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P-Card Administration, Misuse and Abuse

Monday, May 20, 2019   (3 Comments)
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Submitted by Darryl Sweet, CPSM, C.P.M.
CAPPO Immediate Past President 2019-2020


In my position here at UC Hastings Law one of areas of responsibility and accountability is that I am the college’s p-card program administrator. I know that many, many of our CAPPO colleagues share the same responsibility, or something very close to that of administrator. There are different ways to administer a p-card program - from front-end highly-restrictive to low dollar spend with post-audit - and I am sure CAPPO agencies represent the spectrum of how to do so.  Each of us that is a p-card program administrator carries concern everyday as it relates to misuse, or possible misuse. I would wager that we all have first-hand experience dealing with misuse of an agency-issued p-card.  I have been on the public side for over 20 years, with 15 as a program administrator, and have had to deal with several cases in those years.


Since the conference in January I have been monitoring nationwide news about public agency issued p-cards, and misuse and abuse connected to them. I would say that in my daily news updates, not a day has gone by - again, since January - during which there was not an article about p-card misuse or abuse somewhere in the U.S. On many days I have found multiple stories on the topic.


Here are two examples of the worst, most egregious, or just that I find most interesting.  All quotes and descriptions are from free news sources on the internet, found using google.


Broward County, FL

Port Everglades


       In February 2019, and internal county audit cannot locate materials purchased with a county p-card

       The worker in the hot-seat explained. He “told investigators the port received what was purchased. He told them he could not explain why the materials were not where they should be.

       Goods were not being centrally received, tracked, or re-distributed

       Storage areas were not secure, not locked, and without cameras

       No inventory system in place.


To interject here: This is a recipe for disaster, right? SMH.


Continuing with Port Everglades, Broward County…

From the Sun Sentinel May 2019


“More than 30 P-Cards held by port public works employees were suspended last year and auditors found that parts and supplies were not being being tracked in the port’s inventory system, creating the possibility of greater abuses.”


This comes after the initial February issues were discovered. And it gets “better.”  One worker, who was fired earlier this May, and who was under investigation by the FBI at the time (I assume it was Kyle and his team who we met at CAPPO - Palm Springs), used... 

“...(his) county credit card to buy materials for the port through his family-owned businesses and to purchase other goods for family members… (he) told investigators the port was the only customer for the five family businesses. He admitted he didn’t use the family businesses because they offered cheaper prices, but to make a profit.”


Let me re-state that… five businesses, one customer. Total.


The article goes on to say that none of those five businesses were not registered as port vendors, and the worker never revealed his connection to the businesses to his supervisors. This worker, as quoted in the paper, knew that what was going on was wrong, and he spent a lot of time and effort trying not to get caught.


There were more instances with other workers, just as unbelievably brazen as this one. AIf there is a good part to this story it’s that the situation was found out, uncovered, investigated, and is now being prosecuted.



I have seen blatant abuse, but not nearly to this extent. I have seen partial abuse, out of ignorance or not caring, and I’ve seen plainly simple mistakes.  A case like this one requires skill, professionalism, thoroughness, accuracy, and more, to uncover, document, and move forward to corrective action.  If I happened up a situation like this as a p-card administrator I would me the goods!  Where are the items you bought?


Atlanta, GA

Atlanta Public Schools


This case is, in my opinion, pretty far out there.  Admittedly, I do not know the specifics of how the schools operate.  The first thing I noticed was this statistic, as reported by the Atlanta Journal Constitution in their investigation of the case”


“The audit examined the use of 538 Visa cards held by 284 APS employees, including some principals, secretaries, business managers and central office managers responsible for budgets.”


It goes on to say that a reason cited for that situation was so that staff did not co-mingle funds when making charges. For me that points out that there was also not a good system for reconciliation of p-card transactions.


Another very interesting statistic related to the number of staff and number of cards is that over a two-year period, they spent $20 million using their p-cards.  That is an enormous spend for the staff population. A red flag to me.


It is not often that just a single item creates turmoil in a p-card program.  The paper also noted the following about the situation at Atlanta Public Schools:


“Cardholders were not required to receive training before using their cards and some got cards even though their applications for the program were not completed, approved and on file. When employees stopped working for APS, the district didn’t always know to cancel their cards.”


Not surprisingly, staff were not turning in receipts, and other back-up documentation, in the course of doing business. Let’s say that they were.  The $20 million in spend in two years was the result of 44,200 transactions.  If the agency had a traditional paper system (paper receipts attached to a paper reconciliation form) then I can hardly imagine an accounts payable department able to absorb that much paper, and reconcile that many transactions in, from just the p-card program.  I wonder what the non-pcard spend amount was?


Again, the good in this situation is that the audit, and the article from the Journal Constitution brought to the situation to light, and corrective actions have been put in place. But, we have to ask, how did the situation get so out-of-hand?  Incomplete applications, no training, but still distributing cards to staff.  How come no one in a leadership position said to put halt to this?


Take what you will from the two stories above.  There is a lot to learn from both situations.  P-card programs are pervasive.   But, non-management, or mis-management, of a p-card program can be disastrous for an agency. They unlock fraud potential, a culture of untracked goods, and they result in lost public funds.  All things that our association membership seek training and education to help prevent for our respective agencies.


Happy Purchasing!

Darryl Sweet


Cynthia Duprey says...
Posted Wednesday, July 10, 2019
I have found in the review of the Pcard programs for the agencies that I have consulted with the one suggestion that might be made is for agencies with this program to make the added effort to audit their Pcard programs regularly and ongoing. Perhaps hiring a consultant with past experience for quarterly audits could play a valuable part in an maintaining an optimum program that would pay for itself by reducing the margin of error and other liabilities.
Darryl Sweet says...
Posted Monday, June 3, 2019
Thanks Dianna. I have to say those two things were not always in balance. Arriving here in 2010, I found both contracting and p-card programs to be in need of administrative improvements and it took from 2010 - 2012 to really get a handle on both programs. From 2012 thru present things are more in balance. Front-end orientation and training by Purchasing and Accounts Payable as a team has worked well to channel contracting and p-card admin down the right respective paths (still with some outliers, though). Purchasing has daily pcard program management tasks, so we are in tune with the program. Our college is small, my department is too. July 1 - May 31 we've had 475 contracts, and 9100 +/- pcard transactions across 135 cardholders. Relative to our staff and budget these are big numbers. A big help to balancing these was automating one part of our contracting process (independent consultant agreements).
Dianna Baird CPPB says...
Posted Thursday, May 30, 2019
Great article, Darryl. I am a Pcard Program Administrator and am happy to say that during my 7 years administrating and managing our County's Pcard Program, our Finance audits have found no major issues with our cardholders' transactions (we have 365 cardholders). Can you tell me from your experience, how do you balance your contracting workload with managing and administering the Pcard Program? Do you carry the same volume of contracts as your peers while also administering the Program?

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