HR 8464 — Stopping Fraudulent Payments Act

changes in existing law made by 
the bill, as reported, are shown as follows (existing law 
proposed to be omitted is enclosed in black brackets, new 
matter is printed in italics, and existing law in which no 
change is proposed is shown in roman):

 TITLE 31, UNITED STATES CODE

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SUBTITLE III--FINANCIAL MANAGEMENT

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CHAPTER 33--DEPOSITING, KEEPING, AND PAYING MONEY

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Sec.
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 SUBCHAPTER II--PAYMENTS

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3337. Authority to pause payments for further review and corrective 
 action.

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SUBCHAPTER II--PAYMENTS

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Sec. 3325. Vouchers

 (a) A disbursing official in the executive branch of the 
United States Government shall--
 (1) disburse money only as provided by a voucher 
 certified by--
 (A) the head of the executive agency 
 concerned; or
 (B) an officer or employee of the executive 
 agency having written authorization from the 
 head of the agency to certify vouchers;
 (2) examine a voucher if necessary to decide if it 
 is--
 (A) in proper form;
 (B) certified and approved; and
 (C) computed correctly on the facts 
 certified; and
 (3) except for the correctness of computations on a 
 voucher, compliance with an order to pause a payment 
 pursuant to section 3337(b), or pursuant to payment 
 intercepts or offsets pursuant to section 3716 or 3720A 
 of this title[,,], be held accountable for carrying out 
 clauses (1) and (2) of this subsection.
 (b) In addition to officers and employees referred to in 
subsection (a)(1)(B) of this section as having authorization to 
certify vouchers, members of the armed forces may certify 
vouchers when authorized, in writing, by the Secretary of 
Defense or, in the case of the Coast Guard when it is not 
operating as a service in the Navy, by the Secretary of 
Homeland Security.
 (c) On request, the Secretary of the Treasury may provide to 
the appropriate officer or employee of the United States 
Government a list of persons receiving periodic payments from 
the Government. When certified and in proper form, the list may 
be used as a voucher on which the Secretary may disburse money.
 (d) The head of an executive agency or an officer or employee 
of an executive agency referred to in subsection (a)(1)(B), as 
applicable, shall include with each certified voucher submitted 
to a disbursing official pursuant to this section the taxpayer 
identifying number of each person to whom payment may be made 
under the voucher.

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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.

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CHAPTER 35--ACCOUNTING AND COLLECTION

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SUBCHAPTER III--AUDITING AND SETTLING ACCOUNTS

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Sec. 3527. General authority to relieve accountable officials and 
 agents from liability

 (a) Except as provided in subsection (b) of this section, the 
Comptroller General may relieve a present or former accountable 
official or agent of an agency responsible for the physical 
loss or deficiency of public money, vouchers, checks, 
securities, or records, or may authorize reimbursement from an 
appropriation or fund available for the activity in which the 
loss or deficiency occurred for the amount of the loss or 
deficiency paid by the official or agent as restitution, when--
 (1) the head of the agency decides that--
 (A) the official or agent was carrying out 
 official duties when the loss or deficiency 
 occurred, or the loss or deficiency occurred 
 because of an act or failure to act by a 
 subordinate of the official or agent; and
 (B) the loss or deficiency was not the result 
 of fault or negligence by the official or 
 agent;
 (2) the loss or deficiency was not the result of an 
 illegal or incorrect payment, or was made as a result 
 of a good faith effort to comply with the requirements 
 of section 3337; and
 (3) the Comptroller General agrees with the decision 
 of the head of the agency.
 (b)(1) The Comptroller General shall relieve an official of 
the armed forces referred to in subsection (a) responsible for 
the physical loss or deficiency of public money, vouchers, or 
records, or a payment described in section 3528(a)(4)(A) of 
this title, or shall authorize reimbursement, from an 
appropriation or fund available for reimbursement, of the 
amount of the loss or deficiency paid by or for the official as 
restitution, when--
 (A) in the case of a physical loss or deficiency--
 (i) the Secretary of Defense or the 
 appropriate Secretary of the military 
 department of the Department of Defense (or the 
 Secretary of Homeland Security, in the case of 
 a disbursing official of the Coast Guard when 
 the Coast Guard is not operating as a service 
 in the Navy) decides that the official was 
 carrying out official duties when the loss or 
 deficiency occurred;
 (ii) the loss or deficiency was not the 
 result of an illegal or incorrect payment, or 
 was made as a result of a good faith effort to 
 comply with the requirements of section 3337; 
 and
 (iii) the loss or deficiency was not the 
 result of fault or negligence by the official; 
 or
 (B) in the case of a payment described in section 
 3528(a)(4)(A) of this title, the Secretary of Defense 
 or the Secretary of the appropriate military department 
 (or the Secretary of Homeland Security, in the case of 
 a disbursing official of the Coast Guard when the Coast 
 Guard is not operating as a service in the Navy), after 
 taking a diligent collection action, finds that the 
 criteria of section 3528(b)(1) of this title are 
 satisfied.
 (2) The finding of the Secretary involved is conclusive on 
the Comptroller General.
 (c) On the initiative of the Comptroller General or written 
recommendation of the head of an agency, the Comptroller 
General may relieve a present or former disbursing official of 
the agency responsible for a deficiency in an account because 
of an illegal, improper, or incorrect payment, and credit the 
account for the deficiency, when the Comptroller General 
decides that the payment was not the result of bad faith or 
lack of reasonable care by the official. However, the 
Comptroller General may deny relief when the Comptroller 
General decides the head of the agency did not carry out 
diligently collection action under procedures prescribed by the 
Comptroller General.
 (d)(1) When the Comptroller General decides it is necessary 
to adjust the account of an official or agent granted relief 
under subsection (a) or (c) of this section, the amount of the 
relief shall be charged--
 (A) to an appropriation specifically provided to be 
 charged; or
 (B) if no specific appropriation, to the 
 appropriation or fund available for the expense of the 
 accountable function when the adjustment is carried 
 out.
 (2) Subsection (c) of this section does not--
 (A) affect the liability, or authorize the relief, of 
 a payee, beneficiary, or recipient of an illegal, 
 improper, or incorrect payment; or
 (B) relieve an accountable official, the head of an 
 agency, or the Comptroller General of responsibility in 
 carrying out collection action against a payee, 
 beneficiary, or recipient.
 (e) Relief provided under this section is in addition to 
relief provided under another law.

Sec. 3528. Responsibilities and relief from liability of certifying 
 officials

 (a) A certifying official certifying a voucher is responsible 
for--
 (1) information stated in the certificate, voucher, 
 and supporting records;
 (2) the computation of a certified voucher under this 
 section and section 3325 of this title;
 (3) the legality of a proposed payment under the 
 appropriation or fund involved;
 (4) repaying a payment--
 (A) illegal, improper, or incorrect because 
 of an inaccurate or misleading certificate;
 (B) prohibited by law; or
 (C) that does not represent a legal 
 obligation under the appropriation or fund 
 involved[; and];
 (5) verifying transportation rates, freight 
 classifications, and other information provided on a 
 Government bill of lading or transportation request, 
 unless the Administrator of General Services has 
 determined that verification by a prepayment audit 
 conducted pursuant to section 3726(a) of this title for 
 a particular mode or modes of transportation, or for an 
 agency or subagency, will not adequately protect the 
 interests of the Government[.]; and
 (6) complying with an order to take a corrective 
 action to temporarily delay, condition, or segment a 
 disbursement request pursuant to section 3337.
 (b)(1) The Comptroller General may relieve a certifying 
official from liability when the Comptroller General decides 
that--
 (A) the certification was based on official records 
 and the official did not know, and by reasonable 
 diligence and inquiry could not have discovered, the 
 correct information[; or];
 (B)(i) the obligation was incurred in good faith;
 (ii) no law specifically prohibited the payment; and
 (iii) the United States Government received value for 
 payment[.]; or
 (C) the certification was made as a result of a good 
 faith effort to comply with the requirements of section 
 3337.
 (2) The Comptroller General may deny relief when the 
Comptroller General decides the head of the agency did not 
carry out diligently collection action under procedures 
prescribed by the Comptroller General.
 (c) The Comptroller General shall relieve a certifying 
official from liability for an overpayment--
 (1) to a common carrier under section 3726 of this 
 title when the Comptroller General decides the 
 overpayment occurred only because the administrative 
 audit before payment did not verify transportation 
 rates, freight classifications, or land-grant 
 deductions and the Administrator of General Services 
 has determined that verification by a prepayment audit 
 conducted pursuant to section 3726(a) of this title for 
 a particular mode or modes of transportation, or for an 
 agency or subagency, will not adequately protect the 
 interests of the Government; or
 (2) provided under a Government bill of lading or 
 transportation request when the overpayment was the 
 result of using improper transportation rates or 
 classifications or the failure to deduct the proper 
 amount under a land-grant law or agreement and the 
 Administrator of General Services has determined that 
 verification by a prepayment audit conducted pursuant 
 to section 3726(a) of this title for a particular mode 
 or modes of transportation, or for an agency or 
 subagency, will not adequately protect the interests of 
 the Government.

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