The VA Office of Inspector General (OIG) substantiated an allegation that purchase cardholders at the VA St. Louis Health Care System (System) split purchases to install fire stops (building and fire protection features designed to minimize the effects of fire, smoke, and heat) at its facilities. The OIG found that out of 268 purchases made with a vendor in 2014 and 2015, purchase cardholders made 25 split purchases for the installation of fire stops valued at about $61,000. The OIG identified an additional 153 split purchases made with the same vendor for unrelated construction work valued at approximately $364,000. The OIG found that 211 of the 268 purchases also exceeded the $2,000 micro-purchase threshold for construction acquisitions. Of the 211 purchases that exceeded the micro-purchase threshold, 154 transactions were also split purchases. The value of the remaining 57 purchases exceeding the micro-purchase was approximately $139,000. In total, the OIG identified 235 purchases valued at about $564,000 that were unauthorized commitments and improper payments. The Federal Acquisition Regulation (FAR) requires project leaders to obtain competitive bids for purchases over a certain amount, but employees were following guidance from the System’s Accounting Department that was in direct conflict with FAR requirements and annual purchase card training. Because of these conflicts, System cardholders and approving officials did not have a clear understanding of what represented a split purchase. The OIG made three recommendations, including submitting ratification requests for the improper purchases, providing additional training on how to avoid split purchases and comply with micro-purchase thresholds, and establishing a rigorous monitoring mechanism to identify and prevent improper purchase card transactions.
St. Louis, MO
United States
