Postal Service:

Conditions Leading to Problems in Some Major Purchases

GGD-96-59: Published: Jan 18, 1996. Publicly Released: Jan 18, 1996.

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Pursuant to a congressional request, GAO reviewed whether changes are needed in the Postal Service's purchasing program, focusing on whether: (1) certain problem purchases were due to some underlying causes that should be addressed through legislation; and (2) the Service should implement additional procedural safeguards to minimize future occurrences of such problems.

GAO found that: (1) the problems encountered during the seven purchases reviewed were due to Postal officials' poor judgment, circumventions of existing internal controls, and failure to resolve conflicts of interest; (2) many contracting officers could not exercise independent judgment, since they reported directly to those officials who required the products or services; (3) the Service has taken action to increase oversight and accountability over its purchasing process and to safeguard against such future occurrences; (4) in response to recommendations by the Office of Government Ethics, the Service has outlined actions it is taking to improve its ethics program which should help prevent the recurrence of such purchasing problems; (5) a formal ethics education and training program for contracting officers and personnel is underway; (6) the Service has established one purchasing executive with management authority over the three separate Postal purchasing groups; and (7) the Service plans to adopt a requirement for more explicit documentation of and rationale for contracting officers' business and policy actions.

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