Stopping Fraudulent Payments Act
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The bill would give federal agencies and the Treasury Department new authority to temporarily pause, condition, or segment government payments flagged as high-risk for fraud or improper payment before they go out, using documented fraud-risk indicators and Treasury's Do Not Pay system.
It would also shield officials from personal liability for good-faith actions under the new authority, aiming to curb fraudulent federal payments while requiring notice to payees and time limits on delays.
What this bill would do
What it would do
The bill would add a new section to title 31 of the U.S. Code authorizing agency heads to delay, condition, or segment a payment before certifying it if there is sufficient reason to believe the payment presents an elevated fraud risk or improper-payment risk, based on objective fraud-risk indicators. Treasury would be required to return certified payment vouchers and order corrective action when its Do Not Pay system flags elevated fraud risk. Any pause must be narrowly targeted, time-limited to the minimum period needed to verify eligibility, and routine low-risk portions of a payment must still be released while only the risky portion is held.
The bill would require payee notification within two days, a dispute process, and payment within 30 days (or 7 days after a successful dispute) if no fraud risk is confirmed. It exempts actions that would jeopardize active law enforcement investigations, shields officials from personal liability for good-faith compliance, requires Treasury regulations within 180 days, and requires an annual report to Congress on results. The amendments would take effect one year after enactment.
Key provisions
- 1Would require agency heads to pause, condition, or segment a disbursement before certifying it if there is sufficient reason to believe it poses elevated fraud or improper-payment risk
- 2Would require Treasury to return certified payment vouchers and issue corrective action orders within 2 days when its Do Not Pay system flags elevated fraud risk
- 3Would require any corrective action to be based on documented fraud-risk indicators, narrowly targeted, and time-limited to the minimum period needed for verification
- 4Would require payee notification within 2 days, a dispute process, and payment issuance within 30 days (or 7 days after a successful dispute) absent confirmed fraud risk
- 5Would exempt actions that would jeopardize active federal law enforcement investigations or False Claims Act proceedings
- 6Would protect federal officers and employees from personal liability for good-faith actions taken under the new authority
- 7Would require Treasury to issue implementing regulations within 180 days and Treasury to report annually to Congress on results, savings, and recommendations
Who would be affected
Federal agencies that disburse payments, Treasury Department officials who certify and process payment vouchers, payees and recipients of federal payments (including individuals and state or local governments receiving federally funded, state-administered program payments), and agency inspectors general and law enforcement handling related fraud investigations.
Why it matters
Payees could see legitimate payments temporarily delayed while agencies investigate suspected fraud, though the bill sets notice, dispute, and 30-day resolution deadlines meant to limit disruption. Federal officials gain new legal protection from personal liability for good-faith delays, while agencies and Treasury take on new documentation, notification, and reporting obligations.
What would change
Changes to existing law
Creates 31 U.S.C. Chapter 33, Subchapter II (title 31, United States Code) (Sec. 2(a))
Adds new Section 3337 authorizing agencies and Treasury to pause, condition, or segment payments presenting elevated fraud risk
Amends 31 U.S.C. § 3325(a)(3) (Sec. 2(b))
Adds compliance with a payment-pause order under new Section 3337 to disbursing officials' certification duties
Amends 31 U.S.C. § 3527 (Sec. 2(c))
Relieves accountable officers of liability for losses resulting from good-faith compliance with new Section 3337
Amends 31 U.S.C. § 3528 (Sec. 2(d)-(e))
Adds compliance with corrective-action orders as a certifying official duty and relieves certifying officials acting in good faith under Section 3337
Agencies directed to act
Effective dates
- Treasury regulations implementing the new payment-pause authority
- Report to Congress on results of paused and corrected payments
- The amendments creating the new payment-pause authority
Funding and costs
Congressional Budget Office estimate
CBO estimates H.R. 8464 would cost $25 million in discretionary spending over the 2027–2031 period, while its effect on direct spending (fraudulent payment reductions) cannot be determined.
CBO estimates that implementing H.R. 8464 would require $25 million in discretionary appropriations (spending that Congress must approve each year) over the 2027–2031 period, primarily for administrative activities and required annual reports. The bill would have a negligible effect on direct (mandatory) spending by agencies that can offset costs through fees or collections. Although CBO expects the bill would likely reduce fraudulent payments — and thus reduce direct spending — it lacks sufficient information to estimate the magnitude of those reductions, in part because the bill's interaction with an existing March 2025 executive order on fraud prevention is unclear. CBO identified no intergovernmental or private-sector mandates in the bill.
How implementation would work
Treasury would issue regulations within 180 days of enactment, and annually thereafter, specifying the seniority level of officials authorized to order corrective actions, procedures for using the Do Not Pay system, an appeals process for agencies disputing Treasury orders (with a 5-day response requirement), and minimum notification content. Agencies would notify payees within 2 days of a pause, offer a dispute process, and must resolve and issue payments within 30 days (7 days after a successful dispute) if no fraud is confirmed. Treasury would report annually to OMB and four congressional committees on the volume, outcomes, and savings from paused payments, starting 18 months after enactment. The overall authority takes effect one year after enactment.
Legislative status & sources
Latest action
Received in the Senate.
Official CRS summary
Show the CRS summaryHide the CRS summary
This bill establishes requirements to prevent fraudulent or improper payments from federal programs.
Specifically, the bill directs executive agencies to take corrective actions to temporarily pause, condition, or segment payment voucher requests before certifying them if the agencies have sufficient reason to determine that the payments present elevated risks of fraud or improper payments resulting in financial loss to the government. The corrective actions must be (1) based on objective, documented fraud-risk indicators; (2) narrowly applied to the portion of the payments presenting the elevated risk; and (3) limited in duration to the minimum period necessary to verify the eligibility or accuracy of the payments.
The Department of the Treasury must return certified payment vouchers to agencies for corrective action if they present an elevated risk of fraud based on an output of Treasury’s Do Not Pay system.
The bill also prohibits officers or employees of the federal government from being personally liable for actions taken in good faith under this bill.
Legislative subjects
Fraud offenses and financial crimes; Government Operations and Politics; Government information and archives
Committee report
H. Rept. 119-684