II 

Calendar No. 933 

110TH CONGRESS 

2D SESSION S. 789 

[Report No. 110–437] 

To prevent abuse of Government credit cards. 

IN THE SENATE OF THE UNITED STATES 

MARCH 7, 2007 

Mr. GRASSLEY (for himself, Mr. LIEBERMAN, Ms. COLLINS, Mr. COLEMAN, 

Mrs. MCCASKILL, Mr. LEVIN, Mr. CARPER, and Mr. KERRY) introduced 

the following bill; which was read twice and referred to the Committee 

on Homeland Security and Governmental Affairs 

AUGUST 1, 2008 

Reported by Mr. LIEBERMAN, with an amendment 

[Strike out all after the enacting clause and insert the part printed in italic] 

A BILL 

To prevent abuse of Government credit 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 Credit 

5 Card Abuse Prevention Act of 2007’’. 


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1 SEC. 2. MANAGEMENT OF PURCHASE CARDS. 

2 (a) REQUIRED SAFEGUARDS AND INTERNAL CON3 TROLS.—The head of each executive agency that issues 

4 and uses purchase cards and convenience checks shall es5 tablish and maintain safeguards and internal controls to 

6 ensure the following: 

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

8 of each holder of a purchase card issued by the 

9 agency for official use, annotated with the limita10 tions on single transaction and total credit amounts 

11 that are applicable to the use of each such card by 

12 that purchase cardholder. 

13 (2) Each purchase cardholder is assigned an 

14 approving official other than the cardholder with the 

15 authority to approve or disapprove expenditures. 

16 (3) The holder of a purchase card and each of17 ficial with authority to authorize expenditures 

18 charged to the purchase card are responsible for— 

19 (A) reconciling the charges appearing on 

20 each statement of account for that purchase 

21 card with receipts and other supporting docu22 mentation; and 

23 (B) forwarding such reconciliation to the 

24 designated official who certifies the bill for pay25 ment in a timely manner. 


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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. 

8 (5) Payments on purchase card accounts are 

9 made promptly within prescribed deadlines to avoid 

10 interest penalties. 

11 (6) Rebates and refunds based on prompt pay12 ment on purchase card accounts are monitored for 

13 accuracy and properly recorded as a receipt to the 

14 agency that pays the monthly bill. 

15 (7) Records of each purchase card transaction 

16 (including records on associated contracts, reports, 

17 accounts, and invoices) are retained in accordance 

18 with standard Government policies on the disposition 

19 of records. 

20 (8) Periodic reviews are performed to determine 

21 whether each purchase cardholder has a need for the 

22 purchase card. 

23 (9) Appropriate training is provided to each 

24 purchase cardholder and each official with responsiVerDate Aug 31 2005 23:36 Aug 01, 2008 Jkt 069002 PO 00000 Frm 00003 Fmt 6652 Sfmt 6401 E:\BILLS\S789.RS S789

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1 bility for overseeing the use of purchase cards issued 

2 by an executive agency. 

3 (10) The executive agency has specific policies 

4 regarding the number of purchase cards issued by 

5 various organizations and categories of organiza6 tions, the credit limits authorized for various cat7 egories of cardholders, and categories of employees 

8 eligible to be issued purchase cards, and that those 

9 policies are designed to minimize the financial risk 

10 to the Federal Government of the issuance of the 

11 purchase cards and to ensure the integrity of pur12 chase cardholders. 

13 (11) The executive agency utilizes technologies 

14 to prevent or identify fraudulent purchases, includ15 ing controlling merchant codes and utilizing statis16 tical machine learning and pattern recognition tech17 nologies that review the risk of every transaction. 

18 (12) The executive agency invalidates the pur19 chase card of each employee who— 

20 (A) ceases to be employed by the agency 

21 immediately upon termination of the employ22 ment of the employee; or 

23 (B) transfers to another unit of the agency 

24 immediately upon the transfer of the employee. 


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1 (13) The executive agency takes steps to re2 cover the cost of any improper or fraudulent pur3 chase made by an employee, including, as necessary, 

4 through salary offsets. 

5 (b) MANAGEMENT OF PURCHASE CARDS.—The head 

6 of each executive agency shall prescribe regulations imple7 menting the safeguards and internal controls in subsection 

8 (a). The regulations shall be consistent with regulations 

9 that apply Governmentwide regarding the use of purchase 

10 cards by Government personnel for official purposes. 

11 (c) PENALTIES FOR VIOLATIONS.—The regulations 

12 prescribed under subsection (b) shall provide for appro13 priate adverse personnel actions or other punishment to 

14 be imposed in cases in which employees of an executive 

15 agency violate such regulations or are negligent or engage 

16 in misuse, abuse, or fraud with respect to a purchase card, 

17 including imposition of the following penalties: 

18 (1) In the case of an employee who is suspected 

19 by the executive agency to have engaged in fraud, 

20 referral of the case to the United States Attorney 

21 with jurisdiction over the matter. 

22 (2) In the case of an employee who is found 

23 guilty of fraud or found by the executive agency to 

24 have egregiously abused a purchase card, dismissal 

25 of the employee. 


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1 (d) RISK ASSESSMENTS AND AUDITS.—The Inspec2 tor General of each executive agency shall— 

3 (1) periodically conduct risk assessments of the 

4 agency purchase card program and associated inter5 nal controls and analyze identified weaknesses and 

6 the frequency of improper activity in order to de7 velop a plan for using such risk assessments to de8 termine the scope, frequency, and number of peri9 odic audits of purchase cardholders; 

10 (2) perform periodic audits of purchase card11 holders designed to identify— 

12 (A) potentially fraudulent, improper, and 

13 abusive uses of purchase cards; 

14 (B) any patterns of improper cardholder 

15 transactions, such as purchases of prohibited 

16 items; and 

17 (C) categories of purchases that should be 

18 made by means other than purchase cards in 

19 order to better aggregate purchases and obtain 

20 lower prices; 

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

22 concerned on the results of such audits; and 

23 (4) report to the Director of the Office of Man24 agement and Budget and the Comptroller General 

25 on the implementation of recommendations made to 


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1 the head of the executive agency to address findings 

2 during audits of purchase cardholders. 

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)). 

7 (f) RELATIONSHIP TO DEPARTMENT OF DEFENSE

8 PURCHASE CARD REGULATIONS.— 

9 (1) IN GENERAL.—Except as provided by the 

10 amendments made by paragraph (2), the require11 ments under this section shall not apply to the De12 partment of Defense. 

13 (2) EXCEPTION.—Section 2784(b) of title 10, 

14 United States Code, is amended— 

15 (A) in paragraph (8), by striking ‘‘periodic 

16 audits’’ and all that follows through the period 

17 at the end and inserting ‘‘risk assessments of 

18 the agency purchase card program and associ19 ated internal controls and analyze identified 

20 weaknesses and the frequency of improper ac21 tivity in order to develop a plan for using such 

22 risk assessments to determine the scope, fre23 quency, and number of periodic audits of pur24 chase cardholders.’’; and 


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

2 paragraphs: 

3 ‘‘(11) That the Department of Defense utilizes 

4 technologies to prevent or identify fraudulent pur5 chases, including controlling merchant codes and uti6 lizing statistical machine learning and pattern rec7 ognition technologies that review the risk of every 

8 transaction. 

9 ‘‘(12) That the Secretary of Defense— 

10 ‘‘(A) invalidates the purchase card of each 

11 employee who ceases to be employed by the De12 partment of Defense immediately upon termi13 nation of the employment of the employee; and 

14 ‘‘(B) invalidates the purchase card of each 

15 employee who transfers to another agency or 

16 subunit within the Department of Defense im17 mediately upon such transfer.’’. 

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 safeguards and internal con3 trols over travel charge cards to ensure the fol4 lowing: 

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

6 agency of each holder of a travel charge card 

7 issued by the agency for official use, annotated 

8 with the limitations on amounts that are appli9 cable to the use of each such card by that travel 

10 charge cardholder. 

11 ‘‘(B) Rebates and refunds based on 

12 prompt payment on travel charge card accounts 

13 are properly recorded as a receipt of the agency 

14 that employs the cardholder. 

15 ‘‘(C) Periodic reviews are performed to de16 termine whether each travel charge cardholder 

17 has a need for the travel charge card. 

18 ‘‘(D) Appropriate training is provided to 

19 each travel charge cardholder and each official 

20 with responsibility for overseeing the use of 

21 travel charge cards issued by an executive agen22 cy. 

23 ‘‘(E) Each executive agency has specific 

24 policies regarding the number of travel charge 

25 cards issued by various organizations and catVerDate Aug 31 2005 23:36 Aug 01, 2008 Jkt 069002 PO 00000 Frm 00009 Fmt 6652 Sfmt 6401 E:\BILLS\S789.RS S789

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1 egories of organizations, the credit limits au2 thorized for various categories of cardholders, 

3 and categories of employees eligible to be issued 

4 travel charge cards, and that those policies are 

5 designed to minimize the financial risk to the 

6 Federal Government of the issuance of the trav7 el charge cards and to ensure the integrity of 

8 travel charge cardholders. 

9 ‘‘(F) The head of each executive agency 

10 negotiates with the holder of the applicable 

11 travel card contract, or a third party provider 

12 of credit evaluations if such provider offers 

13 more favorable terms, to evaluate the credit14 worthiness of an individual before issuing the 

15 individual a travel charge card, and that no in16 dividual be issued a travel charge card if the in17 dividual is found not creditworthy as a result of 

18 the evaluation (except that this paragraph shall 

19 not preclude issuance of a restricted use travel 

20 charge card when the individual lacks a credit 

21 history or the issuance of a pre-paid card when 

22 the individual has a credit score below the min23 imum credit score established by the agency). 

24 Each executive agency shall establish a min25 imum credit score for determining the creditVerDate Aug 31 2005 23:36 Aug 01, 2008 Jkt 069002 PO 00000 Frm 00010 Fmt 6652 Sfmt 6401 E:\BILLS\S789.RS S789

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1 worthiness of an individual based on rigorous 

2 statistical analysis of the population of card3 holders and historical behaviors. Notwith4 standing any other provision of law, such eval5 uation shall include an assessment of an indi6 vidual’s consumer report from a consumer re7 porting agency as those terms are defined in 

8 section 603 of the Fair Credit Reporting Act. 

9 The obtaining of a consumer report under this 

10 subsection is deemed to be a circumstance or 

11 purpose authorized or listed under section 604 

12 of the Fair Credit Reporting Act. 

13 ‘‘(G) Each executive agency utilizes tech14 nologies to prevent or identify fraudulent pur15 chases, including controlling merchant codes 

16 and utilizing statistical machine learning and 

17 pattern recognition technologies that review the 

18 risk of every transaction. 

19 ‘‘(H) Each executive agency ensures that 

20 the travel charge card of each employee who 

21 ceases to be employed by the agency is invali22 dated immediately upon termination of the em23 ployment of the employee. 


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1 ‘‘(I) Each executive agency utilizes manda2 tory split disbursements for travel card pur3 chases. 

4 ‘‘(2) REGULATIONS.—The Administrator of 

5 General Services shall prescribe regulations gov6 erning the implementation of the safeguards and in7 ternal controls in paragraph (1) by executive agen8 cies. 

9 ‘‘(3) PENALTIES FOR VIOLATIONS.—The regu10 lations prescribed under paragraph (2) shall provide 

11 for appropriate adverse personnel actions or other 

12 punishment to be imposed in cases in which employ13 ees of an executive agency violate such regulations 

14 or are negligent or engage in misuse, abuse, or fraud 

15 with respect to a travel charge card, including re16 moval in appropriate cases. 

17 ‘‘(4) ASSESSMENTS.—The Inspector General of 

18 each executive agency shall— 

19 ‘‘(A) periodically conduct risk assessments 

20 of the agency travel card program and associ21 ated internal controls and analyze identified 

22 weaknesses and the frequency of improper ac23 tivity in order to develop a plan for using such 

24 risk assessments to determine the scope, freVerDate Aug 31 2005 23:36 Aug 01, 2008 Jkt 069002 PO 00000 Frm 00012 Fmt 6652 Sfmt 6401 E:\BILLS\S789.RS S789

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1 quency, and number of periodic audits of pur2 chase cardholders; 

3 ‘‘(B) perform periodic audits of travel 

4 cardholders designed to identify potentially 

5 fraudulent, improper, and abusive uses of travel 

6 cards; 

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

8 agency concerned on the results of such audits; 

9 and 

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

11 Management and Budget and the Comptroller 

12 General on the implementation of recommenda13 tions made to the head of the executive agency 

14 to address findings during audits of travel card15 holders. 

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

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

18 agency as that term is defined in section 5701 

19 of title 5, United States Code, except that it is 

20 in the executive branch. 

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

22 the Federal contractor-issued travel charge card 

23 that is individually billed to each cardholder.’’. 


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1 SEC. 4. MANAGEMENT OF CENTRALLY BILLED ACCOUNTS. 

2 The head of an executive agency that has employees 

3 who use a centrally billed account shall establish and 

4 maintain safeguards and internal controls to ensure the 

5 following: 

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

7 voucher are compared with items paid for using a 

8 centrally billed account to ensure that an employee 

9 is not reimbursed for an item already paid for 

10 through a centrally billed account. 

11 (2) The executive agency submits requests for 

12 refunds for unauthorized purchases to the holder of 

13 the applicable contract for a centrally billed account. 

14 (3) The executive agency submits requests for 

15 refunds for fully or partially unused tickets to the 

16 holder of the applicable contract for a centrally 

17 billed account. 

18 SEC. 5. REGULATIONS. 

19 (a) IN GENERAL.—Not later than 180 days after the 

20 date of the enactment of this Act— 

21 (1) the head of each executive agency shall pro22 mulgate regulations to implement the requirements 

23 of sections 2 and 4; and 

24 (2) the Administrator of General Services shall 

25 promulgate regulations required pursuant to the 

26 amendments made by section 3. 


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1 (b) BEST PRACTICES.—Regulations promulgated 

2 under this section shall reflect best practices for con3 ducting purchase card and travel card programs. 

4 SECTION 1. SHORT TITLE. 

5 This Act may be cited as the ‘‘Government Credit Card 

6 Abuse Prevention Act of 2008’’. 

7 SEC. 2. MANAGEMENT OF PURCHASE CARDS. 

8 (a) REQUIRED SAFEGUARDS AND INTERNAL CON9 TROLS.—The head of each executive agency that issues and 

10 uses purchase cards and convenience checks shall establish 

11 and maintain safeguards and internal controls to ensure 

12 the following: 

13 (1) There is a record in each executive agency of 

14 each holder of a purchase card issued by the agency 

15 for official use, annotated with the limitations on sin16 gle transaction and total credit amounts that are ap17 plicable to the use of each such card by that purchase 

18 cardholder. 

19 (2) Each purchase cardholder is assigned an ap20 proving official other than the cardholder with the au21 thority to approve or disapprove expenditures. 

22 (3) The holder of a purchase card and each offi23 cial with authority to authorize expenditures charged 

24 to the purchase card are responsible for— 


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1 (A) reconciling the charges appearing on 

2 each statement of account for that purchase card 

3 with receipts and other supporting documenta4 tion; and 

5 (B) forwarding such reconciliation to the 

6 designated official in a timely manner to enable 

7 the designated official to ensure that the Federal 

8 government ultimately pays only for valid 

9 charges. 

10 (4) Any disputed purchase card charge, and any 

11 discrepancy between a receipt and other supporting 

12 documentation and the purchase card statement of ac13 count, is resolved in the manner prescribed in the ap14 plicable Governmentwide purchase card contract en15 tered into by the Administrator of General Services 

16 and in accordance with all laws and executive agency 

17 regulations. 

18 (5) Payments on purchase card accounts are 

19 made promptly within prescribed deadlines to avoid 

20 interest penalties. 

21 (6) Rebates and refunds based on prompt pay22 ment on purchase card accounts are monitored for ac23 curacy, unless otherwise provided by law, and prop24 erly recorded as a receipt to the agency that pays the 

25 monthly bill. 


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1 (7) Records of each purchase card transaction 

2 (including records on associated contracts, reports, ac3 counts, and invoices) are retained in accordance with 

4 standard Government policies on the disposition of 

5 records. 

6 (8) Periodic reviews are performed to determine 

7 whether each purchase cardholder has a need for the 

8 purchase card. 

9 (9) Appropriate training is provided to each 

10 purchase cardholder and each official with responsi11 bility for overseeing the use of purchase cards issued 

12 by an executive agency. 

13 (10) The executive agency has specific policies 

14 regarding the number of purchase cards issued by 

15 various organizations and categories of organizations, 

16 the credit limits authorized for various categories of 

17 cardholders, and categories of employees eligible to be 

18 issued purchase cards, and that those policies are de19 signed to minimize the financial risk to the Federal 

20 Government of the issuance of the purchase cards and 

21 to ensure the integrity of purchase cardholders. 

22 (11) The executive agency utilizes technologies to 

23 prevent or identify fraudulent purchases. 

24 (12) The executive agency invalidates the pur25 chase card of each employee who— 


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1 (A) ceases to be employed by the agency im2 mediately upon termination of the employment 

3 of the employee; or 

4 (B) transfers to another unit of the agency 

5 immediately upon the transfer of the employee 

6 unless the units are covered by the same pur7 chase card authority. 

8 (13) The executive agency takes steps to recover 

9 the cost of any improper or fraudulent purchase made 

10 by an employee, including, as necessary, through sal11 ary offsets. 

12 (b) GUIDANCE ON MANAGEMENT OF PURCHASE

13 CARDS.—Not later than 180 days after the date of the en14 actment of this Act, the Director of the Office of Manage15 ment and Budget shall prescribe guidance governing the im16 plementation of the safeguards and internal controls re17 quired by subsection (a) by executive agencies. 

18 (c) PENALTIES FOR VIOLATIONS.— 

19 (1) IN GENERAL.—The regulations prescribed 

20 under subsection (b) shall provide for appropriate ad21 verse personnel actions or other punishment to be im22 posed in cases in which employees of an executive 

23 agency violate such regulations or are negligent or en24 gage in misuse, abuse, or fraud with respect to a purVerDate Aug 31 2005 23:36 Aug 01, 2008 Jkt 069002 PO 00000 Frm 00018 Fmt 6652 Sfmt 6203 E:\BILLS\S789.RS S789

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1 chase card, including imposition of the following pen2 alties: 

3 (A) In the case of an employee who is sus4 pected by the executive agency to have engaged 

5 in fraud, referral to the Inspector General of the 

6 agency for investigation, and, upon determina7 tion by the Inspector General that a crime may 

8 have occurred, referral of the case to the United 

9 States Attorney with jurisdiction over the mat10 ter. 

11 (B) In the case of an employee who is found 

12 guilty of fraud or found by the Inspector General 

13 of the agency to have egregiously abused a pur14 chase card knowingly and willingly, dismissal of 

15 the employee. 

16 (2) REPORTS ON VIOLATIONS.—The regulations 

17 prescribed under subsection (b) shall require each 

18 head of an executive agency, and each Inspector Gen19 eral of an executive agency, on a semi-annual basis, 

20 to submit to the Director of the Office of Management 

21 and Budget a report on violations or other actions 

22 covered by paragraph (1) by employees of such execu23 tive agency. At a minimum, the report shall set forth 

24 the following: 


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1 (A) A description of each violation or other 

2 action covered by the report. 

3 (B) A description of any adverse personnel 

4 action, punishment, other action taken against 

5 the employee for such violation or other action. 

6 (d) RISK ASSESSMENTS AND AUDITS.—The Inspector 

7 General of each executive agency shall— 

8 (1) periodically conduct risk assessments of the 

9 agency purchase card program and associated inter10 nal controls and analyze identified weaknesses and 

11 the frequency of improper activity in order to develop 

12 a plan for using such risk assessments to determine 

13 the scope, frequency, and number of periodic audits of 

14 purchase cardholders; 

15 (2) perform periodic audits of purchase card 

16 transactions designed to identify— 

17 (A) potentially fraudulent, improper, and 

18 abusive uses of purchase cards; 

19 (B) any patterns of improper cardholder 

20 transactions, such as purchases of prohibited 

21 items; and 

22 (C) categories of purchases that should be 

23 made by means other than purchase cards in 

24 order to better aggregate purchases and obtain 

25 lower prices; 


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

2 concerned on the results of such audits; and 

3 (4) report to the Director of the Office of Man4 agement and Budget and the Comptroller General on 

5 the implementation of recommendations made to the 

6 head of the executive agency to address findings dur7 ing audits of purchase cardholders. 

8 (e) DEFINITION OF EXECUTIVE AGENCY.—In this sec9 tion, the term ‘‘executive agency’’ has the meaning given 

10 such term in section 4(1) of the Office of Federal Procure11 ment Policy Act (41 U.S.C. 403(1)), except as provided 

12 under subsection (f)(1). 

13 (f) RELATIONSHIP TO DEPARTMENT OF DEFENSE

14 PURCHASE CARD REGULATIONS.— 

15 (1) IN GENERAL.—The requirements of sub16 section (a) through (d) shall not apply to the Depart17 ment of Defense. 

18 (2) CONFORMING AMENDMENTS.—Section 2784 

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

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

21 the following new paragraphs: 

22 ‘‘(11) That each purchase cardholder is assigned 

23 an approving official other than the cardholder with 

24 the authority to approve or disapprove expenditures. 


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

2 technologies to prevent or identify fraudulent pur3 chases. 

4 ‘‘(13) That the Department of Defense takes ap5 propriate steps to invalidate the purchase card of 

6 each employee who— 

7 ‘‘(A) ceases to be employed by the Depart8 ment of Defense immediately upon termination 

9 of the employment of the employee; or 

10 ‘‘(B) transfers to another unit of the De11 partment of Defense immediately upon the trans12 fer of the employee unless the units are covered 

13 by the same purchase card authority. 

14 ‘‘(14) That the Department of Defense takes ap15 propriate steps to recover the cost of any improper or 

16 fraudulent purchase made by an employee, including, 

17 as necessary, through salary offsets. 

18 ‘‘(15) That the Inspector General of the Depart19 ment of Defense conducts periodic risk assessments of 

20 purchase card programs and associated internal con21 trols and analyzes identified weaknesses and the fre22 quency of improper activity and uses such risk assess23 ments to develop appropriate corrective actions.’’; and 

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

25 subsection: 


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1 ‘‘(d) SEMI-ANNUAL REPORT.—The Secretary of De2 fense shall submit to the Director of the Office of Manage3 ment and Budget on a semi-annual basis a report on mis4 use, abuse, or fraud with respect to purchase cards by em5 ployees of the Department of Defense. At a minimum, the 

6 report shall include the following: 

7 ‘‘(1) A description of each incident covered by 

8 the report. 

9 ‘‘(2) A description of any adverse personnel ac10 tion, punishment, or other action taken against the 

11 employee in connection with each such incident. 

12 ‘‘(3) A description of actions taken by the De13 partment of Defense to address recommendations 

14 made to address findings arising out of risk assess15 ments and audits conducted pursuant to this sec16 tion.’’. 

17 SEC. 3. MANAGEMENT OF TRAVEL CARDS. 

18 Section 2 of the Travel and Transportation Reform 

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

20 amended by adding at the end the following new subsection: 

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

22 ‘‘(1) REQUIRED SAFEGUARDS AND INTERNAL

23 CONTROLS.—The head of each executive agency that 

24 has employees that use travel charge cards shall estabVerDate Aug 31 2005 23:36 Aug 01, 2008 Jkt 069002 PO 00000 Frm 00023 Fmt 6652 Sfmt 6203 E:\BILLS\S789.RS S789

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1 lish and maintain safeguards and internal controls 

2 over travel charge cards to ensure the following: 

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

4 agency of each holder of a travel charge card 

5 issued by the agency for official use, annotated 

6 with the limitations on amounts that are appli7 cable to the use of each such card by that travel 

8 charge cardholder. 

9 ‘‘(B) Rebates and refunds based on prompt 

10 payment on travel charge card accounts are 

11 monitored for accuracy and, unless otherwise 

12 provided by law, properly recorded as a receipt 

13 of the agency that employs the cardholder. 

14 ‘‘(C) Periodic reviews are performed to de15 termine whether each travel charge cardholder 

16 has a need for the travel charge card. 

17 ‘‘(D) Appropriate training is provided to 

18 each travel charge cardholder and each official 

19 with responsibility for overseeing the use of trav20 el charge cards issued by an executive agency. 

21 ‘‘(E) Each executive agency has specific 

22 policies regarding the number of travel charge 

23 cards issued by various organizations and cat24 egories of organizations, the credit limits author25 ized for various categories of cardholders, and 


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1 categories of employees eligible to be issued travel 

2 charge cards, and that those policies are designed 

3 to minimize the financial risk to the Federal 

4 Government of the issuance of the travel charge 

5 cards and to ensure the integrity of travel charge 

6 cardholders. 

7 ‘‘(F) Each executive agency negotiates with 

8 the holder of the applicable travel card contract 

9 to evaluate the creditworthiness of an individual 

10 before issuing the individual a travel charge 

11 card, and that no individual be issued a travel 

12 charge card if the individual is found not credit13 worthy as a result of the evaluation (except that 

14 this paragraph shall not preclude issuance of a 

15 restricted use travel charge card or pre-paid card 

16 when the individual lacks a credit history or has 

17 a credit score below the minimum credit score es18 tablished by the Office of Management and 

19 Budget). The Director of the Office of Manage20 ment and Budget shall establish a minimum 

21 credit score for determining the creditworthiness 

22 of an individual based on rigorous statistical 

23 analysis of the population of cardholders and 

24 historical behaviors. Notwithstanding any other 

25 provision of law, such evaluation shall include 


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1 an assessment of an individual’s consumer re2 port from a consumer reporting agency as those 

3 terms are defined in section 603 of the Fair 

4 Credit Reporting Act. 

5 ‘‘(G) Each executive agency utilizes tech6 nologies to prevent or identify fraudulent pur7 chases. 

8 ‘‘(H) Each executive agency ensures that the 

9 travel charge card of each employee who ceases to 

10 be employed by the agency is invalidated imme11 diately upon termination of the employment of 

12 the employee. 

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

14 appropriate, direct payment to the holder of the 

15 travel card contract. 

16 ‘‘(2) GUIDANCE ON MANAGEMENT OF TRAVEL

17 CHARGE CARDS.—The Director of the Office of Man18 agement and Budget shall prescribe guidance gov19 erning the implementation of the safeguards and in20 ternal controls in paragraph (1) by executive agen21 cies. 

22 ‘‘(3) PENALTIES FOR VIOLATIONS.— 

23 ‘‘(A) IN GENERAL.—The regulations pre24 scribed under paragraph (2) shall provide for 

25 appropriate adverse personnel actions or other 


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27 

•S 789 RS

1 punishment to be imposed in cases in which em2 ployees of an executive agency violate such regu3 lations or are negligent or engage in misuse, 

4 abuse, or fraud with respect to a travel charge 

5 card, including removal in appropriate cases. 

6 ‘‘(B) REPORTS ON VIOLATIONS.—The regu7 lations prescribed under paragraph (2) shall re8 quire each head of an executive agency, and each 

9 Inspector General of an executive agency, on a 

10 semi-annual basis, to submit to the Director of 

11 the Office of Management and Budget a report 

12 on violations or other actions covered by para13 graph (1) by employees of such executive agency. 

14 At a minimum, the report shall set forth the fol15 lowing: 

16 ‘‘(i) A description of each violation or 

17 other action covered by the report. 

18 ‘‘(ii) A description of any adverse per19 sonnel action, punishment, or other action 

20 taken against the employee for such viola21 tion or other action. 

22 ‘‘(4) ASSESSMENTS.—The Inspector General of 

23 each executive agency shall— 

24 ‘‘(A) periodically conduct risk assessments 

25 of the agency travel card program and associated 


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•S 789 RS

1 internal controls and analyze identified weak2 nesses and the frequency of improper activity in 

3 order to develop a plan for using such risk as4 sessments to determine the scope, frequency, and 

5 number of periodic audits of travel cardholders; 

6 ‘‘(B) perform periodic audits of travel card 

7 purchases designed to identify potentially fraud8 ulent, improper, and abusive uses of travel cards; 

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

10 agency concerned on the results of such audits; 

11 and 

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

13 Management and Budget and the Comptroller 

14 General on the implementation of recommenda15 tions made to the head of the executive agency to 

16 address findings during audits of travel card17 holders. 

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

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

20 agency as that term is defined in section 5701 

21 of title 5, United States Code, except that it is 

22 in the executive branch. 

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

24 the Federal contractor-issued travel charge card 

25 that is individually billed to each cardholder.’’. 


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•S 789 RS

1 SEC. 4. MANAGEMENT OF CENTRALLY BILLED ACCOUNTS. 

2 (a) REQUIRED MANAGEMENT OF CENTRALLY BILLED

3 ACCOUNTS.—The head of an executive agency that has em4 ployees who use a centrally billed account shall establish 

5 and maintain safeguards and internal controls to ensure 

6 the following: 

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

8 voucher are compared with items paid for using a 

9 centrally billed account to ensure that an employee is 

10 not reimbursed for an item already paid for through 

11 a centrally billed account. 

12 (2) The executive agency disputes unauthorized 

13 charges and tracks the status of the disputed trans14 actions to ensure appropriate resolution. 

15 (3) The executive agency submits requests for re16 funds for fully or partially unused tickets to the air17 lines and tracks the status of unused tickets to ensure 

18 appropriate resolution. 

19 (b) GUIDANCE.—The Director of the Office of Manage20 ment and Budget shall prescribe guidance implementing the 

21 requirements of subsection (a) not later than 180 days after 

22 the date of the enactment of this Act. 


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Calendar No. 933 

110TH CONGRESS 

2D SESSION S. 789 

[Report No. 110

–437] 

A BILL 

To prevent abuse of Government credit cards. 

AUGUST 1, 2008 

Reported with an amendment 


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