[Congressional Record (Bound Edition), Volume 162 (2016), Part 7]
[House]
[Pages 9563-9565]
[From the U.S. Government Publishing Office, www.gpo.gov]




             FRAUD REDUCTION AND DATA ANALYTICS ACT OF 2015

  Mr. HURD of Texas. Mr. Speaker, I move to suspend the rules and pass 
the bill (S. 2133) to improve Federal agency financial and 
administrative controls and procedures to assess and mitigate fraud 
risks, and to improve Federal agencies' development and use of data 
analytics for the purpose of identifying, preventing, and responding to 
fraud, including improper payments.
  The Clerk read the title of the bill.
  The text of the bill is as follows:

                                S. 2133

       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 ``Fraud Reduction and Data 
     Analytics Act of 2015''.

     SEC. 2. DEFINITIONS.

       In this Act--
       (1) the term ``agency'' has the meaning given the term in 
     section 551 of title 5, United States Code; and
       (2) the term ``improper payment'' has the meaning given the 
     term in section 2(g) of the Improper Payments Information Act 
     of 2002 (31 U.S.C. 3321 note).

     SEC. 3. ESTABLISHMENT OF FINANCIAL AND ADMINISTRATIVE 
                   CONTROLS RELATING TO FRAUD AND IMPROPER 
                   PAYMENTS.

       (a) Guidelines.--

[[Page 9564]]

       (1) In general.--Not later than 90 days after the date of 
     enactment of this Act, the Director of the Office of 
     Management and Budget, in consultation with the Comptroller 
     General of the United States, shall establish guidelines for 
     agencies to establish financial and administrative controls 
     to identify and assess fraud risks and design and implement 
     control activities in order to prevent, detect, and respond 
     to fraud, including improper payments.
       (2) Contents.--The guidelines described in paragraph (1) 
     shall incorporate the leading practices identified in the 
     report published by the Government Accountability Office on 
     July 28, 2015, entitled ``Framework for Managing Fraud Risks 
     in Federal Programs''.
       (3) Modification.--The Director of the Office of Management 
     and Budget, in consultation with the Comptroller General of 
     the United States, may periodically modify the guidelines 
     described in paragraph (1) as the Director and Comptroller 
     General may determine necessary.
       (b) Requirements for Controls.--The financial and 
     administrative controls required to be established by 
     agencies under subsection (a) shall include--
       (1) conducting an evaluation of fraud risks and using a 
     risk-based approach to design and implement financial and 
     administrative control activities to mitigate identified 
     fraud risks;
       (2) collecting and analyzing data from reporting mechanisms 
     on detected fraud to monitor fraud trends and using that data 
     and information to continuously improve fraud prevention 
     controls; and
       (3) using the results of monitoring, evaluation, audits, 
     and investigations to improve fraud prevention, detection, 
     and response.
       (c) Reports.--
       (1) In general.--Except as provided in paragraph (2), for 
     each of the first 3 fiscal years beginning after the date of 
     enactment of this Act, each agency shall submit to Congress, 
     as part of the annual financial report of the agency, a 
     report on the progress of the agency in--
       (A) implementing--
       (i) the financial and administrative controls required to 
     be established under subsection (a);
       (ii) the fraud risk principle in the Standards for Internal 
     Control in the Federal Government; and
       (iii) Office of Management and Budget Circular A-123 with 
     respect to the leading practices for managing fraud risk;
       (B) identifying risks and vulnerabilities to fraud, 
     including with respect to payroll, beneficiary payments, 
     grants, large contracts, and purchase and travel cards; and
       (C) establishing strategies, procedures, and other steps to 
     curb fraud.
       (2) First report.--If the date of enactment of this Act is 
     less than 180 days before the date on which an agency is 
     required to submit the annual financial report of the agency, 
     the agency may submit the report required under paragraph (1) 
     as part of the following annual financial report of the 
     agency.

     SEC. 4. WORKING GROUP.

       (a) Establishment.--Not later than 180 days after the date 
     of enactment of this Act, the Office of Management and Budget 
     shall establish a working group to improve--
       (1) the sharing of financial and administrative controls 
     established under section 3(a) and other best practices and 
     techniques for detecting, preventing, and responding to 
     fraud, including improper payments; and
       (2) the sharing and development of data analytics 
     techniques.
       (b) Composition.--The working group established under 
     subsection (a) shall be composed of--
       (1) the Controller of the Office of Management and Budget, 
     who shall serve as Chairperson;
       (2) the Chief Financial Officer of each agency; and
       (3) any other party determined to be appropriate by the 
     Director of the Office of Management and Budget, which may 
     include the Chief Information Officer, the Chief Procurement 
     Officer, or the Chief Operating Officer of each agency.
       (c) Consultation.--The working group established under 
     subsection (a) shall consult with Offices of Inspectors 
     General and Federal and non-Federal experts on fraud risk 
     assessments, financial controls, and other relevant matters.
       (d) Meetings.--The working group established under 
     subsection (a) shall hold not fewer than 4 meetings per year.
       (e) Plan.--Not later than 270 days after the date of 
     enactment of this Act, the working group established under 
     subsection (a) shall submit to Congress a plan for the 
     establishment and use of a Federal interagency library of 
     data analytics and data sets, which can incorporate or 
     improve upon existing Federal resources and capacities, for 
     use by agencies and Offices of Inspectors General to 
     facilitate the detection, prevention, and recovery of fraud, 
     including improper payments.

  The SPEAKER pro tempore. Pursuant to the rule, the gentleman from 
Texas (Mr. Hurd) and the gentlewoman from Michigan (Mrs. Lawrence) each 
will control 20 minutes.
  The Chair recognizes the gentleman from Texas.


                             General Leave

  Mr. HURD 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 the bill under 
consideration.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Texas?
  There was no objection.
  Mr. HURD of Texas. Mr. Speaker, I yield myself such time as I may 
consume.
  Mr. Speaker, I rise in support of S. 2133, the Fraud Reduction and 
Data Analytics Act of 2015, introduced by Senator Thomas Carper of 
Delaware.
  S. 2133 is a bipartisan bill that will strengthen and enhance the 
antifraud prevention and detection measures used by Federal agencies. 
Current antifraud prevention and detection measures are reliant on 
after-the-fact reviews of transactions. This system is not perfect.
  A significant portion of the Federal Government's $124 billion in 
overpayments in fiscal year 2014--$19 billion more than fiscal year 
2013--were fraud-related.
  The current reactive antifraud measures require agencies to spend 
time and resources on efforts to track and recover these fraud-related 
overpayments. S. 2133 will help to prevent these fraudulent payments 
from being made in the first place.
  The Fraud Reduction and Data Analytics Act of 2015 will help protect 
taxpayer dollars by requiring the Office of Management and Budget, OMB, 
and Federal agencies to adopt proactive fraud detection controls and 
preventative measures.
  The bill will require the OMB to create a set of guidelines for 
antifraud measures, which agencies must utilize when establishing their 
proactive antifraud control and detection procedures. The bill will 
also require agencies to better collaborate on developing best 
practices for combating fraud.
  S. 2133 also requires that agencies create an interagency working 
group in order to share best practices and crucial fraud prevention 
data, such as the Social Security Administration's data to prevent 
payments to deceased individuals.
  Mr. Speaker, passing S. 2133 and requiring agencies to adopt a 
proactive antifraud approach will not only serve to protect taxpayer 
dollars, but increase public confidence in the administration of 
government programs, especially benefit programs.
  I would like to thank Senator Carper and Senator Thom Tillis for 
introducing this good government legislation, and I would like to thank 
the Subcommittee on Government Operations chairman Mark Meadows for 
championing this bill in the House.
  I urge Members to support this bipartisan bill.
  Mr. Speaker, I reserve the balance of my time.
  Mrs. LAWRENCE. Mr. Speaker, I yield myself such time as I may 
consume.
  Mr. Speaker, the Fraud Reduction and Data Analytics Act is designed 
to strengthen Federal agency efforts to combat financial fraud. 
Congress has passed a number of bills in the past few years aimed at 
curbing improper payments. Fraud in this area is especially harmful. It 
stems not from innocent mistakes, but from the willful intent to steal 
or misuse taxpayer dollars.
  Fraud reduction strategies help reduce these crimes, and the 
Government Accountability Office and the inspector general have 
recommended that agencies implement such strategies.
  The bill before us will require the Director of the Office of 
Management and Budget to consult with GAO to develop antifraud guidance 
for Federal agencies and then monitor the implementation of this 
guidance.
  The bill will also require the establishment of a working group of 
agency chief financial officers to share best practices and help 
disseminate new antifraud techniques. The working group would also be 
required to develop a plan for establishing an interagency library of 
analytical tools and datasets for agencies and IGs to use in fighting 
fraud.
  In developing this plan, I believe the working group should look to 
the

[[Page 9565]]

model of the Recovery Operations Center, which was developed to monitor 
spending under the Recovery Act of 2009, and which has, unfortunately, 
ceased operations.
  These are commonsense steps toward solving a serious problem that 
everyone should support. I urge members to support S. 2133.
  Mr. Speaker, I reserve the balance of my time.
  Mr. HURD of Texas. Mr. Speaker, I yield 5 minutes to the gentleman 
from North Carolina (Mr. Meadows), the chairman of the Subcommittee on 
Government Operations.
  Mr. MEADOWS. I thank Chairman Hurd for his leadership not only on 
this, but on so many important topics here in this body. He certainly 
is looking after transparency and oversight on behalf of the American 
people. I just would like to applaud his leadership there.

                              {time}  1630

  I am proud today, Mr. Speaker, to rise in support of S. 2133, the 
Fraud Reduction and Data Analytics Act of 2015. S. 2133 is a bipartisan 
bill that will provide agencies a critically important measure for 
defeating fraud and protecting taxpayer dollars.
  In fiscal year 2014, the GAO reported that a significant portion of 
the $124 billion in improper payments were related to fraud. To make 
matters worse, all the improper payments increased by a total of $19 
billion--that is billion with a B--from the previous fiscal year.
  Given the cost of these improper payments to agencies and, as a 
result, to the taxpayers, something must be done to block the flow of 
these fraudulent and improper payments. S. 2133 will provide the 
necessary framework around which agencies can build a strong antifraud 
defense system.
  Currently, agencies have been overreliant on an after-the-fact 
antifraud detection measure which requires the agency to review 
payments after they have been made and then make an attempt to recoup 
them. S. 2113 actually would require these agencies to develop 
proactive measures to identify risk, to analyze known cases of fraud, 
and then to develop strategies to prevent future fraud. It will also 
protect the American taxpayer dollars from fraud by requiring agencies 
to better share data that can be used to fight fraud.
  This bill will create a working group of agencies where best 
practices and fraud detection and prevention strategies can be shared 
throughout the government. By combating fraud, agencies will not only 
protect taxpayer dollars, but also increase the trust and confidence in 
the administration of government programs.
  I would like to thank Senator Carper and Senator Tillis for 
introducing this important, good-government legislation, and I urge my 
colleagues to support this bill and help better protect the American 
taxpayer dollars by voting in favor of S. 2133.
  Mrs. LAWRENCE. Mr. Speaker, I have no additional speakers, and I 
yield back the balance of my time.
  Mr. HURD of Texas. Mr. Speaker, I urge adoption of this bill, and 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. Hurd) that the House suspend the rules and 
pass the bill, S. 2133.
  The question was taken; and (two-thirds being in the affirmative) the 
rules were suspended and the bill was passed.
  A motion to reconsider was laid on the table.

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