Sponsor
Maxine Waters
Representative · D-CA
Representative · D-CA
The bill tightens conflict-of-interest rules, enforcement, and fraud controls to protect public trust and defense supply reliability, but at the cost of narrowing eligible suppliers, raising compliance and enforcement costs, and risking implementation-related slowdowns.
Government contractors and taxpayers: the bill bars entities substantially owned by Presidents, the Vice President, or DPA Committee members from receiving Title III assistance, reducing conflicts of interest and helping preserve public trust in defense industrial policy.
Federal agencies, contractors, and taxpayers: the DPA Committee must standardize fraud-risk processes, train staff, and designate points of contact, improving fraud detection, reducing waste, and strengthening oversight of DPA transactions.
Government contractors and defense supply chains: the bill increases penalties for violating DPA provisions, which should deter noncompliance and incentivize contractors to meet DPA orders, improving reliability of defense production.
Qualified suppliers and defense procurement: companies with 20%+ ownership by listed officials (or aggregated relatives) become ineligible for Title III aid, which could shrink the pool of capable suppliers and delay or raise the cost of defense production.
Small businesses and contractors: higher fines and stiffer penalties raise financial risk for contractors, which may increase contract prices or discourage smaller suppliers from bidding on DPA-supported work.
Agencies, contractors, and taxpayers: implementing standardized fraud controls, reporting, and training will impose administrative costs and could slow some DPA transactions as new reviews and procedures are adopted, potentially raising near-term program costs.
Based on analysis of 5 sections of legislative text.
Bars Title III DPA assistance to entities in which the President, VP, or DPA Committee members (or certain relatives) hold ≥20% equity; raises penalties; mandates fraud-risk management and reporting.
Official title: To amend the Defense Production Act of 1950 to limit eligibility for assistance, increase monetary penalties, establish fraud risk management processes, and for other purposes.
Introduced March 20, 2026 by Maxine Waters · Last progress March 20, 2026
Prohibits entities from receiving Defense Production Act (Title III) assistance if the President, Vice President, or members of the Defense Production Act Committee (or certain close relatives) hold a significant equity interest (20% or more) in those entities. Raises monetary penalties in several DPA provisions, requires the DPA Committee to include fraud-reduction steps and a fraud-risk assessment in its annual report, and directs the Committee to implement a fraud risk management program within one year. Also fixes a typographical phrasing error in the DPA short-title clause.