31 U.S.C. § 3352: Estimates of improper payments and reports on actions to reduce improper payments

periodically review all programs and activities that the head of the executive agency administers; and 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. A review under paragraph (1) shall be performed for each program and activity that the head of an executive agency administers not less frequently than once every 3 fiscal years. $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 $100,000,000. whether the program or activity reviewed is new to the executive agency; the complexity of the program or activity reviewed; the volume of payments made through the program or activity reviewed; whether payments or payment eligibility decisions are made outside of the executive agency, such as by a State or local government; recent major changes in program funding, authorities, practices, or procedures; the level, experience, and quality of training for personnel responsible for making program eligibility determinations or certifying that payments are accurate; significant deficiencies in the audit report of the executive agency or other relevant management findings that might hinder accurate payment certification; similarities to other programs or activities that have reported improper payment estimates or been deemed susceptible to significant improper payments; 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; whether the program or activity lacks information or data systems to confirm eligibility or provide for other payment integrity needs; and 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”). 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 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). in which the highest dollar value or highest rate of improper payments occur; or for which there is a higher risk of improper payments; and 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. Subject to Federal privacy policies and to the extent permitted by law, each executive agency with a program identified under paragraph (1)(A) shall on an annual basis submit to the Inspector General of the executive agency and the Office of Management and Budget, and make available to the public, including through a website, a report on that program. has taken or plans to take to recover improper payments; and intends to take to prevent future improper payments; and any referrals the executive agency made or anticipates making to the Department of Justice; or any information provided in connection with a referral described in subclause (I). The Office of Management and Budget shall make each report submitted under subparagraph (A) available on a central website. Subparagraph (B)(ii) shall not prohibit any referral or information being made available to an Inspector General as otherwise provided by law. 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 the oversight or financial controls to identify and prevent improper payments under the program; and 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. Not less frequently than once every year, the head of each executive agency with a program identified under paragraph (1)(A), or a designee of the head of the executive agency, shall meet with the Director of the Office of Management and Budget, or a designee of the Director, to report on actions taken during the preceding year and planned actions to prevent improper payments. 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 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. For the purpose of producing an estimate under paragraph (1), when the executive agency cannot determine, due to lacking or insufficient documentation, whether a payment is proper or not, the payment shall be treated as an improper payment. The head of an executive agency may report separately on what portion of the improper payments estimate for a program or activity of the executive agency under paragraph (1) is attributable to lacking or insufficient documentation. 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; internal controls; human capital; and information systems and other infrastructure; 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; program-specific and activity-specific improper payments reduction targets that have been approved by the Director of the Office of Management and Budget; meeting applicable improper payments reduction targets; and prevent improper payments from being made; and promptly detect and recover improper payments that are made; and 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. a discussion of the methods used by the executive agency to recover improper payments; 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; if a determination has been made that certain improper payments are not collectable, a justification of that determination; an aging schedule of the amounts outstanding; a summary of how recovered amounts have been disposed of; a discussion of any conditions giving rise to improper payments and how those conditions are being resolved; and 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. the Committee on Homeland Security and Governmental Affairs of the Senate; the Committee on Oversight and Reform of the House of Representatives; and the Comptroller General of the United States. a summary of the reports of each executive agency on improper payments and recovery actions submitted under this section; 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; Governmentwide improper payment reduction targets; a Governmentwide estimate of improper payments; and a discussion of progress made towards meeting Governmentwide improper payment reduction targets. Not later than 1 year after the date of enactment of this section, the Director of the Office of Management and Budget shall prescribe guidance for executive agencies to implement the requirements of this section, which shall not include any exemptions to those requirements that are not specifically authorized by this section. the form of the reports on actions to reduce improper payments, recovery actions, and Governmentwide reporting; and strategies for addressing risks and establishing appropriate prepayment and postpayment internal controls. shall continue to be in effect on and after the date of enactment of this section; and may be modified as determined appropriate by the Director of the Office of Management and Budget. Except as provided under paragraph (3) and if not prohibited under any other provision of law, the head of each executive agency shall conduct recovery audits with respect to each program and activity of the executive agency that expends $1,000,000 or more annually if conducting the audits would be cost effective. 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); shall implement this subsection in a manner designed to ensure the greatest financial benefit to the Federal Government; and 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. notify entities, including individuals, of potential overpayments made to those entities; respond to questions concerning potential overpayments; and take other administrative actions with respect to an overpayment claim made or to be made by the executive agency; and 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. 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; 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 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. Each executive agency shall, on an annual basis, include in annual financial statement of the executive agency a report on actions taken by the executive agency during the preceding fiscal year to address the recommendations described in clause (i)(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 forward to other executive agencies any information that applies to that executive agency. Amounts collected by executive agencies each fiscal year through recovery audits shall be treated in accordance with this paragraph. The head of an executive agency shall determine the distribution of collected amounts described in subparagraph (A), less amounts needed to fulfill the purposes of section 3562(a) of this title , in accordance with subparagraphs (C), (D), and (E). 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); 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 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. 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; shall remain available for the same period and purposes as the appropriation or fund to which credited; and in the case of recoveries of overpayments that are made from a trust or special fund account, shall revert to that account; and 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 for other amounts, shall be newly available for the same time period as the funds were originally available for obligation. the Inspector General to carry out this Act; or any other activities of the Inspector General relating to investigating improper payments or auditing internal controls associated with payments; and shall remain available for the same period and purposes as the appropriation or fund to which credited. Amounts collected that are not applied in accordance with subparagraph (B), (C), (D), or (E) shall be deposited in the Treasury as miscellaneous receipts, except that in the case of recoveries of overpayments that are made from trust or special fund accounts, those amounts shall revert to those accounts. This paragraph shall apply only to recoveries of overpayments that are made from discretionary appropriations, as defined in section 250(c)(7) of the Balanced Budget and Emergency Deficit Control Act of 1985 ( 2 U.S.C. 900(c)(7) ), and shall not apply to recoveries of overpayments that are made from discretionary amounts that were appropriated before the date of enactment of the Improper Payments Elimination and Recovery Act of 2010, as in effect on the day before the date of enactment of this section. This paragraph shall not apply to the recovery of an overpayment if the appropriation from which the overpayment was made has not expired. The head of each executive agency shall conduct a financial management improvement program consistent with rules prescribed by the Director of the Office of Management and Budget. shall, as the first priority of the program, address problems that contribute directly to executive agency improper payments; and may seek to reduce errors and waste in other executive agency programs and operations. Any nongovernmental entity that, in the course of recovery auditing or recovery activity under this subsection, obtains information that identifies an individual or with respect to which there is a reasonable basis to believe that the information can be used to identify an individual, may not disclose the information for any purpose other than the recovery auditing or recovery activity and governmental oversight of the activity, unless disclosure for that other purpose is authorized by the individual to the executive agency that contracted for the performance of the recovery auditing or recovery activity. Except as provided under paragraph (4), nothing in this subsection shall be construed as terminating or in any way limiting authorities that are otherwise available to executive agencies under existing provisions of law to recover improper payments and use recovered amounts.