DOD to enlist tech to fight credit card abuse

DOD Charge Card Task Force Final Report

The Defense Department expects to use data mining to protect against waste, fraud or abuse of DOD credit cards, based on the recommendations of a task force examining recent problems.

Data mining technology, which analyzes vast stores of data to identify trends to someone reviewing the information, would be used to flag questionable purchases. The report also recommends the development of an online system for reviewing and approving card purchases.

The June 27 task force report includes a series of administrative and legislative changes to help DOD improve oversight of purchase and travel cards, said Defense comptroller and chief financial officer Dov Zakheim in a Pentagon press briefing.

Zakheim and Pete Aldridge, undersecretary of Defense for acquisition, technology and logistics, will oversee the implementation of the recommendations, many of which will be done on an expedited basis, according to the Pentagon.

The report follows a series of congressional hearings about questionable use of DOD-issued credit cards.

Zakheim stressed that the purchase and travel cards are a critical component of DOD's efforts to cut costs.

"They really are essential to improving business practices," he said. The credit cards save the government about $20 every time they are used when compared to the former, paper-based buying processes.

But Zakheim said that DOD needed to make headway in its fight against credit card waste, which is why data mining technology is important.

Navy Lt. Cmdr. Jack Stem, the Defense Logistics Agency's deputy program manager for e-business, said DOD's EMall has a feature that allows managers to create reports that detail how funds are spent. "We track all purchase card data," and EMall can provide reports based on that data.

The task force's recommendations were generally praised. Sen. Charles Grassley (R-Iowa), a longtime critic of government credit card abuse, said Defense Secretary Donald Rumsfeld is "trying to solve the problem instead of making excuses. This is a giant step in the right direction. The momentum is good, but we still have a way to go before we can claim victory."

Mark Amtower, a partner with Amtower and Co. in Ashton, Md., said that for the most part, the task force has taken "very strong, common sense approaches."

He added that DOD is correctly handling the issue itself rather than having Congress pass new laws. "We don't need more laws," he said. "This is not a legislative issue."

***

On the trail

The Defense Department's credit card task force recommendations include:

* Deploying data mining technology to detect suspicious transactions.

* Accelerating electronic billing and certification systems.

* Using metrics to track progress in improving credit card programs.

* Developing and deploying new training materials and courses on purchase cards.

* Establishing skills and grade levels for purchase-card program coordinators.

* Reducing the number of cards.