S. 3982

II  119th CONGRESS  2d Session  S. 3982  IN THE SENATE OF THE UNITED STATES   March 4, 2026   Mr. Sheehy  (for himself and  Ms. Blunt Rochester ) introduced the following bill; which was read twice and referred to the  Committee on Commerce, Science, and Transportation    A BILL
To establish protections against digital impersonation fraud, and for other purposes.
1.
Short title
This Act may be cited as the   AI Fraud Accountability  Act of 2026  .
2.
Criminal prohibition on use of digital impersonations to commit fraud
(a)
In general
Section 223 of the Communications Act of 1934 (47 U.S.C. 223) is amended—
(1)
by redesignating subsection (i) as subsection (j); and
(2)
by inserting after subsection (h) the following:
(i)
Use of digital impersonations To commit fraud
(1)
Definitions
In this subsection:
(A)
Digital impersonation
The term  digital impersonation  means any visual or audio
  depiction of—
(i)
an identifiable individual created
  through the use of software, machine learning, artificial intelligence, or any
  other computer-generated or technological means, including by adapting,
  modifying, manipulating, or altering an authentic visual or audio depiction,
  that, when viewed or listened to as a whole by a reasonable person, is
  indistinguishable from an authentic visual or audio depiction of the
  individual; or
(ii)
an imaginary individual created through the use of software, machine
  learning, artificial intelligence, or any other computer-generated or
  technological means, including by adapting, modifying, manipulating, or
  altering an authentic visual or audio depiction of an imaginary individual,
  that, when viewed or listened to as a whole by a reasonable person, is
  indistinguishable from a visual or audio depiction of a real
  individual.
(B)
Identifiable individual
The term  identifiable individual  means an individual—
(i)
who appears in whole or in part, or is heard, in a digital impersonation;
  and
(ii)
whose face, likeness, voice, or other distinguishing characteristic
  (including a unique birthmark or other recognizable feature) is displayed or
  heard in connection with such digital impersonation.
(2)
Offense
(A)
In general
Subject to subparagraph (B), it shall be unlawful for a person, in
  interstate or foreign communications, to falsely pose as an identifiable
  individual or imaginary individual, in a manner intended to be taken as genuine,
  in a digital impersonation, with intent to defraud a person of any money, paper,
  document, or thing of value.
(B)
Exceptions
Subparagraph (A) shall not apply to a lawfully authorized investigative,
  protective, or intelligence activity of—
(i)
a law enforcement agency of the United States, a State, or a political
  subdivision of a State; or
(ii)
an intelligence agency of the United States;
(3)
Penalties
Any person who violates paragraph (2) shall be fined under title 18, United
  States Code, imprisoned not more than 3 years, or both.
(4)
Threats
Any person who intentionally threatens to commit the offense under paragraph
  (2) for the purpose of intimidation, coercion, extortion, or to create mental
  distress shall be punished as provided in paragraph (3).
(5)
Forfeiture
(A)
In general
The court, in imposing a sentence on any
  person convicted of a violation of paragraph (2), shall order, in addition to
  any other sentence imposed and irrespective of any other sentence imposed and
  irrespective of any provision of State law, that the person forfeit to the
  United States—
(i)
the person’s interest in property, real or personal, constituting or
  derived from any gross proceeds of the violation, or any property traceable to
  such property, obtained or retained directly or indirectly as a result of the
  violation; and
(ii)
any personal property of the person used, or intended to be used, in any
  manner or part, to commit or to facilitate the commission of the
  violation.
(B)
Procedures
Section 413 of the Controlled Substances Act (21 U.S.C. 853), with the
  exception of subsections (a) and (d), shall apply to the criminal forfeiture of
  property under subparagraph (A).
(6)
Extraterritorial jurisdiction
There is extraterritorial Federal jurisdiction over an offense under paragraph
  (2).
 .
(b)
Defenses
Section 223(e)(1) of the Communications Act of 1934 (47 U.S.C. 223(e)(1)) is amended by striking  or (h)  and inserting  (h), or (i) .
3.
Protection against digital impersonation fraud
(a)
Prohibition
(1)
In general
Subject to paragraph (2), it shall be unlawful for a person, in interstate or foreign commerce, to falsely pose as an identifiable or imaginary individual in a manner intended to be taken as genuine, in a digital impersonation, with intent to defraud a person of any money, paper, document, or thing of value.
(2)
Exception
The prohibition described in paragraph (1) shall not apply to a lawfully authorized investigative, protective, or intelligence activity of—
(A)
a law enforcement agency of the United States, a State, or a political subdivision of a State; or
(B)
an intelligence agency of the United States.
(b)
Enforcement by the Commission
(1)
Unfair or deceptive acts or practices
A violation of subsection (a) shall be treated as a violation of a rule defining an unfair or deceptive act or practice prescribed under section 18(a)(1)(B) of the Federal Trade Commission Act (15 U.S.C. 57a(a)(1)(B)).
(2)
Powers of the Commission
(A)
In general
The Commission shall enforce this section in the same manner, by the same means, and with the same jurisdiction, powers, and duties as though all applicable terms and provisions of the Federal Trade Commission Act (15 U.S.C. 41 et seq.) were incorporated into and made a part of this section.
(B)
Privileges and immunities
Any person who violates subsection (a) shall be subject to the penalties and entitled to the privileges and immunities provided in the Federal Trade Commission Act (15 U.S.C. 41 et seq.).
(C)
Authority preserved
Nothing in this Act shall be construed to limit the authority of the Commission under any other provision of law.
(c)
Definitions
For purposes of this section:
(1)
Commission
The term  Commission  means the Federal Trade Commission.
(2)
Digital impersonation; identifiable individual
The terms  digital impersonation  and  identifiable individual  have the meaning given such terms in section 223(i) of the Communications Act of 1934 (47 U.S.C. 223(i)), as added by section 2 of this Act.
4.
Working group on digital impersonation fraud
(a)
Definitions
In this section:
(1)
Appropriate committees of Congress
The term  appropriate committees of Congress  means—
(A)
the Committee on Commerce, Science, and Transportation of the Senate; and
(B)
the Committee on Science, Space, and Technology of the House of Representatives.
(2)
Digital forensics
The term  digital forensics  means scientific or technical practices used to recognize, collect, analyze, or interpret digital evidence for the purposes of investigating crimes or other incidents, including the use of digital impersonation to commit fraud.
(3)
Digital impersonation
The term  digital impersonation  has the meaning given that term in section 223(i) of the Communications Act of 1934 (47 U.S.C. 223(i)), as added by section 2 of this Act.
(4)
Director
The term  Director  means the Director of the National Institute of Standards and Technology.
(b)
Establishment of Working Group
(1)
In general
Not later than 30 days after the date of the enactment of this Act, the Secretary of Commerce, acting through the Director, shall convene a working group (referred to in this section as the  Working Group ) to engage in technical discussions and research for the development of best practices and recommendations for the recognition, detection, prevention, and tracing of digital impersonations used in violation of section 223(i) of the Communications Act of 1934 (47 U.S.C. 223(i)), as amended by section 2 of this Act, and section 3(a) of this Act.
(2)
Composition
The Working Group shall consist of—
(A)
representatives from—
(i)
the Department of Justice;
(ii)
the Federal Trade Commission;
(iii)
Federal, State, and local government law enforcement agencies; and
(iv)
private sector industries, including—
(I)
financial services;
(II)
health care;
(III)
retail and e-commerce;
(IV)
telecommunications; and
(V)
digital platforms, including social media platforms; and
(B)
scientists and engineers with expertise in—
(i)
digital forensics; and
(ii)
artificial intelligence, including the generation or detection of digital impersonations.
(c)
Public workshop
The Director shall—
(1)
convene not less than 1 public workshop to solicit input from stakeholders on the best practices and recommendations developed under subsection (b)(1); and
(2)
incorporate such input into the best practices and recommendations as the Director considers appropriate.
(d)
Publication of best practices and recommendations
Not later than 1 year after the date of the enactment of this Act, the Director shall publish on a publicly accessible website of the National Institute of Standards and Technology a report that contains the best practices and recommendations developed pursuant to subsection (b)(1) and modified under subsection (c)(2).
(e)
Annual review and updates
Not later than 2 years after the date of the enactment of this Act, and not less frequently than once each year thereafter, the Director shall—
(1)
review the best practices and recommendations developed under this section; and
(2)
update the best practices and recommendations published under subsection (d) as the Director considers appropriate pursuant to the most recent review conducted pursuant to paragraph (1) of this subsection.
(f)
Report to Congress
Not later than 1 year after the date of the enactment of this Act, and annually thereafter, the Director shall submit to the appropriate committees of Congress a report that summarizes—
(1)
the meetings and collaboration of the Working Group during the year preceding the submission of the report; and
(2)
the work planned by the Working Group for the year following the submission of the report.
(g)
Sunset
The requirements of this section shall terminate on the date that is 10 years after the date of the enactment of this Act.
5.
Cooperation with foreign law enforcement agencies
(a)
List of countries with highest occurrence of violations
Not later than 90 days after the date of enactment of this section, the Federal Trade Commission (in this section referred to as the  Commission ), in consultation with the Attorney General and the Secretary of State, shall identify a list of the top 10 foreign countries where the highest occurrence of violations of section 2 or 3 originate and harm individuals located in the United States or a territory thereof.
(b)
FTC international agreements
(1)
In general
Using the list of foreign countries identified under subsection (a), the Commission, in coordination with the Secretary of State, may enter into agreements with such foreign countries to ensure the cooperation of any foreign law enforcement agency in the Commission's enforcement of this Act.
(2)
Requirements
Any agreement entered into by the Commission under paragraph (1) shall be subject to the requirements described in section 6(j)(4) of the Federal Trade Commission Act (15 U.S.C. 46(j)(4)).
(3)
Report to Congress
Not later than 1 year after the date of enactment of this section, and annually thereafter, the Commission shall submit to the Committee on Commerce, Science, and Transportation of the Senate and the Committee on Energy and Commerce of the House of Representatives a report on the implementation of this subsection during the reporting period, including—
(A)
any new agreements with foreign countries (as described in paragraph (1)) entered into during such period;
(B)
any negotiations regarding new agreements or modifications to agreements with foreign countries during such period;
(C)
a description of the Commission's coordination with foreign law enforcement agencies to enforce alleged violations of section 3; and
(D)
any challenges with cooperation of foreign law enforcement agencies (including with respect to foreign countries without an agreement under paragraph (1)) in the enforcement of section 3.
(c)
DOJ review of international law enforcement agency agreements
(1)
In general
Not later than 1 year after the date of enactment of this section, and not less frequently than every 5 years thereafter, the Attorney General shall review and, as necessary and consistent with authorities under applicable law, modify international agreements with foreign law enforcement agencies in foreign countries identified under subsection (a) to encourage assistance with the enforcement of violations of section 223(i) of the Communications Act of 1934, as added by section 2 of this Act, that originate outside the United States.
(2)
Report
Not later than 1 year after the date of enactment of this section, and every 5 years thereafter, the Attorney General shall submit to the Committee on Commerce, Science, and Transportation of the Senate, the Committee on the Judiciary of the Senate, the Committee on Energy and Commerce of the House of Representatives, and the Committee on the Judiciary of the House of Representatives a report that includes—
(A)
an analysis of the review conducted under paragraph (1);
(B)
a description of any modifications to international agreements described in paragraph (1) pursued by the Attorney General; and
(C)
recommendations to strengthen the enforcement of violations of section 223(i) of the Communications Act of 1934, as added by section 2 of this Act, that—
(i)
originate outside the United States; and
(ii)
harm United States persons located in the United States.
6.
Savings clause
Nothing in this Act shall be construed to restrict parody, satire, journalism, or any other rights, privileges, or immunities protected by the First Amendment to the Constitution of the United States.