ROANOKE TIMES 
                      Copyright (c) 1996, Roanoke Times

DATE: Saturday, March 16, 1996               TAG: 9603180126
SECTION: NATIONAL/INTERNATIONAL   PAGE: C5   EDITION: METRO 
DATELINE: WASHINGTON 
SOURCE: LOS ANGELES TIMES

GOVERNMENT: MISUSE OF CREDIT CARDS RAMPANT FEDERAL WORKERS FIND CREDIT EASY TO GET, ABUSE

Under the Clinton administration, the number of federal workers with government-sponsored credit cards has nearly doubled to 1.4 million, and thousands of them are using the cards improperly to buy personal goods such as liquor, jewelry and health club memberships, according to government officials.

The General Services Administration, which oversees the use of government property, said that the number of federal credit card holders has soared since 1993, when the administration awarded the franchise for government credit cards to American Express.

Officials said that credit card abuse has become a widespread problem in the federal bureaucracy, in part because it is so easy for government workers to get virtually limitless credit and then misuse it.

Allegations of credit card misuse are under investigation by several Republican-led congressional committees, and legislation recently was offered in the House to curb personal expenditures by cardholders.

Preliminary findings by congressional investigators show that many agencies fail to monitor how the cards are used and that many government-sponsored credit card accounts are delinquent.

At the National Oceanic and Atmospheric Administration, for example, only one person is assigned to review card charges by more than 5,000 federal employees, according to NOAA officials.

In most cases, the individual - not the government - is liable when a federal employee fails to repay debts accrued on group credit card accounts, although the government sometimes resorts to garnisheeing the wages of delinquent cardholders.

Yet even if employees repay American Express for personal purchases, they are violating the terms under which they got the government-sponsored credit card, investigators said. All cardholders are required to sign a pledge saying that they will use the cards strictly for official business.

Because the cards are intended solely for government business, federal cardholders normally pay no annual fees, nor are they assessed the usual penalties or 2.5 percent interest charges levied against typical cardholders. They do not undergo a credit check before receiving the cards, and they have no credit limit. So overdue bills can amount to an interest-free loan for government workers.

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