(a)
(1)
(A) periodically review all programs and activities that the head of the executive agency administers; and
(B) identify all programs and activities with outlays exceeding the statutory threshold dollar amount described in paragraph (3)(A)(i) that may be susceptible to significant improper payments.
(2)
(3)
(A)
(i) $10,000,000 of all reported program or activity payments of the executive agency made during that fiscal year and 1.5 percent of program outlays; or
(ii) $100,000,000.
(B)
(i) whether the program or activity reviewed is new to the executive agency;
(ii) the complexity of the program or activity reviewed;
(iii) the volume of payments made through the program or activity reviewed;
(iv) whether payments or payment eligibility decisions are made outside of the executive agency, such as by a State or local government;
(v) recent major changes in program funding, authorities, practices, or procedures;
(vi) the level, experience, and quality of training for personnel responsible for making program eligibility determinations or certifying that payments are accurate;
(vii) significant deficiencies in the audit report of the executive agency or other relevant management findings that might hinder accurate payment certification;
(viii) similarities to other programs or activities that have reported improper payment estimates or been deemed susceptible to significant improper payments;
(ix) the accuracy and reliability of improper payment estimates previously reported for the program or activity, or other indicator of potential susceptibility to improper payments identified by the Inspector General of the executive agency, the Government Accountability Office, other audits performed by or on behalf of the Federal, State, or local government, disclosures by the executive agency, or any other means;
(x) whether the program or activity lacks information or data systems to confirm eligibility or provide for other payment integrity needs; and
(xi) the risk of fraud as assessed by the executive agency under the Standards for Internal Control in the Federal Government published by the Government Accountability Office (commonly known as the "Green Book").
(C)
(i) a listing of each program or activity identified under paragraph (1), including the date on which the program or activity was most recently assessed for risk under paragraph (1); and
(ii) a listing of any program or activity for which the executive agency makes any substantial changes to the methodologies of the reviews conducted under paragraph (1).
(b)
(1)
(A) identify a list of high-priority Federal programs for greater levels of oversight and review—
(i) in which the highest dollar value or highest rate of improper payments occur; or
(ii) for which there is a higher risk of improper payments; and
(B) in coordination with the executive agency responsible for administering a high-priority program identified under subparagraph (A), establish annual targets and semi-annual or quarterly actions for reducing improper payments associated with the high-priority program.
(2)
(A)
(B)
(i) shall describe any action the executive agency—
(I) has taken or plans to take to recover improper payments; and
(II) intends to take to prevent future improper payments; and
(ii) shall not include—
(I) any referrals the executive agency made or anticipates making to the Department of Justice; or
(II) any information provided in connection with a referral described in subclause (I).
(C)
(D)
(E)
(i) review—
(I) the assessment of the level of risk associated with the program and the quality of the improper payment estimates and methodology of the executive agency relating to the program; and
(II) the oversight or financial controls to identify and prevent improper payments under the program; and
(ii) submit to the appropriate authorizing and appropriations committees of Congress recommendations, which may be included in another report submitted by the Inspector General to Congress, for modifying any plans of the executive agency relating to the program, including improvements for improper payments determination and estimation methodology.
(F)
(c)
(1)
(A) produce a statistically valid estimate, or an estimate that is otherwise appropriate using a methodology approved by the Director of the Office of Management and Budget, of the improper payments made under the program or activity; and
(B) include the estimates described in subparagraph (A) in the accompanying materials to the annual financial statement of the executive agency and as required in applicable guidance of the Office of Management and Budget.
(2)
(A)
(B)
(d)
(1) a description of the causes of the improper payments, actions planned or taken to correct those causes, and the planned or actual completion date of the actions taken to address those causes;
(2) in order to reduce improper payments to a level below which further expenditures to reduce improper payments would cost more than the amount those expenditures would save in prevented or recovered improper payments, a statement of whether the executive agency has what is needed with respect to—
(A) internal controls;
(B) human capital; and
(C) information systems and other infrastructure;
(3) if the executive agency does not have sufficient resources to establish and maintain effective internal controls as described in paragraph (2)(A), a description of the resources the executive agency has requested in the budget submission of the executive agency to establish and maintain those internal controls;
(4) program-specific and activity-specific improper payments reduction targets that have been approved by the Director of the Office of Management and Budget;
(5) a description of the steps the executive agency has taken to ensure that executive agency managers, programs, and, where appropriate, States and local governments are held accountable through annual performance appraisal criteria for—
(A) meeting applicable improper payments reduction targets; and
(B) establishing and maintaining sufficient internal controls, including an appropriate control environment, that effectively—
(i) prevent improper payments from being made; and
(ii) promptly detect and recover improper payments that are made; and
(6) a description of how the level of planned or completed actions by the executive agency to address the causes of the improper payments matches the level of improper payments, including a breakdown by category of improper payment and specific timelines for completion of those actions.
(e)
(1) a discussion of the methods used by the executive agency to recover improper payments;
(2) the amounts recovered, outstanding, and determined to not be collectable, including the percent those amounts represent of the total improper payments of the executive agency;
(3) if a determination has been made that certain improper payments are not collectable, a justification of that determination;
(4) an aging schedule of the amounts outstanding;
(5) a summary of how recovered amounts have been disposed of;
(6) a discussion of any conditions giving rise to improper payments and how those conditions are being resolved; and
(7) if the executive agency has determined under subsection (i) that performing recovery audits for any applicable program or activity is not cost-effective, a justification for that determination.
(f)
(1)
(A) the Committee on Homeland Security and Governmental Affairs of the Senate;
(B) the Committee on Oversight and Reform of the House of Representatives; and
(C) the Comptroller General of the United States.
(2)
(A) a summary of the reports of each executive agency on improper payments and recovery actions submitted under this section;
(B) an identification of the compliance status of each executive agency, as determined by the Inspector General of the executive agency under section 3353, to which this section applies;
(C) Governmentwide improper payment reduction targets;
(D) a Governmentwide estimate of improper payments; and
(E) a discussion of progress made towards meeting Governmentwide improper payment reduction targets.
(g)
(1)
(2)
(A) the form of the reports on actions to reduce improper payments, recovery actions, and Governmentwide reporting; and
(B) strategies for addressing risks and establishing appropriate prepayment and postpayment internal controls.
(h)
(1) shall continue to be in effect on and after the date of enactment of this section; and
(2) may be modified as determined appropriate by the Director of the Office of Management and Budget.
(i)
(1)
(A)
(B)
(i) shall give priority to the most recent payments and to payments made in any program identified as susceptible to significant improper payments under subsection (a);
(ii) shall implement this subsection in a manner designed to ensure the greatest financial benefit to the Federal Government; and
(iii) may conduct the recovery audit directly, by using other departments and agencies of the United States, or by procuring performance of recovery audits by private sector sources by contract, subject to the availability of appropriations, or by any combination thereof.
(C)
(i) subject to subparagraph (B)(iii), and except to the extent such actions are outside the authority of the executive agency under section 7103 of title 41, the head of the executive agency may authorize the contractor to—
(I) notify entities, including individuals, of potential overpayments made to those entities;
(II) respond to questions concerning potential overpayments; and
(III) take other administrative actions with respect to an overpayment claim made or to be made by the executive agency; and
(ii) the contractor shall not have the authority to make a final determination relating to whether any overpayment occurred or whether to compromise, settle, or terminate an overpayment claim.
(D)
(i)
(I) provide to the executive agency periodic reports on conditions giving rise to overpayments identified by the contractor and any recommendations on how to mitigate those conditions;
(II) notify the executive agency of any overpayments identified by the contractor pertaining to the executive agency or to any other executive agency that are beyond the scope of the contract; and
(III) report to the executive agency credible evidence of fraud or vulnerabilities to fraud and conduct appropriate training of personnel of the contractor on identification of fraud.
(ii)
(E)
(i) take prompt and appropriate action in response to a report or notification by a contractor under subclause (I) or (II) of subparagraph (D)(i) to collect an overpayment; and
(ii) forward to other executive agencies any information that applies to that executive agency.
(2)
(A)
(B)
(C)
(i) shall be available to the head of the executive agency to carry out the financial management improvement program of the executive agency under paragraph (3);
(ii) may be credited, if applicable, for the purpose described in clause (i) by the head of an executive agency to any executive agency appropriations and funds that are available for obligation at the time of collection; and
(iii) shall be used to supplement and not supplant any other amounts available for the purpose described in clause (i) and shall remain available until expended.
(D)
(i) shall be credited to the appropriation or fund, if any, available for obligation at the time of collection for the same general purposes as the appropriation or fund from which the overpayment was made;
(ii) shall remain available for the same period and purposes as the appropriation or fund to which credited; and
(iii) if the appropriation from which an overpayment was made has expired—
(I) in the case of recoveries of overpayments that are made from a trust or special fund account, shall revert to that account; and
(II) in the case of other recoveries of overpayments—
(aa) for amounts that are recovered more than 5 fiscal years from the last fiscal year in which the funds were available for obligation, shall be deposited in the Treasury as miscellaneous receipts; and
(bb) for other amounts, shall be newly available for the same time period as the funds were originally available for obligation.
(E)
(i) shall be available to the Inspector General of that executive agency for—
(I) the Inspector General to carry out this Act; or
(II) any other activities of the Inspector General relating to investigating improper payments or auditing internal controls associated with payments; and
(ii) shall remain available for the same period and purposes as the appropriation or fund to which credited.
(F)
(G)
(H)
(3)
(A)
(B)
(i) shall, as the first priority of the program, address problems that contribute directly to executive agency improper payments; and
(ii) may seek to reduce errors and waste in other executive agency programs and operations.
(4)
(5)
Editorial Notes
References in Text
The date of enactment of this section, referred to in subsecs. (g)(1), (h), and (i)(2)(G), is the date of enactment of Pub. L. 116–117, which was approved Mar. 2, 2020.
Section 2(g) of the Improper Payments Elimination and Recovery Act of 2010, referred to in subsec. (h), is section 2(g) of Pub. L. 111–204, July 22, 2010, 124 Stat. 2228, which was formerly set out as a note under section 3321 of this title, prior to repeal by Pub. L. 116–117, §3(a)(2), Mar. 2, 2020, 134 Stat. 133.
This Act, referred to in subsec. (i)(2)(E)(i)(I), probably means Pub. L. 116–117, which enacted this subchapter, amended section 3562 of this title, section 612 of Title 6, Domestic Security, and section 1397ee of Title 42, The Public Health and Welfare, amended provisions set out as a note under 5701 of Title 5, Government Organization and Employees, and repealed provisions set out as notes under sections 3301 and 3321 of this title. For complete classification of this Act to the Code, see Short Title of 2020 Amendment note set out under section 3301 of this title and Tables.
The date of enactment of the Improper Payments Elimination and Recovery Act of 2010, referred to subsec. (i)(2)(G), is the date of enactment of Pub. L. 111–204, which was approved July 22, 2010.
Statutory Notes and Related Subsidiaries
Change of Name
Committee on Oversight and Reform of House of Representatives changed to Committee on Oversight and Accountability of House of Representatives by House Resolution No. 5, One Hundred Eighteenth Congress, Jan. 9, 2023.