I 

111TH CONGRESS 

1ST SESSION H. R. 2189 

To prevent abuse of Government charge cards. 

IN THE HOUSE OF REPRESENTATIVES 

APRIL 30, 2009 

Mr. WILSON of South Carolina (for himself and Mr. ELLSWORTH) introduced 

the following bill; which was referred to the Committee on Oversight and 

Government Reform, and in addition to the Committee on Armed Services, for a period to be subsequently determined by the Speaker, in each 

case for consideration of such provisions as fall within the jurisdiction of 

the committee concerned 

A BILL 

To prevent abuse of Government charge cards. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Government Charge 

5 Card Abuse Prevention Act of 2009’’. 

6 SEC. 2. MANAGEMENT OF PURCHASE CARDS. 

7 (a) REQUIRED SAFEGUARDS AND INTERNAL CON8 TROLS.—The head of each executive agency that issues 

9 and uses purchase cards and convenience checks shall esVerDate Nov 24 2008 03:52 May 02, 2009 Jkt 079200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H2189.IH H2189

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1 tablish and maintain safeguards and internal controls to 

2 ensure the following: 

3 (1) There is a record in each executive agency 

4 of each holder of a purchase card issued by the 

5 agency for official use, annotated with the limita6 tions on single transactions and total transactions 

7 that are applicable to the use of each such card or 

8 check by that purchase cardholder. 

9 (2) Each purchase cardholder and individual 

10 issued a convenience check is assigned an approving 

11 official other than the cardholder with the authority 

12 to approve or disapprove transactions. 

13 (3) The holder of a purchase card and each of14 ficial with authority to authorize expenditures 

15 charged to the purchase card are responsible for— 

16 (A) reconciling the charges appearing on 

17 each statement of account for that purchase 

18 card with receipts and other supporting docu19 mentation; and 

20 (B) forwarding such reconciliation to the 

21 certifying official in a timely manner to enable 

22 the certifying official to ensure that the Federal 

23 Government ultimately pays only for valid 

24 charges. 


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1 (4) Any disputed purchase card charge, and 

2 any discrepancy between a receipt and other sup3 porting documentation and the purchase card state4 ment of account, is resolved in the manner pre5 scribed in the applicable governmentwide purchase 

6 card contract entered into by the Administrator of 

7 General Services and in accordance with all laws and 

8 executive agency regulations. 

9 (5) Payments on purchase card accounts are 

10 made promptly within prescribed deadlines to avoid 

11 interest penalties. 

12 (6) Rebates and refunds based on prompt pay13 ment, sales volume, or other actions by the agency 

14 on purchase card accounts are reviewed for accuracy 

15 and properly recorded as a receipt to the agency 

16 that pays the monthly bill. 

17 (7) Records of each purchase card transaction 

18 (including records on associated contracts, reports, 

19 accounts, and invoices) are retained in accordance 

20 with standard Government policies on the disposition 

21 of records. 

22 (8) Periodic reviews are performed to determine 

23 whether each purchase cardholder has a need for the 

24 purchase card. 


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1 (9) Appropriate training regarding the proper 

2 use of purchase cards is provided to each purchase 

3 cardholder in advance of being issued a purchase 

4 card and periodically thereafter and to each official 

5 with responsibility for overseeing the use of purchase 

6 cards issued by an executive agency in advance of 

7 assuming such oversight duties and periodically 

8 thereafter. 

9 (10) The executive agency has specific policies 

10 regarding the number of purchase cards issued by 

11 various component organizations and categories of 

12 component organizations, the credit limits author13 ized for various categories of cardholders, and cat14 egories of employees eligible to be issued purchase 

15 cards, and that those policies are designed to mini16 mize the financial risk to the Federal Government of 

17 the issuance of the purchase cards and to ensure the 

18 integrity of purchase cardholders. 

19 (11) The executive agency utilizes effective sys20 tems, techniques, and technologies to prevent or 

21 identify fraudulent purchases. 

22 (12) The executive agency invalidates the pur23 chase card of each employee who— 


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1 (A) ceases to be employed by the agency, 

2 immediately upon termination of the employ3 ment of the employee; or 

4 (B) transfers to another unit of the agency 

5 immediately upon the transfer of the employee 

6 unless the agency determines that the units are 

7 covered by the same purchase card authority. 

8 (13) The executive agency takes steps to re9 cover the cost of any erroneous, improper, or illegal 

10 purchase made with a purchase card or convenience 

11 check by an employee, including, as necessary, 

12 through salary offsets. 

13 (b) GUIDANCE ON MANAGEMENT OF PURCHASE

14 CARDS.—Not later than 180 days after the date of the 

15 enactment of this Act, the Director of the Office of Man16 agement and Budget shall review the existing guidance 

17 and, as necessary, prescribe additional guidance governing 

18 the implementation of the safeguards and internal controls 

19 required by subsection (a) by executive agencies. 

20 (c) PENALTIES FOR VIOLATIONS.— 

21 (1) IN GENERAL.—The head of each executive 

22 agency shall provide for appropriate adverse per23 sonnel actions or other punishment to be imposed in 

24 cases in which employees of the agency violate agen25 cy policies implementing the guidance required by 


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1 subsection (b) or make improper, erroneous, or ille2 gal purchases with purchase cards or convenience 

3 checks. 

4 (2) DISMISSAL.—Penalties prescribed for em5 ployee misuse of purchase cards or convenience 

6 checks shall include dismissal of the employee, as 

7 appropriate. 

8 (3) REPORTS ON VIOLATIONS.—The guidance 

9 prescribed under subsection (b) shall direct each 

10 head of an executive agency with more than 

11 $10,000,000 in purchase card spending annually, 

12 and each Inspector General of such an executive 

13 agency on a semiannual basis, to submit to the Di14 rector of the Office of Management and Budget a 

15 joint report on violations or other actions covered by 

16 paragraph (1) by employees of such executive agen17 cy. At a minimum, the report shall set forth the fol18 lowing: 

19 (A) A description of each violation. 

20 (B) A description of any adverse personnel 

21 action, punishment, or other action taken 

22 against the employee for such violation. 

23 (d) RISK ASSESSMENTS AND AUDITS.—The Inspec24 tor General of each executive agency shall— 


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1 (1) conduct periodic assessments of the agency 

2 purchase card or convenience check programs to 

3 identify and analyze risks of illegal, improper, or er4 roneous purchases and payments in order to develop 

5 a plan for using such risk assessments to determine 

6 the scope, frequency, and number of periodic audits 

7 of purchase card or convenience check transactions; 

8 (2) perform analysis or audits as necessary, of 

9 purchase card transactions designed to identify— 

10 (A) potentially illegal, improper, erroneous, 

11 and abusive uses of purchase cards; 

12 (B) any patterns of such uses; and 

13 (C) categories of purchases that could be 

14 made by means other than purchase cards in 

15 order to better aggregate purchases and obtain 

16 lower prices (excluding transactions made under 

17 card-based strategic sourcing arrangements); 

18 (3) report to the head of the executive agency 

19 concerned on the results of such analysis or audits; 

20 and 

21 (4) report to the Director of the Office of Man22 agement and Budget on the implementation of rec23 ommendations made to the head of the executive 

24 agency to address findings of any analysis or audit 

25 of purchase card and convenience check transactions 


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1 or programs for compilation and transmission by the 

2 Director to Congress and the Comptroller General. 

3 (e) DEFINITION OF EXECUTIVE AGENCY.—In this 

4 section, the term ‘‘executive agency’’ has the meaning 

5 given such term in section 4(1) of the Office of Federal 

6 Procurement Policy Act (41 U.S.C. 403(1)), except as 

7 provided under subsection (f)(1). 

8 (f) RELATIONSHIP TO DEPARTMENT OF DEFENSE

9 PURCHASE CARD REGULATIONS.— 

10 (1) IN GENERAL.—The requirements of sub11 sections (a) through (d) shall not apply to the De12 partment of Defense. 

13 (2) CONFORMING AMENDMENTS.—Section 2784 

14 of title 10, United States Code, is amended— 

15 (A) in subsection (b), by adding at the end 

16 the following new paragraphs: 

17 ‘‘(11) That each purchase cardholder and indi18 vidual issued a convenience check is assigned an ap19 proving official other than the cardholder with the 

20 authority to approve or disapprove transactions. 

21 ‘‘(12) That the Department of Defense utilizes 

22 effective systems, techniques, and technologies to 

23 prevent or identify fraudulent purchases. 


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1 ‘‘(13) That the Department of Defense takes 

2 appropriate steps to invalidate the purchase card of 

3 each employee who— 

4 ‘‘(A) ceases to be employed by the Depart5 ment of Defense, immediately upon termination 

6 of the employment of the employee; or 

7 ‘‘(B) transfers to another unit of the De8 partment of Defense immediately upon the 

9 transfer of the employee unless the Secretary of 

10 Defense determines that the units are covered 

11 by the same purchase card authority. 

12 ‘‘(14) That the Department of Defense takes 

13 appropriate steps to recover the cost of any erro14 neous, improper, or illegal purchase made with a 

15 purchase card or convenience check by an employee, 

16 including, as necessary, through salary offsets. 

17 ‘‘(15) That the Inspector General of the De18 partment of Defense conducts periodic assessments 

19 of purchase card or convenience check programs to 

20 identify and analyze risks of illegal, improper, or er21 roneous purchases and payments and uses such risk 

22 assessments to develop appropriate recommendations 

23 for corrective actions.’’; and 

24 (B) by adding at the end the following new 

25 subsection: 


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1 ‘‘(d) SEMIANNUAL REPORT.—The Secretary of De2 fense and the Inspector General of the Department of De3 fense shall submit to the Director of the Office of Manage4 ment and Budget on a semiannual basis a joint report on 

5 illegal, improper, or erroneous purchases and payments 

6 made with purchase cards or convenience checks by em7 ployees of the Department of Defense. At a minimum, the 

8 report shall include the following: 

9 ‘‘(1) A description of each violation. 

10 ‘‘(2) A description of any adverse personnel ac11 tion, punishment, or other action taken against the 

12 employee for such violation. 

13 ‘‘(3) A description of actions taken by the De14 partment of Defense to address recommendations 

15 made to address findings arising out of risk assess16 ments and audits conducted pursuant to this sec17 tion.’’. 

18 SEC. 3. MANAGEMENT OF TRAVEL CARDS. 

19 Section 2 of the Travel and Transportation Reform 

20 Act of 1998 (Public Law 105–264; 5 U.S.C. 5701 note) 

21 is amended by adding at the end the following new sub22 section: 

23 ‘‘(h) MANAGEMENT OF TRAVEL CHARGE CARDS.— 

24 ‘‘(1) REQUIRED SAFEGUARDS AND INTERNAL

25 CONTROLS.—The head of each executive agency that 


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1 has employees that use travel charge cards shall es2 tablish and maintain the following internal control 

3 activities to ensure the proper, efficient, and effec4 tive use of such travel charge cards: 

5 ‘‘(A) There is a record in each executive 

6 agency of each holder of a travel charge card 

7 issued on behalf of the agency for official use, 

8 annotated with the limitations on amounts that 

9 are applicable to the use of each such card by 

10 that travel charge cardholder. 

11 ‘‘(B) Rebates and refunds based on 

12 prompt payment, sales volume, or other actions 

13 by the agency on travel charge card accounts 

14 are monitored for accuracy and properly re15 corded as a receipt of the agency that employs 

16 the cardholder. 

17 ‘‘(C) Periodic reviews are performed to de18 termine whether each travel charge cardholder 

19 has a need for the travel charge card. 

20 ‘‘(D) Appropriate training is provided to 

21 each travel charge cardholder and each official 

22 with responsibility for overseeing the use of 

23 travel charge cards issued by an executive agen24 cy. 


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1 ‘‘(E) Each executive agency has specific 

2 policies regarding the number of travel charge 

3 cards issued for various component organiza4 tions and categories of component organiza5 tions, the credit limits authorized for various 

6 categories of cardholders, and categories of em7 ployees eligible to be issued travel charge cards, 

8 and designs those policies to minimize the fi9 nancial risk to the Federal Government of the 

10 issuance of the travel charge cards and to en11 sure the integrity of travel charge cardholders. 

12 ‘‘(F) Each executive agency ensures its 

13 contractual arrangement with each servicing 

14 travel charge card issuing contractor contains a 

15 requirement to evaluate the creditworthiness of 

16 an individual before issuing that individual a 

17 travel charge card, and that no individual be 

18 issued a travel charge card if that individual is 

19 found not creditworthy as a result of the eval20 uation (except that this paragraph shall not 

21 preclude issuance of a restricted use travel 

22 charge card or pre-paid card when the indi23 vidual lacks a credit history or has a credit 

24 score below the minimum credit score estab25 lished by the Office of Management and BudgVerDate Nov 24 2008 03:52 May 02, 2009 Jkt 079200 PO 00000 Frm 00012 Fmt 6652 Sfmt 6201 E:\BILLS\H2189.IH H2189

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1 et). The Director of the Office of Management 

2 and Budget shall establish a minimum credit 

3 score for determining the creditworthiness of an 

4 individual based on rigorous statistical analysis 

5 of the population of cardholders and historical 

6 behaviors. Notwithstanding any other provision 

7 of law, such evaluation shall include an assess8 ment of an individual’s consumer report from a 

9 consumer reporting agency as those terms are 

10 defined in section 603 of the Fair Credit Re11 porting Act. 

12 ‘‘(G) Each executive agency utilizes effec13 tive systems, techniques, and technologies to 

14 prevent or identify improper purchases. 

15 ‘‘(H) Each executive agency ensures that 

16 the travel charge card of each employee who 

17 ceases to be employed by the agency is invali18 dated immediately upon termination of the em19 ployment of the employee. 

20 ‘‘(I) Each executive agency utilizes, where 

21 appropriate, direct payment to the holder of the 

22 travel card contract. 

23 ‘‘(2) GUIDANCE ON MANAGEMENT OF TRAVEL

24 CHARGE CARDS.—Not later than 180 days after the 

25 date of the enactment of this Act, the Director of 


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1 the Office of Management and Budget shall review 

2 the existing guidance and, as necessary, prescribe 

3 additional guidance for executive agencies governing 

4 the implementation of the requirements in para5 graph (1). 

6 ‘‘(3) PENALTIES FOR VIOLATIONS.— 

7 ‘‘(A) IN GENERAL.—Consistent with the 

8 guidance prescribed under paragraph (2), each 

9 executive agency shall provide for appropriate 

10 adverse personnel actions to be imposed in 

11 cases in which employees of the executive agen12 cy fail to comply with applicable travel charge 

13 card terms and conditions or applicable agency 

14 regulations or commit fraud with respect to a 

15 travel charge card, including removal in appro16 priate cases. 

17 ‘‘(B) REPORTS ON VIOLATIONS.—The 

18 guidance prescribed under paragraph (2) shall 

19 require each head of an executive agency with 

20 more than $10,000,000 in travel card spending 

21 annually, and each inspector general of such an 

22 executive agency, on a semiannual basis, to sub23 mit to the Director of the Office of Manage24 ment and Budget a joint report on violations or 

25 other actions covered by subparagraph (A) by 


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1 employees of such executive agency. At a min2 imum, the report shall set forth the following: 

3 ‘‘(i) A description of each violation. 

4 ‘‘(ii) A description of any adverse per5 sonnel action, punishment, or other action 

6 taken against the employee for such viola7 tion or other action. 

8 ‘‘(4) RISK ASSESSMENTS AND AUDITS.—The in9 spector general of each executive agency shall— 

10 ‘‘(A) conduct periodic assessments of the 

11 agency travel charge card program and associ12 ated internal controls to identify and analyze 

13 risks of illegal, improper, or erroneous travel 

14 charges and payments in order to develop a 

15 plan for using such risk assessments to deter16 mine the scope, frequency, and number of peri17 odic audits of travel charge card transactions; 

18 ‘‘(B) perform periodic analysis and audits, 

19 as appropriate, of travel charge card trans20 actions designed to identify potentially im21 proper, erroneous, and illegal uses of travel 

22 charge cards; 

23 ‘‘(C) report to the head of the executive 

24 agency concerned on the results of such anal25 ysis and audits; and 


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1 ‘‘(D) report to the Director of the Office of 

2 Management and Budget on the implementa3 tion of recommendations made to the head of 

4 the executive agency to address findings of any 

5 analysis or audit of travel charge card trans6 actions or programs for compilation and trans7 mission by the Director to Congress and the 

8 Comptroller General. 

9 ‘‘(5) DEFINITIONS.—In this subsection: 

10 ‘‘(A) The term ‘executive agency’ means an 

11 agency as that term is defined in subpara12 graphs (A) and (B) of section 5701(1) of title 

13 5, United States Code. 

14 ‘‘(B) The term ‘travel charge card’ means 

15 any Federal contractor-issued travel charge 

16 card that is individually billed to each card17 holder.’’. 

18 SEC. 4. MANAGEMENT OF CENTRALLY BILLED ACCOUNTS. 

19 (a) REQUIRED INTERNAL CONTROLS FOR CEN20 TRALLY BILLED ACCOUNTS.—The head of an executive 

21 agency that has employees who use a travel charge card 

22 that is billed directly to the United States Government 

23 shall establish and maintain the following internal control 

24 activities: 


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1 (1) Items submitted on an employee’s travel 

2 voucher shall be compared with items paid for using 

3 a centrally billed account on any related travel to en4 sure that an employee is not reimbursed for an item 

5 already paid for by the United States Government 

6 through a centrally billed account. 

7 (2) The executive agency shall dispute unallow8 able and erroneous charges and track the status of 

9 the disputed transactions to ensure appropriate reso10 lution. 

11 (3) The executive agency shall submit requests 

12 to servicing airlines for refunds of fully or partially 

13 unused tickets, when entitled to such refunds, and 

14 track the status of unused tickets to ensure appro15 priate resolution. 

16 (b) GUIDANCE.—Not later than 180 days after the 

17 date of the enactment of this Act, the Director of the Of18 fice of Management and Budget shall review the existing 

19 guidance and, as necessary, prescribe additional guidance 

20 for executive agencies implementing the requirements of 

21 subsection (a). 

22 SEC. 5. CONSTRUCTION. 

23 Nothing in this Act shall be construed to excuse the 

24 head of an executive agency from the responsibilities set 

25 out in section 3512 of title 31, United States Code, or 


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1 in the Improper Payments Act of 2002 (31 U.S.C. 3321 

2 note). 

Æ 


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