(CNSNews.com) - Employees of the U.S. Department of Housing and Urban Development, armed with government charge cards, made “at least 950” “unauthorized, unsupported, or ineligible purchases” in fiscal 2017, according to a report by the department’s inspector general.
These included a $400 charge at “an adult entertainment gentlemen’s club” and a $282 “unauthorized ATM withdrawal” followed by an $849 “unauthorized charge” at a Las Vegas casino hotel.
“HUD’s travel cards were used for unauthorized, unsupported, or ineligible purchases in at least 950 instances totaling more than $95,000,” said the IG’s report.
The IG estimated the overall number of unauthorized, unsupported and ineligible purchase by examining a selected sampling of actual purchases.
“We estimated that HUD’s travel cards were used for unauthorized or unsupported purchases in at least 944 instances totaling nearly $91,000,” said the IG report. “That estimate is based on the results of our review of 78 statistically selected purchases. We also identified 15 purchases totaling more than $5,000 that were ineligible.”
The IG also looked at 6 purchases by 5 cardholders that had signs of misuse.
These included the $400 charge—which a HUD employee claimed for for “a meal”—at “an adult entertainment gentleman’s club” and the $282 ATM withdrawal followed by the $849 charge at the Las Vegas casino hotel.
“In addition to our statistical sample, we reviewed a separate sample of 6 purchases from the universe of all 89,573 fiscal year 2017 transactions,” said the IG report. “These purchases were made by five cardholders and showed indications of misuse; specifically, ATM withdrawals within 3 days of a casino hotel charge; retail purchases greater than $300; bar, lounge, or nightclub purchases greater than $300; and any transaction, aside from hotels, airlines, and trains, greater than $1,000.
“Two of the five HUD employees showed that their purchases were proper, with one being related to an approved employee relocation and the other a result of card theft,” said the report.
“The four remaining ineligible purchases made by three employees totaled $1,946.
• “The first cardholder made an unauthorized ATM withdrawal with a travel card for $282 in fiscal year 2017 and then used the card again at a casino hotel in Las Vegas for $849 the following day. While following up on these purchases, we identified three additional ineligible purchases this employee made at casino hotels in 2018 for more than $800, each totaling nearly $3,000.
• “The second cardholder used a travel card at an adult entertainment gentlemen’s club, charging more $400 while on an approve trip to attend training. The cardholder told us that charge was for a meal. However, the vendor did not advertise or make mention of serving foods in its marketing.
• “The third cardholder used a travel card at a retail store, charging $355 without an authorization. The cardholder stated that the cardholder’s spouse may have made the store purchase by accident. HUD policies strictly forbid family members of the cardholder or any other person from using the travel card.”
The Office of the Inspector General for the Department of Housing and Urban Development says in its report that it made a recommendation to HUD’s Office of the Chief Financial Officer regarding the instances it discovered where HUD employees had used government charge cards to make “ineligible” purchases.
In sum, the IG advised the financial office to determine “what administrative actions were taken to resolve these violations.”
“Refer the 15 ineligible travel card transactions totaling $5,393 to the appropriate program office and obtain a response regarding what administrative actions were taken to resolve the violations,” said the recommendation. “If no actions were taken, OCFO should request support to show why no corrective actions were taken.”