Travel Cards

The Army's individually billed travel card program is different from the purchase card program in that the cardholder is directly responsible for all charges incurred on his or her travel card account, and the monthly bill is sent to the cardholder for payment. The cardholder is responsible for submitting a properly documented voucher and is reimbursed by the Army for all valid expenses related to official government travel. The intent of the travel card program was to improve convenience for the traveler and to reduced the government's costs of administering travel. GAO found substantial delinquencies and charge-offs of Army travel-card accounts during fiscal year 2001, and delinquencies continued into the first half of fiscal year 2002. GAO's analysis shows a correlation between delinquency problems and the travel cardholder's age and pay grade. GAO found that the Army's delinquency and charge-off problems are primarily associated with young, low- to mid-level enlisted military personnel. In addition, a weak internal control environment compounded by instances of delays in processing travel reimbursements to Army military and civilian personnel contributed to the high delinquency rates. The Army and the Department of Defense have taken action to address and focus command- and installation-level attention on management of delinquent travel card accounts. However, these actions are primarily focused on treating the symptoms or "back-end" problems rather than the "front-end" or preventive controls. GAO's work identified numerous instances of potentially fraudulent and abusive activity related to the travel card. During fiscal year 2001, 1,200 of the over 4,200 Army account holders who had written at least one nonsufficient funds (NSF) check to pay their travel card bill had their accounts charged off. In the same period, more than 200 cardholders whose accounts were eventually charged off may have also committed bank fraud by writing three or more NSF checks to the Bank of America. GAO's audit found that weaknesses in the Army's overall control environment, including a number of specific controls that were either flawed in their design or in their implementation, are the root source of the Army's inability to prevent or effectively detect the numerous instances of potentially fraudulent and abusive travel card related activity previously detected.

Recommendations

Our recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.

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