II 

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 and Mr. GRASSLEY) introduced the following bill; 

which was read twice and referred to the Committee on the Judiciary 

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’’. 

6 SEC. 2. DEPARTMENT OF JUSTICE WORKING CAPITAL 

7 FUND REFORMS. 

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

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

10 note) is amended— 


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1 (1) by striking ‘‘Notwithstanding’’ and insert2 ing the following: 

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

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

5 ‘‘(i) the unobligated balances in the 

6 debt collection management account; and 

7 ‘‘(ii) the unobligated balances in the 

8 supplemental fraud fighting account; 

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

10 account’ means the account established in the 

11 Department of Justice Working Capital Fund 

12 under paragraph (2); 

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

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

15 the Securities Exchange Act of 1934 (15 

16 U.S.C. 78dd–1) and an offense under sec17 tion 104 or 104A of the Foreign Corrupt 

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

19 and 78dd–3); 

20 ‘‘(ii) a securities fraud offense, as de21 fined in section 3301 of title 18, United 

22 States Code; 

23 ‘‘(iii) a fraud offense relating to a fi24 nancial institution or a federally related 

25 mortgage loan, as defined in section 3 of 


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1 the Real Estate Settlement Procedures Act 

2 of 1974 (12 U.S.C. 2602), including an of3 fense under section 152, 157, 1004, 1005, 

4 1006, 1007, 1011, or 1014 of title 18, 

5 United States Code; 

6 ‘‘(iv) an offense involving procurement 

7 fraud, including defective pricing, bid rig8 ging, product substitution, misuse of clas9 sified or procurement sensitive informa10 tion, grant fraud, fraud associated with 

11 labor mischarging, and fraud involving for12 eign military sales; 

13 ‘‘(v) an offense under the Internal 

14 Revenue Code of 1986 involving fraud; 

15 ‘‘(vi) an action under subchapter III 

16 of chapter 37 of title 31, United States 

17 Code (commonly known as the ‘False 

18 Claims Act’), and an offense under chapter 

19 15 of title 18, United States Code; 

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

21 1030, or 1031 of title 18, United States 

22 Code; and 

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

24 title 18, United States Code; and 


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

2 account’ means the supplemental fraud fighting 

3 account established in the Department of Jus4 tice Working Capital Fund under paragraph 

5 (3)(A). 

6 ‘‘(2) DEBT COLLECTION MANAGEMENT AC7 COUNT.—Notwithstanding’’; 

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

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

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

11 ‘‘(3) SUPPLEMENTAL FRAUD FIGHTING AC12 COUNT.— 

13 ‘‘(A) ESTABLISHMENT.—There is estab14 lished as a separate account in the Department 

15 of Justice Working Capital Fund established 

16 under section 527 of title 28, United States 

17 Code, a supplemental fraud fighting account. 

18 ‘‘(B) CREDITING OF AMOUNTS.—Notwith19 standing section 3302 of title 31, United States 

20 Code, or any other statute affecting the cred21 iting of collections, the Attorney General may 

22 credit, as an offsetting collection, to the supple23 mental fraud fighting account up to 0.5 percent 

24 of all amounts collected pursuant to civil debt 


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1 collection litigation activities of the Department 

2 of Justice. 

3 ‘‘(C) USE OF FUNDS.— 

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

5 (ii), the Attorney General may use 

6 amounts in the supplemental fraud fight7 ing account for the cost (including equip8 ment, salaries and benefits, travel and 

9 training, and interagency task force oper10 ations) of the investigation of and conduct 

11 of criminal, civil, or administrative pro12 ceedings relating to fraud offenses. 

13 ‘‘(ii) LIMITATION.—The Attorney 

14 General may not use amounts in the sup15 plemental fraud fighting account for the 

16 cost of the investigation of or the conduct 

17 of criminal, civil, or administrative pro18 ceedings relating to— 

19 ‘‘(I) an offense under section 

20 30A of the Securities Exchange Act of 

21 1934 (15 U.S.C. 78dd–1); or 

22 ‘‘(II) an offense under section 

23 104 or 104A of the Foreign Corrupt 

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

25 78dd–2 and 78dd–3). 


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

2 (4), amounts in the supplemental fraud fighting 

3 account shall remain available until expended 

4 and shall be subject to the terms and conditions 

5 of the Department of Justice Working Capital 

6 Fund. 

7 ‘‘(4) MAXIMUM AMOUNT.— 

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

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

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

11 each fiscal year thereafter. 

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

13 subparagraph (A), the Secretary of the Treas14 ury shall rescind amounts from the debt collec15 tion management account and the supplemental 

16 fraud fighting account in a ratio of 6 dollars to 

17 1 dollar, respectively. 

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

19 months after the date of enactment of the Taxpayer 

20 Protection and Fraud Enforcement Act of 2011, and 

21 every year thereafter, the Attorney General shall 

22 submit to Congress a report that identifies, for the 

23 most recent fiscal year before the date of the re24 port— 


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1 ‘‘(A) the amount credited to the debt col2 lection management account and the amount 

3 credited to the supplemental fraud fighting ac4 count from civil debt collection litigation, which 

5 shall include, for each account— 

6 ‘‘(i) a comprehensive description of 

7 the source of the amount credited; and 

8 ‘‘(ii) a list the civil actions and settle9 ments from which amounts were collected 

10 and credited to the account; 

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

12 collection management account for civil debt 

13 collection, which shall include a comprehensive 

14 description of the use of amounts in the ac15 count that identifies the amount expended for— 

16 ‘‘(i) paying the costs of processing 

17 and tracking civil and criminal debt-collec18 tion litigation; 

19 ‘‘(ii) financial systems; 

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

21 expenses; 

22 ‘‘(iv) debt-collection-related adminis23 trative expenses; and 

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

25 expenses; 


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1 ‘‘(C) the amounts expended from the sup2 plemental fraud fighting account and the jus3 tification for the expenditure of such amounts; 

4 and 

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

6 collection management account and the unobli7 gated balance in the supplemental fraud fight8 ing account at the end of the fiscal year.’’. 

9 SEC. 3. REIMBURSEMENT OF COSTS AWARDED IN FALSE 

10 CLAIMS ACT PROSECUTIONS. 

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

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

13 paid under this paragraph shall be credited to the appro14 priations accounts of the executive agency from which the 

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

16 SEC. 4. INTERLOCUTORY APPEALS OF SUPPRESSION OR 

17 EXCLUSION OF EVIDENCE. 

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

19 amended in the second undesignated paragraph by insert20 ing ‘‘Attorney General, the Deputy Attorney General, an 

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

22 or information, if the’’. 


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1 SEC. 5. EXTENSION OF INTERNATIONAL MONEY LAUN2 DERING STATUTE TO TAX EVASION CRIMES. 

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

4 Code, is amended— 

5 (1) by striking ‘‘intent to promote—’’ and in6 serting the following: ‘‘intent to— 

7 ‘‘(i) promote’’; and 

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

9 ‘‘(ii) engage in conduct constituting a vio10 lation of section 7201 or 7206 of the Internal 

11 Revenue Code of 1986; or’’. 

12 SEC. 6. STRENGTHENING THE PROHIBITION AGAINST 

13 TRAFFICKING IN PASSWORDS. 

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

15 is amended— 

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

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

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

19 inserting ‘‘; or’’. 

20 SEC. 7. CLARIFYING VENUE FOR FEDERAL MAIL FRAUD OF21 FENSES. 

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

23 United States Code, is amended in the second undesig24 nated paragraph by adding before the period at the end 

25 the following: ‘‘or in any district in which an act in fur26 therance of the offense is committed’’. 


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

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

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

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

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

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

7 by striking the item relating to section 3237 and inserting 

8 the following: 

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

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

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

11 amended— 

12 (1) in subsection (b)— 

13 (A) in paragraph (1)— 

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

15 ‘‘510,’’; and 

16 (ii) by striking ‘‘493, 657,’’ and in17 serting ‘‘493,’’; and 

18 (B) in paragraph (3), by striking ‘‘feder19 ally insured’’; and 

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

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

22 the United States Secret Service that is necessary for the 

23 detection and prosecution of a crime against the United 

24 States, the United States Secret Service may— 


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

2 States Secret Service, including unobligated balances 

3 available from prior fiscal years, to— 

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

5 other facilities and lease space within the 

6 United States (including the District of Colum7 bia and the territories and possessions of the 

8 United States), without regard to sections 1341 

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

10 and sections 3901, 4501 through 4506, 6301, 

11 and 6306(a) of title 41; and 

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

13 commercial basis proprietary corporations and 

14 business entities as part of the undercover in15 vestigative operation, without regard to sections 

16 9102 and 9103 of title 31; 

17 ‘‘(B) deposit in banks and other financial insti18 tutions amounts appropriated for the United States 

19 Secret Service, including unobligated balances avail20 able from prior fiscal years, and the proceeds from 

21 the undercover investigative operation, without re22 gard to section 648 of this title and section 3302 of 

23 title 31; and 

24 ‘‘(C) use the proceeds from the undercover in25 vestigative operation to offset necessary and reasonVerDate Mar 15 2010 23:49 May 05, 2011 Jkt 099200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 E:\BILLS\S890.IS S890

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1 able expenses incurred in the undercover investiga2 tive operation, without regard to section 3302 of 

3 title 31. 

4 ‘‘(2) The authority under paragraph (1) may be exer5 cised only upon a written determination by the Director 

6 of the United States Secret Service (in this subsection re7 ferred to as the ‘Director’) that the action being author8 ized under paragraph (1) is necessary for the conduct of 

9 an undercover investigative operation. A determination 

10 under this paragraph may continue in effect for the dura11 tion of an undercover investigative operation, without fis12 cal year limitation. 

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

14 undercover investigative operation to be used as described 

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

16 practicable after the proceeds are no longer necessary for 

17 the conduct of the undercover investigative operation, the 

18 proceeds remaining shall be deposited in the general fund 

19 of the Treasury as miscellaneous receipts. 

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

21 before the date on which a corporation or business entity 

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

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

24 or otherwise disposed of, the Director shall notify the Sec25 retary of Homeland Security regarding the circumstances 


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1 of the corporation or business entity and the liquidation, 

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

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

4 be deposited in the general fund of the Treasury as mis5 cellaneous receipts. 

6 ‘‘(5)(A) The Director shall— 

7 ‘‘(i) on a quarterly basis, conduct detailed fi8 nancial audits of closed undercover investigative op9 erations for which a written determination is made 

10 under paragraph (2); and 

11 ‘‘(ii) submit to the Secretary of Homeland Se12 curity a written report of the results of each audit 

13 conducted under clause (i). 

14 ‘‘(B) On the date on which the budget of the Presi15 dent is submitted under section 1105(a) of title 31 for 

16 each year, the Secretary of Homeland Security shall sub17 mit to the Committee on Appropriations of the Senate and 

18 the Committee on Appropriations of the House of Rep19 resentatives a report summarizing the audits conducted 

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

21 year.’’. 

22 SEC. 9. FALSE CLAIMS SETTLEMENTS. 

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

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

25 submit to the Committee on the Judiciary of the Senate 


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1 and the Committee on the Judiciary of the House of Rep2 resentatives a report that describes each settlement or 

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

4 with the Department of Justice that— 

5 (1) relates to an alleged violation of section 

6 1031 of title 18, United States Code, or section 

7 3729 of title 31, United States Code (including all 

8 settlements of alternative remedies); and 

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

10 than $100,000. 

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

12 each settlement or compromise required to be included in 

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

14 (1) the total amount of the settlement or com15 promise and the portions of the settlement attrib16 utable to violations of various statutory authorities; 

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

18 amount of actual damages is not available a good 

19 faith estimate of the damages, that have been sus20 tained and the minimum and maximum potential 

21 civil penalties that may be incurred as a consequence 

22 of the conduct of the defendant that is the subject 

23 of the settlement or compromise; 

24 (3) the basis for any estimate of damages sus25 tained and the potential civil penalties incurred; 


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1 (4) the amount of the settlement that rep2 resents damages and the multiplier or percentage of 

3 the actual damages used in determining the amount 

4 to be paid under the settlement or compromise; 

5 (5) the amount of the settlement that rep6 resents civil penalties and the percentage of the 

7 maximum potential civil penalty to be paid under the 

8 settlement or compromise; 

9 (6) the amount of the settlement that rep10 resents criminal fines and a statement of the basis 

11 for the fines; 

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

13 matter to which the settlement or compromise re14 lates was pending, including— 

15 (A) the date on which the complaint was 

16 originally filed; 

17 (B) a description of the period the matter 

18 remained under seal; 

19 (C) the date on which the Department of 

20 Justice determined whether to intervene in the 

21 case; and 

22 (D) the date on which the settlement or 

23 compromise was finalized; 

24 (8) whether a defendant or any division, sub25 sidiary, affiliate, or related entity of a defendant had 


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1 previously entered into a settlement or compromise 

2 relating to section 1031 of title 18, United States 

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

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

5 under each such settlement or compromise; 

6 (9) whether a defendant or any division, sub7 sidiary, affiliate, or related entity of a defendant— 

8 (A) entered into a corporate integrity 

9 agreement relating to the settlement or com10 promise; 

11 (B) entered into a deferred prosecution 

12 agreement or nonprosecution agreement relat13 ing to the settlement or compromise; or 

14 (C)(i) previously entered into— 

15 (I) a corporate integrity agreement re16 lating to a settlement or compromise relat17 ing to a different violation of section 

18 3730(b) of title 31, United States Code; or 

19 (II) a deferred prosecution agreement 

20 or nonprosecution agreement relating to a 

21 settlement or compromise relating to a dif22 ferent violation of section 1031 of title 18, 

23 United States Code; and 

24 (ii) if the defendant had entered an agree25 ment described in clause (i), whether the agreeVerDate Mar 15 2010 23:49 May 05, 2011 Jkt 099200 PO 00000 Frm 00016 Fmt 6652 Sfmt 6201 E:\BILLS\S890.IS S890

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1 ment applied to the conduct that is the subject 

2 of the settlement or compromise described in 

3 the report or similar conduct; 

4 (10) for a settlement involving Medicaid, the 

5 amounts paid to the Federal Government and to 

6 each State participating in the settlement or com7 promise; 

8 (11) whether civil investigative demands were 

9 issued in process of investigating the matter to 

10 which the settlement or compromise relates; 

11 (12) for a qui tam action— 

12 (A) the percentage of the settlement 

13 amount awarded to the relator; and 

14 (B) whether the relator requested a fair15 ness hearing relating to the percentage received 

16 by the relator or the total amount of the settle17 ment; 

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

19 that was the victim of the loss resolved by the settle20 ment or compromise participated in the settlement 

21 negotiations; and 

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

23 a relators participated in the settlement negotia24 tions. 


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1 SEC. 10. AGGRAVATED IDENTITY THEFT AND FRAUD. 

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

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

4 ‘‘and fraud’’ at the end. 

5 (b) TECHNICAL AND CONFORMING AMENDMENT.— 

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

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

8 section 1028A and inserting the following: 

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

9 SEC. 11. FRAUD AND RELATED ACTIVITY IN CONNECTION 

10 WITH IDENTIFICATION DOCUMENTS, AU11 THENTICATION FEATURES, AND INFORMA12 TION. 

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

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

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

16 (b) TECHNICAL AND CONFORMING AMENDMENT.— 

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

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

19 section 1028 and inserting the following: 

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

authentication features, and information.’’. 

Æ 


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