"We appreciate the efforts of John Layton and his colleagues on the External Review Team who were involved with this review," Browne said. "The report is a valuable guide to actions the Laboratory will take to strengthen its purchase card program and correct the problems identified. Implementation of the recommendations is a priority for all Laboratory managers."
"This thorough review did not find widespread abuse of the purchase card system," Browne said. "Nonetheless, it did identify transactions in four accounts totaling $2,800 that have been referred to the Department of Energy Inspector General for possible action against those who made what appear to be improper purchases. I will not tolerate abuse of the purchase card program regardless of the amount. We have terminated the employment of one individual who used a Laboratory purchase card for cash advances and gas and food purchases. As soon as the DOE/IG investigation of the other three accounts is complete, we will take whatever action is appropriate."
At Browne's request, former Department of Energy Inspector General John Layton, former Department of Labor Inspector General Charles Masten and a team of forensic accountants from the PricewaterhouseCoopers accounting firm reviewed all purchase card transactions from October 1, 1998 through June 30, 2002 – 170,000 transactions over 45 months valued at $120 million. The same team is continuing its review of other purchasing mechanisms, including purchase orders just-in-time contracts, and local vendors agreements. That report is expected in February 2003.
Following are the key findings and recommendations of the purchase card review and the actions taken by the Laboratory to date to address them:
- $3.78 million of purchases in accounts that had not been reconciled as required.
- Laboratory action and results to date: Of the $3.78 million in unreconciled accounts identified, all but $121,000 has now been reconciled.
- $790,000 in questionable transactions.
- Laboratory action and results to date: $20,000 in questionable transactions remains to be reviewed and justified.
- Disputed items were neither credited by the bank nor followed up by the cardholders in numerous instances; $316,000 in unresolved disputed items remained outstanding.
- Laboratory action and results to date: $175,000 in disputed charges remains to be resolved. /li>
In the words of the Layton report, "The corrective actions recently announced by LANL, along with implementation of the recommendations contained in the attached Report of Findings should provide for an enhanced control environment for the Purchase Card Program." The reference is to a number of policy and procedural changes mandated by Director Browne in August 2002. The changes reduce the number of purchase cards, reduce authorization limits available to cardholders; prohibit purchase of certain property controlled items through the use of purchase cards; and provide sanctions for failure to follow reconciliation and approval requirements.
Los Alamos National Laboratory is operated by the University of California for the National Nuclear Security Administration of the U.S. Department of Energy and works in partnership with NNSA's Sandia and Lawrence Livermore national laboratories to support NNSA in its mission.
Los Alamos enhances global security by ensuring the safety and reliability of the U.S. nuclear weapons stockpile, developing technical solutions to reduce the threat of weapons of mass destruction and solving problems related to energy, environment, infrastructure, health and national security concerns.
To read the Los Alamos National Laboratory External Review of the Purchase Card Program Report of Findings, go to http://www.lanl.gov/orgs/pa/newsbulletin/pdf/02-0139-LTattach.pdf online.
Los Alamos National Laboratory, a multidisciplinary research institution engaged in strategic science on behalf of national security, is operated by Los Alamos National Security, LLC, a team composed of Bechtel National, the University of California, The Babcock & Wilcox Company, and Washington Group International for the Department of Energy's National Nuclear Security Administration.
Los Alamos enhances national security by ensuring the safety and reliability of the U.S. nuclear stockpile, developing technologies to reduce threats from weapons of mass destruction, and solving problems related to energy, environment, infrastructure, health, and global security concerns.
