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Purchase Card Program
1. What may be purchased with the purchase card?
The purchase card shall be used to purchase supplies and services in accordance with the Federal Acquisition Regulation (FAR). Purchase card use as the procurement and payment tool for micro-purchases is defined in FAR 13.2. Micro-purchase means an acquisition of supplies or services in which the aggregate amount does not exceed $2,500, except that the limit is $2,000 in the case of construction, and $7,500 for the Department of Homeland Security. For purchases above the micro-purchase threshold, the purchase card may be used as an ordering and payment mechanism, not a contracting mechanism. When used as an ordering and payment mechanism, contractors may bill against the card. When the order is delivered, the contractor bills the purchase card account instead of issuing an invoice directly to the agency.
To allow agencies the maximum latitude, the contract excludes only a few categories of purchases, such as long-term rental or lease of land or buildings, travel or travel related expenses (excluding conference rooms, meeting spaces, and local transportation services such as Metro fare cards, subway tokens, etc.), and cash advances (unless permitted as a value added service under the agency task order). The contract does not specifically address the maximum transaction amount.
2. What penalties are there for misuse of purchase cards?
In the case of purchase cards, intentional use of the purchase card for other than official government transactions constitutes misuse, and depending on the facts, may constitute fraud. The employing agency of a cardholder employee who misuses the card or who participates in fraud cancels the purchase card and takes disciplinary action against the employee, as appropriate. In the case of card misuse, the employee will be held personally liable to the Government for the amount of any unauthorized (non-Government) transaction.
Additionally, depending on the facts involved, an employee may be subject to fine or imprisonment for action relating to purchase card misuse and fraud. For example, if convicted under 18 U.S.C. 287, a person is subject to a fine of not more than $10,000 or imprisonment for not more than five years or both. Military members may be subject to court martial under 10 U.S.C. 932, UCMJ Art. 132. Also, depending on the circumstances, other sections of the U.S. Code may apply and may carry additional penalties or fines:
- Frauds and Swindles (Mail Fraud) - 18 U.S.C. 1341
- Fraud by Wire, Radio, or Television - 18. U.S.C. 1343
- Conspiracy - 18 U.S.C. 371
- Bribery, Graft, and Conflicts of Interest - 18 U.S.C. 201
- Laundering of Monetary Instruments - 18 U.S.C. 1956
- Embezzlement and Theft - 18. U.S.C. 641
- Fraud and False Statements - 18 U.S.C. 1001
- Extortion and Threats - 18 U.S.C. 871
- Conspiracy to Defraud the Government with Respect to Claims - 18 U.S.C. 286
- Persons in a Position of Trust - Normally used during sentencing. This statement is usually introduced by the Assistant U.S. Attorney to obtain additional points from the Federal Sentencing Guidelines.
Employees issued a card have a responsibility to use the card to procure supplies and services at the direction of the agency under official purchase authorization. Examples of misuse include: 1) purchases which exceed the cardholder's limit; 2) purchases which are not authorized by the agency; 3) purchases for which there is no funding; 4) purchases for personal consumption; 5) purchases which do not comply with Federal Acquisition Regulation and/or other applicable procurement statutes and regulations; and 6) purchases that are billed by the merchant but are never received by the agency.
Purchase card misuse or fraud may have the following potential consequences for the cardholder
- Counseling
- Cancellation of purchase card
- Notation in employee performance evaluation
- Reprimand
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