Congress eliminates federal civil-rights programs, opens agencies to $1,000-per-day lawsuits

What it does

This bill eliminates federal diversity, equity, and inclusion (DEI) programs across the government, rescinding executive orders that established them, closing DEI offices, prohibiting DEI training, and barring federal funds from supporting DEI initiatives in agencies, contractors, grantees, and educational institutions. It defines prohibited DEI practices broadly—including training that asserts any race or gender is inherently superior or inferior—and creates a private right of action with statutory damages of at least $1,000 per violation per day, allowing citizens to sue federal agencies, contractors, and grantees for violations.

Why we flagged it

The bill's operative mechanism is not primarily to prevent discrimination but to eliminate federal civil-rights infrastructure—DEI offices, training, and enforcement mechanisms—and to create litigation exposure for agencies and contractors that maintain such programs. It redefines civil-rights compliance as a prohibited practice.

• Section 702 repeals Section 342 of Dodd-Frank (Offices of Minority and Women Inclusion in financial regulators) and amends Gramm-Leach-Bliley and Securities Exchange Act to prohibit federal financial regulators from requiring DEI practices—unrelated to federal employment or contracting.
• Section 704 repeals Chief Diversity Officer position (10 U.S.C. § 147) and diversity-in-military-leadership program (10 U.S.C. § 656)—military-specific provisions unrelated to general federal DEI policy.
• Section 601 amends Higher Education Act to prohibit accreditors from requiring or encouraging DEI practices and from assessing institutional ideology—extends federal control over private accreditation bodies beyond federal employment.

What the text implies

• Private right of action with $1,000/day statutory damages creates litigation risk for any federal agency, contractor, or grantee perceived to maintain DEI compliance—likely to chill legitimate civil-rights efforts and generate defensive litigation.
• Definition of 'prohibited diversity, equity, or inclusion practice' is broad enough to capture training on systemic racism, historical discrimination, or intersectionality—effectively bans academic and professional education on civil-rights history.
• Section 401–402 (grants and cooperative agreements) and Section 303 (federal contracting) extend DEI prohibitions to all recipients of federal funds, including universities, nonprofits, and private contractors—creates federal control over private-sector hiring and training.
• Section 601 (accreditation standards) prohibits accreditors from assessing institutional 'ideology, belief, or viewpoint'—may shield religious institutions from accreditation scrutiny while preventing accreditors from enforcing civil-rights standards.
• Repeal of Section 342 (Dodd-Frank Offices of Minority and Women Inclusion) removes federal oversight of diversity in financial services—financial regulators lose authority to monitor or enforce diversity in banking and securities industries.

Section numbers refer to the bill text the analysis read — linked under Primary records below.

Who it affects

The bill eliminates federal programs and protections designed to address systemic discrimination in hiring, promotion, and federal contracting. While framed as preventing discrimination, it broadly prohibits training on systemic inequality and creates a private right of action with statutory damages ($1,000/day per violation) that exposes federal agencies, contractors, and grantees to litigation risk, likely chilling legitimate civil-rights compliance efforts. Citizens lose access to federal rem

Who stands to gain

• Financial services firms (banks, securities firms, investment advisors)
• Federal contractors and defense contractors
• Private employers receiving federal grants or cooperative agreements
• Educational institutions (reduced accreditation scrutiny for DEI compliance)

Named in the bill

Office of Personnel Management (OPM), Office of Management and Budget (OMB), Executive Orders 13985, 13988, 14020, 14031, 14035, 14091, National Security Memoranda NSM-03, NSM-04, Chief Diversity Officers Executive Council, Dodd-Frank Wall Street Reform and Consumer Protection Act (Section 342), Gramm-Leach-Bliley Act, Securities Exchange Act of 1934, Higher Education Act of 1965, Department of Defense, Department of Homeland Security, Director of National Intelligence — and 2 more

Where it stands

109 cosponsors: 109 Republicans.

• Feb 4, 2025 — Introduced · Congress.gov: “Introduced in House”
• Feb 4, 2025 — Referred to House Permanent Select Committee on Intelligence and House Committee on Transportation and Infrastructure · Congress.gov: “Referred to the Committee on Oversight and Government Reform, and in addition to the Committees on the…”

Dates and quoted wording are Congress.gov's action record; the timeline shows status changes, not every procedural step.

Money around this bill

5 lobbying clients named this bill on 6 disclosure filings across 2 quarters, Dec 2025 to Jun 2026. Those filings disclosed $3,130,000 in lobbying spend. A filing names 10 bills on average, so that figure is what each filing reported, not a share belonging to this bill.

More lobbying clients named this bill than 78% of bills with at least one filing.

Michael Cloud, the sponsor, reported $223,570 in PAC receipts in the 2026 cycle. $1,000 of that came from 1 PAC tied to these lobbying clients.

• Fedex Corporation — $2,930,000 on 1 filing
• Heritage Action for America — $140,000 on 1 filing
• The Aleut Corporation — $40,000 on 2 filings
• Katmai Government Services LLC — $20,000 on 1 filing
• Pacific Legal Foundation — $0 on 1 filing

Lobbying Disclosure Act filings through Jul 20, 2026. A filing shows who paid to lobby on a bill it names, not what changed.