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Tue, May 06, 2008

Hey, Big Spender! NASA Employees Found Using Agency Credit Cards

One Employee Racks Up $157,000 In Purchases

NASA, which was criticized a few months ago for rewarding contractors with extravagant parties and cruises, is under fire again -- this time, for letting employees use government-issued purchase cards to buy personal items and disregard competitive bidding rules.

The expose, by The Houston Chronicle on Sunday, was careful to point out that most of the 451-thousand transactions it reviewed were purchases from vendors which appear to sell legitimate business items. But the paper says that among the 265-million dollars in credit card charges made between 2004 and 2007 it also found iPods, video games and jewelry.

Some of the data was found in records provided to the paper by NASA. The paper also notes the agency's own auditors have brought purchase card abuses to light in at least five previous internal reports dating back to 1997.

The Bush administration has ordered federal agencies to tighten internal controls on the use of government purchase cards. Bill McNally, NASA's assistant administrator for procurement, says an internal review will be complete by midsummer.

NASA is hardly alone. The Chronicle's review comes at a time when Congress is considering tightening purchase card regulations, following a federal report last month which found widespread abuse of the card programs.

Congressman Nick Lampson is a democrat whose district includes the Johnson Space Center. He's been a proponent of better funding for NASA. He calls the purchase card scandal an affront to the majority of space agency employees, and is calling for harsh punishments. "We should be outraged. Everybody should be," Lampson said. "Clearly we have not done enough."

Keeping tabs on all the cards out there is a daunting task. NASA says more than 3,200 of its employees have used them to make purchases between 2004 and 2007. The cards are the functional equivalent of credit cards, but instead of the user getting a bill and submitting it for reimbursement, the bills go directly to, and are paid directly by, the federal government.

Out of at least 160 cases of card abuse referred to NASA investigators since the start of fiscal 2007, only 25 resulted in disciplinary action. Most cases are small, but last year, Kennedy Space Center employee Elizabeth Ann Osborne pleaded guilty to using her NASA purchase card to buy $157,000 in personal items, including clothing... jewelry... some $51,000 for Wal-Mart gift cards and groceries... a $2,000 air conditioning installation at her home... at least $13,000 in electronics.

A more subtle abuse is buying costly items, which should be procured through competitive bidding, by breaking the price down into smaller chunks and paying with multiple swipes of the purchase card. The Chronicle reported finding about 4,600 cases in which that happened. Under current law, any federal purchase over $3,000 must go through the competitive bid process.

FMI: www.nasa.gov

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