Auditors find credit card fraud and abuse at 5 Florida universities
South Florida Sun-Sentinel
April 20, 2010
A Florida International University professor used a school credit card to buy at least $5,000 worth of personal items, including an MP3 player, a wireless reading device and a membership with United Airlines' Red Carpet club.
An administrative assistant in University of Florida's oral history program submitted receipts for books for a " WWII project." But the books weren't about a world war. They were from Weight Watchers.
An information technology specialist at UF made more than $13,000 in unauthorized purchases, altering receipts to disguise a Blu-ray disc player, video games and Xbox gaming currency.
While university credit or purchasing cards are often quicker and cheaper than other payment methods, they are also prone to abuse, auditors and experts say, especially if employers have lax controls. State auditors this year found more than $150,000 in improper or unverified purchasing card expenses at five universities around the state, and in a few cases, fraud.
Expenses were approved without receipts. Some employees split the costs of items on two transactions to avoid single-purchase limits. In other cases, the cards were used for items specifically forbidden by university policy.
The cards, which usually bear the name of a major credit card company, have been prevalent since the late 1990s at universities, school districts, government agencies and private employers.
"They're convenient, and maybe the convenience outweighs the losses, but I think there should be limited access to the cards," said James D. Ratley, president of the Association of Certified Fraud Examiners. "By issuing them as widely as they are, [employers] are making it almost impossible to monitor, just by the sheer volume of people who have them. And then they're creating a tremendous opportunity for these people."