A substantive restructuring of reporting requirements. V2 updates the short title to include the year 2026 and refines the definitions of eligible federal grant funds by adding specific statutory and regulatory citations. Most significantly, Section 5, which mandates a report on the state of scams, has been fundamentally rewritten to focus on FinCEN data, BSA reports, and the Rapid Response Program, while removing broad statistical estimates and multi-agency expenditure reporting.
GUARD Act
- Sponsor
- Rep. Nunn, Zachary [R-IA-3]
- Committees
- Financial Services Committee (primary)
- Last action
- Sep 16, 2026
Bottom line
The GUARD Act of 2026 empowers local law enforcement to combat modern financial fraud, including cryptocurrency scams, by broadening the use of existing federal grants and enhancing inter-agency cooperation and reporting.
What it actually does
This bill expands the permissible uses of certain existing federal grant funds for State, local, and Tribal law enforcement agencies to include investigating elder financial fraud, 'pig butchering' scams, and general financial fraud. It also clarifies that federal law enforcement can assist these agencies with blockchain tracing tools and mandates several reports on the state of financial fraud in the United States.
Proponents argue
Supporters argue that this legislation is critical for equipping law enforcement with the necessary tools and training to combat increasingly sophisticated financial crimes, particularly those targeting vulnerable populations and leveraging emerging technologies like cryptocurrency. They contend it will improve victim protection and facilitate better coordination across all levels of law enforcement and with financial institutions.
Opponents contend
Critics might raise concerns that by expanding the use of existing grant funds, the bill could inadvertently divert resources from other vital law enforcement priorities that these grants were originally intended to support. Some privacy advocates might also express reservations about the expanded use of blockchain tracing tools, even if focused on fraud.
The bill is concise and clearly written, allowing a reader to understand its core provisions and implications within the typical time allotted for legislative review.
Section 3(a)
Expanding Grant Use for Financial Fraud Investigations
This provision allows State, local, and Tribal law enforcement agencies to use eligible Federal grant funds from specific existing programs (such as those under the PRO-IP Act, VAWA Reauthorization Act, and COPS Technology Program) for investigating elder financial fraud, pig butchering, and general financial fraud. Permitted uses include hiring personnel, providing specialized training (including on blockchain intelligence), acquiring software, improving data collection, and fostering coordination with financial institutions.
Supporters argue
Supporters argue this provision is crucial for equipping local law enforcement with the necessary tools and training to combat sophisticated financial crimes, especially those targeting vulnerable populations and utilizing emerging technologies like cryptocurrency.
Critics contend
Critics might argue that diverting existing grant funds to these specific areas could reduce resources for other critical law enforcement priorities initially intended by the original grant programs, potentially creating new gaps in enforcement.
Tradeoffs
The tension lies between providing flexibility to address new and evolving threats and potentially diluting the original, often specialized, focus of the specified federal grant programs.
Section 7
Federal Support for Blockchain Tracing
This section clarifies that Federal law enforcement agencies are permitted to assist State, local, and Tribal law enforcement agencies and fusion centers in the use of tracing tools for blockchain and related technology. This formalizes and encourages federal support for local agencies investigating crimes involving digital assets, which are often central to modern financial frauds.
Sections 4, 5, 6
Enhanced Reporting and Data Collection on Financial Fraud
The bill mandates several reports to Congress. Section 4 requires the Secretary of the Treasury (via FinCEN) to report on efforts to combat various financial frauds, including legislative recommendations. Section 5 mandates FinCEN to submit biennial reports on the state of scams in the U.S., analyzing trends, volumes, aggregate dollar amounts, typologies, and the role of digital assets. Section 6 requires Federal agencies providing eligible grant funds to submit annual reports to Congress summarizing how those funds were used by local agencies and their impact.
The definition of 'eligible Federal grant funds' specifies that the bill expands the use of funds received under existing programs, such as Title IV of the PRO-IP Act of 2008, Title 28, Code of Federal Regulations, part 23, Section 1401 of the Violence Against Women Act Reauthorization Act of 2022, and Section 1701 of the Omnibus Crime Control and Safe Streets Act of 1968.
Section 2(2)
Why it matters:It is standard legislative practice to define terms by reference to existing law to ensure consistency and avoid redundancy. However, it can obscure the fact that no new funding is being directly provided by this bill.
Case for: Proponents would argue this approach efficiently leverages established funding mechanisms and infrastructure, allowing for rapid adaptation to new threats without the need for entirely new appropriations processes.
Case against: Critics might contend that by not providing new, dedicated funding, the bill might not adequately address the scale of the financial fraud problem, potentially forcing agencies to deprioritize other important areas to fund these new initiatives.
Estimated impact: Qualitatively, it expands the *scope* of existing federal grant funds for State, local, and Tribal law enforcement, rather than increasing the *amount* of funds available. The actual impact depends on how agencies reallocate their budgets.
The bill specifies that training for complex financial investigations should include 'emerging technologies identified in the February 2024 'Critical and Emerging Technology List Update' of the Fast Track Action Subcommittee on Critical and Emerging Technologies of the National Science and Technology Council.'
Section 3(a)(2)(C) and (D)
Why it matters:Referring to an external, dynamic list is a common legislative technique to ensure that the bill's provisions remain current and responsive to rapidly evolving technological landscapes without requiring constant statutory updates.
Case for: Proponents would argue this ensures that law enforcement training remains cutting-edge and directly relevant to the latest technological threats in financial fraud, preventing the bill from becoming quickly outdated.
Case against: Some might argue that relying on an external, non-legislative list for defining training scope could lead to less direct congressional oversight or potential for rapid shifts in focus without legislative review.
Estimated impact: Ensures that law enforcement training programs funded by these grants will adapt to the most current and relevant critical and emerging technologies pertinent to financial fraud investigations.