U.S. Sen. Tommy Tuberville (R-AL) has reintroduced legislation aimed at permanently preventing future administrations from using federal settlement agreements as a funding source for outside activist groups.

Last week, Tuberville was joined by Sens. Ted Budd (R-NC), Ron Johnson (R-WI) and Mike Lee (R-UT) in reintroducing the Stop Settlement Slush Funds Act, which would prohibit the use of federal settlement funds for payments to outside organizations instead of victims or the U.S. Treasury, according to a news release.

The bill follows concerns over a practice used during the Obama administration, when settlement agreements were used to direct money to favored outside organizations rather than victims or the Treasury. The Trump administration’s Department of Justice ended the practice in 2017 and again in 2025 after the Biden administration restored it.

Supporters of the legislation say that without an act of Congress, a future administration could revive the policy with the stroke of a pen. The Stop Settlement Slush Funds Act would permanently ban the practice and require settlement funds to compensate victims, directly remedy harm caused or be returned to the U.S. Treasury.

“We are one election away from these slush funds coming back, and everybody in Washington knows it,” Tuberville said in the release. “The Biden administration proved that the minute Democrats get the keys, they will reopen the loophole and start steering settlement money to their activist friends. I have fought this corruption since my first year in the Senate. Congress needs to put this ban into black-letter law so no future administration can bring this scheme back.”

The legislation would prohibit parties involved in federal disputes from reducing settlement obligations by making “donations” to outside organizations. The bill’s supporters argue the practice allowed the government to select special interest groups to benefit from settlement agreements.

According to a release from Tuberville’s office, the Obama administration’s Department of Justice required some settling parties to direct portions of their settlement obligations to outside organizations selected by the department. Supporters of the bill argued the practice allowed federal settlements to benefit groups they described as advancing a partisan agenda.