SEC. 2. DEFINITIONS. 
In this Act— 
(1) the term ‘‘agency’’ has the meaning given 
the term in section 551 of title 5, United States 
Code; and 
(2) the term ‘‘improper payment’’ has the 
meaning given the term in section 2(g) of the Im-
proper Payments Information Act of 2002 (31 
U.S.C. 3321 note). 
SEC. 3. ESTABLISHMENT OF FINANCIAL AND ADMINISTRA-
TIVE CONTROLS RELATING TO FRAUD AND 
IMPROPER PAYMENTS. 
(a) GUIDELINES.— 
(1) IN GENERAL.—Not later than 90 days after 
the date of enactment of this Act, the Director of 
the Office of Management and Budget, in consulta-
tion with the Comptroller General of the United 
States, shall establish guidelines for agencies to es-
tablish financial and administrative controls to iden-
tify and assess fraud risks and design and imple-
ment control activities in order to prevent, detect, 
and respond to fraud, including improper payments. 
(2) CONTENTS.—The guidelines described in 
paragraph (1) shall incorporate the leading practices 
identified in the report published by the Government 
Accountability Office on July 28, 2015, entitled 
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‘‘Framework for Managing Fraud Risks in Federal 
Programs’’. 
(3) MODIFICATION.—The Director of the Office 
of Management and Budget, in consultation with the 
Comptroller General of the United States, may peri-
odically modify the guidelines described in paragraph 
(1) as the Director and Comptroller General may de-
termine necessary. 
(b) REQUIREMENTS FOR CONTROLS.—The financial 
and administrative controls required to be established by 
agencies under subsection (a) shall include— 
(1) conducting an evaluation of fraud risks and 
using a risk-based approach to design and imple-
ment financial and administrative control activities 
to mitigate identified fraud risks; 
(2) collecting and analyzing data from reporting 
mechanisms on detected fraud to monitor fraud 
trends and using that data and information to con-
tinuously improve fraud prevention controls; and 
(3) using the results of monitoring, evaluation, 
audits, and investigations to improve fraud preven-
tion, detection, and response. 
(c) REPORTS.— 
(1) IN GENERAL.—Except as provided in para-
graph (2), for each of the first 3 fiscal years begin-
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ning after the date of enactment of this Act, each 
agency shall submit to Congress, as part of the an-
nual financial report of the agency, a report on the 
progress of the agency in— 
(A) implementing— 
(i) the financial and administrative 
controls required to be established under 
subsection (a); 
(ii) the fraud risk principle in the 
Standards for Internal Control in the Fed-
eral Government; and 
(iii) Office of Management and Budg-
et Circular A–123 with respect to the lead-
ing practices for managing fraud risk; 
(B) identifying risks and vulnerabilities to 
fraud, including with respect to payroll, bene-
ficiary payments, grants, large contracts, and 
purchase and travel cards; and 
(C) establishing strategies, procedures, and 
other steps to curb fraud. 
(2) FIRST REPORT.—If the date of enactment 
of this Act is less than 180 days before the date on 
which an agency is required to submit the annual fi-
nancial report of the agency, the agency may submit 
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the report required under paragraph (1) as part of 
the following annual financial report of the agency. 
SEC. 4. WORKING GROUP. 
(a) ESTABLISHMENT.—Not later than 180 days after 
the date of enactment of this Act, the Office of Manage-
ment and Budget shall establish a working group to im-
prove— 
(1) the sharing of financial and administrative 
controls established under section 3(a) and other 
best practices and techniques for detecting, pre-
venting, and responding to fraud, including improper 
payments; and 
(2) the sharing and development of data ana-
lytics techniques. 
(b) COMPOSITION.—The working group established 
under subsection (a) shall be composed of— 
(1) the Controller of the Office of Management 
and Budget, who shall serve as Chairperson; 
(2) the Chief Financial Officer of each agency; 
and 
(3) any other party determined to be appro-
priate by the Director of the Office of Management 
and Budget, which may include the Chief Informa-
tion Officer, the Chief Procurement Officer, or the 
Chief Operating Officer of each agency. 
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(c) CONSULTATION.—The working group established 
under subsection (a) shall consult with Offices of Inspec-
tors General and Federal and non-Federal experts on 
fraud risk assessments, financial controls, and other rel-
evant matters. 
(d) MEETINGS.—The working group established 
under subsection (a) shall hold not fewer than 4 meetings 
per year. 
(e) PLAN.—Not later than 270 days after the date 
of enactment of this Act, the working group established 
under subsection (a) shall submit to Congress a plan for 
the establishment and use of a Federal interagency library 
of data analytics and data sets, which can incorporate or 
improve upon existing Federal resources and capacities, 
for use by agencies and Offices of Inspectors General to 
facilitate the detection, prevention, and recovery of fraud, 
including improper payments. 
Æ 
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