and Employees Misused Travel Credit Cards

The USPS Office Of Inspector General released the following report:

Postal Service employees did not comply with prescribed travel policies resulting in over $600,000 in excessive travel costs for lodging and airfare in FYs 2009 and 2010. We estimate the Postal Service could realize an additional $600,000 in savings over the next 2 years, or $300,000 annually, if it takes action to curtail employee noncompliance with travel policies. Further, the Postal Service did not cancel 2,491 credit cards issued to former employees, including 53 employees listed as deceased in employee records. At the time of our audit, there was more than $37 million in open credit associated with cards of former employees.

Employees Exceeded Government Lodging Rates

Postal Service employees continued to exceed the prevailing government lodging rates. The U.S. Postal Service Office of Inspector General (OIG) also reported this
issue in FY 2009. Of the 155,104 lodging transactions we reviewed, 21,691 exceeded the government lodging rate. Postal Service policy requires travelers to obtain the
government rate for official lodging. While the Postal Service is in the process of clarifying this requirement in their policy, our audit found that employees were frequently
unaware of the established government rate when they obtained lodging and did not verify whether the rate they secured exceeded the government rate. In addition, the current Electronic Travel Voucher System (eTravel) does not flag lodging that exceeds the prevailing government rate and does not require employees to separate lodging amounts from taxes, resulting in lodging rates that are not transparent to reviewing officials. Overall, we noted that from October 2008 through September 2010, the Postal Service could have saved more than $600,000 if employees adhered to prescribed government lodging rates and could save an additional $600,000 over the
next 2 years if action is taken.

We reviewed travel card usage for 2747 employees with high-risk transactions and found that 173 misused their government travel card by purchasing personal items and
taking cash advances unrelated to official travel. While travel coordinators reviewed cardholder statements when delinquencies were identified, they did not routinely review for misuse if there was no associated delinquency. As a result, we identified more than $349,317 in inappropriate purchases and cash advances from October 2008 through September 2010. We referred this employee misconduct to the OIG Office of Investigations, and Postal Service and cognizant officials have taken a variety of personnel actions including employee removal.

When employees misuse their government travel cards, there is an increased risk of delinquency and write-offs, which could negatively impact the Postal Service’s
contractual relationship with Citibank® (goodwill). Further, the amount of money rebated to the Postal Service is reduced when Citibank forgives delinquent accounts.
Based on our audit work, Postal Service officials are mitigating risk by lowering employee credit limits from the current level of $15,000. In addition, the Postal Service
will require employees with government travel cards to sign cardholder agreements to verify employees are aware travel cards are for official travel only.

Travel Cards Were Not Cancelled for Separated Employees

The Postal Service did not cancel 2,491 credit cards issued to former employees, including 53 employees listed as deceased in employee records. We identified two former employees who were using their travel cards after they separated from the Postal Service. Postal Service policy requires an employee’s supervisor to collect an employee’s travel card upon termination. However, no processes exist to verify that credit card accounts for separated employees have been cancelled. At the time of our audit, there was more than $37 million in open credit associated with these cards. When we brought this issue to management’s attention, they took immediate action to begin closing the accounts of the separated employees we identified.

Miscellaneous Travel Policy Noncompliance

Employees violated various other travel policies including paying for other employees’ lodging, using their personal credit card for travel rather than their government travel
card, submitting duplicate claims for travel reimbursement, and other noncompliance described in Appendix B. The eTravel system does not flag or otherwise identify the
noncompliances we identified. As a result, the Postal Service has an increased risk of unnecessary travel expenses.

Travelers Submitted International Airfare Costs Before Travel

We noted in isolated instances that employees submitted travel vouchers for international airfare that was booked for future dates. Postal Service policy explicitiy
prohibits payment in advance of travel. Postal Service officials advised that the employees would not have had sufficient credit on their travel cards if the airfare was
not paid in advance, and such flights were routinely booked far in advance, thus requiring prompt payment before travel. As a result, the Postal Service is at increased
risk for overpayment, as it did with one employee who received a reimbursement of $10,114 in October 2009 for a flight that was never taken. The employee currently has a
credit on his government travel card account and has yet to repay the Postal Service. The Postal Service increases its risk of not collecting the overpayment the longer it
resides in the employee’s account.

Employees Exceeded Government Lodging Rates

Postal Service employees continued to pay for lodging that exceeded the prevailing government lodging rates, as previously reported by the OIG in FY 2009.Postal Service policy requires travelers to obtain the government rate for official lodging. Of the 155,104 lodging transactions made from October 1, 2008, through August 13, 2010, we reviewed, 21,691 exceeded the government lodging rate. While the Postal Service will clarify this requirement in a revised Handbook F-15, our audit found employees were frequently unaware of what the established government rate was when they obtained lodging and did not verify whether the rate they secured exceeded the government rate. Some of the occurrences we noted included:  
 
• One employee claimed 326 lodging nights for reimbursement over a 20-month period that, in total, exceeded the prescribed government lodging rates by $17,877.
 
• Postal Service employees claimed lodging charges for reimbursement for the 2009 and 2010 National Postal Forums that exceeded the prescribed government lodging rates by $88,983.  
• Two employees on an extended detail assignment for the majority of FY 2009 charged a total of $11,000 over the prescribed government lodging rates.

Employees Misused Travel Credit Cards

We reviewed travel card usage for 27415 employees with high-risk transactions and found that 173 misused their government travel cards by purchasing items for personal
use and taking cash advances unrelated to official travel, including the following:

•  Three employees purchased airfare tickets, including tickets to Spain and Italy, for family and friends.
•  One employee purchased an Apple computer and paid his mortgage.
•  One employee used his government issued travel card more than 50 times at adult entertainment establishments.

see full report