Fleet Credit Card Controls in the Capital Metro Area
Background
The U.S. Postal Service operates one of the largest vehicle fleets in the U.S. At the end of fiscal year (FY) 2014, there were over 211,000 vehicles used primarily to deliver and collect mail.
Every postal-owned vehicle is assigned a fleet credit card to be used to pay for its commercially purchased fuel and oil and routine maintenance. During FY 2014, the Postal Service spent over $602 million in fleet credit card purchases. A site manager (or designee) at each facility where vehicles are assigned monitors fleet credit card purchases in the eFleetCard System.
Specific card controls designed to limit improper card use flag some at-risk transactions as exceptions, such as frequency limits and daily cost limits. These at-risk transactions require review and a written justification for the transaction during a monthly reconciliation process. During fiscal year 2014, the Capital Metro Area fleet credit card purchases totaled more than $69 million, with $5.9 million of these costs (8.6 percent) identified as exceptions.
Our objective was to assess the effectiveness of controls over fleet credit cards used in delivery operations in the Capital Metro Area.
What The OIG Found
Controls over fleet credit cards in the Capital Metro Area were not effective. We found fleet credit card reconciliations were not always properly performed and proper justification comments were not always entered for at-risk transactions. This occurred for 108 of 207 (52 percent) of our randomly selected sample exception transactions, resulting in $3.1 million in questioned costs. In addition, fleet credit card physical controls were not adequate at seven of 10 delivery units, placing over $2.9 million of Capital Metro Area assets at risk. We made referrals to our Office of Investigations as appropriate.
These conditions occurred due to inadequate oversight of the fleet credit card reconciliation process, which focuses on completion of reconciliations rather than their accuracy. In addition, units did not always follow policy for securing fleet credit cards.
Improving fleet credit card oversight, management, and guidelines will reduce the potential for error and unauthorized card use.
What The OIG Recommended
We recommended the vice president, Capital Metro Area, ensure site managers reconcile exceptions to receipts, enter proper justification comments for at-risk transactions, and adhere to policy requiring the safeguarding of fleet credit cards when not in use.