In this Feb. 27, 2013 photo, poker players cast their bets during a hand of Texas Hold 'em at the poker room at Caesar's Palace in Las Vegas.

In this Feb. 27, 2013 photo, poker players cast their bets during a hand of Texas Hold 'em at the poker room at Caesar's Palace in Las Vegas. Julie Jacobson/AP

Pentagon Workers Put Escorts and Casino Bets on DOD Charge Cards

Over the course of a year, Defense Department employees put nearly $1 million spent at casinos on government charge cards, a pending investigation has revealed.

CORRECTION: An earlier version of this article incorrectly stated above that U.S. taxpayers paid for Pentagon employees' spending on casinos and escorts during trips to Atlantic City and Las Vegas. The federal government is not financially liable and taxpayer funds are not being used to pay for the misuse, according to a defense official.

A not-yet-released Defense Department investigation has found civilian and military employees used government charge cards to make more than $1 million in purchases at casinos and to pay for escorts, according to an internal report

The Pentagon’s inspector general, as first reported by Politico and confirmed by a department official, found Defense employees used the cards for gambling and “adult entertainment” in Las Vegas and Atlantic City, New Jersey. The IG initiated the review in 2014 in accordance with the 2012 Government Charge Card Abuse Prevention Act.

In the one-year period beginning July 1, 2013, Defense cardholders made 4,437 transactions totaling more than $950,000 at casinos using their government cards. Employees made an additional 900 transactions totaling nearly $100,000 at “adult entertainment establishments.” The Pentagon said this represented a small fraction of the total transactions on department-issued cards, coming to less than one-tenth of 1 percent of the charges.

“While any misuse of the card is taken seriously, the amount of this misuse is extremely small given the size and scope of the DOD travel charge card program,” the official said.

Some or all of the charges may have been paid by the individuals, rather than the government, according to the official. The official added the cardholders paid their own bills and then submitted government-related expenses to the department for reimbursement. One official speculated to Politico the individuals may have used their government -- instead of their personal -- cards to hide the illicit activities from their spouses. 

Sen. Chuck Grassley, R-Iowa, who authored the bill to crack down on government charge card abuse,  said the report is proof the law is working.

“I’m interested to see the report and find out more about what’s being done, right and wrong, at the Defense Department to prevent abuse,” Grassley said. “The law requires periodic audits by inspectors general, like this one, specifically to keep on top of charge card abuse and hold agencies accountable for implementing the required internal controls. If everything is implemented as intended, we’ll stop a lot of purchase card and travel card abuse.”

The Defense official said the individuals who used their cards inappropriately will be held accountable, noting action has been taken on 364 cases and an additional 79 cases are pending action.

“Clearly the behavior displayed by these individuals neither comports with our values nor represents the good service of the vast majority of or service members or DOD civilians,” the official said.

Other recent examples of government charge card abuses included U.S. Postal Service employees who went gambling and bowling on the government’s dime, and Forest Service workers who used their cards for personal trips to gas stations, restaurants and grocery stores.

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