TRAPS Act
- Bill Number
- H.R. 4936
- Origin Chamber
- House
- Congress
- 119th Congress, Session 1
- Policy Area
- Finance and Financial Sector
- Status
- Introduced
- Latest Action
- 2025-08-08: Referred to the House Committee on Financial Services.
- Last Updated
- 2026-06-24T08:10:25Z
AI-Generated Summary
Purpose
The TRAPS Act aims to create a federal task force to study payment scams—fraudulent schemes involving electronic money transfers—and develop strategies to prevent them. It focuses on improving detection, education, and coordination across government, industry, and consumer groups to protect individuals from financial losses due to scams.
Key Provisions
- Definitions:
- "Payment" refers to any electronic fund transfer between individuals using a platform or intermediary (e.g., apps like Venmo or Zelle).
- "Secretary" means the U.S. Secretary of the Treasury.
- "Task Force" is the group established by the Act.
- Establishment and Leadership: The Secretary must create the Task Force within 90 days of the Act's enactment. It is chaired by the Secretary or their designee.
- Membership: The Task Force includes representatives from:
- Federal agencies: Bureau of Consumer Financial Protection (CFPB), Federal Communications Commission (FCC), Federal Trade Commission (FTC), Department of Justice (DOJ), Office of the Comptroller of the Currency (OCC), Federal Reserve Board, National Credit Union Administration (NCUA), Federal Deposit Insurance Corporation (FDIC), and Financial Crimes Enforcement Network (FinCEN).
- Private sector: Experts from financial institutions, credit unions, digital payment networks, community banks, consumer groups, technology/online platform associations, and up to five representatives from scam victims, support networks, or other stakeholders.
- Members serve until the Task Force ends; vacancies are filled similarly to initial appointments.
- Purpose and Approach: The Task Force will analyze scam trends, identify prevention methods, and recommend cross-sector solutions. It emphasizes input from victim support groups and industries affected by scams, such as finance, telecom, and tech.
- Meetings and Duties:
- Must meet at least three times in the first year, with flexibility for more (including virtual).
- Duties include:
- Reviewing best practices against scam tactics like fake calls, texts, ads, pop-ups, and websites.
- Studying international anti-scam efforts.
- Identifying scam methods on payment platforms.
- Developing consumer education strategies to recognize, avoid, and report scams.
- Improving law enforcement coordination to track perpetrators.
- Consulting state, local, Tribal agencies, and financial providers.
- Assessing needs for new federal laws.
- Addressing business email compromise scams.
- Compensation and Operations: Members (if federal employees) receive no extra pay beyond their regular salary. The Task Force is exempt from the Federal Advisory Committee Act (a law governing federal advisory groups, which simplifies operations by avoiding certain procedural requirements).
- Reporting and Termination:
- Within one year of establishment, submit a public report to Senate and House financial committees detailing findings, strategies, legislative/regulatory recommendations, and ways to improve intergovernmental cooperation (e.g., better data sharing and training evaluation).
- Annual report updates thereafter.
- The Task Force sunsets (ends) three years after the initial report.
Significant Changes to Existing Law
This Act introduces a new, temporary federal task force specifically dedicated to payment scams, which does not directly amend prior laws but creates a structured forum for coordination. It exempts the group from the Federal Advisory Committee Act, allowing faster setup and fewer bureaucratic hurdles compared to standard advisory bodies. The Act's recommendations could lead to future changes in laws related to consumer protection, financial regulations, or law enforcement, but it does not enact them itself.
Potential Impacts
- Government Agencies: Increases coordination among federal bodies (e.g., Treasury, DOJ, FTC) and with state/local/Tribal entities, potentially streamlining investigations and data sharing. Agencies may face new reporting duties, but the short-term nature limits long-term burdens.
- Citizens: Enhances consumer protection through better education on scam avoidance and reporting, potentially reducing financial losses from scams. Victims gain indirect representation, which could improve support services.
- International Relations: By reviewing global anti-scam approaches, it may foster U.S. collaboration with other countries on cross-border fraud, though it focuses primarily on domestic efforts.
Main Stakeholders Affected
- Federal Agencies: Treasury, CFPB, FCC, FTC, DOJ, OCC, Federal Reserve, NCUA, FDIC, and FinCEN, which provide members and implement recommendations.
- Financial and Tech Industries: Banks, credit unions, digital payment providers (e.g., PayPal), community banks, and tech associations, contributing expertise and adopting prevention strategies.
- Consumers and Victims: Individuals targeted by scams, supported by consumer groups and victim representatives, who benefit from education and policy improvements.
- State, Local, and Tribal Governments: Involved in consultations, potentially aiding in broader enforcement and data harmonization.
- Law Enforcement and Support Networks: Gain tools for pursuing scammers and estimating scam impacts.
Notable Legal, Constitutional, or Political Implications
- Legal: The exemption from the Federal Advisory Committee Act streamlines operations but raises minor transparency concerns, as it bypasses some public notice and record-keeping rules. Recommendations could influence future regulations under existing laws like the Consumer Financial Protection Act or anti-fraud statutes.
- Constitutional: No direct challenges; it aligns with Congress's authority to regulate interstate commerce and protect consumers from fraud.
- Political: As a bipartisan bill (introduced by representatives from both parties), it promotes collaborative anti-fraud efforts without partisan divides. The three-year sunset provision ensures it's a targeted, non-permanent expansion of government involvement, potentially appealing to fiscal conservatives while addressing rising scam concerns.
This summary was generated by AI and may contain inaccuracies. Refer to the official source document for the authoritative text.
Sponsor
Cosponsors (51)
Rep. Himes, James A. [D-CT-4], Rep. Beyer, Donald S. [D-VA-8], Rep. Williams, Roger [R-TX-25], Rep. Sessions, Pete [R-TX-17], Rep. Soto, Darren [D-FL-9], Rep. Sewell, Terri A. [D-AL-7], Rep. Kim, Young [R-CA-40], Rep. Vindman, Eugene Simon [D-VA-7], Rep. Magaziner, Seth [D-RI-2], Rep. Pettersen, Brittany [D-CO-7], Rep. Meuser, Daniel [R-PA-9], Rep. Sherman, Brad [D-CA-32], Rep. Scott, David [D-GA-13], Rep. Beatty, Joyce [D-OH-3], Rep. Buchanan, Vern [R-FL-16], Rep. Salinas, Andrea [D-OR-6], Rep. Loudermilk, Barry [R-GA-11], Rep. Bera, Ami [D-CA-6], Rep. Steil, Bryan [R-WI-1], Rep. Riley, Josh [D-NY-19], Rep. Salazar, Maria Elvira [R-FL-27], Rep. Raskin, Jamie [D-MD-8], Rep. Tran, Derek [D-CA-45], Rep. Lucas, Frank D. [R-OK-3], Rep. Moore, Tim [R-NC-14], Rep. Valadao, David G. [R-CA-22], Rep. Wittman, Robert J. [R-VA-1], Rep. Smith, Christopher H. [R-NJ-4], Rep. Timmons, William R. [R-SC-4], Rep. Fitzpatrick, Brian K. [R-PA-1], Rep. Correa, J. Luis [D-CA-46], Rep. Weber, Randy K. Sr. [R-TX-14], Rep. Lawler, Michael [R-NY-17], Rep. Malliotakis, Nicole [R-NY-11], Rep. Mann, Tracey [R-KS-1], Rep. Harrigan, Pat [R-NC-10], Rep. Kiggans, Jennifer A. [R-VA-2], Rep. Deluzio, Christopher R. [D-PA-17], Rep. Bacon, Don [R-NE-2], Rep. Latimer, George [D-NY-16], Rep. Walkinshaw, James R. [D-VA-11], Rep. Foxx, Virginia [R-NC-5], Rep. Van Drew, Jefferson [R-NJ-2], Rep. Davids, Sharice [D-KS-3], Rep. Smith, Adrian [R-NE-3], Rep. Davis, Donald G. [D-NC-1], Rep. Neguse, Joe [D-CO-2], Rep. Bonamici, Suzanne [D-OR-1], Rep. Keating, William R. [D-MA-9], Rep. De La Cruz, Monica [R-TX-15] and 1 more
Recent Actions
- 2025-08-08: Referred to the House Committee on Financial Services.
- 2025-08-08: Introduced in House
- 2025-08-08: Introduced in House
Bill Versions
- Taskforce for Recognizing and Averting Payment Scams Act — issued 2025-08-08 — PDF (8 pages)