Wednesday, November 30, 2011

Personal Use of Government Credit Cards Prohibited

In a June 2, 2011 informal opinion, the Washington State Attorney General's Office provided its analysis on whether a local government official or employee may use a government issued credit card for personal purchases and then reimburse the agency for the cost.

Summary of Opinion:  The Attorney General's opinion summarized its conclusion as follows:
"Under the Washington State Constitution and the laws of this state, included RCW 43.09.2855 and RCW 42.24.115, a local government official or employee may not use a publicly-issued credit card for personal purchases, even if the person pays off the card prior to the date that the bill becomes due."
Auditor's Response:  The Washington State Auditor's Office has issued the following statement in response to the Attorney General's opinion, noting that they will begin enforcing this provision during 2013 for 2012 year-end audits:
"Since we want to make sure local governments hear of this guidance and have time to put procedures in place to comply, we will not hold local governments to this interpretation for the 2011 fiscal year.  We will provide information on this opinion to local governments in various ways.  We will begin to audit and report on this issue during 2013 for the 2012 year-end audits."
In the News Recently:  The Port of Seattle elected commissioners were recently cited in an independent ethics report for having used their port issued credit cards for expenses that were not reimbursable by the port or that were clearly personal expenses.  Click here to read my November 1, 2011 blog entry on this subject.

Do You Have a Policy?  If your agency issues credit cards to employees:
  • Do you have clear policies prohibiting use of the cards for personal use?  
  • Do you regularly monitor charges on the credit cards to ensure they are appropriate government expenses?
  • What are the consequences for failure of employees to use the credit cards appropriately?
Mike Purdy's Public Contracting Blog 
© 2011 by Michael E. Purdy Associates, LLC

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