IRS spent more than $121 million on travel charge cards for employees and 'leniently' disciplined those who abused them: Report

Report finds that more than 1,000 IRS employees abused their government-issued charge cards
IRS officials demonstrated a pattern of being overly lenient when punishing employees who misused charge cards, or who failed to pay their bill on time

PUBLISHED: 13:50 EST, 14 June 2013 | UPDATED: 13:50 EST, 14 June 2013

A recently released report by the Treasury Inspector General for Tax Administration finds that in fiscal years 2010 and 2011, more than 1,000 employees at the Internal Revenue Service misused Citybank-issued charge cards designated to pay for employees' work-related expenses. During those same fiscal years, the report finds that IRS employees issued approximately 325 bad checks to Citybank to pay the balance on the charge cards.

Additionally, the report concluded that IRS officials demonstrated a pattern of being overly lenient when punishing employees who misused the charge cards, or who failed to pay their bill on time.

The IRS spent $121 million in travel expenses for its employees in one year

'Of particular concern is the fact that the IRS ask taxpayers to voluntarily pay taxes owed in a timely manner and yet was more tolerant when its employees became delinquent and defaulted on outstanding payments, violated the terms of the Citibank contract, abused a Government-provided resource (travel funding), and compromised the integrity of the IRS,' the report notes.

In other words, the report finds that oftentimes when employees at the agency - which drops the hammer on citizens who don't pay their taxes in a timely manner - fail to pay their bill or abuse a charge card, they aren't punished to nearly the same degree as average citizens who are late on their taxes.

More...

In 1998, then-President Bill Clinton signed a law that requires federal employees to use a 'government-issued travel charge card' to pay for most job-related travel. IRS employees use Citybank cards, which are billed in one of two ways: directly, or centrally.

For centrally billed cards, the bank bills the IRS directly. For directly billed cards, the bank bills individual employees, who are then reimbursed by the IRS.

Employees are not permitted to use the cards for anything other than IRS-related travel expenses.

The report finds that while the IRS is generally effective in controlling how the cards are used, 'in some instances controls were not implemented effectively, which increased the risk for misuse and resulted in some travel card misuse going undetected.'

'Do as I say, not as I do': the IRS is lenient towards its employees who abuse government-issued charge cards, or who can't pay their bill on time

Examples of card misuse include, among other things, use of the card by someone other than the cardholder, use while not on official travel, purchases from an unauthorized merchant and failure to pay on time.

According to the report, obtained by cnsnews.com, '15 cardholders with either secret or top-secret clearances had their travel accounts suspended due to their failure to pay outstanding balances. Two other cardholders with secret and top-secret clearances presented NSF [non-sufficient funds] checks to Citibank for payment of their travel card balance.'

Additionally, '94 cardholders serving public trust positions requiring moderate and high-level background checks wrote one or more NSF checks, and 36 had their accounts charged off [written off as a loss by Citibank] due to their failure to pay outstanding balances.

'For example,' the report states, 'a tax compliance officer wrote seven NSF checks in FY 2011 while occupying a position that required a moderate-risk background investigation.'

By the end of 2011, 51,974 IRS employees had their own Citybank travel cards. In all, they ran up a $121 million bill, which is paid for by taxpayers.

To get an idea of how the IRS punished those who abused the card, the IG's Office examined 30 cases of travel card misuse and determined that officials are very lenient when disciplining abusers.

'While the CCS Branch correctly referred misuse cases to Labor Relations, disciplinary actions against employees were typically less severe than those recommended by the IRS’s penalty guidelines in approximately half of the 30 cases reviewed,” according to the report.

The report also determined that 'the IRS lacked standard policies for referring employees who misused their travel cards to security personnel to determine if background checks, security clearances, and suitability for employment determinations required reevaluation. As a result, employees who wrote NSF checks or had suspended or charged-off accounts received little or no disciplinary action in response to their misuse and did not have their background clearances reevaluated for suitability for employment.'

visit www.lorettamiller4president.com

Saturday, June 15, 2013