By centralizing disbursement authority and enforcing pre-payment verification, the policy could make federal fund delivery more efficient and reduce misuse. For marginalized communities, including low-income individuals, communities of color, and recipients of social safety-net programs, preventing improper payments could free up resources and improve trust in government systems. However, the consolidation of payment systems must be implemented with strong privacy protections to prevent disproportionate exposure of sensitive financial data. There must also be recourse for those who may be subject to process errors where payments should be issued, but have been flagged as improper. It is especially important that the recourse turnaround be rapid – any errors will disproportionately impact low-income individuals who may be depending on disbursements to meet essential needs (e.g., rent, food).
A directive issued by the President that manages operations of the federal government. Executive orders have the force of law but must align with existing statutes and constitutional authority.
Who It Impacts: Federal agencies and employees, directing them on how to implement laws or carry out government functions. Executive orders can also influence businesses and individuals when they relate to issues like immigration, trade, or labor policies.
Who Is Not Impacted: Private citizens and businesses do not have to directly follow an executive order unless it leads to regulations or policies that apply to them. For example, an executive order directing federal agencies to increase renewable energy use does not mandate action from private companies, but it may influence policy shifts that eventually affect them.
Summary
This order strengthens financial integrity by empowering the U.S. Treasury to verify payments before disbursing funds and consolidates federal financial systems. It also increases transparency on how taxpayer dollars flow, aiming to reduce fraud, waste, and abuse in federal spending.
Impact Analysis
Legal Challenges
N/A
Take Institutional Action
Relevant organizations should monitor the implementation to ensure that the people most vulnerable to improper payment errors are protected. They can push for transparency around who is being flagged or blocked.
Collaborate with legal and other organizations who may be able to help individuals navigate the system if they are erroneously flagged as improper payment. Disseminate information on how to access these supports.
Associated or Derivative Policies
Associated: Linked to Executive Order 14247, Modernizing Payments to and from America’s Bank Account, which phases out paper checks and transitions to electronic payments. Builds on existing “Do Not Pay” systems and payment-validation programs under 31 U.S.C. 3351 et seq. to require broader, real-time verification.
Policy Prior to 2025
Prior to this order, agencies disbursed funds through a fragmented system: many non-Treasury disbursing offices (NTDOs) handled payments, and there was limited pre-payment verification. This created risk for improper payments and a lack of centralized oversight.
Additional Resources
USA.gov: Government Benefits: https://www.usa.gov/benefits
USA.gov: Government Checks and Payments, https://www.usa.gov/government-checks-payments
.png)
