---
kind: "section"
citation: "10 U.S.C. § 2783"
title: "10"
title_heading: "Armed Forces"
number: "2783"
heading: "Nonappropriated fund instrumentalities: financial management and use of nonappropriated funds"
release: "119-102"
url: "https://uscodex.org/usc/10/2783"
units:
  - "Subtitle A — General Military Law"
  - "Part IV — Service, Supply, and Property"
  - "Chapter 165 — Accountability and Responsibility"
---

# §2783. Nonappropriated fund instrumentalities: financial management and use of nonappropriated funds

- (a) **Regulation of Management and Use of Nonappropriated Funds.—** The Secretary of Defense shall prescribe regulations governing—
  - (1) the purposes for which nonappropriated [funds](/usc/10/2871.md?p=6) of a nonappropriated [fund](/usc/10/2871.md?p=6) instrumentality of the [United States](/usc/10/101.md?p=a-1) within the [Department](/usc/10/101.md?p=a-6) of Defense may be expended; and
  - (2) the financial management of such [funds](/usc/10/2871.md?p=6) to prevent waste, loss, or unauthorized use.
- (b) **Penalties for Violations.—**
  - (1) A civilian employee of the [Department](/usc/10/101.md?p=a-6) of Defense who is paid from nonappropriated [funds](/usc/10/2871.md?p=6) and who commits a substantial violation of the regulations prescribed under [subsection (a)](#a) shall be subject to the same penalties as are provided by law for misuse of appropriations by a civilian employee of the [Department](/usc/10/101.md?p=a-6) of Defense paid from appropriated [funds](/usc/10/2871.md?p=6). The Secretary of Defense shall prescribe regulations to carry out this paragraph.
  - (2) The Secretary shall provide in regulations that a violation of the regulations prescribed under [subsection (a)](#a) by a person subject to [chapter 47](/usc/10/chstA-ptII-ch47.md) of this title (the Uniform Code of Military Justice) is punishable as a violation of [section 892 of this title](/usc/10/892.md) (article 92 of the Uniform Code of Military Justice).
- (c) **Notification of Violations.—**
  - (1) A civilian employee of the [Department](/usc/10/101.md?p=a-6) of Defense (whether paid from nonappropriated [funds](/usc/10/2871.md?p=6) or from appropriated [funds](/usc/10/2871.md?p=6)), and a [member](/usc/10/1408.md?p=a-5) of the [armed forces](/usc/10/101.md?p=a-4), whose duties include the obligation of nonappropriated [funds](/usc/10/2871.md?p=6), shall notify the Secretary of Defense of information which the person reasonably believes evidences—
    - (A) a violation by another person of any law, rule, or regulation regarding the management of such [funds](/usc/10/2871.md?p=6); or
    - (B) other mismanagement or gross waste of such [funds](/usc/10/2871.md?p=6).
  - (2) The Secretary of Defense shall designate civilian employees of the [Department](/usc/10/101.md?p=a-6) of Defense or [members](/usc/10/1408.md?p=a-5) of the [armed forces](/usc/10/101.md?p=a-4) to receive a notification described in [paragraph (1)](#c-1) and ensure the prompt investigation of the validity of information provided in the notification.
  - (3) The Secretary shall prescribe regulations to protect the confidentiality of a person making a notification under [paragraph (1)](#c-1).

## Source credit

(Added Pub. L. 102–484, div. A, title III, § 362(a), Oct. 23, 1992, 106 Stat. 2379, § 2490a; renumbered § 2783 and amended Pub. L. 103–160, div. A, title XI, § 1182(a)(8)(A), Nov. 30, 1993, 107 Stat. 1771.)

## Notes

### Editorial Notes

### Amendments

1993—Pub. L. 103–160 renumbered section 2490a of this title as this section.

Subsec. (b)(2). Pub. L. 103–160, § 1182(a)(8)(A)(i), substituted “chapter 47 of this title” for “chapter 47 of title 10, United States Code”, “Justice) is” for “Justice), is”, and “section 892 of this title” for “section 892 of such title”.

Subsec. (c)(1). Pub. L. 103–160, § 1182(a)(8)(A)(ii), substituted “armed forces” for “Armed Forces”.

### Statutory Notes and Related Subsidiaries

### Standardization of Certain Programs and Activities of Military Exchanges

Pub. L. 102–484, div. A, title III, § 361, Oct. 23, 1992, 106 Stat. 2379, directed the Secretary of Defense to standardize among the military departments the accounting, financial reporting formats, and automatic data processing and telecommunications data transfer of information by no later than Mar. 31, 1994, and report to Congress, no later than Mar. 31, 1993, on other programs and activities that could be standardized or consolidated.