H.R. 8463

[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[H.R. 8463 Engrossed in House (EH)]

<DOC>

119th CONGRESS
2d Session
H. R. 8463

_______________________________________________________________________

AN ACT

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.

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 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--
``(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.
``(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.

Passed the House of Representatives June 8, 2026.

Attest:

Clerk.
119th CONGRESS

2d Session

H. R. 8463

_______________________________________________________________________

AN ACT

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.