[Congressional Record Volume 172, Number 96 (Monday, June 8, 2026)]
[House]
[Pages H3919-H3923]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
PRE-PAYMENT FRAUD PREVENTION AND TREASURY DATA ACCESS ACT
Mr. GILL of Texas. Mr. Speaker, I move to suspend the rules and pass
the bill (H.R. 8463) to establish governmentwide requirements for pre-
payment fraud prevention actions, to provide the U.S. Treasury
appropriate data resources, to facilitate participation in
governmentwide anti-fraud data sharing, and for other purposes, as
amended.
The Clerk read the title of the bill.
The text of the bill is as follows:
H.R. 8463
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Pre-Payment Fraud Prevention
and Treasury Data Access Act''.
SEC. 2. PRE-PAYMENT FRAUD PREVENTION REQUIREMENTS FOR
AGENCIES.
(a) Establishment of Pre-payment Agency Responsibilities.--
(1) Amendment.--Chapter 33 of title 31, United States Code,
is amended by inserting after section 3325 the following:
``Sec. 3325a. Agency duties for fraud and improper payment
prevention before the issuance of a payment voucher request
``(a) Mandatory Actions Before Issuing a Payment Voucher.--
The head of an agency, or an officer or employee described in
section 3325(a)(1(B), may not certify a voucher under section
3325 until the following requirements are met:
``(1) Each pre-certification requirement described in
subsection (b) for such payment request.
``(2) Confirmation is provided that the payment complies
with any disbursement requirement and instruction, including
any pre-certification requirement, published by the Secretary
of the Treasury.
``(3) Confirmation is provided that any other appropriate
payment, account, and payee validation program or service
that the Secretary of the Treasury, in consultation with the
Director, requires to reduce fraud and an improper payment
resulting in financial loss to the Government, including any
agency evaluation of the fraud-risk indicator of a program
required under section 3352 and agency procedures required
under section 3554(b)(1), have been conducted, in accordance
with necessary exceptions for statutory, policy, or
operational reasons.
``(b) Payment Verification Pre-certification
Requirements.--Not later than 180 days after the date of the
enactment of this section, and as needed thereafter, the
Secretary of the Treasury shall, in consultation with the
Director of the Office of Management and Budget, issue
regulations, and guidance as necessary, for the pre-
certification requirements of this section, for vouchers
certified under section 3325, including any deadline for pre-
certification information and related records to be submitted
to the requisite Treasury official and disbursing official
under subchapter IV of this chapter, before the date of
disbursement in order to allow for sufficient time to meet
the requirements of this section, including the following:
``(1) Funds are available at the time the obligation is
incurred and if an obligation is incurred when funds are not
available, then the agency may not certify the payment
voucher.
``(2) The amount of the payment and the name of the payee
on the payment voucher are correct, in conformance with the
prescribed standard format.
``(3) A valid social security number, taxpayer
identification number, employer identification number,
individual taxpayer identification number, or payee ID number
is provided for each payee on the voucher, if applicable.
``(4) The appropriation or fund from which the payment will
be made is available for the purpose described in the voucher
and indicated with the appropriate Treasury Account Symbol or
Business Event Type Code.
``(5) A payee is not deceased, if the payment would be
improperly made to a deceased payee.
``(6) The account number, if any, provided on the payment
voucher is held at a financial institution and is open,
valid, and belongs to the payee or a valid designee of the
payee.
``(7) Any other identifier in conformance with the payment
verification pre-certification requirements established by
the Secretary of the Treasury, which may include the
Procurement Instrument Identified and the Federal Award
Identification Number.
``(c) Return of Payment Voucher.--The Secretary, in
consultation with the Director, shall issue guidance and
establish procedures to authorize the Chief Disbursing
Officer of the Department of the Treasury, or an agency
disbursing official, to return to the relevant agency
certifying official, including a notification to the agency,
any payment or payment voucher issued under section 3325
which does not comply with pre-certification
[[Page H3920]]
verification requirements established under this section as
determined by the Secretary.
``(d) Agency Requests for Exemptions.--The Secretary of the
Treasury shall include in the regulations issued under
subsection (b), or in other regulations or guidance issued
under this chapter, a process for agencies to request
exemptions from some or all of the payment verification
requirements for specific payments or categories of payments
under this section, which shall include a requirement for the
agency to provide a plan and reasonable timeframe to
remediate the need for the exemption. Any approved exemption
shall be documented in any related payment voucher certified
under section 3325 for the duration of the exemption.''.
(2) Technical and conforming amendment.--The table of
sections for chapter 33 of title 31, United States Code, is
amended by inserting after the item for section 3325 the
following:
``3325a. Agency duties for fraud and improper payment prevention before
the issuance of a payment voucher request.''.
(b) Amendment to Responsibilities of Agency Certifying
Official for Payment Vouchers.--Section 3528(a) of title 31,
United States Code, is amended--
(1) in paragraph (2), by inserting after ``of this title''
the following: ``, including pre-certification requirements
described in section 3325a'';
(2) by redesignating paragraphs (4) and (5) as paragraphs
(5) and (6), respectively; and
(3) by inserting after paragraph (3) the following:
``(4) Ensuring that--
``(A) the agency has complied with the requirements of
section 3325a and subchapter IV of this title; and
``(B) a covered recipient is in compliance with the
reporting requirements under section 6107.''.
(c) Prepayment Requirements of Payment Disbursing
Officials.--Section 3325 of title 31, United States Code, is
amended--
(1) in subsection (d) by striking ``taxpayer identifying
number of each person'' and inserting ``information required
to be submitted under section 3325a(b) of each payee''; and
(2) by adding at the end the following:
``(e)(1) Before certifying a voucher to a disbursing
official, the head of an agency or an officer or employee of
an agency described in subparagraph (A) or (B) of subsection
(a)(1), as applicable, shall take necessary actions to
accurately disburse payments to the recipients of those
payments, including by--
``(A) verifying the accuracy of the bank account
information to which a payment is to be disbursed, to the
extent practicable; and
``(B) comparing the bank account information of the
proposed recipient to other payment records available to the
agency, to the extent practicable.
``(2) The Secretary of the Treasury shall issue guidance to
carry out this subsection, which may be carried out through
any guidance issued for section 3325a(b).''.
(d) Addition of Fraud Prevention Indicators to Agency
Improper Payment Risk Assessments.--
(1) Definitions amendments.--Section 3351 of title 31,
United States Code is amended--
(A) in paragraph (3)--
(i) in the heading, by striking ``initiative'' and
inserting ``system'';
(ii) by striking ``Initiative'' and inserting ``System'';
and
(iii) by striking ``initiative'' and inserting ``system'';
and
(B) by adding at the end the following (and by
redesignating and moving the paragraphs to appear in
alphabetical order):
``(9) Appropriate authorizing and appropriations committees
of congress.--The term `appropriate authorizing and
appropriations committees of Congress' means the following:
``(A) The Committees on Appropriations of the Senate and
the House of Representatives.
``(B) The Committee on Homeland Security and Governmental
Affairs of the Senate.
``(C) The Committee on Oversight and Government Reform of
the House of Representatives.
``(D) The Budget Committee of the House of Representatives
and the Committee on the Budget of the Senate.
``(D) Any other relevant congressional committee of
jurisdiction.
``(10) Director.--The term `Director' means the Director of
the Office of Management and Budget.
``(11) Fraud-risk indicator.--The term `fraud-risk
indicator' means an objective data point or analytic signal
that indicates an anomalous payment pattern or increase in
the volume of a payment amount, a verified data mismatch,
network or behavioral anomaly, or match identified by the Do
Not Pay system and any other payment, account, and payee
validation program or service provided by the Department of
the Treasury that would result in financial loss to the
Government.''.
(2) Amendment.--Section 3352(a)(1) of title 31, United
States Code, is amended--
(A) in subparagraph (A), by striking ``; and'' and
inserting a semicolon;
(B) in subparagraph (B), by striking the period at the end
and inserting ``; and''; and
(C) by adding at the end the following:
``(C) design and apply fraud-risk indicators to the
programs identified under paragraph (A).''.
SEC. 3. TREASURY DO NOT PAY SYSTEM.
(a) Amendment.--Section 3354 of title 31, United States
Code, is amended--
(1) in the heading, by striking ``Initiative'' and
inserting ``system'';
(2) in subsection (a)--
(A) by amending paragraph (1) to read as follows:
``(1) In general.--The head of each executive agency shall
establish and maintain appropriate preaward and prepayment
procedures to prevent and recover improper payments,
including payments resulting in financial loss to the
Government, and to prevent financial fraud. Such procedures
shall include, at a minimum--
``(A) screening all persons or entities that receive, or
seek to receive, Federal awards or payments against all
appropriate Do Not Pay system data assets, including data
assets described in paragraph (2)(a), and risk tools before
an award is made or a payment request is submitted to the
disbursing officer in accordance with section 3325a; and
``(B) a periodic review of available data assets and
notification to the Secretary of any data asset that the
agency requires access to, either directly or through the Do
Not Pay system.'';
(B) in paragraph (2), by striking ``At a minimum and before
issuing any payment or award, each executive agency shall
review as appropriate the following databases to verify
eligibility of the payment and award:'' and inserting the
following: ``Consistent with the routine use authority under
section 552a of title 5, and subject to the requirements of
paragraphs (3) and (6), the Secretary shall have access to
the following data assets for the purposes described in
paragraph (1):''; and
(C) by adding at the end the following:
``(3) Publication of data assets; additional data assets.--
``(A) Publication of data assets.--The Secretary shall
publish and maintain a System of Records Notice for the Do
Not Pay system that identifies each data asset, the routine
uses under which the data asset is disclosed from that system
of record, the specific permitted purposes, and the access
controls applicable to each data asset. A data asset may not
be disclosed from the Do Not Pay system before publication of
the applicable routine uses in the relevant System of Records
Notice.
``(B) Designation.--The Secretary, in consultation with the
Director, may designate additional categories of data assets
for inclusion in the Do Not Pay system that substantially
assist agencies in carrying out the requirements of paragraph
(1).
``(C) Privacy and notice.--In designating data assets that
include personally identifiable information, law enforcement
sensitive information, or information subject to section 552a
of title 5, the Secretary shall--
``(i) act in coordination with the Director of the Office
of Management and Budget; and
``(ii) provide public notice and an opportunity for comment
for not less than 15 days prior to designation.
``(D) Database inclusion.--Following designation of a
category of data assets under subparagraph (B), the Secretary
shall provide public notice and an opportunity for comment
for not less than 30 days before adding any specific data
asset within such category.
``(E) Non-sensitive data.--Data assets that do not include
personally identifiable information, law enforcement
sensitive information, or information subject to section 552a
of title 5 may be added at the discretion of the Secretary
without designation if a list of such data assets is
disclosed to the public on a public website maintained by the
Department of the Treasury.
``(4) Treatment of data matching for purposes of agency use
of do not pay system.--For purposes of section 552a of title
5, or any other provision of law, a computerized comparison
of two or more automated Federal systems of records, or a
computerized comparison of a Federal system of records with
other records or non-Federal records, carried out by the
Secretary to verify payments or identify or recover improper
payments under this section shall not be considered a
matching program if such match-based inquiry is conducted in
strict adherence to the limitations of use under paragraph
(5), returns a binary verification response, resulting data
is not retained by the agency for more than 30 days in order
to address the immediate award eligibility or payment
verification determination, and contains not more than 20
discrete record requests at a time for a particular agency
program.
``(5) Limitation on use.--
``(A) In general.--Information obtained through the Do Not
Pay system may be used solely for the purposes described in
paragraph (1), or for Federal or State law enforcement or
investigative purposes and any officer, employee, contractor,
subcontractor, or agent of a Federal or State entity may not
publish, examine for a purpose not explicitly authorized
under this section, or communicate such information furnished
in such data assets other than in fulfillment of the purposes
of this section.
``(B) Implementation of system.--The Do Not Pay system
shall be implemented in a manner to strictly provide match-
based queries that return only limited responses derived from
the data submitted by any individual described in
subparagraph (A) with the minimum data exchanged and retained
in order to conduct the verification match and any associated
responsibility under section 552a(p) of title 5, if--
[[Page H3921]]
``(i) such responses to match-based queries are limited to
a confirmation or denial of a match, the level of confidence
in a match, the data sources that informed the match, and
other administrative metadata or the minimum additional data
elements necessary to achieve the purposes described in
paragraph (1); and
``(ii) any individual described in subparagraph (A) is
prohibited from retrieving, browsing, making repeated and
tailored match-based inquiries with the intention of
reconstituting the underlying record in another system, or
otherwise accessing any underlying record maintained in the
Do Not Pay system under subsection (a)(2) beyond the
information necessary to resolve a match-based query solely
for the purposes described in paragraph (1).
``(C) Individuals accessing information.--Any individual
described in subparagraph (A)--
``(i) may not take an adverse action against any individual
based solely upon the information obtained under such
subparagraph;
``(ii) shall take additional independent steps to verify
the eligibility of a benefit recipient before taking any
adverse action, when necessary or appropriate or when
required by applicable law; and
``(iii) shall make an independent judgment regarding the
decision to certify a payment for disbursement or pursue
recovery of a potentially improper payment.
``(6) Confidentiality maintenance.--The Secretary shall
maintain, with respect to each data asset obtained through
the Do Not Pay system, the same level of confidentiality
required by the law governing the source of that data asset.
Information obtained from a data asset may only be used for
purposes for which the source statute authorizes disclosure,
and access to such information shall be limited to persons
and entities for whom the source statute authorizes access.
The Secretary shall document, in the System of Records Notice
required under paragraph (2), the specific confidentiality
obligations applicable to each data asset and the means by
which Treasury ensures compliance.
``(7) Penalty for unlawful disclosure.--Any individual
described in paragraph (5)(A) who knowingly and willfully
discloses information in violation of paragraph (5) shall be
fined not more than $250,000, imprisoned not more than 5
years, or both.
``(8) Exception when payment otherwise required under
law.--The head of an executive agency may be exempt from the
requirements of paragraph (1) if a Federal statute expressly
requires that a payment or award be made notwithstanding
potential ineligibility, and the agency head notifies the
Secretary of the Treasury and the Director of the Office of
Management and Budget prior to certification of the payment
under section 3325.
``(9) Definition.--In this section, the term `data asset'
has the meaning given that term in section 3502(17) of title
44.'';
(3) by striking subsections (b) through (c) and inserting
the following:
``(b) Establishment of System.--The Secretary of the
Treasury shall establish and maintain a Do Not Pay system,
which shall be administered and operated by the Fiscal
Service of the Department of the Treasury. The Do Not Pay
system shall include--
``(1) the data assets described in subsection (a)(2); and
``(2) such other data assets as the Secretary of the
Treasury may designate, in consultation with the Director of
the Office of Management and Budget, to assist agencies in
carrying out subsection (a)(1).
``(c) State and Other Governmental Use.--
``(1) In general.--Each State and local government
administering a federally funded program, and any contractor,
subcontractor, or agent thereof, including State and local
government auditors, shall have access to the Do Not Pay
system to review preaward and prepayment data in order to
prevent and recover improper payments, including payments
resulting in financial loss to the Government, and to prevent
financial fraud if procedures are established regarding--
``(A) the screening of persons or entities that receive, or
seek to receive Federal awards or payments against
appropriate Do Not Pay system data assets, including data
assets described in subsection (a)(2), and risk tools before
an award is made or a payment request is submitted to the
disbursing officer; and
``(B) periodic review of available data assets and
notification to the Secretary of any data asset that the
agency requires access to, either directly or through the Do
Not Pay system.
``(2) Other governmental use.--The judicial and legislative
branches of the United States (as defined in section 202(e)
of title 18) shall have access to the Do Not Pay system
strictly for purposes of verifying eligibility for payments
and preventing fraud and improper payments as authorized
under subsection (a)(1).
``(3) Privacy requirements.--The Director, in coordination
with the Secretary, shall issue regulations implementing this
section, including establishing privacy and other
requirements applicable to such access and disclosure,
consistent with section 552a of title 5.
``(d) Quarterly Report.--The Secretary, in consultation
with the Director, shall submit to the appropriate
authorizing and appropriations committees of Congress
quarterly reports on the governmentwide operation of the Do
Not Pay system, which may be included as part of another
report submitted to Congress by the Secretary, and which
shall include the following:
``(1) Performance measures for monitoring the effectiveness
of the system in reducing improper payments.
``(2) Information on the frequency of corrections and
identification of erroneous data.
``(3) Recommendations for legislative or administrative
action to enhance the operations of the system.
``(4) An assessment of agency, State, and local compliance
with the requirements of this section, including a listing of
all memorandums established with the head of an agency under
subsection (a)(4) that documents agency use of the Do Not Pay
system.
``(e) Evaluation.--Not less than annually, the Evaluation
Officer of the agency, as designated under section 313 of
title 5, shall provide the appropriate authorization and
appropriations committees of Congress an evaluation of the Do
Not Pay system, including the best available estimate of the
effectiveness of the system in reducing fraud and improper
payments that lead to financial loss of the Government in
agency programs on a monthly and regional basis for such
program. The evaluation shall include an analysis of which
data sources maintained by the Do Not Pay system are
attributed to identifying or reducing instances of likely
fraudulent or improper payments by count and total dollar
savings value to the Government.
``(f) Continuity and Transition.--
``(1) Continuation of previous system if necessary.--The Do
Not Pay initiative in effect on the day before the date of
the enactment of this section shall continue as necessary to
support implementation of the Do Not Pay system.
``(2) Guidance, rules, and procedures.--Guidance, rules,
and procedures in effect before the date of the enactment of
this section shall remain in effect until modified by the
Secretary or the Director of the Office of Management and
Budget.
``(3) Rules of construction.--Nothing in this subsection
may be construed--
``(A) except as specifically provided in subsection (a)(4),
to modify or supersede the requirements of section 552a of
title 5, including the requirements for notice in section
552a(e)(12) and for due process rights of an individual under
section 552a(p); or
``(B) to limit any authority of an Inspector General under
applicable law.'';
(4) in subsection (d)--
(A) in paragraph (1)(C)--
(i) in clause (i), by striking ``3 years'' and inserting
``5 years''; and
(ii) in clause (ii), by striking ``3 years'' and inserting
``5 years'';
(B) by redesignating paragraphs (2) through (4) as
paragraphs (3) through (5), respectively; and
(C) by inserting after paragraph (1) the following:
``(2) Voluntary expedited process for computer matching by
executive agencies for purposes of using the do not pay
system.--
``(A) In general.--In accordance with section 552a of title
5 (commonly known as the `Privacy Act of 1974'), the head of
each executive agency may enter into an expedited process for
establishing a computer matching agreement with the head of
another executive agency for the purposes of ongoing and
automated data matching with the Do Not Pay system for
purposes under this section in order to assist in the
detection and prevention of fraudulent and improper payments.
``(B) Requirement for use of computer matching agreement
template.--Not later than 180 days after the effective date
of this section, the Director, in coordination with the
Secretary of the Treasury, shall establish a standard
computer matching agreement template for the Do Not Pay
system which shall authorize an agency that adopts the
standard template to be deemed to have satisfied the
requirements of section 552a(o) of title 5 upon execution of
the agreement without the need for review by a Data Integrity
Board established under section 552a(u) of title 5.
``(C) Requirement for federal record notices and
publication.--The standard computer matching agreement
template described under paragraph (B), and any future
modification to the template, shall be published in the
Federal Register by the Secretary of the Treasury 30-days
prior to putting any such template or modification of such
template into effect. On a quarterly basis the Secretary of
the Treasury shall publish in the Federal Register a
consolidated listing of each computer matching agreement
using the standardized template under paragraph (B) and
maintain on a publicly available website all active computer
matching agreements using such template or the process under
paragraph (1) that shall include the agency name, data assets
covered, authorized purposes, and date of the agreement. The
consolidated quarterly listing under this subparagraph shall
satisfy the matching program notice requirements of section
552a(e)(12) of title 5 for each computer matching agreement
using the standardized template under paragraph (B), and no
separate Federal Register publication under section
552a(e)(12) shall be required of any agency participating in
such an agreement.
[[Page H3922]]
``(D) Termination date.--An agreement under this
paragraph--
``(i) shall have a termination date of less than 5 years;
and
``(ii) during the 3-month period ending on the date on
which the agreement is scheduled to terminate, may be renewed
by each executive agency that entered into the agreement for
not more than 5 years if the head of the agency attests to
the Secretary of the Treasury and the Director of the Office
of Management and Budget that the agreement is not being
modified.
``(E) Requirement for omb guidance.--Not later than 180
days after the effective date of this section, the Director
of the Office of Management and Budget, in consultation with
the Secretary of the Treasury, shall issue guidance,
including the computer matching agreement template, to
implement this paragraph.
``(F) Multiple agencies.--For purposes of this paragraph,
section 552a(o)(1) of title 5 shall be applied by
substituting `between the source agency and the recipient
agency or non-Federal agency or an agreement governing
multiple agencies' for `between the source agency and the
recipient agency or non-Federal agency' in the matter
preceding subparagraph (A).''; and
(5) by striking subsection (e).
(b) Technical and Conforming Amendment.--The item relating
to section 3354 in the table of sections for chapter 33 of
title 31, United States Code, is amended, by striking
``Initiative'' and inserting ``system''.
SEC. 4. SINGLE REPORT ON FIRST TIME USE OF FUNDS BY
RECIPIENT.
(a) Establishment of Post-award Single Report Requirement
on First-time Use of Funds by Recipient of Federal Award.--
Chapter 61 of title 31, United States Code, is amended by
adding at the end the following:
``Sec. 6107. Single report on first time use of funds by
recipient
``(a) Federal Award Reporting Requirement.--The head of
each agency that administers a covered award shall require
each covered recipient to, as a condition of receiving
amounts under such award, submit to the head of the agency,
not later than 180 days after the receipt of such award
unless a deadline exception may be applied pursuant to
pursuant to regulations promulgated under subsection (b), a
one-time report on the use of such amounts that--
``(1) includes any content required to be included in such
report pursuant to subsection (b); and
``(2) is in the format required under such subsection.
``(b) Governmentwide Report Regulations and Guidance.--
``(1) Contents and format of report.--
``(A) Promulgation.--Not later than 1 year after the date
of the enactment of this section, the Director, in
coordination with the Secretary of the Treasury and the
standard-setting agency designated under section 6402(a)(1),
shall promulgate regulations, and any clarifying guidance as
may be necessary, to establish governmentwide requirements
for the content and format of the report described under
subsection (a).
``(B) Updates.--Any guidance or regulation promulgated
under subparagraph (A) shall be updated as necessary, but in
any case, shall be updated not less often than once every 5
years.
``(2) Report minimum requirements.--The regulations and any
clarifying guidance promulgated under paragraph (1), shall at
a minimum--
``(A) enable the head of an awarding agency to determine
whether amounts provided under a covered award are being used
by the recipient required to submit the report, and any sub-
recipient or sub-grantee thereof, for the intended purpose of
the program, as set forth in statute, regulation, or policies
and procedures of the agency;
``(B) enable fraud prevention, detection, investigation,
and mitigation, in future awards of Federal funds to the
recipient required to submit the report by identifying
relevant fraud-risk indicators that would require a referral
for investigation and criminal referral to the appropriate
entity of the Federal Government, including any identified
effort by a recipient to defraud the Federal Government or
violate sections 3729 through 3731 of title 31 (commonly
referred to as the `False Claims Act');
``(C) ensure that any sub-recipient or sub-grantee, at any
level, of the recipient required to submit the report provide
to such recipient such information as may be necessary to
enable aggregate reporting on the covered award by the
recipient;
``(D) require the heads of agencies to apply the
governmentwide data standards established under chapter 64
with respect to the format and content of the report required
to be submitted;
``(E) align with the Federal award reporting requirements
and data standards under the Federal Funding Accountability
and Transparency Act of 2006 (Public Law 109-282; 31 U.S.C.
6101 note), to the maximum extent practicable;
``(F) reduce recipient and agency reporting burdens by
avoiding duplication in recipient reporting obligations, to
the extent practicable; and
``(G) provide clarification for agencies to apply a
reporting deadline exception under subsection (a)(1), which
may be made for an entire program or type of covered award,
beyond 180 days when the use of the covered funds by the
covered recipient takes place more than 180 days after a
receipt of such covered award.
``(c) Agency Requirements.--In accordance with the
regulations and any clarifying guidance promulgated under
subsection (b), the head of an agency that administers a
covered award shall--
``(1) update the terms and conditions of Federal awards in
the agency programs to implement subsection (a) for covered
recipients;
``(2) include a summary of the post-award reporting
requirements established under subsection (a), including the
required content and reporting format, in the Notice of
Funding Opportunity (which has the meaning given the term in
section 200.1 of title 2, Code of Federal Regulations) for
Federal financial assistance (as defined under section 7501
of this title) in order to assist applicants for such
assistance in understanding post-award reporting obligations;
``(3) to the maximum extent practicable--
``(A) provide user-friendly and plain language directives
for covered recipients to fulfill their reporting obligation
under subsection (a); and
``(B) use existing post-award reporting requirements to
reduce the burden of cumulative post-award reporting; and
``(4) establish procedures within the agency to identify
covered recipients that are not in compliance with the
reporting requirement under subsection (a).
``(d) Noncompliance.--For a case in which a covered
recipient does not submit the report required by subsection
(a), the awarding agency shall--
``(1) provide a timely written notice of noncompliance to
the recipient that--
``(A) clearly states the reason for noncompliance;
``(B) notifies the recipient of the obligation of the
agency to cease further disbursements to the entity until the
covered recipient is in compliance; and
``(C) provides clear instructions to the covered recipient
on how to come back into compliance; and
``(2) prevent a payment voucher from being issued under
section 3325 for a payment to such recipient for funds
related to the particular program for which the report was
required, until such report is submitted.
``(e) Availability of Report.--Each report submitted under
subsection (a) shall be--
``(1) kept on file by the agency for a period of not less
than 5 years after the date on the conclusion of the duration
of the award; and
``(2) made available upon request to--
``(A) the Director;
``(B) the Secretary of the Treasury;
``(C) the Attorney General;
``(D) the Inspector General of the agency concerned; and
``(E) the appropriate congressional committees.
``(f) Use of Information Included in Report.--Information
included in the report required by subsection (a) shall be
used by the agency in support of improper payment activities
of the agency under section 3352 as appropriate and
applicable.
``(g) Definitions.--In this section:
``(1) Appropriate congressional committees.--The term
`appropriate congressional committees' means--
``(A) the Committees on Appropriations of the Senate and
the House of Representatives;
``(B) the Committee on Homeland Security and Governmental
Affairs of the Senate;
``(C) the Committee on Oversight and Government Reform of
the House of Representatives; and
``(D) any other relevant congressional committee of
jurisdiction.
``(2) Covered award.--The term `covered award' means a
Federal award (as defined under section 7501) in an amount
not less than $50,000 (based on fiscal year 2027 constant
dollars).
``(3) Covered recipient.--The term `covered recipient'
means any entity, including any State, the District of
Columbia, and any territory or possession of the United
States, including a pass-through entity (as defined under
section 7501), that receives the covered award from a
particular agency program for the first time in that
program's existence.
``(4) Fraud-risk indicator.--The term `fraud-risk
indicator' means an objective data point or analytic signal
that indicates an anomalous payment pattern or increase in
the volume of a payment amount, a verified data mismatch,
network or behavioral anomaly, or match identified by the Do
Not Pay system and any other payment, account, and payee
validation program or service provided by the Department of
the Treasury that would result in financial loss to the
government.''.
(b) Technical and Conforming Amendment.--The table of
sections for chapter 61 of title 31, United States Code, is
amended, by adding at the end the following:
``6107. Single report on first time use of funds by recipient.''.
(c) Clarification of Application of First Reporting
Deadline.--The report required under subsection (a) of
section 6107 of title 31, United States Code, as added by
subsection (a), shall apply to a covered award made during
the fiscal year following the promulgation of regulations or
guidance by the Director under subsection (b)(1)(A) of such
section.
SEC. 5. EFFECTIVE DATE.
This Act and the amendments made by this Act shall take
effect on the date that is 180 days after the date of the
enactment of this Act.
[[Page H3923]]
The SPEAKER pro tempore. Pursuant to the rule, the gentleman from
Texas (Mr. Gill) and the gentleman from Virginia (Mr. Subramanyam) each
will control 20 minutes.
The Chair recognizes the gentleman from Texas.
General Leave
Mr. GILL of Texas. Mr. Speaker, I ask unanimous consent that all
Members may have 5 legislative days in which to revise and extend their
remarks and include extraneous material on this measure.
The SPEAKER pro tempore. Is there objection to the request of the
gentleman from Texas?
There was no objection.
Mr. GILL of Texas. Mr. Speaker, I yield to the gentleman from
Kentucky (Mr. Comer) such time as he may consume.
Mr. COMER. Mr. Speaker, I rise in support of H.R. 8463, the Pre-
Payment Fraud Prevention and Treasury Data Access Act.
Every year, the Federal Government loses hundreds of billions of
dollars to fraud and improper payments.
The Government Accountability Office estimates that the Federal
Government has lost over $2.8 trillion since 2003 to payments that
should never have been made or were made incorrectly.
Annual improper payments ballooned to nearly $236 billion in fiscal
year 2023, more than six times the amount in 2003.
The Government Accountability Office also estimates that the Federal
Government loses between $233 billion and $521 billion annually to
fraud across government programs.
Fraud at these levels costs each tax filer, on average, between
$1,000 and $3,000 per year. These losses should alarm each one of us
and call us to action. The American taxpayer is covering the bill for
fraud while criminals get rich.
This bill takes meaningful steps to mitigate this problem by
meaningfully curbing fraudulent payments and improper payments before
funds go out the door and are lost forever.
The Pre-Payment Fraud Prevention and Treasury Data Access Act
enhances and expands government financial integrity controls by
requiring anti-fraud risk evaluations to identify suspicious payments
before agencies request a payment be issued by the U.S. Treasury.
These reforms are centered around increasing the use and
effectiveness of the Treasury's existing Do Not Pay system. It is
currently only utilized by a mere 4 percent of eligible programs across
the government.
This bill will address the procedural hurdles agencies face in using
the system and bring agencies into compliance with their required anti-
fraud checks.
The bill also lowers barriers for the Treasury to bring additional
nonsensitive datasets into the Do Not Pay system.
This legislation was drafted in coordination with privacy
stakeholders to ensure appropriate data protection safeguards for
personal and sensitive information.
The reforms in this legislation are commonsense and long overdue.
I thank House Oversight and Government Reform Committee Ranking
Member Garcia and his staff for working together with us to ensure such
crucial legislation could advance on a bipartisan basis.
Mr. Speaker, I think we have a strong bill that will truly make a
meaningful difference for the financial and program integrity of the
U.S. Government. I encourage my colleagues to support this bipartisan
reform bill.
Mr. SUBRAMANYAM. Mr. Speaker, I also rise in support of H.R. 8463,
the Pre-Payment Fraud Prevention and Treasury Data Access Act.
This bill will help prevent improper payments by requiring that
agencies verify with the U.S. Treasury that payments are going to the
right place before they are made. Agencies would be required to use the
Treasury's Do Not Pay system to confirm that recipients, one, have a
valid Social Security number; two, are not deceased; and, three, have a
valid bank account.
The bill would also impose heavy fines for any misuse of the Do Not
Pay system.
This is a commonsense change, and I urge my colleagues to join me in
supporting this bill.
Mr. Speaker, I reserve the balance of my time.
Mr. GILL of Texas. Mr. Speaker, I rise in support of H.R. 8463, the
Pre-Payment Fraud Prevention and Treasury Data Access Act. I have no
further speakers. I am prepared to close, and I reserve the balance of
my time.
Mr. SUBRAMANYAM. Mr. Speaker, I am prepared to close, as well.
Mr. Speaker, I urge my colleagues to support this bill, H.R. 8463. I
congratulate the chair and ranking member on their bipartisan work, and
I yield back the balance of my time.
Mr. GILL of Texas. Mr. Speaker, I yield myself the balance of my
time.
Mr. Speaker, I encourage my colleagues to support H.R. 8463, the Pre-
Payment Fraud Prevention and Treasury Data Access Act.
As Chairman Comer, the bill's sponsor, explained, this legislation
enhances and expands the government's financial integrity controls by
codifying agency pre-payment anti-fraud risk evaluations.
This will help identify suspicious payments before they are sent out
the door, stopping fraudulent or improper payments before they happen.
In fiscal year 2025, the U.S. Treasury Department reported that they
have helped agencies and States prevent and recover over $11 billion in
fraudulent and improper payments. They have done this by using existing
tools such as the Do Not Pay system.
However, as the chairman explained, these systems are being
drastically underutilized by Federal agencies and are in need of
certain reforms. We can only imagine the additional savings that H.R.
8463's reforms will help achieve by increasing the pre-payment fraud
prevention activities of Federal agencies and increasing the
utilization of the Do Not Pay system.
I encourage my colleagues to support the bipartisan H.R. 8463 so we
can protect taxpayers, ensure proper program integrity, and prevent
fraud before it happens.
Mr. Speaker, I yield back the balance of my time.
The SPEAKER pro tempore. The question is on the motion offered by the
gentleman from Texas (Mr. Gill) that the House suspend the rules and
pass the bill, H.R. 8463, as amended.
The question was taken; and (two-thirds being in the affirmative) the
rules were suspended and the bill, as amended, was passed.
A motion to reconsider was laid on the table.
____________________