Coats Highlights Millions in Unverified Purchases at State Department, FAA

WASHINGTON, DC – Senator Dan Coats (R-Ind.), the Chairman of the Joint Economic Committee, delivered his weekly “Waste of the Week” speech and highlighted two policies that are ripe for abuse within the State Department and Federal Aviation Administration (FAA). Coats said changing these two policies could result in up to $295.6 million in taxpayer savings over the next decade.

Coats discussed how State Department employees located overseas – such as at an embassy or consulate – have access to what’s called a purchase card to make “simple transactions.” To prevent wasteful or fraudulent use of the purchase cards, federal law and State Department guidelines require that all transactions meet eligibility criteria and be continually monitored. One of the key eligibility criteria is that all of the purchase receipts must be retained for a minimum of three years.

However, a recent report by the State Department Inspector General (IG) revealed that overseas employees don’t have to send any purchase documentation to supervisors in D.C. for further review. When the State Department IG tried to access documentation for purchase card transactions, the IG found that many overseas offices didn’t keep transaction records. In fiscal year 2014, the IG found that more than half of overseas offices either didn’t perform reviews of purchase card transactions or didn’t respond to the IGs request to produce documentation. The report determined that during 2013 and 2014 there were $53.6 million in unaccounted for purchases. Over a ten year period, these transactions will amount to over $263 million in unknown and unverified purchases just within the State Department’s overseas offices.

“We all are familiar with the adage ‘trust but verify,’” said Coats. “It seems there’s a whole lot of trust but not a lot of verification with State Department purchase cards.”

Just like the State Department, the FAA has guidelines requiring employees to document and track equipment purchases. However, the FAA Inspector General (IG) found that many employees didn’t comply with the guidelines and the employees are not consistently held responsible for safeguarding their assigned equipment and supplies like digital cameras and laptops. As a result, the FAA IG found that there are nearly 15,000 pieces of equipment and material that employees may not be able to locate. The combined value of that missing property is over $32.5 million.

“The United States has racked up more than 19 trillion dollars in debt, and it is outrageous to think that some executive agencies don’t feel the need to require accountability or even responsibility from employees who spend taxpayer dollars or use taxpayer-funded equipment,” said Coats.