Home > News > Government Workers Go On Credit Card Spending Spree & You Get the Bill

Comments 0 Comments
Advertiser Disclosure


A lot of people have trouble keeping their credit card spending under control — ideally, those people aren’t government employees using taxpayer-funded payment cards. In a congressional hearing Tuesday, federal auditors described purchase-card misuse across several government departments, amounting to millions of dollars of misused or wasted government funds.

It’s not the first time this problem has come up. Two years ago, President Barack Obama signed into law the Government Charge Card Abuse Prevention Act of 2012, which was designed to reduce waste, fraud and abuse among employees with government-supplied payment cards. As the auditors’ testimony shows, there’s still a lot of room for improvement.

For example, Elliot Lewis, assistant inspector general for audits in the Labor Department’s inspector general’s office, testified about an audit of the Job Corps program, a nationwide network of campuses offering career development services to at-risk young women and men: About 35% of prepaid debit cards issued to Job Corps centers were misused to buy electronics, clothing, cellphone services and a variety of online purchases, totaling $249,477. These cards were supposed to pay for student travel expenses, but in many cases, Job Corps employees were using the cards for personal gain.

The Job Corps’ use of prepaid cards was pretty inefficient: The program paid $106,776 in merchant fees from December 2009 to March 2013, unused balances totaled $30,000, and four centers had a massive amount ($72,240) of unused cards lying around, increasing risk for fraud and theft.

Then there’s the Environmental Protection Agency. Janet Kasper, director of contracts and assistance agreement audits in the EPA inspector general office, said the agency did not effectively oversee its cardholders. Of the transaction sample auditors reviewed, 94% were not in compliance with EPA policies.

Here’s an example: The audit found three times cardholders purchased gym memberships, prepaying nearly $3,000 for the services, and two of those purchases were family memberships, not just the EPA employee.

An internal review at the Bureau of Land Management found $800,000 of gift card purchases, $70,000 of which were made on a government purchase card of an employee in the agency’s Idaho office, a September report shows.

Just like losing track of your purchase habits can push you over budget, these government oversights can really add up. Unfortunately, we’re not only financially responsible for our spending missteps, our tax dollars support the government’s.

More Money-Saving Reads:

Image: Carsten Reisinger

Comments on articles and responses to those comments are not provided or commissioned by a bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by a bank advertiser. It is not a bank advertiser's responsibility to ensure all posts and/or questions are answered.

Please note that our comments are moderated, so it may take a little time before you see them on the page. Thanks for your patience.

Credit.com receives compensation for the financial products and services advertised on this site if our users apply for and sign up for any of them.

Hello, Reader!

Thanks for checking out Credit.com. We hope you find the site and the journalism we produce useful. We wanted to take some time to tell you a bit about ourselves.

Our People

The Credit.com editorial team is staffed by a team of editors and reporters, each with many years of financial reporting experience. We’ve worked for places like the New York Times, American Banker, Frontline, TheStreet.com, Business Insider, ABC News, NBC News, CNBC and many others. We also employ a few freelancers and more than 50 contributors (these are typically subject matter experts from the worlds of finance, academia, politics, business and elsewhere).

Our Reporting

We take great pains to ensure that the articles, video and graphics you see on Credit.com are thoroughly reported and fact-checked. Each story is read by two separate editors, and we adhere to the highest editorial standards. We’re not perfect, however, and if you see something that you think is wrong, please email us at editorial team [at] credit [dot] com,

The Credit.com editorial team is committed to providing our readers and viewers with sound, well-reported and understandable information designed to inform and empower. We won’t tell you what to do. We will, however, do our best to explain the consequences of various actions, thereby arming you with the information you need to make decisions that are in your best interests. We also write about things relating to money and finance we think are interesting and want to share.

In addition to appearing on Credit.com, our articles are syndicated to dozens of other news sites. We have more than 100 partners, including MSN, ABC News, CBS News, Yahoo, Marketwatch, Scripps, Money Magazine and many others. This network operates similarly to the Associated Press or Reuters, except we focus almost exclusively on issues relating to personal finance. These are not advertorial or paid placements, rather we provide these articles to our partners in most cases for free. These relationships create more awareness of Credit.com in general and they result in more traffic to us as well.

Our Business Model

Credit.com’s journalism is largely supported by an e-commerce business model. Rather than rely on revenue from display ad impressions, Credit.com maintains a financial marketplace separate from its editorial pages. When someone navigates to those pages, and applies for a credit card, for example, Credit.com will get paid what is essentially a finder’s fee if that person ends up getting the card. That doesn’t mean, however, that our editorial decisions are informed by the products available in our marketplace. The editorial team chooses what to write about and how to write about it independently of the decisions and priorities of the business side of the company. In fact, we maintain a strict and important firewall between the editorial and business departments. Our mission as journalists is to serve the reader, not the advertiser. In that sense, we are no different from any other news organization that is supported by ad revenue.

Visitors to Credit.com are also able to register for a free Credit.com account, which gives them access to a tool called The Credit Report Card. This tool provides users with two free credit scores and a breakdown of the information in their Experian credit report, updated twice monthly. Again, this tool is entirely free, and we mention that frequently in our articles, because we think that it’s a good thing for users to have access to data like this. Separate from its educational value, there is also a business angle to the Credit Report Card. Registered users can be matched with products and services for which they are most likely to qualify. In other words, if you register and you find that your credit is less than stellar, Credit.com won’t recommend a high-end platinum credit card that requires an excellent credit score You’d likely get rejected, and that’s no good for you or Credit.com. You’d be no closer to getting a product you need, there’d be a wasted inquiry on your credit report, and Credit.com wouldn’t get paid. These are essentially what are commonly referred to as "targeted ads" in the world of the Internet. Despite all of this, however, even if you never apply for any product, the Credit Report Card will remain free, and none of this will impact how the editorial team reports on credit and credit scores.

Your Stories

Lastly, much of what we do is informed by our own experiences as well as the experiences of our readers. We want to tell your stories if you’re interested in sharing them. Please email us at story ideas [at] credit [dot] com with ideas or visit us on Facebook or Twitter.

Thanks for stopping by.

- The Credit.com Editorial Team