What happens in Vegas doesn’t stay in Vegas, according to a new audit of how federal military workers use their government-issued travel credit cards.

From lap dances to slots, federal workers rang up more than $1 million for personal use on their government credit cards. That those charges didn’t immediately raise eyebrows at the Department of Defense (DoD) indicates that some officials may regard such services as just another perk of working for the government.

The cardholders reportedly ultimately were not reimbursed for these expenses (they pay the bill for their government cards and are then reimbursed), so in the long run taxpayers were not charged for lap dances or evenings at the roulette wheel. But, according to rules, government employees are not permitted to use government credit cards for any personal use at all, even if they know that the government is unlikely to reimburse them.

The Pentagon inspector general released an audit recently that revealed Pentagon workers swiped their government issued credit cards at casinos and for “adult entertainment” at such genteel establishments as Larry Flynt’s Hustler’s Club. Over a 12-month period, DoD cardholders spent $952,258 in more than 4,400 transactions at casinos. This is out of $3.2 million in charges (the majority of which appear to be legit and for official use). They spent another nearly $100,000 at strip clubs and other adult entertainment establishments.

The audit report recommendations that the card vendor, Citibank, block usage of those government credit cards at such places. Not surprisingly, gaming industry representatives and those representing adult nightclubs welcome military dollars at their establishments and disagree and are hoping that the DoD will ignore these recommendations.  After all, they claim there are many “legitimate business-related expenses” that occur at their facilities. They think a blanket ban on using government credit cards at their establishments would infringe on the workers’ constitutional right of freedom to go to strip clubs and privacy.

MilitaryTimes has more on this story:

A Navy SEAL traveling to El Paso on official duty recently visited several strip clubs, laid down his official government credit card and spent a total of more than $1,000 at adult entertainment establishment during his 17 days of travel.

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In a report released Tuesday, the IG documented widespread abuse of military credit cards for personal use and repeated failure of DoD's detection system for flagging potential abuse of taxpayers' dollars.

In response, Pentagon officials emphasized that Government Travel Cards are issued to, billed to and paid for by the employees who hold them. The improper charges flagged by the IG were not reimbursed by the Defense Department and taxpayers sustained no losses, because individual employees are ultimately responsible for paying the balances for any outstanding charges with out-of-pocket cash.

Nevertheless, the IG noted, standard rules restrict government credit cards to use for official business.

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To identify wrongful spending in its investigation, the IG used the Visa IntelliLink Compliance Management system, a service in which the Visa company provides data on credit card transactions for businesses and others to use in identifying improper charges.

The IG recommended that the Defense Department adopt policies requiring its agencies to use this Visa service, according to the report.

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Defense Department spokesman Lt. Cmdr. Nate Christensen told Military Times that the IG report overstated the problems with the Government Charge Card program.

"The report language applies a very broad stroke against all cardholders when, in reality, personal use of the Government Travel Charge Card is negligible when compared to the size and scope of the program," Christensen said.

Overstating the problem? Negligible? That the DoD thinks this report is over-stating the problems is indicative of a lax approach to how government workers use the resources they are given. While in the long-run, taxpayers aren’t footing the bill, in the short-run, we are. Currently, the system waits for workers to reimburse the expenses. What happens if they forget a month or two? The agencies overseeing credit cards didn’t detect the improper transactions and unless a worker identified it. Whether it’s $1 million or $1 billion, misuse should not be tolerated.

The AG has made recommendations that seem reasonable and set expectations on what will be tolerated. Why can’t workers whip out there personal cards for their lap dance after they’ve settled up their bill for dinner or for their hotel room? Perhaps it’s convenience or perhaps because they don’t want a strip club expense to pop up on their personal credit statement.

A perk of work travel is the ability to use your personal money and time to explore a new area. That’s fine within reason. The problem is whether there are systems in place to ensure that workers are honestly stewards of government resources and use them for legitimate work expenses and not having fun on our dime.