H.R. 9588 – FRAUD Act | Legislate.dev

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Updated July 7, 2026 at 8:51 AM UTC

The Federal Responsibility and Accountability for Unchecked Dereliction Act (the FRAUD Act) requires top state officials—such as governors, agency heads, and state inspectors general—to report any written fraud warning involving at least $250,000 of federal money to the FBI within 180 days. States must certify that these officials have complied with the reporting rule in order to receive federal funds for the next fiscal year. Violations can lead to fines, up to ten years in prison, and possible debarment from managing federal funds.

Key Provisions

Covered state officials must report a fraud warning about federal funds to the FBI Director within 180 days of receiving it.
To qualify for federal funding, a state's chief executive must certify that its covered officials have substantially complied with the reporting requirement.
Knowingly failing to report or interfering with investigations is a criminal offense punishable by fines, imprisonment of up to ten years, or both.
Federal agencies can bar officials convicted of these offenses from overseeing the distribution of federal funds.

Legislative Activity

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1 earlier action

HouseIntro Referral Latest Action

Referred to the House Committee on Oversight and Government Reform.

Oversight and Government Reform Committee

July 2, 2026

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HouseIntro Referral

Introduced in House

July 2, 2026

HouseIntro Referral

Referred to the House Committee on Oversight and Government Reform.

Oversight and Government Reform Committee

July 2, 2026

Bill Text

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Introduced in HouseIssued July 2, 2026

I

119th CONGRESS

2d Session

H. R. 9588

IN THE HOUSE OF REPRESENTATIVES

July 2, 2026

Mr. Stauber (for himself, Mr. Emmer, Mr. Finstad, and Mrs. Fischbach) introduced the following bill; which was referred to the Committee on Oversight and Government Reform

A BILL

To require certain State officials to report fraud involving Federal funds, and for other purposes.

1.

Short title

This Act may be cited as the Federal Responsibility and Accountability for Unchecked Dereliction Act or the FRAUD Act.

2.

Duty to report fraud involving Federal funds

(a)

Reporting requirement

Not later than 180 days after receiving a fraud warning involving covered Federal funds, a covered official shall report such warning to the Director of the Federal Bureau of Investigation.

(b)

Condition of receipt of Federal funds

In order to be eligible to receive Federal funds for a fiscal year, the chief executive of a State shall certify to the head of the Federal agency providing such funds that during the previous fiscal year the covered officials of the State have substantially complied with the requirement under subsection (a).

(c)

Offense

Whoever, being a covered official, knowingly—

(1)

violates the requirement under subsection (a); or

(2)

obstructs, interferes with, or impedes a Federal, State, or Inspector General investigation involving fraud involving covered Federal funds,

shall be fined under title 18, United States Code, imprisoned for not more than 10 years, or both.

(d)

Debarment

The head of an agency that oversees the distribution of Federal funds, with respect to which a covered official has been convicted of an offense under subsection (c), may prohibit such covered official from overseeing the distribution of such funds.

3.

Rule of construction

Nothing in this Act shall be construed to—

(1)

authorize the Federal Government to remove a State official from elected office; or

(2)

violate principles of federalism under the Tenth Amendment to the Constitution of the United States.

4.

Definitions

In this Act:

(1)

Covered official

The term covered official means—

(A)

the Governor of a State;

(B)

the head of a State agency that administers, oversees, distributes, or certifies expenditures of covered Federal funds; and

(C)

any State Inspector General, or equivalent State official established by law, with statutory responsibility for investigating, auditing, or overseeing covered Federal funds.

(2)

Fraud warning

The term fraud warning means a written allegation of a specific instance of fraud involving covered Federal funds, supported by documentary evidence, which may include a written finding, a referral, an audit, an investigative report, or a whistleblower complaint, alleging the misuse, theft, diversion, or improper expenditure of not less than $250,000 in covered Federal funds.

(3)

Covered Federal funds

The term covered Federal funds means any Federal funds provided to a State or State agency through a grant, cooperative agreement, reimbursement program, direct appropriation, or other Federal funding mechanism.