1. Purchasing Card Reviewer Training

2. We will cover: Cardholder Responsibilities Cardholder Responsibilities Restrictions Restrictions Purchases Requiring Approval Purchases Requiring Approval Changes to Cardholder Information Changes to Cardholder Information Reviewer’s Responsibilities Reviewer’s Responsibilities Establishing the Review Process Establishing the Review Process Leaving the Department Leaving the Department Location of Forms Location of Forms Purchasing Card Fraud Purchasing Card Fraud Contact Information Contact Information

3. Cardholder’s Responsibilities

4. Making only authorized purchases Making only authorized purchases Obtaining a detailed receipt for each purchase Obtaining a detailed receipt for each purchase Completing the transaction log with a brief description justifying the purchase Completing the transaction log with a brief description justifying the purchase Reconciling the monthly Visa statement Reconciling the monthly Visa statement Resolving any discrepancies Resolving any discrepancies

5. Cardholder’s Responsibilities (con’t) Ensuring credits are received Ensuring credits are received Documenting furniture and food purchases as required Documenting furniture and food purchases as required Signing the log Signing the log Passing the paperwork to assigned Reviewer for approval in a timely manner Passing the paperwork to assigned Reviewer for approval in a timely manner Note: Reallocation of charges may be the responsibility of the cardholder, but this decision is made at the department level. Note: Reallocation of charges may be the responsibility of the cardholder, but this decision is made at the department level.

6. Reconcile Monthly VISA Statement Compare VISA statement to transaction log and resolve any discrepancies in a timely manner Compare VISA statement to transaction log and resolve any discrepancies in a timely manner Keep all receipts and related paperwork (VISA statement, signed transaction log) together Keep all receipts and related paperwork (VISA statement, signed transaction log) together Forward entire package to reviewer within 3 days of completion Forward entire package to reviewer within 3 days of completion

7. Restrictions

8. Restrictions at Point of Sale These transactions will be declined by the bank: Purchases exceeding the single purchase limit or monthly credit limit Purchases exceeding the single purchase limit or monthly credit limit Cash advances Cash advances Restrictions by merchant category Restrictions by merchant category Travel (Hotels, Airfare, Car Rentals) Travel (Hotels, Airfare, Car Rentals) Restaurants, liquor stores Restaurants, liquor stores Entertainment, recreational services Entertainment, recreational services Personal services such as photographic studios, funeral services Personal services such as photographic studios, funeral services

9. State and University Restrictions These transactions may not automatically decline, but are not allowed. They will be monitored for compliance through the review policy These transactions may not automatically decline, but are not allowed. They will be monitored for compliance through the review policy Personal purchases Personal purchases Cash Equivalents (ex. Gift Cards) Cash Equivalents (ex. Gift Cards) Gifts, contributions, and donations (such as alcohol and flowers) Gifts, contributions, and donations (such as alcohol and flowers) Alcohol for any purpose Alcohol for any purpose Allowing someone else to use the card Allowing someone else to use the card

10. State and University Restrictions (con’t) Personally accepting kickbacks or incentives Personally accepting kickbacks or incentives Entertainment (costs of social activities and related incidental costs such as meals, beverages, lodging, transportation, and gratuities) Entertainment (costs of social activities and related incidental costs such as meals, beverages, lodging, transportation, and gratuities) Stringing purchases to avoid limit of delegated authority ($5,000) Stringing purchases to avoid limit of delegated authority ($5,000)

11. State and University Restrictions (con’t) Services provided by an unincorporated vendor (applies to services only – these vendors must be incorporated) Services provided by an unincorporated vendor (applies to services only – these vendors must be incorporated) Food purchases must be well documented with the name and purpose of the function and who attended it, by name or affiliation. Costs for alcoholic beverages are not to be included under any circumstance. Food purchases must be well documented with the name and purpose of the function and who attended it, by name or affiliation. Costs for alcoholic beverages are not to be included under any circumstance.

12. Purchases Requiring Additional Approval Licenses, contracts, and agreements must be sent to Procurement & Supply for approval. Cardholders are not authorized signatories for the University Licenses, contracts, and agreements must be sent to Procurement & Supply for approval. Cardholders are not authorized signatories for the University Telecommunications equipment (antenna, satellite installations, 2-way radios) require approval from OIT/NTS Telecommunications equipment (antenna, satellite installations, 2-way radios) require approval from OIT/NTS Purchase of hazardous materials must be generated through Environmental Safety Purchase of hazardous materials must be generated through Environmental Safety Modifications to building structure must be approved by and coordinated through Facilities Management Modifications to building structure must be approved by and coordinated through Facilities Management

13. Purchases Requiring Additional Approval (con’t) Purchase of furniture (must be purchased from MCE, or must be documented on Potential Business for MCE form) Purchase of furniture (must be purchased from MCE, or must be documented on Potential Business for MCE form) All Contract and Grant funds shall be in compliance with the associated terms of the contract or grant All Contract and Grant funds shall be in compliance with the associated terms of the contract or grant Food purchases must be well documented with the name and purpose of the function and who attended it, by name or affiliation. Food purchases must be well documented with the name and purpose of the function and who attended it, by name or affiliation.

14. Changes to Cardholder Information Request changes using Account Maintenance Request Form (available online) Request changes using Account Maintenance Request Form (available online) Cardholder Name or Address Change Cardholder Name or Address Change Default FRS Account Change Default FRS Account Change Cancel Card Cancel Card Single Purchase or Monthly Credit Limit Change (as a minimum, requires department head approval) Single Purchase or Monthly Credit Limit Change (as a minimum, requires department head approval)

15. No Transactions in a Billing Period? Logs do not have to be approved Logs do not have to be approved Credit card statements will not be sent Credit card statements will not be sent Review process is not required Review process is not required

16. Reviewer’s Responsibilities

17. Reviewer is the cardholder’s immediate supervisor or someone within the cardholder’s chain of command Reviewer is the cardholder’s immediate supervisor or someone within the cardholder’s chain of command Reviewers are required to ensure that charges are valid, authorized, are within UM Purchasing Card policy and procedures, and are appropriately documented Reviewers are required to ensure that charges are valid, authorized, are within UM Purchasing Card policy and procedures, and are appropriately documented A Reviewer may not review his/her own transactions A Reviewer may not review his/her own transactions

18. Reviewer’s Responsibilities (con’t) At the end of each billing period, the Reviewer is required to: At the end of each billing period, the Reviewer is required to: Review the transaction log to ensure all entries are authorized Review the transaction log to ensure all entries are authorized Ensure detailed receipt matches the transaction and description of purchase Ensure detailed receipt matches the transaction and description of purchase Confirm each transaction is authorized and in compliance with UM policies and procedures Confirm each transaction is authorized and in compliance with UM policies and procedures Confirm that no one other than the cardholder gained access to the card information Confirm that no one other than the cardholder gained access to the card information

19. Reviewer’s Responsibilities (con’t) Sign the monthly transaction log for all cardholders for whom they review, certifying all transactions are authorized and that policy and procedures have been followed Sign the monthly transaction log for all cardholders for whom they review, certifying all transactions are authorized and that policy and procedures have been followed Electronically sign off verifying the review has been completed (procedures located at http://www.purchase.umd.edu/general/ pcardresponsibilites.html) Electronically sign off verifying the review has been completed (procedures located at http://www.purchase.umd.edu/general/ pcardresponsibilites.html)

20. Reviewer’s Responsibilities (con’t) Retain the records in chronological order in the department’s business office, and securely maintain the files. Retain the records in chronological order in the department’s business office, and securely maintain the files. Ensure Contract and Grant funds are spent within the contract or grant guidelines. Ensure Contract and Grant funds are spent within the contract or grant guidelines. Note: Reviewers will receive an email notification each month reminding them that the review is due. Note: Reviewers will receive an email notification each month reminding them that the review is due. Ensure cards are cancelled when a cardholder leaves the University or the department Ensure cards are cancelled when a cardholder leaves the University or the department

21. Establishing the Review Process

22. Departments may require pre- authorization prior to cardholder making a purchase Departments may require pre- authorization prior to cardholder making a purchase Some departments have established procedures (check with your Business Office) Some departments have established procedures (check with your Business Office)

23. Establishing the Review Process (con’t) You may have an administrative person perform initial review of records: You may have an administrative person perform initial review of records: Ensure a detailed receipt is in the file, and that the receipt matches the description on the log Ensure a detailed receipt is in the file, and that the receipt matches the description on the log Reconcile credit card statement to the transaction log Reconcile credit card statement to the transaction log Place receipts in same order as listed on the log and statement Place receipts in same order as listed on the log and statement

24. Establishing the Review Process (con’t) Ask Questions – have a clear understanding of why the purchase was made and who authorized it. Ask Questions – have a clear understanding of why the purchase was made and who authorized it. Only the Reviewer (supervisor) can: Only the Reviewer (supervisor) can: Certify that transactions are authorized (have you reviewed the receipt?) Certify that transactions are authorized (have you reviewed the receipt?) Sign the actual transaction log Sign the actual transaction log

25. Leaving the Department?

26. If the cardholder leaves the department If the cardholder leaves the department Cardholder or Reviewer Notifies the Delegated Procurement Team by submitting an Account Maintenance Form Cardholder or Reviewer Notifies the Delegated Procurement Team by submitting an Account Maintenance Form Reviewer shreds the card and discards it Reviewer shreds the card and discards it Reviewer performs complete assessment of all transactions Reviewer performs complete assessment of all transactions

27. Leaving the Department? (con’t) Reviewer to conduct an exit review of departing cardholder’s transactions Reviewer to conduct an exit review of departing cardholder’s transactions Ensure sensitive equipment (computers, digital cameras, etc.) are tagged in inventory Ensure sensitive equipment (computers, digital cameras, etc.) are tagged in inventory Take another look at all records Take another look at all records Trust everyone – review anyway Trust everyone – review anyway

28. Leaving the Department? (con’t) If the Reviewer leaves the department If the Reviewer leaves the department Another reviewer must be assigned to each cardholder Another reviewer must be assigned to each cardholder Complete a Reviewer Access Request form Complete a Reviewer Access Request form Removing the previous reviewer Removing the previous reviewer Assigning a new reviewer Assigning a new reviewer Submit form to Delegated Procurement Team Submit form to Delegated Procurement Team

29. Forms All forms associated with the Purchasing Card are available online at All forms associated with the Purchasing Card are available online at www.purchase.umd.edu www.purchase.umd.edu

30. Purchasing Card Fraud

31. What is Fraud? A deception deliberately practiced in order to secure unfair or unlawful personal gain What Fraud is Not MisuseNegligence

32. Misuse Restricted purchases made for the institution - not for personal gain Restricted purchases made for the institution - not for personal gain Examples of misuse include: Examples of misuse include: Purchasing restricted goods and services (ie. Travel on a travel restricted card) Purchasing restricted goods and services (ie. Travel on a travel restricted card) Intentionally splitting a purchase to circumvent delegated authority (either by the initiative of cardholder or departmental authority) Intentionally splitting a purchase to circumvent delegated authority (either by the initiative of cardholder or departmental authority) Paying unfair and unreasonable prices, not making good business decisions Paying unfair and unreasonable prices, not making good business decisions Allowing someone else to use the card Allowing someone else to use the card

33. Negligence Sloppy recordkeeping - not for personal gain Sloppy recordkeeping - not for personal gain Unsecured record retention Unsecured record retention Lack of one receipt Lack of one receipt Missing statements Missing statements Lack of additionally required documentation Lack of additionally required documentation

34. Consequences of Misuse and Negligence Report misuse and negligence to Delegated Procurement Team Report misuse and negligence to Delegated Procurement Team Institute the “3 strikes, you’re out” rule Institute the “3 strikes, you’re out” rule Suspend card until cardholder attends another training (becomes HR issue) Suspend card until cardholder attends another training (becomes HR issue) Cancel the card (coordinate with Delegated Procurement Team) Cancel the card (coordinate with Delegated Procurement Team)

35. Back to Fraud Why does fraud occur? Why does fraud occur? How does fraud occur? How does fraud occur?

36. Why Does Fraud Occur? Inattentive Reviewers - cardholders won’t take the risk if they know their transactions are carefully reviewed Inattentive Reviewers - cardholders won’t take the risk if they know their transactions are carefully reviewed Fraud is a premeditated, calculated act to defraud institution Fraud is a premeditated, calculated act to defraud institution Crime of necessity (personal financial need) Crime of necessity (personal financial need) Crime of passion (desperation) Crime of passion (desperation) Incident of bad judgment Incident of bad judgment Program Weaknesses Program Weaknesses

37. Program Weaknesses Department unnecessarily has too many cardholders Department unnecessarily has too many cardholders Reviewers responsible for too many cardholders Reviewers responsible for too many cardholders Insufficient training Insufficient training Faltering Reviewer (very dangerous as this is the first line of defense) Faltering Reviewer (very dangerous as this is the first line of defense) We must have proper mechanisms installed to detect and halt fraud We must have proper mechanisms installed to detect and halt fraud

38. How Does Fraud Occur? Services paid for, but not received by the University (usually involves two individuals) Services paid for, but not received by the University (usually involves two individuals) Personal purchases made, and removed from institution’s property or shipped to another location Personal purchases made, and removed from institution’s property or shipped to another location Personal purchases made in combination with authorized goods/services Personal purchases made in combination with authorized goods/services

39. Consequences of Fraud Restitution Restitution Loss of Leave Time Loss of Leave Time Suspension and/or Termination of Employment Suspension and/or Termination of Employment Fines Fines Criminal Prosecution Criminal Prosecution

40. Review, Review, Review Reviewers are the University’s first line of defense against purchasing card fraud. Purchasing card fraud is often a symptom of a bigger personnel issue. If you suspect purchasing card fraud, contact the Delegated Procurement Team Immediately.

41. Contact Information *Send an email to pcard@umd.edu to certify completion of reviewer training* pcard@umd.edu Contact the Delegated Procurement Team Voice Mail(301) 405-5834 FAX (301) 314-1352 Emailpcard@umd.edu pcard@umd.edu