIG concluded, "Until DOT takes the necessary actions to further strengthen controls, it will be unable to more effectively detect travel card misuse."