Title 15, Commerce and TradeRelease 119-110
§1366 Termination of Payments for Noncompliance with Law or Diversion of Funds
Title 15 › CHAPTER 37 — STATE TECHNICAL SERVICES › § 1366
Summary
After giving an agency fair notice and a chance for a hearing, the Secretary can stop federal payments if the agency is not following the rules or if money has been lost, misused, or diverted. Payments stay stopped until the Secretary is sure the agency fixed the problem or repays or arranges to repay the funds.
Full Legal Text
Title 15, §1366
Commerce and Trade, Source: USLM XML via OLRC
Whenever the Secretary, after reasonable notice and opportunity for hearing to any designated agency or participating institution receiving funds under this chapter finds that—
(a)the agency or institution is not complying substantially with provisions of this chapter, with the regulations promulgated by the Secretary, or with the approved annual technical services program; or
(b)any funds paid to the agency or institution under the provisions of this chapter have been lost, misapplied, or otherwise diverted from the purposes for which they were paid or furnished—
the Secretary shall notify such agency or institution that no further payments will be made under the provisions of this chapter until he is satisfied that there is substantial compliance or the diversion has been corrected or, if compliance or correction is impossible, until such agency or institution repays or arranges for the repayment of Federal funds which have been diverted or improperly expended.
Reference
Citations & Metadata
Citation
15 U.S.C. § 1366
Title 15, Commerce and Trade
Last Updated
Sep 22, 2026
Release point: 119-110