US Code

Public Law 119-73 (01/23/2026)

10 U.S.C. § 3806

Action in case of fraud

(a)

Remedy Coordination Official Defined .—

In this section, the term “remedy coordination official”, with respect to an agency, means the person or entity in that agency who coordinates within that agency the administration of criminal, civil, administrative, and contractual remedies resulting from investigations of fraud or corruption related to procurement activities.
(b)

Recommendation to Reduce or Suspend Payments .—

In any case in which the remedy coordination official of an agency finds that there is substantial evidence that the request of a contractor for advance, partial, or progress payment under a contract awarded by that agency is based on fraud, the remedy coordination official shall recommend that the head of the agency reduce or suspend further payments to such contractor.
(c)

Reduction or Suspension of Payments .—

The head of an agency receiving a recommendation under subsection (b) in the case of a contractor’s request for payment under a contract shall determine whether there is substantial evidence that the request is based on fraud. Upon making such a determination, the agency head may reduce or suspend further payments to the contractor under such contract.
(d)

Extent of Reduction or Suspension .—

The extent of any reduction or suspension of payments by the head of an agency under subsection (c) on the basis of fraud shall be reasonably commensurate with the anticipated loss to the United States resulting from the fraud.
(e)

Written Justification .—

A written justification for each decision of the head of an agency whether to reduce or suspend payments under subsection (c) and for each recommendation received by such agency head in connection with such decision shall be prepared and be retained in the files of such agency.
(f)

Notice .—

The head of an agency shall prescribe procedures to ensure that, before such agency head decides to reduce or suspend payments in the case of a contractor under subsection (c), the contractor is afforded notice of the proposed reduction or suspension and an opportunity to submit matters to the head of the agency in response to such proposed reduction or suspension.
(g)

Review .—

Not later than 180 days after the date on which the head of an agency reduces or suspends payments to a contractor under subsection (c), the remedy coordination official of such agency shall—
(1)
review the determination of fraud on which the reduction or suspension is based; and
(2)
transmit a recommendation to the head of such agency whether the suspension or reduction should continue.
(h)

Annual Report .—

The head of an agency shall prepare for each year a report containing the recommendations made by the remedy coordination official of that agency to reduce or suspend payments under subsection (c), the actions taken on the recommendations and the reasons for such actions, and an assessment of the effects of such actions on the Federal Government. The Secretary of each military department shall transmit the annual report of such department to the Secretary of Defense. Each such report shall be available to any member of Congress upon request.
(i)

Restriction on Delegation .—

The head of an agency may not delegate responsibilities under this section to any person in a position below level IV of the Executive Schedule.
(j)

Inapplicability to Coast Guard .—

section 3063 of this titleThis section applies to the agencies named in paragraphs (1), (2), (3), (4), and (6) of .

Pub. L. 116–283, div. A, title XVIII, § 1834(a)134 Stat. 4234(Added and amended , (g), , , 4237.)

Editorial Notes

References in Text

section 5315 of Title 5Level IV of the Executive Schedule, referred to in subsec. (i), is set out in , Government Organization and Employees.

Codification

section 2307 of this titlePub. L. 116–283, § 1834(g)Pub. L. 101–510, div. A, title VIII, § 836(a)104 Stat. 1615Pub. L. 102–25, title VII, § 701(j)(2)(A)105 Stat. 116Pub. L. 102–484, div. A, title X, § 1052(24)106 Stat. 2500Pub. L. 103–355, title II, § 2001(a)(7)108 Stat. 3301Pub. L. 105–85, div. A, title VIII, § 802(1)111 Stat. 1831Pub. L. 106–391, title III, § 306114 Stat. 1592The text of subsec. (i) of , which was transferred to this section and amended by , was based on , , ; , , ; , , ; , , ; , , ; , , .

Amendments

Pub. L. 116–283, § 1834(g)(1)section 2307 of this title2021—, (2), (11), transferred subsec. (i) of to this section, struck out subsec. (i) designation and heading “Action in Case of Fraud” at beginning, and redesignated par. (10) as subsec. (a), pars. (1) to (7) as subsecs. (b) to (h), respectively, and pars. (9) and (8) as subsecs. (i) and (j), respectively.

Pub. L. 116–283, § 1834(g)(3)Subsec. (a). , inserted heading and substituted “this section” for “this subsection”.

Pub. L. 116–283, § 1834(g)(4)Subsec. (b). , inserted heading.

Pub. L. 116–283, § 1834(g)(5)Subsec. (c). , inserted heading and substituted “subsection (b)” for “paragraph (1)”.

Pub. L. 116–283, § 1834(g)(6)Subsec. (d). , inserted heading and substituted “subsection (c)” for “paragraph (2)”.

Pub. L. 116–283, § 1834(g)(7)Subsec. (e). , inserted heading and substituted “subsection (c)” for “paragraph (2)”.

Pub. L. 116–283, § 1834(g)(8)Subsec. (f). , inserted heading and substituted “subsection (c)” for “paragraph (2)”.

Pub. L. 116–283, § 1834(g)(9)Subsec. (g). , inserted heading, substituted “subsection (c)” for “paragraph (2)” in introductory provisions, and redesignated subpars. (A) and (B) as pars. (1) and (2), respectively.

Pub. L. 116–283, § 1834(g)(10)Subsec. (h). , inserted heading and substituted “subsection (c)” for “paragraph (2)”.

Pub. L. 116–283, § 1834(g)(12)Subsec. (i). , inserted heading and substituted “this section” for “this subsection”.

Pub. L. 116–283, § 1834(g)(13)Subsec. (j). , inserted heading and substituted “section applies” for “subsection applies” and “section 3063” for “section 2303(a)”.

Statutory Notes and Related Subsidiaries

Effective Date

Pub. L. 116–283section 1801(d) of Pub. L. 116–283section 3001 of this titleSection and amendment by effective , with additional provisions for delayed implementation and applicability of existing law, see , set out as an Effective Date of 2021 Amendment note preceding .