Protecting America’s Bank Account Against Fraud, Waste, and Abuse

March 25, 2025

Executive Orders

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Action Summary

Purpose: Enhance financial integrity and operational efficiency by improving oversight over the United States General Fund, which processes trillions in transactions annually.
Financial Risks Addressed: Combat fraud, waste, and improper payments that risk billions of taxpayer dollars, citing previous losses estimated between $233 billion and $521 billion.
Enhanced Payment Verification:
- Pre-certification Processes: Require agencies to implement pre-disbursement verification using updated Treasury guidance and the Do Not Pay Working System.
- Data Access and Integration: Facilitate data sharing by amending Privacy Act records notices and waiving certain administrative barriers for computer matching activities.
Agency Compliance and Verification: Mandate agency heads, through designated officials, to follow new pre-certification criteria (e.g., fund availability, correct payee information, valid account numbers) prior to payment certification.
Core Financial System Consolidation:
- CFO Act Agencies: Direct consolidation of core financial systems, ensuring adherence to federal accounting and reporting standards.
- Non-CFO Act Agencies: Transition and consolidate transactional financial management services under a single provider approved by the Treasury.
Reduction of NTDOs:
- Review and Revocation: Assess and potentially revoke delegated disbursing authority to reduce fragmentation.
- Centralization: Develop a plan to transition payment disbursements back to the Department of the Treasury’s systems while ensuring continuity.
Implementation and Reporting:
- Agencies must submit a compliance plan and update their systems to align with Treasury requirements within specified timeframes (30 to 180 days).
- The Treasury will report progress to the President and ensure integration of proper verification processes.
General Provisions:
- Clarify that the order does not impair existing legal authorities or create enforceable rights against the Government.
- Ensure protections for classified, personal, and tax-related information throughout implementation.

Risks & Considerations

The Executive Order mandates significant changes in financial management systems across federal agencies, which could lead to disruptions in funding flows and financial reporting. This may impact federal grants and contracts that Vanderbilt University relies on.
Increased scrutiny and verification processes for federal disbursements could delay payments, affecting cash flow for research projects and other federally funded initiatives at the university.
The consolidation of financial systems and reduction of Non-Treasury Disbursing Offices (NTDOs) may streamline processes but could also lead to initial confusion and adjustment periods for compliance with new standards.
Vanderbilt University may need to enhance its own financial management systems to align with new federal requirements, potentially incurring additional costs and resource allocation.

Impacted Programs

Office of Sponsored Programs at Vanderbilt may need to adjust its processes to ensure compliance with new federal financial management and reporting standards.
Vanderbilt’s Financial Aid Office might experience changes in the timing and processing of federal student aid disbursements, requiring adjustments in financial planning and communication with students.
The Office of Research could face challenges in managing federal research grants, necessitating close monitoring of compliance with new disbursement and reporting requirements.
Vanderbilt’s partnerships with federal agencies for research and development may need to be reevaluated to ensure alignment with the new financial management policies.

Financial Impact

The reallocation and consolidation of federal financial systems could impact the timing and availability of federal funds, potentially affecting Vanderbilt’s budget planning and financial stability.
Vanderbilt University might need to invest in upgrading its financial management systems to ensure compatibility with federal systems, which could involve significant financial and operational resources.
There may be opportunities for Vanderbilt to engage in research and development projects focused on improving financial management and fraud prevention, potentially leading to new funding streams.
Changes in federal disbursement processes could affect the university’s ability to manage cash flow effectively, necessitating adjustments in financial strategies and contingency planning.

Relevance Score: 4 (The order presents a need for potential major changes or transformations of programs.)

Key Actions

Vanderbilt University’s Financial Management Office should review and ensure compliance with the new financial management and reporting standards set by the Department of the Treasury. This includes updating systems to align with the Treasury’s guidelines for pre-certification verification processes to prevent fraud and improper payments.
The Office of Federal Relations should monitor changes in disbursing authority and the consolidation of financial systems to identify any impacts on federal funding and grants that the university receives. Engaging with federal agencies to understand these changes will be crucial.
Vanderbilt’s IT Department should prepare for potential system integrations and updates required to comply with the Treasury’s centralized financial management systems. This may involve collaborating with external providers approved by the Department of the Treasury.
The Office of Compliance and Risk Management should assess the implications of the executive order on data sharing and privacy, ensuring that any data provided to the Department of the Treasury complies with the Privacy Act of 1974 and other relevant regulations.

Opportunities

The executive order presents an opportunity for Vanderbilt’s Research Centers to engage in studies related to financial fraud prevention and the effectiveness of centralized financial systems. This research could position Vanderbilt as a leader in financial integrity and operational efficiency.
By aligning with the Treasury’s initiatives, Vanderbilt can enhance its reputation as a responsible steward of federal funds, potentially increasing its eligibility for future federal grants and funding opportunities.
The focus on transparency and accountability in federal financial operations aligns with Vanderbilt’s commitment to ethical practices, providing an opportunity to showcase its adherence to these principles in its financial management and reporting.

Relevance Score: 3 (The order requires some adjustments to Vanderbilt’s financial management processes and systems to ensure compliance and capitalize on opportunities.)

Average Relevance Score: 4.2

Timeline for Implementation

Within 30 days of the date of the order – the Secretary of the Treasury shall assess whether to maintain or revoke delegated disbursing authorities.
Within 90 days – agency heads must review and modify relevant system of records notices under the Privacy Act, and submit a compliance plan to the OMB Director.
Within 180 days – the OMB Director is required to issue guidance for consolidating core financial systems and the Secretary of the Treasury must submit an implementation report to the President.
As soon as practicable, but not later than 180 days – guidance for non-CFO Act agencies regarding consolidation of transactional financial management services is to be issued.

Relevance Score: 4

Impacted Government Organizations

Department of the Treasury: Central to this order, it is tasked with safeguarding the General Fund, executing pre-certification verification processes, and consolidating payment systems to prevent fraud and improper payments.
Office of Management and Budget (OMB): Works in close consultation with the Treasury to update guidance, issue instructions regarding system integration, and oversee compliance across agencies.
All Federal Agencies with Disbursing Authority: Required to provide the Treasury with detailed payment information and transition aspects of their disbursement systems, thereby ensuring transparency and centralized oversight.
CFO Act Agencies: Directed to consolidate their core financial systems as part of efforts to standardize financial management and reporting.
Non-Treasury Disbursing Offices (NTDOs) – Including the Departments of Defense, Homeland Security, and the Department of Justice (Attorney General): These agencies, which traditionally handle their own disbursements, must coordinate with the Treasury to shift responsibilities and align with unified financial controls.

Relevance Score: 5 (The directive applies broadly across the entire Federal Government, affecting numerous agencies and systems.)

Responsible Officials

Secretary of the Treasury – Charged with updating guidance, enhancing systems for payment verification, issuing instructions for pre-certification of disbursements, and coordinating multiple initiatives to safeguard the General Fund.
Director of the Office of Management and Budget (OMB Director) – Tasked with developing and issuing guidance related to the consolidation of core financial systems, and with receiving compliance plans and coordinating with the Secretary of the Treasury.
Agency Heads – Required to cooperate with the Secretary of the Treasury by implementing pre-certification procedures, updating system of records notices, consolidating financial systems (as appropriate), and submitting compliance plans.
Designated Agency Officials (Certifying Officers) – Responsible for verifying that disbursements comply with established payment verification requirements and returning non-compliant payments for reconciliation.
Secretary of Defense, Secretary of Homeland Security, and Attorney General – Specifically identified as agency heads whose departments must work with the Secretary of the Treasury regarding disbursing authority and transition of payment systems.
Department of the Treasury’s Chief Disbursing Officer – Assigned to receive disbursement requests for reconciliation and to facilitate the centralization of payment systems.
Assistant to the President for Economic Policy – Designated to receive the implementation report from the Secretary of the Treasury detailing progress on the order’s mandates.

Relevance Score: 5 (The directives impact White House and Cabinet-level officials, affecting key agency heads and senior leadership across the Federal Government.)