Ethics, Credit Cards and Government Leaders

By on February 5, 2007 in Current Events with 1 Comment

Leaders in an organization establish the tone and set ethics requirements whether the requirements are published or just understood by those that work there.

In the federal government, the Merit Systems Protection Board (MSPB) is a leader. Its decisions and studies influence the nature and the future of government organizations. The agency is professional and provides useful information that is used by OPM, Congress and agencies.

But sometimes its decisions can miss the mark—at least in the view of an outside observer. Here is an example of a case decision that misses the mark and sets a tone for government that is unfortunate.

FedSmith published an article way back in 2003 entitled Where’s The Outrage? The subject was misuse of government travel cards. The Inspector General at an agency found widespread misuse of the cards and found more than $7.7 million in improper charges within six months. In other words, 10 percent of the total charges in the agency during this time were not authorized.

But here is a conundrum. What if the agency tries to curb the abuse? Will the effort be upheld?

The Outrage article concluded: “OK, Mr. President, you said you want to run the federal government like a business. So, here’s a test of that philosophy. What would a corporation do if it found out in one of its divisions employees had engaged in this level of abuse of travel cards, that the division had no internal controls, that hands were slapped when the auditors blew the whistle? I suspect that the offending employees would be history, as would the managers that let the abuse happen. Can we have just a bit of outrage over the situation at Agriculture?”

If an agency decides to take an action for misuse of a government card but the decision is overturned, the MSPB is sending a message. Decision-makers will likely conclude it is a waste of resources to take serious action and go along with the general perception that firing a federal employee is too time-consuming and too expensive. Perhaps Uncle Sam should put up with the abuse of a few hundred million throughout government and just forget about it.

That, at least, is one possible conclusion as as a result of a recent MSPB decision in Bullock v. Department of Homeland Security.

The decision by the 2-1 majority does not seem controversial at first glance. It adopts a recommendation from an administrative judge. The Board orders the agency to cancel the removal action and to “substitute in its place a demotion to a non-supervisory position with the least reduction in grade and pay.”

The agency is also told “to pay the appellant the correct amount of back pay, interest on back pay, and other benefits under the Office of Personnel Management’s regulations.”

If the point was missed that the agency was in hot water, the Board also ordered that, in the event of a dispute on the amount of money due to the appellant, “we ORDER (emphasis in the original) the agency to pay the appellant the undisputed amount no later than 60 calendar days after the date of this decision.”

An agency executive hearing of the case would likely conclude that the Department of Homeland Security was railroading an innocent employee.

But, there is also a dissenting opinion issued by Board Chairman Neil McPhie. The dissent gives the reader insight into the facts the majority opinion did not divulge. Here are the facts as related in the dissent.

The Department of Homeland Security fired a GS-12 supervisor for misusing a government travel card. While on detail, she made unauthorized charges for purchases such as clothing, shoes, makeup, a rental car and a massage. The total unauthorized charges: over $4000.

The appellant admitted the misconduct. The administrative judge mitigated the penalty because she had 17 years of federal service and the table of penalties recommended up to a 14-day suspension for a first offense. She paid the unauthorized charges.

The agency fired the employee because the misuse of the charge card was repeated and she knew the charges were not authorized. The dissenting opinion concludes the appellant did not request reimbursement because she knew her actions were wrong. She did not testify she thought she was permitted to charge non-reimbursable expenses to her government card. The charges to the card “systematically exceeded her per diem reimbursement by more than 70% for 7 months running.”

The dissenting Chairman concludes a supervisory law enforcement officer should be held to a very high standard of conduct and that the agency’s decision was justified.

An agency reading the Board’s decision and order could conclude that firing an employee for misusing a charge card will not be upheld. Perhaps it could also conclude a non-supervisory employee making unauthorized purchases on a government travel card is less of an offense than if a supervisor did so.

Perhaps outrage about agency employees who make unauthorized charges to government cards totaling tens of millions of dollars is misplaced. The time and money spent by GAO and IG offices to try and correct the problem throughout government may be a waste of time spent on an unimportant issue.

Perhaps the next time an IG or the GAO comes down hard on an agency for not enforcing the regulations regarding the misuse of government travel cards, the agency will tell them “If the MSPB does not take the violations seriously, why should we?”

Recent articles on the FedSmith site have elicted cries of outrage from some over rules prohibiting employees covered by the FERS employement system from getting extra credit for unused sick leave upon retirement. In a recent unscientific poll, 33% of the approximately 1400 readers responding said they have used sick leave when it was not authorized. Some readers found that using sick leave when it is not authorized is justified because they do not personally view the system as being fair.

A government that operates in an atmosphere of “situational ethics” will be an interesting experience. If an employee takes sick leave in violation of regulatory requirements, many do not see a problem. There is little difference between using sick leave when not authorized or charging unauthorized travel expenses to a government credit card.

Huge sums of money are apparently being charged to government travel cards according to investigators. When an agency decided to fire an employee and get the problem under control, it got slapped. While the employee got demoted (“with the least deduction in grade and pay”) along with a check for back pay, the message is clear: The agency is making too much out of this issue.

While Chairman McPhie would opt for a higher standard of ethics, he is in the minority in this instance. Misuse of a government charge card is not that big a deal in the view of the Board. Employees and agencies will no doubt get the message and it will be louder than that issued by the GAO or other investigators.

The ethics standard on this issue has been set by the MSPB. Unfortunately, it is lowering the ethical bar when government needs to be setting an example of higher standards. Kudos to Chairman McPhie for making the effort and his willingness to stand up for what he thinks is the right move for government.

© 2016 Ralph R. Smith. All rights reserved. This article may not be reproduced without express written consent from Ralph R. Smith.


About the Author

Ralph Smith has several decades of experience working with federal human resources issues. He has written extensively on a full range of human resources topics in books and newsletters and is a co-founder of two companies and several newsletters onĀ federal human resources.