Federal agencies have been told to tighten their controls over the charge cards they issue to their employees for travel and relatively minor purchases and to make sure their policies provide for discipline up to dismissal for misusing the cards.

An Office of Management and Budget memo issued Friday carries out a law passed a year ago in response to years of congressional hearings and investigative reports into improper spending.

Some federal employees are issued purchase cards to buy commercial goods and services whose value falls below requirements for formal contracting procedures, and the agencies pay the bills directly, according to a Senate report written while the bill was under consideration. Employees use government travel cards to pay for official travel expenses; the bill might be sent to the employee, who pays it and is reimbursed, or the card issuer may bill the government directly.

“The lack of adequate management has led to the waste of millions of dollars in taxpayer money on fraudulent, questionable or unnecessarily expensive purchases,” the report said, citing Government Accountability Office reports stretching over a decade. “Additionally, late or non-payment of travel card bills by federal employees triggers contractual provisions allowing the vendor banks to reduce rebates, causing the government to forfeit millions of dollars in lost rebates.”

The Government Charge Card Abuse Prevention Act requires agencies to annually certify that they have certain controls in place or that they are taking corrective actions to lessen the risk of fraud and other inappropriate uses of the cards. The OMB memo said that those controls are to include verifying that charges paid directly by the government are not also reimbursed to an employee and assuring that the government gets refunds on unused or only partially used travel tickets.

It said agencies also must have policies to “deter employee misuse” of the cards, including dunning salaries to recover improper charges and disciplinary actions, which “should include dismissal, as appropriate.”

Agencies with more than $10 million in purchase card spending will have to report annually on any violations and the actions they took in response. In addition, agency inspectors general will have to conduct risk assessments at least annually.

In some cases the new policies will become part of previously ordered requirements.