Travel Cards: Control Weaknesses Leave Navy Vulnerable to Fraud and Abuse

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Testimony issued by the General Accounting Office with an abstract that begins "This testimony discusses the Department of the Navy's internal controls over the government travel card program. The Navy's average delinquency rate of 12 percent over the last 2 years is nearly identical to the Army's, which has the highest delinquency rate in the Department of Defense, and 6 percentage points higher than that of federal civilian agencies. The Navy's overall delinquency and charge-off problems, which have cost the Navy millions in lost rebates and higher fees, are primarily associated with lower-paid, enlisted military personnel. In addition, lack of ... continued below

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United States. General Accounting Office. October 8, 2002.

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Testimony issued by the General Accounting Office with an abstract that begins "This testimony discusses the Department of the Navy's internal controls over the government travel card program. The Navy's average delinquency rate of 12 percent over the last 2 years is nearly identical to the Army's, which has the highest delinquency rate in the Department of Defense, and 6 percentage points higher than that of federal civilian agencies. The Navy's overall delinquency and charge-off problems, which have cost the Navy millions in lost rebates and higher fees, are primarily associated with lower-paid, enlisted military personnel. In addition, lack of management emphasis and oversight has resulted in management failure to promptly detect and address instances of potentially fraudulent and abusive activities related to the travel card program. During fiscal year 2001 and the first 6 months of fiscal year 2002, over 250 Navy personnel might have committed bank fraud by writing three or more nonsufficient fund checks to Bank of America, while many others abused the travel card program by failing to pay Bank of America charges or using the card for inappropriate transactions such as for prostitution and gambling. However, because Navy management was often not aware of these activities, disciplinary actions were not consistently taken against these cardholders. GAO also found a significant relationship between travel card fraud, abuse, and delinquencies and individuals with substantial card history problems. Many cardholders whose accounts were charged off or put in salary offset had bankruptcies and accounts placed in collection prior to receiving the card. The Navy's practice of authorizing a travel card to be issued to virtually anyone who asked for it compounded an already existing problem by giving those with a history of bad financial management additional credit. Although GAO found that Navy management had taken some corrective actions to address delinquencies and misuse, additional preventive solutions are necessary if Navy is to effectively address these issues."

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Government Accountability Office Reports

The U.S. Government Accountability Office (GAO) is an independent, nonpartisan agency that works for the U.S. Congress investigating how the federal government spends taxpayers' money. Its goal is to increase accountability and improve the performance of the federal government. The Government Accountability Office Reports Collection consists of over 13,000 documents on a variety of topics ranging from fiscal issues to international affairs.

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  • October 8, 2002

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  • June 10, 2014, 6:42 a.m.

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United States. General Accounting Office. Travel Cards: Control Weaknesses Leave Navy Vulnerable to Fraud and Abuse, text, October 8, 2002; Washington D.C.. (digital.library.unt.edu/ark:/67531/metadc289741/: accessed November 19, 2017), University of North Texas Libraries, Digital Library, digital.library.unt.edu; crediting UNT Libraries Government Documents Department.