Department of Defense employees racked up an estimated $1 million in personal expenses on their government charge cards at casinos and strip clubs last year, the Pentagon's inspector general reported Tuesday. They included a civilian who withdrew thousands of dollars at the Maryland Live casino.
The civilian took out $3,366 at casino ATMs between 2012 and 2014, the inspector general reported. Another three withdrawals totaling $402 were rejected.
The civilian, who is not identified in the report, was among 2,636 holders of Defense Department cards who splurged at casinos while not on official business. Six hundred and forty-six cardholders made charges at adult entertainment venues.
While the payments were a small fraction of the $3.4 billion spent on the cards last year, the lesson from the inspector general's report is that lax oversight makes it easy for employees to get away with questionable transactions.
The taxpayer is not on the hook for such spending, but using the cards for personal transactions is against the department's rules, and the inspector general recommended the department come up with ways to keep a closer watch on the cards.
Some of the illicit use of the cards seemed strikingly obvious. For example, cardholders reviewed by the inspector general made such payments as $308 at an establishment called Dreams Cabaret; $2,100 at Vegas Showgirls; $1,614 at Larry Flynt's Hustler Club; and a hefty $4,686 at Sapphire Gentlemen's Club.
That last transaction paid for a visit to the VIP room for an airman and several of his friends, the inspector general found. The jaunt earned the airman a demotion.
And the red flag that gave away the regular visitor to Maryland Live? There was no record on file showing the employee was traveling and would need to use the government card.
The inspector general wrote that the department should look for ways that spending that occurs when the employee is not on official travel could be highlighted automatically. Such a system, the inspector general reported, "may have prevented the cardholder from abusing the [card] for over 2 years."
The employee's bosses were oblivious to the unauthorized spending. But once inspectors alerted them, the employee received a three-day unpaid suspension and lost use of the card.