H.R. 2978 — GUARD Act

This section defines six terms for purposes of this Act: (1) elder financial fraud (i.e., illegal or improper use of an elderly or adult with a disability's money, property, or other resources for monetary or personal benefit); (2) eligible Federal grant funds (i.e., funds received under specified DOJ programs, including Local Law Enforcement Grants for Enforcement of Cybercrimes Against Individuals under 34 U.S.C. 30107); (3) general financial fraud (i.e., intentional misrepresentation of information or identity, unlawful use of credit/debit cards or ATMs, or electronic transmission of deceptive information to obtain money or things of value); (4) pig butchering (i.e., confidence and investment fraud luring victims into increasing cryptocurrency contributions before the scammer disappears); (5) scam (i.e., financial crime using social engineering for deceptive inducement to acquire funds or personal/sensitive information); and (6) State (i.e., each of the several States, the District of Columbia, and each U.S. territory).

This section authorizes State, local, and Tribal law enforcement agencies receiving eligible federal grant funds to use such funds for investigating elder financial fraud, pig butchering (i.e., a type of investment scam), and general financial fraud, including by (1) hiring and retaining analysts, agents, experts, and other personnel; (2) providing training specific to complex financial investigations, including on coordination among State, local, Tribal, and federal agencies, victim assistance, blockchain intelligence tools and emerging technologies identified in the February 2024 Critical and Emerging Technology List Update of the National Science and Technology Council, and unique aspects of transnational fraud investigations; (3) obtaining software and technical tools; (4) encouraging improved data collection and reporting; (5) supporting training and tabletop exercises to enhance coordination and communication with financial institutions; and (6) designating a financial sector liaison as a point of contact for sharing fraud-related information. It further requires each such agency to report to the federal grant provider within one year of such use, detailing the amount and purpose of funds expended, statistics on fraud in the agency's jurisdiction with analysis of the funds' effects, and an assessment of the agency's ability to deter such fraud.

This section directs the Secretary of the Treasury and the Director of the Financial Crimes Enforcement Network, in consultation with the Attorney General, the Secretary of Homeland Security, and the appropriate Federal banking agencies and Federal functional regulators, to jointly submit to Congress, no later than one year after enactment of this Act, a report on efforts and recommendations related to general financial fraud, pig butchering, elder financial fraud, and scams.

This section directs the Secretary of the Treasury and the Director of the Financial Crimes Enforcement Network, in consultation with the Attorney General, the Secretary of Homeland Security, and appropriate federal banking agencies and functional regulators, to submit to Congress, not later than two years after enactment, a report on the state of scams in the United States that (1) estimates annual numbers of financial fraud, pig butchering, elder financial fraud, and other scams (including attempted and successful scams via social media, online dating services, email, and impersonation of financial institutions and non-bank financial institutions); annual numbers of affected consumers, dollar losses, percentages attributable to overseas actors and organized crime, attempted scams involving impersonation of financial institution phone numbers, and synthetic identities impersonating U.S. consumers; (2) provides an overview of federal civil and criminal enforcement actions against recipients of scam proceeds (including numbers of actions, their effectiveness, types of claims and penalties imposed, relief obtained, and connections to Suspicious Activity Reports); and (3) identifies amounts made available and expended to address such scams by the Bureau of Consumer Financial Protection, Department of Justice, Federal Bureau of Investigation, Federal Communications Commission, Board of Governors of the Federal Reserve System, Federal Trade Commission, Financial Crimes Enforcement Network, Securities and Exchange Commission, and Social Security Administration. The section further requires the Secretary of the Treasury to solicit public comment on the report from consumers, social media companies, email providers, telecommunications companies, financial institutions, and non-bank financial institutions.

This section requires each federal agency providing eligible federal grant funds used for a purpose specified under section 3(a) to issue an annual report to the Committee on Financial Services of the House of Representatives and the Committee on Banking, Housing, and Urban Affairs of the Senate containing information received from law enforcement agencies under section 3(b).