Tuesday's report is a follow-up to a 2015 audit in which the inspector general identified 4,437 transactions totaling $952,258 where DoD credit card holders used their cards “at casinos for personal use." That report also found 900 transactions totaling more than $96,000 “at adult entertainment establishments.”
In its latest report, the inspector general’s office reviewed 30 cardholders with “the highest dollar amount of high-risk transactions” from the previous audit.
Dr. Brett M. Baker, deputy IG for audit, found that DoD managers failed to take action to “eliminate additional abuse,” and “did not consistently consider the security implications” of improper card use. As a result, the inspector general said the card program “remained vulnerable to continued misuse.”
The report also said that only two of the 30 employees it studied had their security clearances reviewed by the appropriate authorities before the audit uncovered a problem with their card use.
A dozen of the employees and personnel in the report had top secret security clearances. Three had security clearance that gave them access to information on the operation or design of nuclear weapons. Five had no security clearance.
The report said credit card abuse was “usually” not reported to proper officials, and that management “did not refer incidents for a variety of reasons,” including believing the person in question was "financially secure,” and not a security risk.
The inspector general said those applying for security clearance are required to fill out a form that asks whether the applicant has been “counseled, warned or disciplined” for improperly using an employers credit card at any point in the previous seven years.
Failure to answer that question honestly, as occurred in at least one case the inspector general studied, can result in further penalties.
The inspector general recommended that the DoD tighten its internal review and monitoring procedures to guard against future card abuse, and to ensure that cases under investigation are tracked and the results reported to prevent potential security issues.
It also recommended further training so employees and their managers would be aware of the penalties for improper card use.
The DoD's Carrie Wibben, director of counterintelligence and security, agreed with the inspector general’s recommendations, and said reporting requirements identified in the audit were being incorporated into a new training manual due to be published by the end of the year.
A.M. Kurta, deputy assistant secretary of defense for military personnel policy, said that while the recommendations would be followed, the overall dollar amounts involved were insignificant.
“I believe it is important to note,” Kurta said, the monetary amount of the personal use of the Government Travel Charge Card identified in the audit amounted to less that 0.04 percent of the total travel card spend.”
Kurta also said the DoD’s card delinquency rates for individual billed accounts are “just over 1 percent,” much less than the “industry average of over 4 percent.”
“This is a strong indicator of the overall success of our program and the diligence of our agency program coordinators,” Kurta said.
The inspector general said Kurta's comments "minimize the importance of our findings."
"We identified significant weaknesses in the oversight of the travel program as a result of our review of only 30 cardholders," the inspector general said, "and we also identified significant deficiencies in how DoD travel officials responded to our previous audit."
"The deputy assistant secretary’s comments attempt to minimize the potential risks presented by our findings, including the risk of security vulnerabilities by cardholders who misused travel cards," the inspector general said.