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Project on Government Oversight

GAO Report Echoes POGO's Concerns with the DHS Katrina Purchase Card Program

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July 19, 2006

WASHINGTON —today, the Government Accountability Office will testify before Congress that weak monitoring and oversight controls over the government purchase card program the Department of Homeland Security (DHS) used in response to Hurricane Katrina exposed the federal government to potential fraud and abuse.

The Project On Government Oversight (POGO) has repeatedly criticized the lack of oversight of government purchase cards and warned that the increased credit limits—of $250,000—for Hurricane Katrina spending would increase the already strong potential for fraud.

The report details “numerous examples of potentially fraudulent, improper, and abusive or questionable transactions,” including the “purchase of a beer brewing kit, a 63” plasma television costing $8,000 which was found unused in its original box six months after being purchased, and tens of thousands of dollars for training at golf and tennis resorts.” 

Additional purchases totaling $600,000 were considered unauthorized, lost, or stolen.

“This news, albeit disturbing, doesn’t surprise me,” stated Scott Amey, POGO’s General Counsel.  “Last year the government spent over $17 billion using purchase cards, with questionable monitoring.  I had hoped that previous reports of purchase card spending on Victoria Secret merchandise, jewelry, escort services, trips to Las Vegas , and breast enhancement surgery provided the government with the proof that it needed to improve card oversight.  Unfortunately, we are seeing more of the same and therefore the public is left thinking that the government doesn’t care how it spends taxpayer dollars.”

Today’s hearing before the Senate Committee on Homeland Security and Governmental Affairs is in support of S. 457 the “Purchase Card Waste Elimination Act of 2006,” which would require guidelines to assist agencies in improving the purchase card program and reporting to Congress.

Founded in 1981, the Project On Government Oversight (POGO) is a nonpartisan independent watchdog that champions good government reforms. POGO’s investigations into corruption, misconduct, and conflicts of interest achieve a more effective, accountable, open, and ethical federal government.