07.01.2008 0

Smart Cards Stupid Waste of Tax Dollars

  • On: 07/20/2008 14:23:38
  • In: Fiscal Responsibility
  • ALG News was not surprised to discover that nearly half of purchases made using government credit cards – dubiously named “SmartPay” cards – were improper according to a new Government Accountability Office (GAO) audit.

    The stated purpose for the cards was to “improve bureaucratic efficiency”. However, according to the Washington Post, GAO’s audit of the “SmartPay” cards found an “unacceptably high” rate of violations of Federal law. In fact, nearly half of purchases made were in violation of stated rules:

    “The GAO found that 41 percent of the transactions it examined did not follow government purchasing rules. The problem was worse with larger purchases: Forty-eight percent of transactions over $2,500 were in violation of federal rules, the report said.”

    With fiscal discipline at that rate, any normal business would be bankrupt in a year! Unfortunately, with government, it’s a sure sign of eternal life.

    And, of course, there’s equipment missing, too:

    “The GAO also found that agencies could not account for nearly $2 million worth of items identified in the audit — including laptop computers, digital cameras and, at the Army, more than a dozen computer servers worth $100,000 each.”

    The GAO’s audit is definitely welcome, and it has been coming for a long while:

    “The audit is the culmination of a series of GAO reports over the past decade that have uncovered improper use of government-issued purchase cards at agencies, including the Defense Department and the Department of Homeland Security. Government employees spent nearly $20 billion last year using ‘SmartPay’ cards and related convenience checks, for items ranging from pencils to computers to utility trucks.”

    The audit, however, may have come a little too late, since if last year’s purchases total reached a staggering $20 billion – and 41% of that improperly spent – as much as $ 8 billion has already been wasted. And the tab is continuing to rise!

    The Post also summarizes some of the more egregious examples of fraud committed by bureaucrats entrusted with safeguarding our national finances:

    • “In the fraudulent category, a longtime employee of the U.S. Forest Service in Oregon, Debra K. Durfey, wrote convenience checks worth more than $640,000 from 2000 to 2006 to a live-in boyfriend, who used the money for gambling, car expenses and mortgage payments, according to the GAO and the Justice Department… The fraud went undetected until a whistle-blower forwarded a tip to the Agriculture Department’s inspector general. Durfey, who headed her unit’s purchasing office, pleaded guilty last year and was sentenced to 21 months in prison and restitution.
    • “Another fraud case involved the U.S. Postal Service, where an unidentified postmaster used his card to charge $1,100 over a 15-month period for ‘various online dating services’ while he was under investigation for viewing pornography on a government computer. The employee worked out an agreement to remain on sick leave until he retired in 2007 and paid back the money spent on the dating services, according to the GAO report and a Postal Service spokesman.
    • “In a case the GAO deemed ‘abusive,’ the Postal Service spent $13,500 in 2006 on a dinner at a Ruth’s Chris Steak House in Orlando, including ‘over 200 appetizers and over $3,000 of alcohol, including more than 40 bottles of wine costing more than $50 each and brand-name liquor such as Courvoisier, Belvedere and Johnny Walker Gold.’ The tab came to more than $160 a head for the 81 guests, the report said… Postal Service spokesman Gerry McKiernan said the dinner was held to entertain large postal customers who were already in Florida for another conference, and actually saved money because it combined four events into one. He also defended the payments for alcohol.”

    Just like kids in a candy store! But, then, why should anyone be surprised that when given a blank check, Big Government bureaucrats wasted massive amounts of money? After all: they didn’t have to work for it!

    With “SmartPay” cards like these, Congress would have to be dumb as a post to ever authorize their use again. So, expect to see it – with an increase in the credit card limit, cash advances, and privacy protection against the prying eyes of the nosey public.

    ALG Perspective: This is one of the most egregious cases of Big Government waste ALG News has ever seen. It underscores the need for real accountability not just in our nation’s bureaucracies, but also in Congress. Congress has delegated far too much of its spending authority away to departments and agencies, and more oversight needs to be done to assure how the agencies are spending taxpayer funds. Finally, the “SmartPay” card program needs to be eliminated once and for all.

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