(A) ceases to be employed by the agency, 
immediately upon termination of the employ-
ment of the employee; or 
(B) transfers to another unit of the agency 
immediately upon the transfer of the employee 
unless the agency determines that the units are 
covered by the same purchase card authority. 
(13) The executive agency takes steps to re-
cover the cost of any erroneous, improper, or illegal 
purchase made with a purchase card or convenience 
check by an employee, including, as necessary, 
through salary offsets. 
(b) GUIDANCE
ON MANAGEMENT
OF PURCHASE 
CARDS.—Not later than 180 days after the date of the 
enactment of this Act, the Director of the Office of Man-
agement and Budget shall review the existing guidance 
and, as necessary, prescribe additional guidance governing 
the implementation of the safeguards and internal controls 
required by subsection (a) by executive agencies. 
(c) PENALTIES FOR VIOLATIONS.— 
(1) IN GENERAL.—The head of each executive 
agency shall provide for appropriate adverse per-
sonnel actions or other punishment to be imposed in 
cases in which employees of the agency violate agen-
cy policies implementing the guidance required by 
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subsection (b) or make improper, erroneous, or ille-
gal purchases with purchase cards or convenience 
checks. 
(2) DISMISSAL.—Penalties prescribed for em-
ployee misuse of purchase cards or convenience 
checks shall include dismissal of the employee, as 
appropriate. 
(3) REPORTS ON VIOLATIONS.—The guidance 
prescribed under subsection (b) shall direct each 
head of an executive agency with more than 
$10,000,000 in purchase card spending annually, 
and each Inspector General of such an executive 
agency on a semiannual basis, to submit to the Di-
rector of the Office of Management and Budget a 
joint report on violations or other actions covered by 
paragraph (1) by employees of such executive agen-
cy. At a minimum, the report shall set forth the fol-
lowing: 
(A) A description of each violation. 
(B) A description of any adverse personnel 
action, punishment, or other action taken 
against the employee for such violation. 
(d) RISK ASSESSMENTS AND AUDITS.—The Inspec-
tor General of each executive agency shall— 
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(1) conduct periodic assessments of the agency 
purchase card or convenience check programs to 
identify and analyze risks of illegal, improper, or er-
roneous purchases and payments in order to develop 
a plan for using such risk assessments to determine 
the scope, frequency, and number of periodic audits 
of purchase card or convenience check transactions; 
(2) perform analysis or audits as necessary, of 
purchase card transactions designed to identify— 
(A) potentially illegal, improper, erroneous, 
and abusive uses of purchase cards; 
(B) any patterns of such uses; and 
(C) categories of purchases that could be 
made by means other than purchase cards in 
order to better aggregate purchases and obtain 
lower prices (excluding transactions made under 
card-based strategic sourcing arrangements); 
(3) report to the head of the executive agency 
concerned on the results of such analysis or audits; 
and 
(4) report to the Director of the Office of Man-
agement and Budget on the implementation of rec-
ommendations made to the head of the executive 
agency to address findings of any analysis or audit 
of purchase card and convenience check transactions 
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or programs for compilation and transmission by the 
Director to Congress and the Comptroller General. 
(e) DEFINITION OF EXECUTIVE AGENCY.—In this 
section, the term ‘‘executive agency’’ has the meaning 
given such term in section 4(1) of the Office of Federal 
Procurement Policy Act (41 U.S.C. 403(1)), except as 
provided under subsection (f)(1). 
(f) RELATIONSHIP TO DEPARTMENT OF DEFENSE 
PURCHASE CARD REGULATIONS.— 
(1) IN
GENERAL.—The requirements of sub-
sections (a) through (d) shall not apply to the De-
partment of Defense. 
(2) CONFORMING AMENDMENTS.—Section 2784 
of title 10, United States Code, is amended— 
(A) in subsection (b), by adding at the end 
the following new paragraphs: 
‘‘(11) That each purchase cardholder and indi-
vidual issued a convenience check is assigned an ap-
proving official other than the cardholder with the 
authority to approve or disapprove transactions. 
‘‘(12) That the Department of Defense utilizes 
effective systems, techniques, and technologies to 
prevent or identify fraudulent purchases. 
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‘‘(13) That the Department of Defense takes 
appropriate steps to invalidate the purchase card of 
each employee who— 
‘‘(A) ceases to be employed by the Depart-
ment of Defense, immediately upon termination 
of the employment of the employee; or 
‘‘(B) transfers to another unit of the De-
partment of Defense immediately upon the 
transfer of the employee unless the Secretary of 
Defense determines that the units are covered 
by the same purchase card authority. 
‘‘(14) That the Department of Defense takes 
appropriate steps to recover the cost of any erro-
neous, improper, or illegal purchase made with a 
purchase card or convenience check by an employee, 
including, as necessary, through salary offsets. 
‘‘(15) That the Inspector General of the De-
partment of Defense conducts periodic assessments 
of purchase card or convenience check programs to 
identify and analyze risks of illegal, improper, or er-
roneous purchases and payments and uses such risk 
assessments to develop appropriate recommendations 
for corrective actions.’’; and 
(B) by adding at the end the following new 
subsection: 
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‘‘(d) SEMIANNUAL REPORT.—The Secretary of De-
fense and the Inspector General of the Department of De-
fense shall submit to the Director of the Office of Manage-
ment and Budget on a semiannual basis a joint report on 
illegal, improper, or erroneous purchases and payments 
made with purchase cards or convenience checks by em-
ployees of the Department of Defense. At a minimum, the 
report shall include the following: 
‘‘(1) A description of each violation. 
‘‘(2) A description of any adverse personnel ac-
tion, punishment, or other action taken against the 
employee for such violation. 
‘‘(3) A description of actions taken by the De-
partment of Defense to address recommendations 
made to address findings arising out of risk assess-
ments and audits conducted pursuant to this sec-
tion.’’. 
SEC. 3. MANAGEMENT OF TRAVEL CARDS. 
Section 2 of the Travel and Transportation Reform 
Act of 1998 (Public Law 105–264; 5 U.S.C. 5701 note) 
is amended by adding at the end the following new sub-
section: 
‘‘(h) MANAGEMENT OF TRAVEL CHARGE CARDS.— 
‘‘(1) REQUIRED
SAFEGUARDS
AND
INTERNAL 
CONTROLS.—The head of each executive agency that 
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‘‘(E) Each executive agency has specific 
policies regarding the number of travel charge 
cards issued for various component organiza-
tions and categories of component organiza-
tions, the credit limits authorized for various 
categories of cardholders, and categories of em-
ployees eligible to be issued travel charge cards, 
and designs those policies to minimize the fi-
nancial risk to the Federal Government of the 
issuance of the travel charge cards and to en-
sure the integrity of travel charge cardholders. 
‘‘(F) Each executive agency ensures its 
contractual arrangement with each servicing 
travel charge card issuing contractor contains a 
requirement to evaluate the creditworthiness of 
an individual before issuing that individual a 
travel charge card, and that no individual be 
issued a travel charge card if that individual is 
found not creditworthy as a result of the eval-
uation (except that this paragraph shall not 
preclude issuance of a restricted use travel 
charge card or pre-paid card when the indi-
vidual lacks a credit history or has a credit 
score below the minimum credit score estab-
lished by the Office of Management and Budg-
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et). The Director of the Office of Management 
and Budget shall establish a minimum credit 
score for determining the creditworthiness of an 
individual based on rigorous statistical analysis 
of the population of cardholders and historical 
behaviors. Notwithstanding any other provision 
of law, such evaluation shall include an assess-
ment of an individual’s consumer report from a 
consumer reporting agency as those terms are 
defined in section 603 of the Fair Credit Re-
porting Act. 
‘‘(G) Each executive agency utilizes effec-
tive systems, techniques, and technologies to 
prevent or identify improper purchases. 
‘‘(H) Each executive agency ensures that 
the travel charge card of each employee who 
ceases to be employed by the agency is invali-
dated immediately upon termination of the em-
ployment of the employee. 
‘‘(I) Each executive agency utilizes, where 
appropriate, direct payment to the holder of the 
travel card contract. 
‘‘(2) GUIDANCE ON MANAGEMENT OF TRAVEL 
CHARGE CARDS.—Not later than 180 days after the 
date of the enactment of this Act, the Director of 
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the Office of Management and Budget shall review 
the existing guidance and, as necessary, prescribe 
additional guidance for executive agencies governing 
the implementation of the requirements in para-
graph (1). 
‘‘(3) PENALTIES FOR VIOLATIONS.— 
‘‘(A) IN
GENERAL.—Consistent with the 
guidance prescribed under paragraph (2), each 
executive agency shall provide for appropriate 
adverse personnel actions to be imposed in 
cases in which employees of the executive agen-
cy fail to comply with applicable travel charge 
card terms and conditions or applicable agency 
regulations or commit fraud with respect to a 
travel charge card, including removal in appro-
priate cases. 
‘‘(B) 
REPORTS
ON
VIOLATIONS.—The 
guidance prescribed under paragraph (2) shall 
require each head of an executive agency with 
more than $10,000,000 in travel card spending 
annually, and each inspector general of such an 
executive agency, on a semiannual basis, to sub-
mit to the Director of the Office of Manage-
ment and Budget a joint report on violations or 
other actions covered by subparagraph (A) by 
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employees of such executive agency. At a min-
imum, the report shall set forth the following: 
‘‘(i) A description of each violation. 
‘‘(ii) A description of any adverse per-
sonnel action, punishment, or other action 
taken against the employee for such viola-
tion or other action. 
‘‘(4) RISK ASSESSMENTS AND AUDITS.—The in-
spector general of each executive agency shall— 
‘‘(A) conduct periodic assessments of the 
agency travel charge card program and associ-
ated internal controls to identify and analyze 
risks of illegal, improper, or erroneous travel 
charges and payments in order to develop a 
plan for using such risk assessments to deter-
mine the scope, frequency, and number of peri-
odic audits of travel charge card transactions; 
‘‘(B) perform periodic analysis and audits, 
as appropriate, of travel charge card trans-
actions designed to identify potentially im-
proper, erroneous, and illegal uses of travel 
charge cards; 
‘‘(C) report to the head of the executive 
agency concerned on the results of such anal-
ysis and audits; and 
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‘‘(D) report to the Director of the Office of 
Management and Budget on the implementa-
tion of recommendations made to the head of 
the executive agency to address findings of any 
analysis or audit of travel charge card trans-
actions or programs for compilation and trans-
mission by the Director to Congress and the 
Comptroller General. 
‘‘(5) DEFINITIONS.—In this subsection: 
‘‘(A) The term ‘executive agency’ means an 
agency as that term is defined in subpara-
graphs (A) and (B) of section 5701(1) of title 
5, United States Code. 
‘‘(B) The term ‘travel charge card’ means 
any Federal contractor-issued travel charge 
card that is individually billed to each card-
holder.’’. 
SEC. 4. MANAGEMENT OF CENTRALLY BILLED ACCOUNTS. 
(a) REQUIRED INTERNAL CONTROLS
FOR CEN-
TRALLY BILLED ACCOUNTS.—The head of an executive 
agency that has employees who use a travel charge card 
that is billed directly to the United States Government 
shall establish and maintain the following internal control 
activities: 
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(1) Items submitted on an employee’s travel 
voucher shall be compared with items paid for using 
a centrally billed account on any related travel to en-
sure that an employee is not reimbursed for an item 
already paid for by the United States Government 
through a centrally billed account. 
(2) The executive agency shall dispute unallow-
able and erroneous charges and track the status of 
the disputed transactions to ensure appropriate reso-
lution. 
(3) The executive agency shall submit requests 
to servicing airlines for refunds of fully or partially 
unused tickets, when entitled to such refunds, and 
track the status of unused tickets to ensure appro-
priate resolution. 
(b) GUIDANCE.—Not later than 180 days after the 
date of the enactment of this Act, the Director of the Of-
fice of Management and Budget shall review the existing 
guidance and, as necessary, prescribe additional guidance 
for executive agencies implementing the requirements of 
subsection (a). 
SEC. 5. CONSTRUCTION. 
Nothing in this Act shall be construed to excuse the 
head of an executive agency from the responsibilities set 
out in section 3512 of title 31, United States Code, or 
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