II 

Calendar No. 60 

112TH CONGRESS 

1ST SESSION S. 890 

To establish the supplemental fraud fighting account, and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

MAY 5, 2011 

Mr. LEAHY (for himself, Mr. GRASSLEY, Ms. KLOBUCHAR, and Mr. COONS) 

introduced the following bill; which was read twice and referred to the 

Committee on the Judiciary 

MAY 19, 2011 

Reported by Mr. LEAHY, without amendment 

A BILL 

To establish the supplemental fraud fighting account, 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 ‘‘Fighting Fraud to Pro5 tect Taxpayers Act of 2011’’. 


pwalker on DSK8KYBLC1PROD with BILLS
2 

•S 890 RS

1 SEC. 2. DEPARTMENT OF JUSTICE WORKING CAPITAL 

2 FUND REFORMS. 

3 Section 11013(a) of the 21st Century Department of 

4 Justice Appropriations Authorization Act (28 U.S.C. 527 

5 note) is amended— 

6 (1) by striking ‘‘Notwithstanding’’ and insert7 ing the following: 

8 ‘‘(1) DEFINITIONS.—In this subsection— 

9 ‘‘(A) the term ‘covered amounts’ means— 

10 ‘‘(i) the unobligated balances in the 

11 debt collection management account; and 

12 ‘‘(ii) the unobligated balances in the 

13 supplemental fraud fighting account; 

14 ‘‘(B) the term ‘debt collection management 

15 account’ means the account established in the 

16 Department of Justice Working Capital Fund 

17 under paragraph (2); 

18 ‘‘(C) the term ‘fraud offense’ includes— 

19 ‘‘(i) an offense under section 30A of 

20 the Securities Exchange Act of 1934 (15 

21 U.S.C. 78dd–1) and an offense under sec22 tion 104 or 104A of the Foreign Corrupt 

23 Practices Act of 1977 (15 U.S.C. 78dd–2 

24 and 78dd–3); 


pwalker on DSK8KYBLC1PROD with BILLS
3 

•S 890 RS

1 ‘‘(ii) a securities fraud offense, as de2 fined in section 3301 of title 18, United 

3 States Code; 

4 ‘‘(iii) a fraud offense relating to a fi5 nancial institution or a federally related 

6 mortgage loan, as defined in section 3 of 

7 the Real Estate Settlement Procedures Act 

8 of 1974 (12 U.S.C. 2602), including an of9 fense under section 152, 157, 1004, 1005, 

10 1006, 1007, 1011, or 1014 of title 18, 

11 United States Code; 

12 ‘‘(iv) an offense involving procurement 

13 fraud, including defective pricing, bid rig14 ging, product substitution, misuse of clas15 sified or procurement sensitive informa16 tion, grant fraud, fraud associated with 

17 labor mischarging, and fraud involving for18 eign military sales; 

19 ‘‘(v) an offense under the Internal 

20 Revenue Code of 1986 involving fraud; 

21 ‘‘(vi) an action under subchapter III 

22 of chapter 37 of title 31, United States 

23 Code (commonly known as the ‘False 

24 Claims Act’), and an offense under chapter 

25 15 of title 18, United States Code; 


pwalker on DSK8KYBLC1PROD with BILLS
4 

•S 890 RS

1 ‘‘(vii) an offense under section 1029, 

2 1030, or 1031 of title 18, United States 

3 Code; and 

4 ‘‘(viii) an offense under chapter 63 of 

5 title 18, United States Code; and 

6 ‘‘(D) the term ‘supplemental fraud fighting 

7 account’ means the supplemental fraud fighting 

8 account established in the Department of Jus9 tice Working Capital Fund under paragraph 

10 (3)(A). 

11 ‘‘(2) DEBT COLLECTION MANAGEMENT AC12 COUNT.—Notwithstanding’’; 

13 (2) by striking ‘‘Such amounts’’ and inserting 

14 ‘‘Subject to paragraph (4), such amounts’’; and 

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

16 ‘‘(3) SUPPLEMENTAL FRAUD FIGHTING AC17 COUNT.— 

18 ‘‘(A) ESTABLISHMENT.—There is estab19 lished as a separate account in the Department 

20 of Justice Working Capital Fund established 

21 under section 527 of title 28, United States 

22 Code, a supplemental fraud fighting account. 

23 ‘‘(B) CREDITING OF AMOUNTS.—Notwith24 standing section 3302 of title 31, United States 

25 Code, or any other statute affecting the credVerDate Mar 15 2010 01:19 May 20, 2011 Jkt 099200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\S890.RS S890

pwalker on DSK8KYBLC1PROD with BILLS
5 

•S 890 RS

1 iting of collections, the Attorney General may 

2 credit, as an offsetting collection, to the supple3 mental fraud fighting account up to 0.5 percent 

4 of all amounts collected pursuant to civil debt 

5 collection litigation activities of the Department 

6 of Justice. 

7 ‘‘(C) USE OF FUNDS.— 

8 ‘‘(i) IN GENERAL.—Subject to clause 

9 (ii), the Attorney General may use 

10 amounts in the supplemental fraud fight11 ing account for the cost (including equip12 ment, salaries and benefits, travel and 

13 training, and interagency task force oper14 ations) of the investigation of and conduct 

15 of criminal, civil, or administrative pro16 ceedings relating to fraud offenses. 

17 ‘‘(ii) LIMITATION.—The Attorney 

18 General may not use amounts in the sup19 plemental fraud fighting account for the 

20 cost of the investigation of or the conduct 

21 of criminal, civil, or administrative pro22 ceedings relating to— 

23 ‘‘(I) an offense under section 

24 30A of the Securities Exchange Act of 

25 1934 (15 U.S.C. 78dd–1); or 


pwalker on DSK8KYBLC1PROD with BILLS
6 

•S 890 RS

1 ‘‘(II) an offense under section 

2 104 or 104A of the Foreign Corrupt 

3 Practices Act of 1977 (15 U.S.C. 

4 78dd–2 and 78dd–3). 

5 ‘‘(D) CONDITIONS.—Subject to paragraph 

6 (4), amounts in the supplemental fraud fighting 

7 account shall remain available until expended 

8 and shall be subject to the terms and conditions 

9 of the Department of Justice Working Capital 

10 Fund. 

11 ‘‘(4) MAXIMUM AMOUNT.— 

12 ‘‘(A) IN GENERAL.—There are rescinded 

13 all covered amounts in excess of $175,000,000 

14 at the end of fiscal year 2012 and the end of 

15 each fiscal year thereafter. 

16 ‘‘(B) RATIO.—For any rescission under 

17 subparagraph (A), the Secretary of the Treas18 ury shall rescind amounts from the debt collec19 tion management account and the supplemental 

20 fraud fighting account in a ratio of 6 dollars to 

21 1 dollar, respectively. 

22 ‘‘(5) ANNUAL REPORT.—Not later than 6 

23 months after the date of enactment of the Taxpayer 

24 Protection and Fraud Enforcement Act of 2011, and 

25 every year thereafter, the Attorney General shall 


pwalker on DSK8KYBLC1PROD with BILLS
7 

•S 890 RS

1 submit to Congress a report that identifies, for the 

2 most recent fiscal year before the date of the re3 port— 

4 ‘‘(A) the amount credited to the debt col5 lection management account and the amount 

6 credited to the supplemental fraud fighting ac7 count from civil debt collection litigation, which 

8 shall include, for each account— 

9 ‘‘(i) a comprehensive description of 

10 the source of the amount credited; and 

11 ‘‘(ii) a list the civil actions and settle12 ments from which amounts were collected 

13 and credited to the account; 

14 ‘‘(B) the amount expended from the debt 

15 collection management account for civil debt 

16 collection, which shall include a comprehensive 

17 description of the use of amounts in the ac18 count that identifies the amount expended for— 

19 ‘‘(i) paying the costs of processing 

20 and tracking civil and criminal debt-collec21 tion litigation; 

22 ‘‘(ii) financial systems; 

23 ‘‘(iii) debt-collection-related personnel 

24 expenses; 


pwalker on DSK8KYBLC1PROD with BILLS
8 

•S 890 RS

1 ‘‘(iv) debt-collection-related adminis2 trative expenses; and 

3 ‘‘(v) debt-collection-related litigation 

4 expenses; 

5 ‘‘(C) the amounts expended from the sup6 plemental fraud fighting account and the jus7 tification for the expenditure of such amounts; 

8 and 

9 ‘‘(D) the unobligated balance in the debt 

10 collection management account and the unobli11 gated balance in the supplemental fraud fight12 ing account at the end of the fiscal year.’’. 

13 SEC. 3. REIMBURSEMENT OF COSTS AWARDED IN FALSE 

14 CLAIMS ACT PROSECUTIONS. 

15 Section 3729(a)(3) of title 31, United States Code, 

16 is amended by adding at the end the following: ‘‘Any costs 

17 paid under this paragraph shall be credited to the appro18 priations accounts of the executive agency from which the 

19 funds used for the costs of the civil action were paid.’’. 

20 SEC. 4. INTERLOCUTORY APPEALS OF SUPPRESSION OR 

21 EXCLUSION OF EVIDENCE. 

22 Section 3731 of title 18, United States Code, is 

23 amended in the second undesignated paragraph by insert24 ing ‘‘Attorney General, the Deputy Attorney General, an 


pwalker on DSK8KYBLC1PROD with BILLS
9 

•S 890 RS

1 Assistant Attorney General, or the’’ after ‘‘an indictment 

2 or information, if the’’. 

3 SEC. 5. EXTENSION OF INTERNATIONAL MONEY LAUN4 DERING STATUTE TO TAX EVASION CRIMES. 

5 Section 1956(a)(2)(A) of title 18, United States 

6 Code, is amended— 

7 (1) by striking ‘‘intent to promote—’’ and in8 serting the following: ‘‘intent to— 

9 ‘‘(i) promote’’; and 

10 (2) by adding at the end the following: 

11 ‘‘(ii) engage in conduct constituting a vio12 lation of section 7201 or 7206 of the Internal 

13 Revenue Code of 1986; or’’. 

14 SEC. 6. STRENGTHENING THE PROHIBITION AGAINST 

15 TRAFFICKING IN PASSWORDS. 

16 Section 1030(a)(6) of title 18, United States Code, 

17 is amended— 

18 (1) in the matter preceding subparagraph (A), 

19 by inserting ‘‘protected’’ before ‘‘computer’’; and 

20 (2) by striking ‘‘, if—’’ and all that follows and 

21 inserting ‘‘; or’’. 

22 SEC. 7. CLARIFYING VENUE FOR FEDERAL MAIL FRAUD OF23 FENSES. 

24 (a) IN GENERAL.—Section 3237(a) of title 18, 

25 United States Code, is amended in the second undesigVerDate Mar 15 2010 01:19 May 20, 2011 Jkt 099200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\S890.RS S890

pwalker on DSK8KYBLC1PROD with BILLS
10 

•S 890 RS

1 nated paragraph by adding before the period at the end 

2 the following: ‘‘or in any district in which an act in fur3 therance of the offense is committed’’. 

4 (b) SECTION HEADING.—Section 3237 of title 18, 

5 United States Code, is amended in the section heading by 

6 striking ‘‘begun’’ and all that follows and inserting 

7 ‘‘taking place in more than one district’’. 

8 (c) TABLE OF SECTIONS.—The table of sections for 

9 chapter 211 of title 18, United States Code, is amended 

10 by striking the item relating to section 3237 and inserting 

11 the following: 

‘‘3237. Offenses taking place in more than one district.’’. 

12 SEC. 8. EXPANSION OF AUTHORITY OF SECRET SERVICE. 

13 Section 3056 of title 18, United States Code, is 

14 amended— 

15 (1) in subsection (b)— 

16 (A) in paragraph (1)— 

17 (i) by inserting ‘‘641, 656, 657,’’ after 

18 ‘‘510,’’; and 

19 (ii) by striking ‘‘493, 657,’’ and in20 serting ‘‘493,’’; and 

21 (B) in paragraph (3), by striking ‘‘feder22 ally insured’’; and 

23 (2) by adding at the end the following: 

24 ‘‘(h)(1) For any undercover investigative operation of 

25 the United States Secret Service that is necessary for the 


pwalker on DSK8KYBLC1PROD with BILLS
11 

•S 890 RS

1 detection and prosecution of a crime against the United 

2 States, the United States Secret Service may— 

3 ‘‘(A) use amounts appropriated for the United 

4 States Secret Service, including unobligated balances 

5 available from prior fiscal years, to— 

6 ‘‘(i) purchase property, buildings, and 

7 other facilities and lease space within the 

8 United States (including the District of Colum9 bia and the territories and possessions of the 

10 United States), without regard to sections 1341 

11 and 3324 of title 31, section 8141 of title 40, 

12 and sections 3901, 4501 through 4506, 6301, 

13 and 6306(a) of title 41; and 

14 ‘‘(ii) establish, acquire, and operate on a 

15 commercial basis proprietary corporations and 

16 business entities as part of the undercover in17 vestigative operation, without regard to sections 

18 9102 and 9103 of title 31; 

19 ‘‘(B) deposit in banks and other financial insti20 tutions amounts appropriated for the United States 

21 Secret Service, including unobligated balances avail22 able from prior fiscal years, and the proceeds from 

23 the undercover investigative operation, without re24 gard to section 648 of this title and section 3302 of 

25 title 31; and 


pwalker on DSK8KYBLC1PROD with BILLS
12 

•S 890 RS

1 ‘‘(C) use the proceeds from the undercover in2 vestigative operation to offset necessary and reason3 able expenses incurred in the undercover investiga4 tive operation, without regard to section 3302 of 

5 title 31. 

6 ‘‘(2) The authority under paragraph (1) may be exer7 cised only upon a written determination by the Director 

8 of the United States Secret Service (in this subsection re9 ferred to as the ‘Director’) that the action being author10 ized under paragraph (1) is necessary for the conduct of 

11 an undercover investigative operation. A determination 

12 under this paragraph may continue in effect for the dura13 tion of an undercover investigative operation, without fis14 cal year limitation. 

15 ‘‘(3) If the Director authorizes the proceeds from an 

16 undercover investigative operation to be used as described 

17 in subparagraph (B) or (C) of paragraph (1), as soon as 

18 practicable after the proceeds are no longer necessary for 

19 the conduct of the undercover investigative operation, the 

20 proceeds remaining shall be deposited in the general fund 

21 of the Treasury as miscellaneous receipts. 

22 ‘‘(4) As early as the Director determines practicable 

23 before the date on which a corporation or business entity 

24 established or acquired under paragraph (1)(A)(ii) with a 

25 net value of more than $50,000 is to be liquidated, sold, 


pwalker on DSK8KYBLC1PROD with BILLS
13 

•S 890 RS

1 or otherwise disposed of, the Director shall notify the Sec2 retary of Homeland Security regarding the circumstances 

3 of the corporation or business entity and the liquidation, 

4 sale, or other disposition. The proceeds of the liquidation, 

5 sale, or other disposition, after obligations are met, shall 

6 be deposited in the general fund of the Treasury as mis7 cellaneous receipts. 

8 ‘‘(5)(A) The Director shall— 

9 ‘‘(i) on a quarterly basis, conduct detailed fi10 nancial audits of closed undercover investigative op11 erations for which a written determination is made 

12 under paragraph (2); and 

13 ‘‘(ii) submit to the Secretary of Homeland Se14 curity a written report of the results of each audit 

15 conducted under clause (i). 

16 ‘‘(B) On the date on which the budget of the Presi17 dent is submitted under section 1105(a) of title 31 for 

18 each year, the Secretary of Homeland Security shall sub19 mit to the Committee on Appropriations of the Senate and 

20 the Committee on Appropriations of the House of Rep21 resentatives a report summarizing the audits conducted 

22 under subparagraph (A)(i) relating to the previous fiscal 

23 year.’’. 


pwalker on DSK8KYBLC1PROD with BILLS
14 

•S 890 RS

1 SEC. 9. FALSE CLAIMS SETTLEMENTS. 

2 (a) REPORTS BY ATTORNEY GENERAL.—Not later 

3 than November 1 of each year, the Attorney General shall 

4 submit to the Committee on the Judiciary of the Senate 

5 and the Committee on the Judiciary of the House of Rep6 resentatives a report that describes each settlement or 

7 compromise of any claim, suit, or other action entered into 

8 with the Department of Justice that— 

9 (1) relates to an alleged violation of section 

10 1031 of title 18, United States Code, or section 

11 3729 of title 31, United States Code (including all 

12 settlements of alternative remedies); and 

13 (2) results from a claim for damages of more 

14 than $100,000. 

15 (b) CONTENTS OF REPORTS.—The description of 

16 each settlement or compromise required to be included in 

17 an annual report under subsection (a) shall include— 

18 (1) the total amount of the settlement or com19 promise and the portions of the settlement attrib20 utable to violations of various statutory authorities; 

21 (2) the amount of actual damages, or if the 

22 amount of actual damages is not available a good 

23 faith estimate of the damages, that have been sus24 tained and the minimum and maximum potential 

25 civil penalties that may be incurred as a consequence 


pwalker on DSK8KYBLC1PROD with BILLS
15 

•S 890 RS

1 of the conduct of the defendant that is the subject 

2 of the settlement or compromise; 

3 (3) the basis for any estimate of damages sus4 tained and the potential civil penalties incurred; 

5 (4) the amount of the settlement that rep6 resents damages and the multiplier or percentage of 

7 the actual damages used in determining the amount 

8 to be paid under the settlement or compromise; 

9 (5) the amount of the settlement that rep10 resents civil penalties and the percentage of the 

11 maximum potential civil penalty to be paid under the 

12 settlement or compromise; 

13 (6) the amount of the settlement that rep14 resents criminal fines and a statement of the basis 

15 for the fines; 

16 (7) a description of the period during which the 

17 matter to which the settlement or compromise re18 lates was pending, including— 

19 (A) the date on which the complaint was 

20 originally filed; 

21 (B) a description of the period the matter 

22 remained under seal; 

23 (C) the date on which the Department of 

24 Justice determined whether to intervene in the 

25 case; and 


pwalker on DSK8KYBLC1PROD with BILLS
16 

•S 890 RS

1 (D) the date on which the settlement or 

2 compromise was finalized; 

3 (8) whether a defendant or any division, sub4 sidiary, affiliate, or related entity of a defendant had 

5 previously entered into a settlement or compromise 

6 relating to section 1031 of title 18, United States 

7 Code, or section 3730(b) of title 31, United States 

8 Code, and, if so, the date of and amount to be paid 

9 under each such settlement or compromise; 

10 (9) whether a defendant or any division, sub11 sidiary, affiliate, or related entity of a defendant— 

12 (A) entered into a corporate integrity 

13 agreement relating to the settlement or com14 promise; 

15 (B) entered into a deferred prosecution 

16 agreement or nonprosecution agreement relat17 ing to the settlement or compromise; or 

18 (C)(i) previously entered into— 

19 (I) a corporate integrity agreement re20 lating to a settlement or compromise relat21 ing to a different violation of section 

22 3730(b) of title 31, United States Code; or 

23 (II) a deferred prosecution agreement 

24 or nonprosecution agreement relating to a 

25 settlement or compromise relating to a difVerDate Mar 15 2010 01:19 May 20, 2011 Jkt 099200 PO 00000 Frm 00016 Fmt 6652 Sfmt 6201 E:\BILLS\S890.RS S890

pwalker on DSK8KYBLC1PROD with BILLS
17 

•S 890 RS

1 ferent violation of section 1031 of title 18, 

2 United States Code; and 

3 (ii) if the defendant had entered an agree4 ment described in clause (i), whether the agree5 ment applied to the conduct that is the subject 

6 of the settlement or compromise described in 

7 the report or similar conduct; 

8 (10) for a settlement involving Medicaid, the 

9 amounts paid to the Federal Government and to 

10 each State participating in the settlement or com11 promise; 

12 (11) whether civil investigative demands were 

13 issued in process of investigating the matter to 

14 which the settlement or compromise relates; 

15 (12) for a qui tam action— 

16 (A) the percentage of the settlement 

17 amount awarded to the relator; and 

18 (B) whether the relator requested a fair19 ness hearing relating to the percentage received 

20 by the relator or the total amount of the settle21 ment; 

22 (13) the extent to which officers of the agency 

23 that was the victim of the loss resolved by the settle24 ment or compromise participated in the settlement 

25 negotiations; and 


pwalker on DSK8KYBLC1PROD with BILLS
18 

•S 890 RS

1 (14) the extent to which a relator or counsel for 

2 a relators participated in the settlement negotia3 tions. 

4 SEC. 10. AGGRAVATED IDENTITY THEFT AND FRAUD. 

5 (a) IN GENERAL.—Section 1028A of title 18, United 

6 States Code, is amended in the section heading by adding 

7 ‘‘and fraud’’ at the end. 

8 (b) TECHNICAL AND CONFORMING AMENDMENT.— 

9 The table of sections for chapter 47 of title 18, United 

10 States Code, is amended by striking the item relating to 

11 section 1028A and inserting the following: 

‘‘1028A. Aggravated identity theft and fraud.’’. 

12 SEC. 11. FRAUD AND RELATED ACTIVITY IN CONNECTION 

13 WITH IDENTIFICATION DOCUMENTS, AU14 THENTICATION FEATURES, AND INFORMA15 TION. 

16 (a) IN GENERAL.—Section 1028(a)(7) of title 18, 

17 United States Code, is amended by inserting ‘‘(including 

18 an organization)’’ after ‘‘person’’. 

19 (b) TECHNICAL AND CONFORMING AMENDMENT.— 

20 The table of sections for chapter 47 of title 18, United 

21 States Code, is amended by striking the item relating to 

22 section 1028 and inserting the following: 

‘‘1028. Fraud and related activity in connection with identification documents, 

authentication features, and information.’’. 


pwalker on DSK8KYBLC1PROD with BILLS

pwalker on DSK8KYBLC1PROD with BILLS
Calendar No. 60 

112TH CONGRESS 

1ST SESSION S. 890 

A BILL 

To establish the supplemental fraud fighting 

account, and for other purposes. 

MAY 19, 2011 

Reported without amendment 


pwalker on DSK8KYBLC1PROD with BILLS