CHARLOTTE, North Carolina (AP) -- Misuse of government credit cards by military personnel has left Bank of America Corp. with more than $60 million in unpaid debt since 1998, a congressional investigation has found.
The investigation reviewing the bank-issued individual travel cards -- including at Camp Lejeune near Jacksonville and Fort Bragg near Fayetteville -- has found an unusually high number of delinquent cards and a chronic lack of government oversight.
The cards, which work like corporate credit cards, also have been used fraudulently. Investigators found that some cards were used to pay for prostitution, jewelry, cruises and New York Yankees games.
The investigators also found that more than 5,000 military personnel submitted bad checks as payment.
"This has been a good example of what can happen when you have breakdowns in control," Greg Kutz, investigator with the General Accounting Office, said this week. "No one is actually responsible for one thing."
The Defense Department is canceling some 400,000 travel cards by the end of this month, nearly 20 percent of the total issued by the federal government, the OMB said.
Also, a congressional bill would limit the number of accounts issued by the Pentagon to 1.5 million, prohibit issuance of a government card to anyone found not credit worthy and establish procedures for disciplinary actions.
Charlotte-based Bank of America signed the five-year Defense Department contract in 1998 to be the sole provider of travel cards to the Army, Marines, Navy and Air Force.
The bank has issued more than one million cards with the stamp "For Official Government Travel Only," meaning the cards are to be used only for travel expenses.
The largest portion of delinquent cards has been traced to lower-level military personnel, who made less than $30,000 annually, and also to those who had bad credit history or no credit history. The cards were routinely given to 18-year-olds fresh out of high school.
