When a party runs out of toilet paper, a poo-ragger is one who will use a hand towel in lou of lack of TP. After using the hand towel the poo-ragger will through the crumpled mess into a corner in the bathroom and deny that the aforementioned event ever happened.
Friend: Dude what is that smell?
Friend 2: Idk dude... Wait is that a poo-rag in the corner.
Friend: It totally is. Shit, who knew there was a poo-ragger at the party last night...