II 

118TH CONGRESS 

1ST SESSION S. 2924 

To amend title 31, United States Code, to improve the management of 

improper payments, and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

SEPTEMBER 26 (legislative day, SEPTEMBER 22), 2023 

Mr. CARPER (for himself and Mr. BRAUN) introduced the following bill; which 

was read twice and referred to the Committee on Homeland Security and 

Governmental Affairs 

A BILL 

To amend title 31, United States Code, to improve the 

management of improper payments, and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Safeguarding the 

5 Transparency and Efficiency of Payments Act’’ or the 

6 ‘‘STEP Act’’. 

7 SEC. 2. IMPROPER PAYMENTS. 

8 (a) DEFINITIONS.— 

9 (1) IN GENERAL.—Section 3351 of title 31, 

10 United States Code, is amended— 


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1 (A) by redesignating paragraphs (2) 

2 through (8) as paragraphs (3) through (9), re3 spectively; 

4 (B) by inserting after paragraph (1) the 

5 following: 

6 ‘‘(2) CHIEF FINANCIAL OFFICER.—The term 

7 ‘chief financial officer’ means— 

8 ‘‘(A) with respect to an executive agency 

9 described in section 901(b), the Chief Financial 

10 Officer of the executive agency appointed under 

11 such section; and 

12 ‘‘(B) with respect to an executive agency 

13 that is not described in section 901(b), the offi14 cial serving as the senior executive responsible 

15 for managing the financial activities of the exec16 utive agency.’’; and 

17 (C) in paragraph (3), as so redesignated— 

18 (i) in subparagraph (A)— 

19 (I) in clause (i)— 

20 (aa) by striking ‘‘published’’ 

21 and inserting ‘‘included’’; and 

22 (bb) by striking ‘‘with’’ and 

23 inserting ‘‘in the document con24 taining’’; and 


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1 (II) in clause (ii), by striking 

2 ‘‘statement’’ and inserting ‘‘docu3 ment’’; 

4 (ii) in subparagraph (C), by striking 

5 ‘‘accompanying materials to’’ and inserting 

6 ‘‘document containing;’’ 

7 (iii) in subparagraph (D), by striking 

8 ‘‘accompanying materials to’’ and inserting 

9 ‘‘document containing’’; and 

10 (iv) in subparagraph (E), by striking 

11 ‘‘accompanying materials to’’ and inserting 

12 ‘‘document containing’’. 

13 (2) CONFORMING AMENDMENTS.—Section 

14 3353(a)(4)(B) of title 31, United States Code, is 

15 amended— 

16 (A) in clause (i), by striking ‘‘section 

17 3351(2)(B)’’ and inserting ‘‘section 

18 3351(3)(B)’’; 

19 (B) in clause (ii), by striking ‘‘section 

20 3351(2)(C)’’ and inserting ‘‘section 

21 3351(3)(C)’’; 

22 (C) in clause (iii), by striking ‘‘section 

23 3351(2)(D)’’ and inserting ‘‘section 

24 3351(3)(D)’’; and 


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1 (D) in clause (vi), by striking ‘‘section 

2 3351(2)(A)’’ and inserting ‘‘section 

3 3351(3)(A)’’. 

4 (b) ESTIMATES OF IMPROPER PAYMENTS AND RE5 PORTS ON ACTIONS TO REDUCE IMPROPER PAYMENTS.— 

6 Section 3352 of title 31, United States Code, is amend7 ed— 

8 (1) in subsection (a)— 

9 (A) in paragraph (3)— 

10 (i) in subparagraph (B), in the matter 

11 preceding clause (i), by striking ‘‘para12 graph (1)’’ and inserting ‘‘paragraph 

13 (1)(B)’’; and 

14 (ii) in subparagraph (C), by striking 

15 ‘‘paragraph (1)’’ and inserting ‘‘para16 graphs (1) and (4)’’; and 

17 (B) by adding at the end the following: 

18 ‘‘(4) NEW PROGRAMS AND ACTIVITIES.—In ad19 dition to the programs and activities identified under 

20 paragraph (1)(B), the head of an executive agency 

21 shall annually identify as susceptible to significant 

22 improper payments any program or activity that— 

23 ‘‘(A) has or is expected to have outlays ex24 ceeding $100,000,000 in any one of the first 3 

25 fiscal years of operation; and 


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1 ‘‘(B) is in the first 4 years of operation.’’; 

2 (2) in subsection (c)(1)— 

3 (A) in the matter preceding subparagraph 

4 (A), by striking ‘‘subsection (a)(1)’’ and insert5 ing ‘‘paragraph (1) or (4) of subsection (a)’’; 

6 and 

7 (B) by striking subparagraphs (A) and (B) 

8 and inserting the following: 

9 ‘‘(A) produce a statistically valid estimate 

10 of the improper payments made under the pro11 gram or activity, or an estimate of such im12 proper payments that is otherwise appropriate 

13 using a methodology approved by— 

14 ‘‘(i) the Director of the Office of Man15 agement and Budget; and 

16 ‘‘(ii) the chief financial officer of the 

17 executive agency; and 

18 ‘‘(B) report the estimates described in sub19 paragraph (A) in accordance with subsection 

20 (j).’’; and 

21 (3) by adding at the end the following: 

22 ‘‘(j) ANNUAL REPORTS.—Any annual report required 

23 to be made by the head of an executive agency under this 

24 section shall— 


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1 ‘‘(1) be included in full in the document con2 taining the annual financial statement of the execu3 tive agency; and 

4 ‘‘(2) include a statement by the chief financial 

5 officer of the executive agency— 

6 ‘‘(A) certifying— 

7 ‘‘(i) the reliability of the executive 

8 agency’s identification of programs and ac9 tivities that may be susceptible to signifi10 cant improper payments under subsection 

11 (a); and 

12 ‘‘(ii) the validity of each estimate of 

13 improper payments under subsection (c); 

14 and 

15 ‘‘(B) describing the actions of the chief fi16 nancial officer of the executive agency to mon17 itor the development and implementation of any 

18 corrective action plans reported under sub19 section (d).’’. 

20 (c) FINANCIAL AND ADMINISTRATIVE CONTROLS RE21 LATING TO FRAUD AND IMPROPER PAYMENTS.—Section 

22 3357 of title 31, United States Code, is amended by strik23 ing subsection (d) and inserting the following: 

24 ‘‘(d) REPORTS.—For each fiscal year beginning in 

25 the first fiscal year after the date of enactment of the 


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1 Safeguarding the Transparency and Efficiency of Pay2 ments Act, and in each of the following 9 fiscal years, the 

3 head of each agency shall submit to Congress, in the re4 port containing the annual financial statement of the 

5 agency, a report— 

6 ‘‘(1) on the progress of the agency in— 

7 ‘‘(A) implementing— 

8 ‘‘(i) the financial and administrative 

9 controls required to be established under 

10 subsection (c)(1); 

11 ‘‘(ii) the fraud risk principles in the 

12 Standards for Internal Control in the Fed13 eral Government of the Government Ac14 countability Office; and 

15 ‘‘(iii) Circular A–123 of the Office of 

16 Management and Budget with respect to 

17 the leading practices for managing fraud 

18 risk; 

19 ‘‘(B) identifying fraud risks and 

20 vulnerabilities, including with respect to payroll, 

21 beneficiary payments, grants, large contracts, 

22 and purchase and travel cards; and 

23 ‘‘(C) establishing strategies, procedures, 

24 and other steps to curb fraud; and 


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1 ‘‘(2) that includes, as defined by the leading 

2 practices identified in the report published by the 

3 Government Accountability Office on July 28, 2015, 

4 entitled ‘Framework for Managing Fraud Risks in 

5 Federal Programs’— 

6 ‘‘(A) an identification of— 

7 ‘‘(i) each dedicated entity that leads 

8 the fraud risk management activities of the 

9 agency and the roles of each such entity; 

10 ‘‘(ii) the responsibilities of each entity 

11 described in clause (i); 

12 ‘‘(iii) each program and operation of 

13 the agency for which each entity described 

14 in clause (i) is responsible; 

15 ‘‘(iv) the capacity of the entity de16 scribed in clause (i), including any limita17 tions, to strategically manage the fraud 

18 risks of the agency; 

19 ‘‘(v) any program or operation of the 

20 agency for which there is not a dedicated 

21 entity that leads fraud risk management 

22 activities; and 

23 ‘‘(vi) if applicable, a detailed justifica24 tion for not having a dedicated entity, as 

25 described in clause (v); 


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1 ‘‘(B) the status of the fraud risk profiles 

2 for each program and operation of the agency, 

3 including the date of the last update and date 

4 of the next planned update of those fraud risk 

5 profiles; 

6 ‘‘(C) with respect to each program or oper7 ation of the agency for which there is not a 

8 fraud risk profile, an identification of that pro9 gram or operation and a detailed justification 

10 for not having a fraud risk profile for the pro11 gram or operation; 

12 ‘‘(D) the status of the antifraud strategies 

13 for each program and operation of the agency, 

14 including the date of the last update and the 

15 date of the next planned update of those anti16 fraud strategies; and 

17 ‘‘(E) with respect to each program or oper18 ation of the agency for which there is not an 

19 antifraud strategy, an identification of that pro20 gram or operation and a detailed justification 

21 for not having an antifraud strategy for the 

22 program or operation.’’. 

Æ 


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