Federal Procurement, or Who Says the Airlines Aren’t Getting Enough Subsidies

Truly shocking and I’m not easily shocked.

    The Defense Department spent an estimated $100 million for airline tickets that were not used over a six-year period and failed to seek refunds even though the tickets were reimbursable, congressional investigators say.

    The department compounded the problem by reimbursing employee claims for tickets bought by the Pentagon, the investigators said.

    A prior report, issued last November, found that the Pentagon bought 68,000 first-class or business-class airline seats for employees who should have flown coach.

    The reimbursable tickets had no advanced purchase requirements, minimum or maximum stays or penalties for changes or cancellations under department agreements with the airlines.

    “The millions of dollars wasted on unused airline tickets provides another example of why DOD financial management is one of our high-risk areas, with DOD highly vulnerable to fraud, waste and abuse,” the GAO said.

    Two of the three lawmakers who asked for the study were Republicans, and both were highly critical of the Pentagon’s lack of financial control.

    While one GAO report focused on the unused tickets, the second investigation found potential fraud.

    It said the department paid travelers for tickets the department already bought and reimbursed employees for tickets that had not been authorized.

    A limited review of records for 2001 and 2002 identified 27,000 transactions totaling more than $8 million in reimbursements to employees for tickets bought by the government. These figures represent only a small portion of the potential fraud, the GAO said.

About Gary Leff

Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel - a topic he has covered since 2002. Co-founder of frequent flyer community InsideFlyer.com, emcee of the Freddie Awards, and named one of the "World's Top Travel Experts" by Conde' Nast Traveler (2010-Present) Gary has been a guest on most major news media, profiled in several top print publications, and published broadly on the topic of consumer loyalty. More About Gary »

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