I do not believe in distributing corporate credit cards to the management team or employees. Let me explain why. I have had two transactions with employees that have convinced me that if you own a company, it is not a wise decision to issue your employees a company credit card.
I was the President / CEO of a large corporation doing a turnaround when the first transaction occurred. The business was losing approximately $500,000 per month. During the first week when I started, I reviewed the company’s American Express invoice for the current month. The charges on the bill shocked me. The management team and the eight sales managers each had a company credit card.
Corporate Issued Credit Cards
One of the sales managers had a charge on his card for $12,000. I did not recognize the vendor who received the $12,000. I called the sales manager to my office to ask him about the charge. When he arrived and saw the AMEX bill on my desk, he looked distressed. He lowered his head and did not look up at me while he told me the story about the $12,000.
He and a client with the client’s management team went to a “gentlemen’s” club. They ended up in the VIP room with several “performers” to entertain them for a couple of hours. The client drank so much that he passed out and was taken away in an ambulance. My sales manager ended up paying the bill and used the company credit card because that was the only card he had with him with a high enough credit line to cover the $12,000 charge.
I asked him how and when he was going to reimburse the company for the AMEX charge. He said that he would bring me a check for the total amount the next morning. Even though I wanted to fire him immediately, I waited until the end of the pay period so I had the money refunded and his check cleared the bank.
Corporate Issued Credit Cards are a bad idea every time!
Two days later at the weekly management meeting, I had the CFO of the company collect all the AMEX cards from the managers, and the VP of Sales gathered the rest from his managers.
My name is Robert Curry, and I am an Author, CEO Coach, Keynote Speaker, and Turnaround Specialist. Over the past 20 years, I have worked with more than 70 companies taking their businesses from Loses to Profits.
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