HOUSTON (KTRK) --HISD employees abused or misused district-issued credit cards with hundreds of transactions flaunting procurement card rules, according to an internal audit made public Monday.
A key problem: While card purchases are limited to $1,000 per transaction, 68 percent of purchases reviewed appear to have circumnavigated that rule by breaking up the transactions into separate purchases.
"It's a very high percentage," HISD chief auditor Richard Patton said at the school board's audit committee meeting.
For example, one card user racked up a $4,000 bill on a restaurant trip, asking the restaurant to break the bill into four, separate $1,000 tabs to get around the $1,000-per-purchase rule.
"That person is just dishonest," Audit Committee Chairwoman Jolanda Jones said.
Other findings include:
- Cardholders made 541 purchases totaling $181,885 from prohibited or restricted vendors. This does not necessarily point to an illegal purchase, officials noted, but rather purchases from stores that have not applied to do business with the district.
- Purchases totaling $11,770 were "unallowable," with cards used to buy food, entertainment and gifts using money earmarked for low-income kids.
- Purchases were not reviewed on time, meaning that a giant bill of $584,400 was due at the end of the year. Not checking purchases in a timely manner increases the "risk of fraud and misuse of funds," according to the audit.
- Some "unauthorized, prohibited, or inappropriate" purchases were made by cardholders, according to the audit. That includes seven transactions totaling $4,552 and three purchases totaling $552 that the audit said "correspond to a misappropriation of funds/personal transactions."
HISD has policies in place that address misuse and appropriation of district-issued cards -- called "Procards" -- via a 96-page user's manual, relying on a stated policy for failure to comply with guidelines. Employees can get their cards taken away if misuse is found, and the district may punish employees further if the abuses are egregious, officials said.
The audit team examined transactions between January 15 and May 15, 2015. As part of the review, 110 transactions were examined.
HISD administrators promised fixes to the problems uncovered by their audit team.
Editor's note: This report has been corrected and was re-published 1:22 pm Aug. 18.