H.R. 8464

[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[H.R. 8464 Engrossed in House (EH)]

<DOC>

119th CONGRESS
2d Session
H. R. 8464

_______________________________________________________________________

AN ACT

To amend title 31, United States Code, to authorize pausing and 
segmenting payments, 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 ``Stopping Fraudulent Payments Act''.

SEC. 2. AUTHORITY TO PAUSE PAYMENTS FOR FURTHER REVIEW AND CORRECTIVE 
ACTION.

(a) Treasury Payment Voucher Waiver Authority.--
(1) Amendment.--Subchapter II of chapter 33 of title 31, 
United States Code, is amended by adding at the end the 
following:
``Sec. 3337. Authority to pause payments for further review and 
corrective action
``(a) Agency Obligation to Pause Disbursement Requests for 
Corrective Action.--The head of an agency shall take a corrective 
action to temporarily delay, condition, or segment a disbursement 
request before the certification of a payment voucher under section 
3325 if, as determined by an official designated by the head of the 
agency, the agency--
``(1) has sufficient reason to determine that the payment 
presents an elevated risk of fraud based on a fraud-risk 
indicator or an improper payment resulting in financial loss to 
the Government as estimated under the requirements of section 
3352 in accordance with the statutorily-defined eligibility 
requirements or other legally-established condition of the 
program for a payee to be eligible to receive payment;
``(2) has sufficient reason to determine, based on a 
notification by the relevant State or local government official 
in the case of a payment from Federal funds disbursed by a 
State or local government under a State-administered and 
federally-funded program, that the payment presents an elevated 
risk of fraud based on a fraud-risk indicator or an improper 
payment resulting in financial loss to the Government as 
estimated under the requirements of section 3352 in accordance 
with the statutorily-defined eligibility requirements or other 
legally-established condition of the program for a payee to be 
eligible to receive payment; or
``(3) has been notified of an order from the Secretary of 
the Treasury described under subsection (b).
``(b) Treasury Obligation to Return Payment Voucher and Issue 
Corrective Action Order.--Except where otherwise required by law, the 
Secretary shall promptly notify the relevant certifying official of an 
order to return a certified payment voucher submitted to a disbursing 
official under section 3325 and issue a corrective action order to the 
head of an agency not later than 2 days after the Secretary makes a 
determination that in accordance with the statutorily-defined 
eligibility requirements or other legally-established condition of the 
program for a payee to be eligible to receive payment that such payment 
presents an elevated risk of fraud based on a fraud-risk indicator or 
an improper payment resulting in financial loss to the Government based 
on an output of the Do Not Pay system under section 3354.
``(c) Agency Documentation and Time-limited Corrective Action.--An 
action taken by the head of an agency under subsection (a) shall--
``(1) be based on an objective, documented fraud-risk 
indicator;
``(2) be narrowly applied to the portion of the payment 
presenting the elevated risk; and
``(3) be limited in duration to the minimum period 
necessary, as determined by the head of the agency, to verify 
eligibility of the payee or accuracy of the payment per any 
program requirement associated with the payment or as 
stipulated under law.
``(d) Payee Notification and Time Limit of Paused Disbursement 
Requests.--With respect to a disbursement request that has been 
delayed, conditioned, or segmented pursuant to subsection (a) or a 
payment voucher that is returned pursuant subsection (b), the head of 
the agency shall take the following actions:
``(1) Promptly provide to the payee (not later than 2 days 
after a determination under subsection (a) or a notification to 
the agency under subsection (b)), as appropriate, and for a 
case in which the payment from Federal funds disbursed by a 
State or local government under a State-administered and 
federally-funded program also provides to such relevant State 
or local government official, a notification that--
``(A) a disbursement has been temporarily paused, 
conditioned, or segmented;
``(B) identifies the nature of the fraud-risk 
indicator or improper payment relied upon by the agency 
to make the corrective action determination under 
subsection (a) or notification to the agency under 
subsection (b); and
``(C) outlines the process for the corrective 
action review period.
``(2) Use a process tailored to the specific requirements 
and design of the agency program for a payee, or the State or 
local government described under paragraph (1), to contest any 
factual inaccuracy or provide clarifying information during the 
corrective action review period.
``(3) Issue such payment not later than 30 days after a 
determination to take a corrective action is made by the head 
of the agency under subsection (a) or the agency was notified 
by the Secretary under subsection (b) of a corrective action 
order, but not later than 7 days after the date on which the 
payee contests the corrective action under the process 
established pursuant to paragraph (2), if the head of the 
agency determines that the payment does not present an elevated 
risk of fraud or an improper payment resulting in financial 
loss to the Government.
``(e) Segmentation of Low-risk Payments.--To the maximum extent 
practicable, the head of each agency shall allow a routine, 
historically consistent payment amount to proceed while temporarily 
holding an anomalous, unusually large, or high-risk portion of a 
payment, or class of payments, pending review and resolution of an 
agency corrective action determination under subsection (a) or a 
corrective action order under subsection (b).
``(f) Exemptions for Law Enforcement Activities.--The head of an 
agency, in consultation with the Secretary and the Attorney General, 
may waive any provision in this section on a case-by-case basis if 
notified of or instructed by a Federal law enforcement authority, 
including an agency Inspector General, that the action will jeopardize 
an active criminal investigation or legal proceeding related to an 
effort to defraud the Federal Government or violate sections 3729 
through 3733 of title 31 (commonly known as the `False Claims Act').
``(g) Limitation of Liability.--No officer or employee of the 
Federal Government shall be personally liable for an action taken in 
good faith under this section. An action taken under this section may 
not constitute a final determination of eligibility, liability, or 
wrongdoing on the part of a payee.
``(h) Rule of Construction for Program Authorizing Statute.--
Nothing in this section may be construed to supersede any other 
provision of law with respect to any statute that authorizes the 
payment or program the payment is made under.
``(i) Regulations.--Not later than 180 days after the date of the 
enactment of this section, and annually thereafter, the Secretary, in 
consultation with the Director, shall issue regulations and establish 
procedures to administer the requirements of this section that shall be 
published in the Federal Register that, at a minimum, specify the 
following:
``(1) The minimum seniority of an agency official 
designated under subsection (a) authorized to make a 
determination to issue a corrective action.
``(2) The procedures by which the Secretary of the Treasury 
will use the Do Not Pay system under section 3354 to make a 
determination under subsection (b) in accordance with the 
statutorily-defined eligibility requirements or other legally-
established condition of a program for a payee to be eligible 
to receive payment.
``(3) The procedure for an agency to dispute an order to 
return a certified payment voucher and appeal a related 
corrective action order under subsection (b) to the Fiscal 
Assistant Secretary, which shall at a minimum include a 
requirement for the agency to receive a response not later than 
five days after making such a dispute or appeal to the 
Department of the Treasury.
``(4) The minimum information requirements of a 
notification required under subsection (d)(1).
``(j) Definitions.--In this section:
``(1) Director.--The term `Director' means the Director of 
the Office of Management and Budget.
``(2) 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 under section 3354 and any payment, account, or payee 
validation program or service administered by the Secretary 
that would result in financial loss to the Government.
``(3) Routine, historically consistent payment amount.--The 
term `routine, historically consistent payment amount' means a 
payment amount that is consistent with previous payment history 
of the payee, established program use patterns, or other 
objective benchmarks determined by the certifying agency.
``(4) Secretary.--The term `Secretary' means the Secretary 
of the Treasury.''.
(2) Technical and conforming amendment.--The table of 
sections for chapter 33 of title 31, United States Codes, is 
amended by inserting after the item for section 3336 the 
following:

``3337. Authority to pause payments for further review and 
corrective action.''.
(b) Requirements and Authorities of Payment Disbursing Officials.--
Paragraph (3) of section 3325(a) of title 31, United States Code, is 
amended--
(1) by inserting ``, compliance with an order to pause a 
payment pursuant to section 3337(b),'' after ``except for the 
correctness of computations on a voucher''; and
(2) by striking ``,,'' and inserting a comma.
(c) Relief of Accountable Officers.--Section 3527 of title 31, 
United States Code, is amended--
(1) in subsection (a)(2), by inserting after ``the loss or 
deficiency was not the result of an illegal or incorrect 
payment'' the following: ``, or was made as a result of a good 
faith effort to comply with the requirements of section 3337''; 
and
(2) in subsection (b)(1)(A)(ii), by inserting after ``the 
loss or deficiency was not the result of an illegal or 
incorrect payment'' the following: ``, or was made as a result 
of a good faith effort to comply with the requirements of 
section 3337''.
(d) Requirements and Authorities of Payment Certifying Officials.--
Subsection (a) of section 3528 of title 31, United States Code, is 
amended--
(1) in paragraph (4)(C), by striking ``; and'' and 
inserting a semicolon;
(2) in paragraph (5), by striking the period at the end and 
inserting ``; and''; and
(3) by adding at the end the following
``(6) complying with an order to take a corrective action 
to temporarily delay, condition, or segment a disbursement 
request pursuant to section 3337.''.
(e) Relief of Certifying Officials.--Subsection (b)(1) of section 
3528 of title 31, United States Code--
(1) in subparagraph (A), by striking ``; or'' and inserting 
a semicolon;
(2) in subparagraph (B)(iii), by striking the period at the 
end and inserting ``; or''; and
(3) by inserting at the end the following new subparagraph:
``(C) the certification was made as a result of a good 
faith effort to comply with the requirements of section 
3337.''.
(f) Report on Results of Payments Paused for Further Review and 
Corrective Action.--Not later than 18 months after the date of the 
enactment of this Act, and annually thereafter, the Secretary of the 
Treasury shall submit to the Director of the Office of Management and 
Budget, the Committees on Appropriations of the Senate and the House of 
Representatives, the Committee on Homeland Security and Governmental 
Affairs of the Senate, and the Committee on Oversight and Government 
Reform of the House of Representatives, a report on the following:
(1) The total number of orders to return a certified 
payment voucher submitted to a disbursing official under 
section 3325 of title 31, United States Code, and corrective 
action orders issued to the head of an agency under the 
authorities provided by section 3337(b) of such title, as added 
by this section.
(2) The percentage of such payments that are issued by the 
agency, including by successful contestations filed by the 
recipient or payee with the agency, and recommendations to 
mitigate such errors in the fraud-risk indicators of the 
Department of the Treasury in the future.
(3) The total savings to the Federal Government in payments 
determined to be fraudulent or result in financial loss to the 
Government under the authorities provided by subsections (a) 
and (b) of section 3337 of title 31, United States Code, as 
added by this section.
(4) Any necessary policy, regulatory, or legislative 
recommendations related to the authorities and requirements 
under section of section 3337 of title 31, United States Code, 
as added by this section, or other relevant law.
(g) Effective Date.--The amendments made by this section shall take 
effect 1 year after the date of the enactment of this Act.

Passed the House of Representatives June 10, 2026.

Attest:

Clerk.
119th CONGRESS

2d Session

H. R. 8464

_______________________________________________________________________

AN ACT

To amend title 31, United States Code, to authorize pausing and 
segmenting payments, and for other purposes.