[Congressional Bills 112th Congress]
[From the U.S. Government Publishing Office]
[S. 300 Enrolled Bill (ENR)]
S.300
One Hundred Twelfth Congress
of the
United States of America
AT THE SECOND SESSION
Begun and held at the City of Washington on Tuesday,
the third day of January, two thousand and twelve
An Act
To prevent abuse of Government charge cards.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,

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This Act may be cited as the ``Government Charge Card Abuse
Prevention Act of 2012''.

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(a) Government-wide Safeguards and Internal Controls.--
(1) In general.--Chapter 19 of title 41, United States Code, is
amended by adding at the end the following new section:
``Sec. 1909. Management of purchase cards
``(a) Required Safeguards and Internal Controls.--The head of each
executive agency that issues and uses purchase cards and convenience
checks shall establish and maintain safeguards and internal controls to
ensure the following:
``(1) There is a record in each executive agency of each holder
of a purchase card issued by the agency for official use, annotated
with the limitations on single transactions and total transactions
that are applicable to the use of each such card or check by that
purchase card holder.
``(2) Each purchase card holder and individual issued a
convenience check is assigned an approving official other than the
card holder with the authority to approve or disapprove
transactions.
``(3) The holder of a purchase card and each official with
authority to authorize expenditures charged to the purchase card
are responsible for--
``(A) reconciling the charges appearing on each statement
of account for that purchase card with receipts and other
supporting documentation; and
``(B) forwarding a summary report to the certifying
official in a timely manner of information necessary to enable
the certifying official to ensure that the Federal Government
ultimately pays only for valid charges that are consistent with
the terms of the applicable Government-wide purchase card
contract entered into by the Administrator of General Services.
``(4) Any disputed purchase card charge, and any discrepancy
between a receipt and other supporting documentation and the
purchase card statement of account, is resolved in the manner
prescribed in the applicable Government-wide purchase card contract
entered into by the Administrator of General Services.
``(5) Payments on purchase card accounts are made promptly
within prescribed deadlines to avoid interest penalties.
``(6) Rebates and refunds based on prompt payment, sales
volume, or other actions by the agency on purchase card accounts
are reviewed for accuracy and properly recorded as a receipt to the
agency that pays the monthly bill.
``(7) Records of each purchase card transaction (including
records on associated contracts, reports, accounts, and invoices)
are retained in accordance with standard Government policies on the
disposition of records.
``(8) Periodic reviews are performed to determine whether each
purchase card holder has a need for the purchase card.
``(9) Appropriate training is provided to each purchase card
holder and each official with responsibility for overseeing the use
of purchase cards issued by the executive agency.
``(10) The executive agency has specific policies regarding the
number of purchase cards issued by various component organizations
and categories of component organizations, the credit limits
authorized for various categories of card holders, and categories
of employees eligible to be issued purchase cards, and that those
policies are designed to minimize the financial risk to the Federal
Government of the issuance of the purchase cards and to ensure the
integrity of purchase card holders.
``(11) The executive agency uses effective systems, techniques,
and technologies to prevent or identify illegal, improper, or
erroneous purchases.
``(12) The executive agency invalidates the purchase card of
each employee who--
``(A) ceases to be employed by the agency, immediately upon
termination of the employment 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 recover the cost of
any illegal, improper, or erroneous purchase made with a purchase
card or convenience check by an employee, including, as necessary,
through salary offsets.
``(b) Guidance.--The Director of the Office of Management and
Budget shall review existing guidance and, as necessary, prescribe
additional guidance governing the implementation of the requirements of
subsection (a) by executive agencies.
``(c) Penalties for Violations.--
``(1) In general.--The head of each executive agency shall
provide for appropriate adverse personnel actions or other
punishment to be imposed in cases in which employees of the agency
violate agency policies implementing the guidance required by
subsection (b) or make illegal, improper, or erroneous purchases
with purchase cards or convenience checks.
``(2) Dismissal.--Penalties prescribed for employee 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 Director of the Office of Management and
Budget a joint report on violations or other actions covered by
paragraph (1) by employees of such executive agency. At a minimum,
the report shall set forth the following:
``(A) A summary description of confirmed violations
involving misuse of a purchase card following completion of a
review by the agency or by the Inspector General of the agency.
``(B) A summary description of all adverse personnel
action, punishment, or other action taken based on each
violation.
``(d) Risk Assessments and Audits.--The Inspector General of each
executive agency shall--
``(1) conduct periodic assessments of the agency purchase card
or convenience check programs to identify and analyze risks of
illegal, improper, or erroneous 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, or erroneous 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 Management and
Budget on the implementation of recommendations made to the head of
the executive agency to address findings of any analysis or audit
of purchase card and convenience check transactions or programs for
compilation and transmission by the Director to Congress and the
Comptroller General.
``(e) Relationship to Department of Defense Purchase Card
Regulations.--The requirements of this section shall not apply to the
Department of Defense. See section 2784 of title 10 for provisions
relating to management of purchase cards in the Department.''.
(2) Clerical amendment.--The table of sections at the beginning
of chapter 19 of title 41, United States Code, is amended by adding
at the end the following new item:
``1909. Management of purchase cards.''.
(b) Conforming Amendments to Department of Defense Purchase Card
Provisions.--Subsection (b) of section 2784 of title 10, United States
Code, is amended--
(1) by moving paragraph (8) to the end of the subsection and
redesignating that paragraph as paragraph (14);
(2) by redesignating paragraphs (2), (3), (4), (5), (6), and
(7) as paragraphs (3), (4), (5), (6), (7), and (8), respectively;
(3) by inserting after paragraph (1) the following new
paragraph (2):
``(2) That each purchase card holder and individual issued a
convenience check is assigned an approving official other than the
card holder with the authority to approve or disapprove
transactions.'';
(4) by adding after paragraph (10) the following new
paragraphs:
``(11) That the Department of Defense uses effective systems,
techniques, and technologies to prevent or identify potential
fraudulent purchases.
``(12) That the Department of Defense takes appropriate steps
to invalidate the purchase card of each card holder who--
``(A) in the case of an employee of the Department--
``(i) ceases to be employed by the Department,
immediately upon termination of the employment of the
employee; or
``(ii) transfers to another unit of the Department,
immediately upon the transfer of the employee unless the
Secretary of Defense determines that the units are covered
by the same purchase card authority; and
``(B) in the case of a member of the armed forces, is
separated or released from active duty or full-time National
Guard duty.
``(13) That the Department of Defense takes steps to recover
the cost of any illegal, improper, or erroneous purchase made with
a purchase card or convenience check by an employee or member of
the armed forces, including, as necessary, through salary
offsets.''; and
(5) by adding at the end the following new paragraph:
``(15) That the Inspector General of the Department of Defense
conducts periodic audits or reviews of purchase card or convenience
check programs to identify and analyze risks of illegal, improper,
or erroneous purchases and payments and that the findings of such
audits or reviews, along with recommendations to prevent abuse of
purchase cards or convenience checks, are reported to the Director
of the Office of Management and Budget and Congress.''.
(c) Deadline for Guidance on Management of Purchase Cards.--The
Director of the Office of Management and Budget shall prescribe the
guidance required by section 1909(b) of title 41, United States Code,
as added by subsection (a), not later than 180 days after the date of
the enactment of this Act.

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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 subsection:
``(h) Management of Travel Charge Cards.--
``(1) Required safeguards and internal controls.--The head of
each executive agency that has employees that use travel charge
cards shall establish and maintain the following internal control
activities to ensure the proper, efficient, and effective use of
such travel charge cards:
``(A) There is a record in each executive agency of each
holder of a travel charge card issued on behalf of the agency
for official use, annotated with the limitations on amounts
that are applicable to the use of each such card by that travel
charge card holder.
``(B) Rebates and refunds based on prompt payment, sales
volume, or other actions by the agency on travel charge card
accounts are monitored for accuracy and properly recorded as a
receipt of the agency that employs the card holder.
``(C) Periodic reviews are performed to determine whether
each travel charge card holder has a need for the travel charge
card.
``(D) Appropriate training is provided to each travel
charge card holder and each official with responsibility for
overseeing the use of travel charge cards issued by the
executive agency.
``(E) Each executive agency has specific policies regarding
travel charge cards issued for various component organizations
and categories of component organizations, the credit limits
authorized for various categories of card holders, and
categories of employees eligible to be issued travel charge
cards, and designs those policies to minimize the financial
risk to the Federal Government of the issuance of the travel
charge cards and to ensure the integrity of travel charge card
holders.
``(F) Each executive agency has policies to ensure its
contractual arrangement with each travel charge card issuing
contractor contains a requirement that the creditworthiness of
an individual be evaluated before the individual is issued 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 evaluation (except that this paragraph shall not
preclude issuance of a restricted use, prepaid, declining
balance, controlled-spend, or stored value card when the
individual lacks a credit history or has a credit score below
the minimum credit score established by the Director of the
Office of Management and Budget). 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 card holders
and historical behaviors. Notwithstanding any other provision
of law, such evaluation shall include an assessment of an
individual's consumer report from a consumer reporting agency
as those terms are defined in section 603 of the Fair Credit
Reporting Act (15 U.S.C. 1681a).
``(G) Each executive agency uses effective 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 invalidated immediately upon termination of the employment
of the employee (or, in the case of a member of the uniformed
services, upon separation or release from active duty or full-
time National Guard duty).
``(I) Each executive agency shall ensure that, where
appropriate, travel card payments are issued directly to the
travel card-issuing bank for credit to the employee's
individual travel card account.
``(2) Guidance on management of travel charge cards.--Not later
than 180 days after the date of the enactment of the Government
Charge Card Abuse Prevention Act of 2012, the Director of 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
paragraph (1).
``(3) Inspector general audit.--The Inspector General of each
executive agency with more than $10,000,000 in travel card spending
shall conduct periodic audits or reviews of travel card programs to
analyze risks of illegal, improper, or erroneous purchases and
payments. The findings of such audits or reviews along with
recommendations to prevent improper use of travel cards shall be
reported to the Director of the Office of Management and Budget and
Congress.
``(4) Penalties for violations.--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 agency 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 appropriate cases.
``(5) Definitions.--In this subsection:
``(A) Executive agency.--The term `executive agency' means
an agency as that term is defined in subparagraphs (A) and (B)
of section 5701(1) of title 5, United States Code.
``(B) Travel charge card.--The term `travel charge card'
means any Federal contractor-issued travel charge card that is
individually billed to each card holder.''.

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(a) Required Internal Controls for Centrally 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:
(1) The executive agency shall ensure that officials with the
authority to approve official travel verify that centrally billed
account charges are not reimbursed to an employee.
(2) The executive agency shall dispute unallowable and
erroneous charges and track the status of the disputed transactions
to ensure appropriate resolution.
(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 appropriate resolution.
(b) Guidance.--Not later than 180 days after the date of the
enactment of this Act, the Director of the Office of Management and
Budget shall review the existing guidance and, as necessary, prescribe
additional guidance for executive agencies implementing the
requirements of subsection (a).

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In this Act:
(1) Executive agency.--The term ``executive agency'' has the
meaning given such term in section 133 of title 41, United States
Code.
(2) Employee.--The term ``employee'' has the meaning given such
term in section 2(d)(3) of the Travel and Transportation Reform Act
of 1998 (Public Law 105-264; 5 U.S.C. 5701 note).

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(a) Executive Agency Accounting.--Nothing in this Act, or the
amendments made by 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 in the Improper Payments
Information Act of 2002 (31 U.S.C. 3321 note).
(b) Personal Information.--Nothing in this Act, or the amendments
made by this Act, shall be construed to require the disclosure of
personally identifying information that is otherwise protected from
disclosure under section 552a of title 5, United States Code (popularly
known as the Privacy Act of 1974).
Speaker of the House of Representatives.
Vice President of the United States and
President of the Senate.

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Government Charge Card Abuse Prevention Act of 2011 — S. 300

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