WASHINGTON - Education Secretary Rod Paige said he will appoint an eight-person "strike team" to address waste, fraud and errors in the Education Department, promising to deliver "a clean audit" in 18 months.

In the final three years of the Clinton administration, the Education Department lost track of $450 million, the department's chief inspector said earlier this month, prompting one Republican lawmaker to liken the agency's financial practices to those of "a Third World republic."

The department, which has a $44.5 billion budget and manages billions more in student loans, said poor oversight resulted in several instances in which money was stolen or improperly spent, and others in which checks for grants were duplicated or money was never distributed.

Paige yesterday announced the formation of a team made up of senior staff that will spend the next three months looking into the agency's financial practices. Paige said he will report the results in three months, with a prediction that the auditing firm of Ernst and Young will give the department "the Good Housekeeping Seal of Approval" by the fall of 2002.

Paige said he would urge President Bush to appoint a chief financial officer for the department, a position that he said has been vacant for two years, and choose an assistant secretary for management.

In an April 3 report to the House Education and Workforce investigations subcommittee, auditors said a review showed that 21 employees could write checks of up to $10,000 without supervision. A review of department finances from May 1998 to September 2000 found that 19,000 of these checks were written, totaling $23 million.

The audit also found that as of October, about 230 employees had government credit cards in their names, including 36 workers who could charge up to $25,000 per month and two who could charge up to $300,000 per month.