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U.S. Department of Housing and Urban Development 

Office of Inspector General 

451 Seventh Street, SW 

Washington, DC 20410-4500 

Phone: (202) 708-0390 Fax: (202) 708-1354

June 5, 2007 

MEMORANDUM FOR: David Palladino, Office Director, Office of Administrative and 

Management Services, AJA 

 

FROM: John P. McCarty, Assistant Inspector General for Investigation, GI 

SUBJECT: Sprint FONCARDS 

 File: IED-06-0012 

The Inspections and Evaluations Division conducts independent, objective 

examinations of Department of Housing and Urban Development (HUD) activities, 

programs, operations, or organizational issues. We completed a limited review 

concerning Sprint FONCARDS or calling cards. We conducted the review to ensure 

adequate controls were present. 

 The objectives of our review were to determine the controls in place to identify 

waste, fraud or abuse regarding the FTS 2001 Sprint FONCARD. 

We determined that verification memorandums were not being sent to individuals 

to verify that calls were official and were made by the individual as required in the 

monthly review process. We also determined that there was a limited inventory of the 

cards. A complete inventory of personnel and FONCARD numbers are required in order 

to identify and notify individuals. 

BACKGROUND 

 On August 30, 2005, we were provided with a copy of the policy and procedures 

issued to establish controls over the FONCARDs, which in essence stated: 

• The approving official in the field or other headquarter office, submits an electronic 

request with justification to the telecommunications office. 

• The telecommunications office reviews and approves the request. 

• Once approved, a request is sent to Sprint for a new FONCARD. 
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• Upon receipt from Sprint, the telecommunications office issues the FONCARD to 

the requesting approving official. Attached to the FONCARD are the policies and 

procedures memorandum and a custody receipt that is signed by the employee 

receiving the FONCARD. 

The Telecommunications office described the monthly review process: 

• A Computer Disk (CD) is received from Sprint on a monthly basis that contains all 

HUDs FONCARD data for the previous month (only data for FONCARDs used). 

• Reviews are conducted for unusually high or excessive calls. Reports are run from 

the Sprint Interactive Desktop Reporter (SPIDR) program. SPIDR is a program 

used by the HUD Telecommunications Office to Monitor Telephone bills to include 

calling cards or FONCARDs. Sprint sends electronic phone bills recorded on CDs 

with detailed information to HUD’s Telecommunications Office on a monthly basis. 

The average cost for the FONCARDS are $45,000 per month based on the detailed 

reports. 

• All Invoices that exceed $20.00 are printed. 

• Individual invoices (exceeding $20) and an attached verification memorandum 

are sent to individuals to verify that the calls were official and were made by the 

individual. 

SCOPE AND METHODOLOGY 

 To achieve our objectives, we obtained, downloaded and reviewed phone bills 

recorded on CDs from January 2005 to August 2006. Detailed reports were converted to 

an excel format and an analysis was conducted for any occurrence of 900 or 866 

numbers. Detailed reports for the FONCARDS are over 1000 pages per month. There 

were no occurrences of 900 or 866 numbers indicated on any of the detailed reports. 

 According to the Telecommunications office, detailed monthly bills that are over 

$20 are sent to individuals for signature verification. The average number of FONCARD 

bills over $20 was 40 per month (January 2005 to August 2006). The following 

FONCARD numbers over $20 were randomly selected for review of signature 

verification: 5609853451 – June 2006, 4879581176 – April 2006, 8471118038 – January 

2006, 3677458052 – June 2006, and 6887650739 – January 2006. The 

Telecommunications office could not produce the verifications. 

 A review was conducted for 261 FONCARD numbers from OIG employees. The 

numbers were checked against the Sprint bills for January 2006 to August 2006. Four 

individuals exceeded $20 per month and should have received memorandums from the 

Telecommunications Office to verify calls. Three out of four did not see their bills. One 
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individual verified his bills in the past but he could not remember the approximate date. The 

Telecommunications office did not send verification memorandums to all OIG employees. 

 A FONCARD inventory was provided by the Telecommunications Office for 

personnel in the OIG. The inventory contained 161 personnel and FONCARD numbers. 

The OIG compiled a list that contained 261 personnel. The OIG forwarded the 

Telecommunications office an updated list. The Telecommunications office did not have 

total accountability of the FONCARDS for OIG personnel. 

Recommendations 

 We recommend that the Telecommunications office maintain an accountability of 

the FONCARDS. The OIG forwarded an updated inventory list that included personnel 

name and FONCARD numbers to the Telecommunications Office. A similar list should 

be requested from the other HUD divisions. An accurate accountability will ensure the 

individuals who exceed $20 per month will verify the official use of the Card. 

Acknowledgements 

The report was prepared under the direction of John P. McCarty, Assistant 

Inspector General for Investigation. 

The assignment was supervised by Michael Groszkiewicz, Special Agent in 

Charge, Inspections and Evaluations Division, Office of Investigation. 

The following field staff worked on the assignment and report: 

Sheila Keating, Senior Forensic Auditor