[Congressional Bills 104th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3931 Introduced in House (IH)]







104th CONGRESS
  2d Session
                                H. R. 3931

 To amend the Financial Institutions Reform, Recovery, and Enforcement 
Act of 1989 to require the development and implementation of a national 
 financial crimes strategy to combat financial crimes involving money 
    laundering and other related activities, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             July 31, 1996

Ms. Velazquez (for herself, Mr. Rangel, Mr. Schumer, Mrs. Maloney, Mr. 
Manton, Mr. Ackerman, Mr. Towns, Mrs. Lowey, Mr. Flake, Mr. Nadler, Mr. 
 Owens, Mr. Serrano, Mr. Engel, Mr. Gilman, Mr. Hinchey, and Mr. King) 
 introduced the following bill; which was referred to the Committee on 
Banking and Financial Services, and in addition to the Committee on the 
 Judiciary, for a period to be subsequently determined by the Speaker, 
 in each case for consideration of such provisions as fall within the 
                jurisdiction of the committee concerned

_______________________________________________________________________

                                 A BILL


 
 To amend the Financial Institutions Reform, Recovery, and Enforcement 
Act of 1989 to require the development and implementation of a national 
 financial crimes strategy to combat financial crimes involving money 
    laundering and other related activities, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``National Financial Crimes Strategy 
Act of 1996''.

SEC. 2. FINANCIAL CRIMES INVOLVING MONEY LAUNDERING AND RELATED 
              CRIMINAL ACTIVITIES.

    (a) In General.--Title IX of the Financial Institutions Reform, 
Recovery, and Enforcement Act of 1989 (relating to regulatory 
enforcement authority and criminal enhancements) is amended by adding 
at the end the following new subtitle:

            ``Subtitle G--National Financial Crimes Strategy

``SEC. 971. NATIONAL FINANCIAL CRIMES STRATEGY.

    ``(a) Development and Submission to Congress.--
            ``(1) In general.--Before the end of the 180-day period 
        beginning on the date of the enactment of this subtitle and 
        before February 1 of each subsequent year, the President, 
        acting through the Secretary of the Treasury, shall develop a 
        national strategy for combating financial crimes which shall be 
        submitted to the Congress.
            ``(2) Separate presentation of classified material.--Any 
        part of the strategy that involves information which is 
        properly classified under criteria established by Executive 
        order shall be submitted to the Congress separately.
    ``(b) Development of Strategy.--The national strategy for combating 
financial crimes shall include the following:
            ``(1) Long-range goals.--Comprehensive, research-based, 
        long-range goals for reducing financial crime in the United 
        States.
            ``(2) Short-term objective.--A short-term objective which 
        the Secretary determines may be realistically achieved by the 
        end of the 2-year period beginning on the date of transmission 
        of the strategy.
            ``(3) Allocation of law enforcement resources.--A 
        description of the manner in which law enforcement resources 
        will be allocated.
            ``(4) Review of nonfederal financial crime control 
        activities.--A review of the financial crime control activities 
        of State and local governments and recommendations for 
        sufficient cooperation between Federal agencies and such State 
        and local governments to achieve a well-coordinated and 
        effective policy for fighting financial crimes by all levels of 
        government.
            ``(5) All other goals, objectives, and strategies.--A 
        complete list of goals, objectives, and priorities for reducing 
        financial crimes in addition to the goals and objectives 
        described in paragraphs (1) and (2).
            ``(6) Private sector initiatives; intergovernmental 
        cooperation.--A description of private sector initiatives, 
        cooperative efforts between the Federal Government and State 
and local governments, and cooperative efforts among the several States 
and between State and local governments for financial crimes control 
which could be utilized or should be encouraged.
            ``(7) Project and budget priorities.--A 3-year projection 
        for program and budget priorities and achievable projects for 
        reductions in financial crimes.
            ``(8) Assessment of funding.--A complete assessment of how 
        the proposed budget is intended to implement the strategy and 
        whether the funding levels contained in the proposed budget are 
        sufficient to implement the strategy.
            ``(9) Designated areas.--A description of geographical 
        areas designated as `high-intensity financial crime areas' in 
        accordance with section 3.
            ``(10) Improved communications systems.--A plan for 
        improving the compatibility of automated information and 
        information systems to provide the Federal Government and State 
        and local governments with timely, accurate, and complete 
        information.
    ``(c) Consultations.--In developing the national strategy for 
combating financial crimes, the Secretary shall consult with--
            ``(1) Department of the Treasury law enforcement 
        organizations;
            ``(2) the Attorney General and the Director of the Federal 
        Bureau of Investigation;
            ``(3) Members of Congress;
            ``(4) State and local officials, including State and local 
        prosecutors; and
            ``(5) private citizens with experience and expertise in the 
        field of financial crimes law enforcement.
    ``(d) Submission of Reports by Secretary.--
            ``(1) Report on consultations.--At the time the President 
        transmits the national strategy on combating financial crimes, 
        the Secretary shall submit a report indicating the persons 
        consulted by the director pursuant to subsection (c).
            ``(2) Effectiveness report.--At the time each national 
        strategy for combating financial crimes is transmitted by the 
        President to the Congress (other than the 1st transmission of 
        any such strategy) pursuant to subsection (a), the Secretary 
        shall submit a report containing a complete evaluation of the 
        effectiveness of policies to combat financial crimes.

``SEC. 972. HIGH-INTENSITY FINANCIAL CRIME AREAS.

    ``(a) Designation of Areas.--The Secretary, in consultation with 
the heads of the Department of the Treasury law enforcement 
organizations, the Attorney General, the Director of the Federal Bureau 
of Investigation, the Governors of the several States, and other State 
and local officials and after taking into consideration the factors 
specified in subsection (b), may designate any geographical area of the 
United States as a `high-intensity financial crime area'.
    ``(b) Factors.--In considering the designation of any area as a 
high-intensity financial crime area, the Secretary shall take into 
account the following factors:
            ``(1) The population of the area and the demographics of 
        the population.
            ``(2) The number of bank transactions which originate in 
        such area or involve institutions located in such area.
            ``(3) The number of electronic funds transfers which 
        originate in such area or involve institutions located in such 
        area.
            ``(4) The number of stock or commodities transactions which 
        originate in such area or involve institutions located in such 
        area.
            ``(5) The number of requests for information which are made 
        to the financial crimes enforcement network and which originate 
        from such area or involve institutions or businesses located in 
        such area or residents of such area.
            ``(6) Whether the area is a key transportation hub with any 
        international ports or airports or an extensive highway system.
            ``(7) Whether the area is an international center for 
        banking or commerce.
            ``(8) The extent to which the area is a center of financial 
        crimes.
            ``(9) The extent to which financial crimes and financial 
        crime-related activities in such area are having a harmful 
        impact in other areas of the country.
            ``(10) The extent to which State and local governments and 
        State and local law enforcement agencies have committed 
        resources to respond to the financial crime problem in the area 
        and the degree to which the commitment of such resources 
        reflects a determination by such government and agencies to 
        address the problem aggressively.
            ``(11) The extent to which a significant increase in the 
        allocation of Federal resources to combat financial crimes in 
        such area is necessary to provide an adequate State and local 
        response to financial crimes and financial crime-related 
        activities in such area.

``SEC. 974. DESIGNATION OF LEAD AGENCY.

    ``(a) In General.--The Secretary shall have the principal 
responsibility for carrying out the national strategy for combating 
financial crimes.
    ``(b) Coordination of Law Enforcement Activities.--
            ``(1) Notice of major crime reduction activities.--The 
        heads of the Department of the Treasury law enforcement 
        organizations, the Attorney General, and the Director of the 
        Federal Bureau of Investigation shall notify the Secretary, in 
        writing, of any major financial crime reduction activity 
        proposed to be carried out by the agency or organization of 
        which such person is the head in an area designated as a high-
        intensity financial crime area.
            ``(2) Advance notice.--The notice required to be submitted 
        under paragraph (1) shall be provided in advance of the 
initiation of the activity with respect to which such notice is 
submitted unless extenuating circumstances require otherwise.
            ``(3) Objection of secretary.--If the Secretary objects to 
        the proposed activity for which the Secretary receives notice 
        under paragraph (1), the Secretary shall notify the agency in 
        writing of the basis for the Secretary's objection.
    ``(c) Federal Responses Authorized.--With respect to any area 
designated under section 3(a) as a high-intensity financial crime area, 
the Secretary may take the following initiatives:
            ``(1) Develop a plan for the redistribution or the 
        temporary reassignment of the personnel and physical resources 
        of the Department of the Treasury law enforcement 
        organizations, the Department of Justice (including the offices 
        of the United States Attorneys, the Federal Bureau of 
        Investigation, and, when appropriate, the United States 
        Marshals Service), and any other Federal law enforcement 
        organization the President determines to be appropriate in 
        order to more effectively combat financial crimes in such area 
        and make recommendations to the head of each such agency or 
        department for such redistribution or temporary reassignment.
            ``(2) Recommend increases in Federal assistance which the 
        Secretary determines is necessary to combat financial crimes in 
        such areas.
            ``(3) Establish joint cooperative efforts, and coordinate 
        enforcement activities, between Federal law enforcement 
        agencies and State and local law enforcement agencies with 
        respect to financial crimes in such area.

``SEC. 975. GRANTS FOR FIGHTING FINANCIAL CRIMES.

    ``(a) Program Authorized.--The Secretary is authorized to provide 
grants to any consortium consisting of 3 or more State or local law 
enforcement agencies and prosecutors to provide funding necessary to 
investigate and prosecute financial crimes in high-intensity financial 
crime areas.
    ``(b) Authorization.--There are authorized to be appropriated such 
sums as may be necessary for fiscal years beginning after fiscal year 
1996 to carry out this section.

``SEC. 976. BUDGETS FOR LAW ENFORCEMENT ACTIVITIES RELATING TO 
              FINANCIAL CRIMES.

    ``Section 1105 of title 31, United States Code, is amended by 
adding at the end the following new subsection:
    ```(h) The Director of the Office of Management and Budget shall 
establish the funding for law enforcement activities with respect to 
financial crimes for each applicable department or agency as a separate 
object class in each budget annually submitted to the Congress under 
this section.'.

``SEC. 977. DEFINITIONS.

    ``For purposes of this subtitle, the following definitions shall 
apply:
            ``(1) Department of the treasury law enforcement 
        organizations.--The term `Department of the Treasury law 
        enforcement organizations' has the meaning given to such term 
        in section 9703(p) of title 31, United States Code.
            ``(2) Financial crime.--The term `financial crime' means an 
        offense under section 1956 of title 18, United States Code, or 
        section 5324 of title 31 of such Code, and any related Federal, 
        State, or local criminal offense.
            ``(3) Secretary.--The term `Secretary' means the Secretary 
        of the Treasury.''.
    (b) Report and Recommendations.--Before January 1, 1997, the 
Secretary shall submit a report to the Committee on Banking and 
Financial Services of the House of Representatives and the Committee on 
Banking, Housing, and Urban Affairs of the Senate on the effectiveness 
of and the need for the designation of areas, under section 972 of 
Financial Institutions Reform, Recovery, and Enforcement Act of 1989 
(as added by subsection (a) of this section), as high-intensity 
financial crime areas, together with such recommendations for 
legislation as the Secretary may determine to be appropriate to carry 
out the purposes of such section.
                                 <all>