Program Pitfall: No Accountability

Not holding employees—at all job levels—accountable for their card program roles is a slippery slope that increases the risk of policy violations and internal fraud. Indeed, most cases of cardholder fraud indicate that a lack of accountability contributed to the program. While the following real-life example does not necessarily involve fraud, it demonstrates what can happen. Also included below are some suggestions for overcoming the issue.

Related Resources

• P-Card controls and fraud cases

• Program roles and responsibilities

• Card program management

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Real-life Example

An end-user explained to Recharged Education’s Lynn Larson how issuing cards to employees has resulted in shopping sprees. Cardholders leave the office to shop with their P-Cards, wasting time and money. (It was unclear if any purchases were personal/fraudulent). She said that, even if she strengthened card policies and procedures, there still would not be any consequences for the rogue behavior because management was part of the problem. Sometimes they were the shoppers. Lynn had to agree that what she described was a mess.

Suggestions

The above is an extreme case for which an extreme response might be necessary: scale back or even eliminate the cards. However, the problematic management team might resist that, too. Rather than increasing check usage, her organization should at least focus on electronic payments—ACH and/or an electronic accounts payable solution like Virtual Cards or buyer-initiated payments.

Overall, unsupportive management is tough, and sometimes impossible, to overcome. If you are a program manager faced with this issue, try the following:

• Stress best practices to management, including how a successful card program requires clear policies and procedures, consistent enforcement, and consequences for non-compliance.

• Illustrate what can happen if program participants are not held accountable for their roles, such as fraud and blown budgets; if possible, quantify the problem.

• Propose a call or meeting between your management and the card issuer to discuss the importance of accountability.

Final Thoughts

Before embarking on card program expansion, evaluate the strength of your current program. Does it have a solid foundation on which to grow? Does your organization strive for best practices? Clear up major issues before adding volume.