Text: S.300 — 112th Congress (2011-2012)All Bill Information (Except Text)

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Public Law No: 112-194 (10/05/2012)

 
[112th Congress Public Law 194]
[From the U.S. Government Printing Office]



[[Page 126 STAT. 1445]]

Public Law 112-194
112th Congress

                                 An Act


 
To prevent abuse of Government charge cards. <<NOTE: Oct. 5, 2012 -  [S. 
                                 300]>> 

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled, <<NOTE: Government 
Charge Card Abuse Prevention Act of 2012. 41 USC 101 note.>> 
SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Government Charge Card Abuse 
Prevention Act of 2012''.
SEC. 2. MANAGEMENT OF PURCHASE CARDS.

    (a) Government-wide Safeguards and Internal Controls.--
            (1) In general.--Chapter 19 of title 41, United States Code, 
        is amended by adding at the end the following new section:
``Sec. 1909. <<NOTE: 41 USC 1909.>> Management of purchase cards

    ``(a) Required Safeguards and Internal Controls.--The head of each 
executive agency that issues and uses purchase cards and convenience 
checks shall establish and maintain safeguards and internal controls to 
ensure the following:
            ``(1) <<NOTE: Records.>> There is a record in each executive 
        agency of each holder of a purchase card issued by the agency 
        for official use, annotated with the limitations on single 
        transactions and total transactions that are applicable to the 
        use of each such card or check by that purchase card holder.
            ``(2) Each purchase card holder and individual issued a 
        convenience check is assigned an approving official other than 
        the card holder with the authority to approve or disapprove 
        transactions.
            ``(3) The holder of a purchase card and each official with 
        authority to authorize expenditures charged to the purchase card 
        are responsible for--
                    ``(A) reconciling the charges appearing on each 
                statement of account for that purchase card with 
                receipts and other supporting documentation; and
                    ``(B) forwarding a summary report to the certifying 
                official in a timely manner of information necessary to 
                enable the certifying official to ensure that the 
                Federal Government ultimately pays only for valid 
                charges that are consistent with the terms of the 
                applicable Government-wide purchase card contract 
                entered into by the Administrator of General Services.
            ``(4) Any disputed purchase card charge, and any discrepancy 
        between a receipt and other supporting documentation

[[Page 126 STAT. 1446]]

        and the purchase card statement of account, is resolved in the 
        manner prescribed in the applicable Government-wide purchase 
        card contract entered into by the Administrator of General 
        Services.
            ``(5) Payments on purchase card accounts are made promptly 
        within prescribed deadlines to avoid interest penalties.
            ``(6) <<NOTE: Reviews. Records.>> Rebates and refunds based 
        on prompt payment, sales volume, or other actions by the agency 
        on purchase card accounts are reviewed for accuracy and properly 
        recorded as a receipt to the agency that pays the monthly bill.
            ``(7) <<NOTE: Records.>> Records of each purchase card 
        transaction (including records on associated contracts, reports, 
        accounts, and invoices) are retained in accordance with standard 
        Government policies on the disposition of records.
            ``(8) <<NOTE: Reviews.>> Periodic reviews are performed to 
        determine whether each purchase card holder has a need for the 
        purchase card.
            ``(9) Appropriate training is provided to each purchase card 
        holder and each official with responsibility for overseeing the 
        use of purchase cards issued by the executive agency.
            ``(10) The executive agency has specific policies regarding 
        the number of purchase cards issued by various component 
        organizations and categories of component organizations, the 
        credit limits authorized for various categories of card holders, 
        and categories of employees eligible to be issued purchase 
        cards, and that those policies are designed to minimize the 
        financial risk to the Federal Government of the issuance of the 
        purchase cards and to ensure the integrity of purchase card 
        holders.
            ``(11) The executive agency uses effective systems, 
        techniques, and technologies to prevent or identify illegal, 
        improper, or erroneous purchases.
            ``(12) The executive agency invalidates the purchase card of 
        each employee who--
                    ``(A) ceases to be employed by the agency, 
                immediately upon termination of the employment of the 
                employee; or
                    ``(B) transfers to another unit of the agency, 
                immediately upon the transfer of the employee unless the 
                agency determines that the units are covered by the same 
                purchase card authority.
            ``(13) The executive agency takes steps to recover the cost 
        of any illegal, improper, or erroneous purchase made with a 
        purchase card or convenience check by an employee, including, as 
        necessary, through salary offsets.

    ``(b) Guidance.--The <<NOTE: Review.>> Director of the Office of 
Management and Budget shall review existing guidance and, as necessary, 
prescribe additional guidance governing the implementation of the 
requirements of subsection (a) by executive agencies.

    ``(c) Penalties for Violations.--
            ``(1) In general.--The head of each executive agency shall 
        provide for appropriate adverse personnel actions or other 
        punishment to be imposed in cases in which employees of the 
        agency violate agency policies implementing the guidance 
        required by subsection (b) or make illegal, improper, or 
        erroneous purchases with purchase cards or convenience checks.
            ``(2) Dismissal.--Penalties prescribed for employee misuse 
        of purchase cards or convenience checks shall include dismissal 
        of the employee, as appropriate.

[[Page 126 STAT. 1447]]

            ``(3) Reports on violations.--The guidance prescribed under 
        subsection (b) shall direct each head of an executive agency 
        with more than $10,000,000 in purchase card spending annually, 
        and each Inspector General of such an executive agency, on a 
        semiannual basis, to submit to the Director of the Office of 
        Management and Budget a joint report on violations or other 
        actions covered by paragraph (1) by employees of such executive 
        agency. At a minimum, the report shall set forth the following:
                    ``(A) A summary description of confirmed violations 
                involving misuse of a purchase card following completion 
                of a review by the agency or by the Inspector General of 
                the agency.
                    ``(B) A summary description of all adverse personnel 
                action, punishment, or other action taken based on each 
                violation.

    ``(d) Risk Assessments and Audits.--The <<NOTE: Reports.>> Inspector 
General of each executive agency shall--
            ``(1) conduct periodic assessments of the agency purchase 
        card or convenience check programs to identify and analyze risks 
        of illegal, improper, or erroneous purchases and payments in 
        order to develop a plan for using such risk assessments to 
        determine the scope, frequency, and number of periodic audits of 
        purchase card or convenience check transactions;
            ``(2) perform analysis or audits, as necessary, of purchase 
        card transactions designed to identify--
                    ``(A) potentially illegal, improper, or erroneous 
                uses of purchase cards;
                    ``(B) any patterns of such uses; and
                    ``(C) categories of purchases that could be made by 
                means other than purchase cards in order to better 
                aggregate purchases and obtain lower prices (excluding 
                transactions made under card-based strategic sourcing 
                arrangements);
            ``(3) report to the head of the executive agency concerned 
        on the results of such analysis or audits; and
            ``(4) report to the Director of the Office of Management and 
        Budget on the implementation of recommendations made to the head 
        of the executive agency to address findings of any analysis or 
        audit of purchase card and convenience check transactions or 
        programs for compilation and transmission by the Director to 
        Congress and the Comptroller General.

    ``(e) Relationship to Department of Defense Purchase Card 
Regulations.--The requirements of this section shall not apply to the 
Department of Defense. See section 2784 of title 10 for provisions 
relating to management of purchase cards in the Department.''.
            (2) Clerical amendment.--The table of sections at the 
        beginning of chapter 19 of title 41, United States Code, is 
        amended by adding at the end the following new item:

``1909. Management of purchase cards.''.

    (b) Conforming Amendments to Department of Defense Purchase Card 
Provisions.--Subsection (b) of section 2784 of title 10, United States 
Code, is amended--
            (1) by moving paragraph (8) to the end of the subsection and 
        redesignating that paragraph as paragraph (14);

[[Page 126 STAT. 1448]]

            (2) by redesignating paragraphs (2), (3), (4), (5), (6), and 
        (7) as paragraphs (3), (4), (5), (6), (7), and (8), 
        respectively;
            (3) by inserting after paragraph (1) the following new 
        paragraph (2):
            ``(2) That each purchase card holder and individual issued a 
        convenience check is assigned an approving official other than 
        the card holder with the authority to approve or disapprove 
        transactions.'';
            (4) by adding after paragraph (10) the following new 
        paragraphs:
            ``(11) That the Department of Defense uses effective 
        systems, techniques, and technologies to prevent or identify 
        potential fraudulent purchases.
            ``(12) That the Department of Defense takes appropriate 
        steps to invalidate the purchase card of each card holder who--
                    ``(A) in the case of an employee of the Department--
                          ``(i) ceases to be employed by the Department, 
                      immediately upon termination of the employment of 
                      the employee; or
                          ``(ii) transfers to another unit of the 
                      Department, immediately upon the transfer of the 
                      employee unless the Secretary of Defense 
                      determines that the units are covered by the same 
                      purchase card authority; and
                    ``(B) in the case of a member of the armed forces, 
                is separated or released from active duty or full-time 
                National Guard duty.
            ``(13) That the Department of Defense takes steps to recover 
        the cost of any illegal, improper, or erroneous purchase made 
        with a purchase card or convenience check by an employee or 
        member of the armed forces, including, as necessary, through 
        salary offsets.''; and
            (5) by adding at the end the following new paragraph:
            ``(15) <<NOTE: Audits. Recommenda- tions. Reports.>> That 
        the Inspector General of the Department of Defense conducts 
        periodic audits or reviews of purchase card or convenience check 
        programs to identify and analyze risks of illegal, improper, or 
        erroneous purchases and payments and that the findings of such 
        audits or reviews, along with recommendations to prevent abuse 
        of purchase cards or convenience checks, are reported to the 
        Director of the Office of Management and Budget and Congress.''.

    (c) <<NOTE: 41 USC 1909 note.>>  Deadline for Guidance on Management 
of Purchase Cards.--The Director of the Office of Management and Budget 
shall prescribe the guidance required by section 1909(b) of title 41, 
United States Code, as added by subsection (a), not later than 180 days 
after the date of the enactment of this Act.
SEC. 3. MANAGEMENT OF TRAVEL CARDS.

    Section 2 of the Travel and Transportation Reform Act of 1998 
(Public Law 105-264; 5 U.S.C. 5701 note) is amended by adding at the end 
the following new subsection:
    ``(h) Management of Travel Charge Cards.--
            ``(1) Required safeguards and internal controls.--The head 
        of each executive agency that has employees that use travel 
        charge cards shall establish and maintain the following internal 
        control activities to ensure the proper, efficient, and 
        effective use of such travel charge cards:

[[Page 126 STAT. 1449]]

                    ``(A) <<NOTE: Record.>> There is a record in each 
                executive agency of each holder of a travel charge card 
                issued on behalf of the agency for official use, 
                annotated with the limitations on amounts that are 
                applicable to the use of each such card by that travel 
                charge card holder.
                    ``(B) Rebates and refunds based on prompt payment, 
                sales volume, or other actions by the agency on travel 
                charge card accounts are monitored for accuracy and 
                properly recorded as a receipt of the agency that 
                employs the card holder.
                    ``(C) <<NOTE: Reviews.>> Periodic reviews are 
                performed to determine whether each travel charge card 
                holder has a need for the travel charge card.
                    ``(D) Appropriate training is provided to each 
                travel charge card holder and each official with 
                responsibility for overseeing the use of travel charge 
                cards issued by the executive agency.
                    ``(E) Each executive agency has specific policies 
                regarding travel charge cards issued for various 
                component organizations and categories of component 
                organizations, the credit limits authorized for various 
                categories of card holders, and categories of employees 
                eligible to be issued travel charge cards, and designs 
                those policies to minimize the financial risk to the 
                Federal Government of the issuance of the travel charge 
                cards and to ensure the integrity of travel charge card 
                holders.
                    ``(F) <<NOTE: Evaluation.>> Each executive agency 
                has policies to ensure its contractual arrangement with 
                each travel charge card issuing contractor contains a 
                requirement that the creditworthiness of an individual 
                be evaluated before the individual is issued a travel 
                charge card, and that no individual be issued a travel 
                charge card if that individual is found not creditworthy 
                as a result of the evaluation (except that this 
                paragraph shall not preclude issuance of a restricted 
                use, prepaid, declining balance, controlled-spend, or 
                stored value card when the individual lacks a credit 
                history or has a credit score below the minimum credit 
                score established by the Director of the Office of 
                Management and Budget). The Director of the Office of 
                Management and Budget shall establish a minimum credit 
                score for determining the creditworthiness of an 
                individual based on rigorous statistical analysis of the 
                population of card holders and historical 
                behaviors. <<NOTE: Assessment.>> Notwithstanding any 
                other provision of law, such evaluation shall include an 
                assessment of an individual's consumer report from a 
                consumer reporting agency as those terms are defined in 
                section 603 of the Fair Credit Reporting Act (15 U.S.C. 
                1681a).
                    ``(G) Each executive agency uses effective systems, 
                techniques, and technologies to prevent or identify 
                improper purchases.
                    ``(H) Each executive agency ensures that the travel 
                charge card of each employee who ceases to be employed 
                by the agency is invalidated immediately upon 
                termination of the employment of the employee (or, in 
                the case of a member of the uniformed services, upon 
                separation or release from active duty or full-time 
                National Guard duty).

[[Page 126 STAT. 1450]]

                    ``(I) Each executive agency shall ensure that, where 
                appropriate, travel card payments are issued directly to 
                the travel card-issuing bank for credit to the 
                employee's individual travel card account.
            ``(2) <<NOTE: Deadline. Review.>>  Guidance on management of 
        travel charge cards.--Not later than 180 days after the date of 
        the enactment of the Government Charge Card Abuse Prevention Act 
        of 2012, the Director of the Office of Management and Budget 
        shall review the existing guidance and, as necessary, prescribe 
        additional guidance for executive agencies governing the 
        implementation of the requirements in paragraph (1).
            ``(3) <<NOTE: Recommenda- tions. Reports.>>  Inspector 
        general audit.--The Inspector General of each executive agency 
        with more than $10,000,000 in travel card spending shall conduct 
        periodic audits or reviews of travel card programs to analyze 
        risks of illegal, improper, or erroneous purchases and payments. 
        The findings of such audits or reviews along with 
        recommendations to prevent improper use of travel cards shall be 
        reported to the Director of the Office of Management and Budget 
        and Congress.
            ``(4) Penalties for violations.--Consistent with the 
        guidance prescribed under paragraph (2), each executive agency 
        shall provide for appropriate adverse personnel actions to be 
        imposed in cases in which employees of the executive agency fail 
        to comply with applicable travel charge card terms and 
        conditions or applicable agency regulations or commit fraud with 
        respect to a travel charge card, including removal in 
        appropriate cases.
            ``(5) Definitions.--In this subsection:
                    ``(A) Executive agency.--The term `executive agency' 
                means an agency as that term is defined in subparagraphs 
                (A) and (B) of section 5701(1) of title 5, United States 
                Code.
                    ``(B) Travel charge card.--The term `travel charge 
                card' means any Federal contractor-issued travel charge 
                card that is individually billed to each card holder.''.
SEC. 4. <<NOTE: 5 USC 5701 note.>> MANAGEMENT OF CENTRALLY BILLED 
                    ACCOUNTS.

    (a) Required Internal Controls for Centrally Billed Accounts.--The 
head of an executive agency that has employees who use a travel charge 
card that is billed directly to the United States Government shall 
establish and maintain the following internal control activities:
            (1) <<NOTE: Verification.>> The executive agency shall 
        ensure that officials with the authority to approve official 
        travel verify that centrally billed account charges are not 
        reimbursed to an employee.
            (2) The executive agency shall dispute unallowable and 
        erroneous charges and track the status of the disputed 
        transactions to ensure appropriate resolution.
            (3) The executive agency shall submit requests to servicing 
        airlines for refunds of fully or partially unused tickets, when 
        entitled to such refunds, and track the status of unused tickets 
        to ensure appropriate resolution.

    (b) Guidance.--Not <<NOTE: Deadline. Review.>> later than 180 days 
after the date of the enactment of this Act, the Director of the Office 
of Management and Budget shall review the existing guidance and, as 
necessary, prescribe additional guidance for executive agencies 
implementing the requirements of subsection (a).

[[Page 126 STAT. 1451]]

SEC. 5. <<NOTE: 5 USC 5701 note.>> DEFINITIONS.

    In this Act:
            (1) Executive agency.--The term ``executive agency'' has the 
        meaning given such term in section 133 of title 41, United 
        States Code.
            (2) Employee.--The term ``employee'' has the meaning given 
        such term in section 2(d)(3) of the Travel and Transportation 
        Reform Act of 1998 (Public Law 105-264; 5 U.S.C. 5701 note).
SEC. 6. <<NOTE: 5 USC 5701 note.>> CONSTRUCTION.

    (a) Executive Agency Accounting.--Nothing in this Act, or the 
amendments made by this Act, shall be construed to excuse the head of an 
executive agency from the responsibilities set out in section 3512 of 
title 31, United States Code, or in the Improper Payments Information 
Act of 2002 (31 U.S.C. 3321 note).
    (b) Personal Information.--Nothing in this Act, or the amendments 
made by this Act, shall be construed to require the disclosure of 
personally identifying information that is otherwise protected from 
disclosure under section 552a of title 5, United States Code (popularly 
known as the Privacy Act of 1974).

    Approved October 5, 2012.

LEGISLATIVE HISTORY--S. 300:
---------------------------------------------------------------------------

HOUSE REPORTS: No. 112-376, Pt. 1 (Comm. on Oversight and Government 
Reform).
SENATE REPORTS: No. 112-37 (Comm. on Homeland Security and Governmental 
Affairs).
CONGRESSIONAL RECORD:
                                                        Vol. 157 (2011):
                                    July 22, considered and passed 
                                        Senate.
                                                        Vol. 158 (2012):
                                    July 31, Aug. 1, considered and 
                                        passed House, amended.
                                    Sept. 21, Senate concurred in House 
                                        amendment.

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