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Report Reveals Lax Oversight of IRS Phone Cards

By Ed O'Keefe

Internal Revenue Service employees charged approximately $8.4 million to 34,000 agency-issued telephone cards, according to a new report by the agency's inspector general that tracked calls between Oct. 2005 and April 2008. The report's findings mirror a similar 2004 report that blamed managers for not regularly reviewing card charges for potential fraud or abuse.

The IRS issues calling cards to employees that travel for their jobs, participate in flex-place or telecommuting programs or who are required to set up conference calls. Approximately $7.4 million of the total telephone card charges were for teleconferences or related costs between Oct. 2005 and April 2008. The IRS has relied on teleconferencing much more in recent years as it and many other government agencies cut travel costs.

The remaining $1 million was spent on telephone calls or related charges. Investigators discovered improper charges totaling approximately $59,000 on one telephone card used to make calls between the U.S. and various foreign countries between June 2007 and June 2008. Those costs occurred despite the IRS' understanding that the cards, issued by AT&T, were for domestic calls only. Because of the glitch, the agency has asked the phone company for a reimbursement totaling $79,945. Fourteen cards had charges of $500 or more during at least one month between Oct. 2005 and Feb. 2008. One of them had charges totaling $9,332 over a nine month span.

The report, released late last week, also reveals that the tax-collecting agency has not conducted an inventory of its calling cards since fiscal year 2006. It established a computerized tracking system to monitor card charges in 2003, but investigators say the agency has not used it effectively. While the Treasury Inspector General for Tax Administration has investigated IRS telecommunication services in the past, this is the most recent report focused exclusively on calling card costs.

The IRS cites technical issues and staffing shortages for its lax oversight. It also plans to start conducting quarterly reviews of the card program this December and will require employees to justify charges of more than $400 per month.

By Ed O'Keefe  | March 25, 2009; 8:25 AM ET
Categories:  Agencies and Departments, Oversight  
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