Prison sentences and mayoral candidates: P-Card and T&E headlines
All organizations, no matter their size or number of employees, must carefully oversee their purchasing card (P-Card) and travel and entertainment (T&E) expenses. Even just one employee can do thousands of dollars’ worth of damage, and quickly. Here are some recent news stories that are serving as a stern reminder of this.
Connecticut, United States
A doctor formerly employed at the Johns Hopkins University School of Medicine has been sentenced to prison after it was discovered that he had lied about his travel expenses to receive hundreds of thousands of dollars for family vacations, meals, and other expenses that would be paid for by parties other than the school. The doctor defrauded the school in one case for a 13-day family trip to Europe by falsely claiming that the trips were made in order for him to deliver lectures about his work at Hopkins. He was reimbursed three times for flights to and from a conference in Japan: first by Hopkins, then a French life-sciences company, and finally by the Yale School of Medicine, where he had started working before the conference.
The former employee has been convicted of four counts of mail fraud “arising from a multi-year scheme to unlawfully obtain travel expense reimbursements from his former employer,” said the U.S. Attorney’s office. He has been sentenced to a year and a day in federal prison for his crimes, three years of supervised release and almost $600,000 in restitution.
Louisiana, United States
A mayoral candidate in New Orleans, Louisiana continues to be plagued by questions surrounding her use of her City Council P-Card for almost $9,000 in purchases that were later reimbursed, either by herself or her campaign. After reviewing hundreds of pages of the candidate’s credit card statements and invoices, it was found that she had violated the City Council’s P-Card policies by purchasing alcohol on at least five occasions since 2014; she did, however, reimburse the expense two months later.
More concerning, though, is the candidate’s use of the card to purchase upgrades for travel and lodging—expenses she did not reimburse until five years later when she entered the mayoral race. It has also been found that the candidate has $21,000 in unexplained charges, and dozens of receipts that lack information on the reason for the purchases.
Following the revelations, the mayoral candidate has lashed back, calling for the Louisiana Ethics Board to investigate the District Attorney on the case, who has publicly supported her opponent.
Analysis from a media company in Australia is reporting that government agencies are experiencing high degrees of P-Card misuse and abuse, with some of the largest departments spending more than $150,000 on personal purchases. It was found that there were many cases of cards being used to make purchases that violated company policies, including personal purchases of private travel, accounting courses and personal bills. In one case an employee was fired from their position after it was found he had spent $9,000 on inappropriate purchases. While in many cases the purchases were found to be valid or made in error–for example, the employee paying for the accounting course immediately realized the wrong card had been used to pay for the accounting course—needless time and resources must be dedicated to identifying any illegitimate purchases.
Stories such as these highlight the importance of using technology to continuously monitor P-Card and T&E transactions to detect non-compliance or anomalies. Learn more about emerging risks in procurement processes and how analytics can mitigate them. Download our eBook, ‘How to avoid abuse, misuse and fraud in your T&E and P-Card programs’ now!
About Anu Sood
Anu Sood (LinkedIn | Twitter) is the Director Marketing at CaseWare RCM and is responsible for the company’s global marketing strategy. She has over 20 years of experience in product development, product management, product marketing, corporate communications, demand generation, content marketing and strategic marketing in high-tech industries.