Security1 publisher2 min readPublished
House votes to let existing DOJ grants buy blockchain tracing for local police
The GUARD Act, passed by the House on Tuesday, would let five existing Justice Department grant programs pay for the analysts, training and blockchain tracing software that local police say they lack in scam cases.
The Watch · Security desk
What happened
- The House passed the Guarding Unprotected Aging Retirees from Deception Act on Tuesday, a bipartisan bill from Representatives Zachary Nunn, Scott Fitzgerald and Josh Gottheimer.
- The bill lets local agencies spend existing federal grant money on financial fraud analysts, on victim-assistance and blockchain tracing training, on investigative software, and on a bank liaison contact.
- Americans reported a record $11.4 billion in cryptocurrency-related losses during 2025, the caseload the sponsors say local departments cannot currently work.
- The House also passed a bill on Tuesday evening ending the tax Americans owe on money stolen from them, retroactive to victims scammed between 2021 and 2025.
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Why it matters
- capability A detective who could not fit tracing software into a grant's allowed costs can now put the software and the analyst to run it in the same application.
- constraint The eligibility change widens what five existing programs may fund without adding to them, so a fraud analyst competes with the equipment and overtime those awards cover today.
- decision Departments have to decide whether a crypto-tracing analyst is worth more than the line items the same award has been paying for, and whether they can keep that person after the grant period.
- precedent Congress handled the scam enforcement gap as a purchasing question. The next fraud bill is likelier to arrive as grant eligibility language than as a new criminal statute.
The gap here is jurisdictional. One victim's pig-butchering complaint usually does not clear the threshold for a federal investigation, and the department that takes the report is not equipped to work it [8]. The operative change in the bill is what a grant dollar is allowed to buy.
Four allowed uses are named. Hiring analysts and experts in financial fraud [4]. Training officers to assist victims and to use blockchain intelligence tools that trace stolen cryptocurrency and identify perpetrators [5]. Purchasing software to run financial investigations, and designating a point of contact that banks can send information to [6].
Clark Flynt-Barr, government affairs director for financial security at AARP, described the reporting problem in a social media video last week [12]. "One of the things that we heard through AARP's Fraud Watch Network over and over from scam victims was that when they reported scams to their local police, local police didn't have the right tools... to actually investigate those crimes," she said [13]. "This will help to ensure that state and local law enforcement, who really are on the front of lines of fighting scams, have the right tools to do so" [14].
The loss figures set the scale of the caseload. Americans reported a record $11.4 billion in cryptocurrency-related losses in 2025, and investment fraud accounted for $8.6 billion of that [9][10]. That is about 75 percent of the total, leaving roughly $2.8 billion across every other category [18][19]. The bill's own language points at seniors, and at the transnational criminal groups that run these operations from overseas [11].
The money is existing money. The Record reports the funding would be drawn from five Justice Department grant programs already in place, including the Information Sharing Training and Technical Assistance Program, and does not report a new appropriation [7]. A department that puts an analyst on payroll with one of those awards is spending against what the same program funds now.
Senators Katie Britt and Kirsten Gillibrand introduced a companion bill in July 2025, with the emphasis on giving local law enforcement access to blockchain tracing technology [15]. It was added to the Senate's legislative calendar in February [16].
What to watch
- Appropriations levels for the five Justice Department programs: a new allowable cost changes little if the programs are funded flat.
- Whether the next round of DOJ grant solicitations lists blockchain tracing software and fraud analysts as allowable costs in writing.
- Senate action on the scam-tax repeal, whose relief reaches back to victims scammed in 2021.