[Congressional Bills 110th Congress]
[From the U.S. Government Publishing Office]
[H.R. 5611 Introduced in House (IH)]







110th CONGRESS
  2d Session
                                H. R. 5611

 To reform the National Association of Registered Agents and Brokers, 
                        and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             March 13, 2008

Mr. Scott of Georgia (for himself, Mr. Davis of Kentucky, Mr. Gerlach, 
Mr. Manzullo, Mr. Barrett of South Carolina, Mr. Neugebauer, Mr. Jones 
of North Carolina, Mr. Wilson of Ohio, Mr. Clay, Mr. Ross, Mr. Meeks of 
 New York, Ms. Moore of Wisconsin, Mr. Donnelly, Ms. Ginny Brown-Waite 
    of Florida, and Mr. Lincoln Davis of Tennessee) introduced the 
   following bill; which was referred to the Committee on Financial 
                                Services

_______________________________________________________________________

                                 A BILL


 
 To reform the National Association of Registered Agents and Brokers, 
                        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 Association of Registered 
Agents and Brokers Reform Act of 2008''.

SEC. 2. REESTABLISHMENT OF THE NATIONAL ASSOCIATION OF REGISTERED 
              AGENTS AND BROKERS.

    (a) In General.--Subtitle C of title III of the Gramm-Leach-Bliley 
Act (15 U.S.C. 6751 et seq.) is amended to read as follows:

  ``Subtitle C--National Association of Registered Agents and Brokers

``SEC. 321. NATIONAL ASSOCIATION OF REGISTERED AGENTS AND BROKERS.

    ``(a) Establishment.--There is established the National Association 
of Registered Agents and Brokers (hereafter in this subtitle referred 
to as the `Association').
    ``(b) Status.--The Association shall--
            ``(1) be a nonprofit corporation;
            ``(2) have succession until dissolved by an Act of 
        Congress;
            ``(3) not be an agent or instrumentality of the United 
        States Government; and
            ``(4) except as otherwise provided in this subtitle, be 
        subject to, and have all the powers conferred upon a nonprofit 
        corporation by the District of Columbia Nonprofit Corporation 
        Act (D.C. Code, sec. 29-301.01 et seq.).

``SEC. 322. PURPOSE.

    ``The purpose of the Association shall be to provide a mechanism 
through which licensing, continuing education, and other insurance 
producer qualification requirements and conditions can be adopted and 
applied on a multi-state basis, while preserving the right of States to 
license, supervise, and discipline insurance producers, and to 
prescribe and enforce laws and regulations with regard to insurance-
related consumer protection and unfair trade practices.

``SEC. 323. MEMBERSHIP.

    ``(a) Eligibility.--
            ``(1) In general.--Any insurance producer licensed in its 
        home State shall be eligible to become a member in the 
        Association.
            ``(2) Ineligibility for suspension or revocation of 
        license.--Notwithstanding paragraph (1), a State-licensed 
        insurance producer shall not be eligible to become a member if 
        a State insurance regulator has suspended or revoked such 
        producer's license in that State during the 3-year period 
        preceding the date on which such producer applies for 
        membership.
            ``(3) Resumption of eligibility.--Paragraph (2) shall cease 
        to apply to any insurance producer if--
                    ``(A) the State insurance regulator renews the 
                license of such producer in the State in which the 
                license was suspended or revoked; or
                    ``(B) the suspension or revocation is subsequently 
                overturned.
            ``(4) Criminal background check required.--
                    ``(A) In general.--A State-licensed insurance 
                producer shall not be eligible to become a member 
                unless the producer has submitted to a national 
                criminal background record check.
                    ``(B) Criminal background check ordered by home 
                state.--Any insurance producer licensed in a State 
                that, as a condition for such licensure, requires the 
                submission of identification information to the Federal 
                Bureau of Investigation for a national criminal 
                background record check shall be deemed to have 
                submitted to a national criminal background record 
                check for purposes of subparagraph (A).
                    ``(C) Criminal history check ordered by 
                association.--
                            ``(i) In general.--The Association may 
                        submit identification information obtained from 
                        any State-licensed insurance producer licensed 
                        in a State that has not submitted to a national 
                        criminal background record check, and a request 
                        for a national criminal background record check 
                        of such producer, to the Federal Bureau of 
                        Investigation.
                            ``(ii) Regulations.--The board of directors 
                        of the Association shall prescribe regulations 
                        for obtaining identification information and 
                        criminal background record information, 
                        including the establishment of fees required to 
                        perform a criminal background record check.
                    ``(D) Attorney general authorization.--Upon 
                receiving a request from the Association, the Attorney 
                General shall--
                            ``(i) search the records of the Criminal 
                        Justice Information Services Division of the 
                        Federal Bureau of Investigation, and any other 
                        similar database over which the Attorney 
                        General has authority and deems appropriate, 
                        for any criminal background records (including 
                        wanted persons information) corresponding to 
                        the identification information provided under 
                        subparagraph (F); and
                            ``(ii) provide any relevant information 
                        contained in such records that pertain to the 
                        request directly to the Association.
                    ``(E) Relevant information defined.--For purposes 
                of subparagraph (D)(ii), the term `relevant 
                information' means any of the following records:
                            ``(i) All felony convictions.
                            ``(ii) All misdemeanor convictions 
                        involving--
                                    ``(I) violation of a law involving 
                                financial activities;
                                    ``(II) dishonesty or breach of 
                                trust, within the meaning of section 
                                1033 of title 18, United States Code, 
                                including taking, withholding, 
                                misappropriating, or converting money 
                                or property;
                                    ``(III) failure to comply with 
                                child support obligations;
                                    ``(IV) failure to pay taxes; and
                                    ``(V) domestic violence, child 
                                abuse, burglary of a dwelling, or a 
                                criminal offense that has as an element 
                                the use or attempted use of physical 
                                force, or threat of great bodily harm, 
                                or the use, attempted use, or 
                                threatened use of a deadly weapon, 
                                against an individual, including 
                                committing or attempting to commit 
                                murder, manslaughter, kidnapping, 
                                aggravated assault, forcible sex 
                                offenses, robbery, arson, extortion, 
                                and extortionate extension of credit.
                    ``(F) Form of request.--A request under 
                subparagraph (C) shall include a copy of any necessary 
                identification information required by the Attorney 
                General concerning the person about whom the record is 
                requested and a statement signed by the person 
                acknowledging that the Association may request the 
                search.
                    ``(G) Limitation on permissible uses of 
                information.--Information obtained under this section 
                may--
                            ``(i) be used only for regulatory or law 
                        enforcement purposes or for purposes of 
                        determining compliance with membership criteria 
                        established by the Association;
                            ``(ii) be disclosed only to the 
                        Association, State insurance regulators, or 
                        Federal or State law enforcement agencies; and
                            ``(iii) be disclosed only if the recipient 
                        agrees to--
                                    ``(I) maintain the confidentiality 
                                of such information; and
                                    ``(II) limit the use of such 
                                information to the purposes described 
                                in clause (i).
                    ``(H) Penalty for improper use.--Whoever uses any 
                information obtained under this section knowingly and 
                willfully for an unauthorized purpose shall be fined 
                under title 18, United States Code, imprisoned for not 
                more than 2 years, or both.
                    ``(I) Reliance on information.--Neither the 
                Association nor any of its directors, officers, or 
                employees who reasonably rely on information provided 
                under this section shall be liable in any action for 
                using information as permitted under this section in 
                good faith.
                    ``(J) Clarification of section 1033.--
                            ``(i) In general.--With respect to any 
                        action brought under section 1033(e)(1)(B) of 
                        title 18, United States Code, no person engaged 
                        in the business of conducting financial 
                        activities shall be subject to any penalty 
                        resulting from such section if the individual 
                        whom the person permitted to engage in the 
                        business of insurance is a member of the 
                        Association or is licensed, or approved (as 
                        part of an application or otherwise), by a 
                        State insurance regulator that performs 
                        criminal background checks under this section, 
                        unless such person knows that the individual is 
                        in violation of section 1033(e)(1)(A) of such 
                        title.
                            ``(ii) Financial activities defined.--For 
                        purposes of this subparagraph, the term 
                        `financial activities'--
                                    ``(I) means banking activities 
                                (including the ownership of a bank), 
                                securities activities, insurance 
                                activities, or commodities activities; 
                                and
                                    ``(II) includes all activities that 
                                are financial in nature or are 
                                incidental to a financial activity (as 
                                defined under section 4(k) of the Bank 
                                Holding Company Act of 1956).
                    ``(K) Fees.--The Attorney General may charge a 
                reasonable fee for the provision of information under 
                this paragraph.
                    ``(L) Rule of construction.--No provision of this 
                paragraph shall be construed as--
                            ``(i) requiring a State insurance regulator 
                        to perform criminal background checks under 
                        this section; or
                            ``(ii) superseding or otherwise limiting 
                        any other authority that allows access to 
                        criminal background records.
                    ``(M) Regulations.--The Attorney General may 
                prescribe regulations to carry out this paragraph.
                    ``(N) Ineligibility for membership.--The 
                Association may deny membership to any State-licensed 
                insurance producer on the basis of criminal history 
                information obtained pursuant to subparagraph (D).
    ``(b) Authority To Establish Membership Criteria.--The Association 
may establish membership criteria that--
            ``(1) bear a reasonable relationship to the purposes for 
        which the Association was established; and
            ``(2) do not unfairly limit the access of smaller agencies 
        to the Association membership, including imposing 
        discriminatory membership fees on smaller insurance producers.
    ``(c) Establishment of Classes and Categories of Membership.--
            ``(1) Classes of membership.--The Association may establish 
        separate classes of membership, with separate criteria, if the 
        Association reasonably determines that performance of different 
        duties requires different levels of education, training, 
        experience, or other qualifications.
            ``(2) Categories.--
                    ``(A) Separate categories for individuals 
                permitted.--The Association may establish separate 
                categories of membership for individuals and for other 
                persons within each class, based on the types of 
                licensing categories that exist under State laws.
                    ``(B) Separate treatment for depository 
                institutions prohibited.--No special categories of 
                membership, and no distinct membership criteria, shall 
                be established for members which are depository 
                institutions or for employees, agents, or affiliates of 
                depository institutions.
    ``(d) Membership Criteria.--
            ``(1) In general.--The Association may establish criteria 
        for membership which shall include standards for personal 
        qualifications, education, training, and experience.
            ``(2) Qualifications.--In establishing criteria under 
        paragraph (1), the Association shall consider the highest 
        levels of insurance producer qualifications established under 
        the licensing laws of the States.
            ``(3) Assistance from states.--
                    ``(A) In general.--The Association may request a 
                State to provide assistance in investigating and 
                evaluating a prospective member's eligibility for 
                membership in the Association.
                    ``(B) Rule of construction.--Subparagraph (A) shall 
                not be construed as requiring or authorizing any State 
                to adopt new or additional requirements concerning the 
                licensing or evaluation of insurance producers.
    ``(e) Effect of Membership.--
            ``(1) Authority of association members.--Membership in the 
        Association shall authorize an insurance producer to sell, 
        solicit, negotiate, effect, procure, deliver, renew, continue, 
        or bind insurance in any State for any line or lines of 
        insurance specified in such producer's home State license, and 
        exercise all such incidental powers, as shall be necessary to 
        carry out such activities, including claims adjustments and 
        settlement, risk management, employee benefits advice, 
        retirement planning, and any other insurance-related consulting 
        activities.
            ``(2) Activities of members of the association.--No State, 
        other than a member's home State, may, by statute, regulation, 
        order, interpretation, or otherwise, deny a license to a member 
        of the Association which has paid the requisite licensing fee 
        for such State to engage in any activity within the scope of 
        authority granted under paragraph (1).
            ``(3) Duplicative licenses.--Neither the Association nor 
        any State, other than the member's home State, may require an 
        individual member to obtain a business entity license or 
        membership in order to engage in any activity within the scope 
        of authority granted in paragraph (1) or in order for the 
        member or any employer, employee, or affiliate of the member to 
        receive compensation for the member's performance of any such 
        activity.
            ``(4) Agent for remitting fees.--The Association shall act 
        as any member's agent for purposes of remitting licensing fees 
        to any State pursuant to subparagraph (2).
            ``(5) Preservation of state consumer protection and market 
        conduct regulation.--No provision of this section shall be 
        construed as altering or affecting the continuing effectiveness 
        of any law, regulation, provision, or other action of any State 
        which purports to regulate market conduct or unfair trade 
        practices or establish consumer protections to the extent that 
        such law, regulation, provision, or other action is not 
        inconsistent with the provisions of this subtitle.
    ``(f) Biennial Renewal.--Membership in the Association shall be 
renewed on a biennial basis.
    ``(g) Continuing Education.--
            ``(1) In general.--The Association shall establish, as a 
        condition of membership, continuing education requirements 
        which shall be comparable to the continuing education 
        requirements under the licensing laws of a majority of the 
        States.
            ``(2) State continuing education requirements.--A member 
        may not be required to satisfy continuing education 
        requirements imposed under the laws, regulations, provisions, 
        or actions of any State other than such member's home State.
            ``(3) Reciprocity.--
                    ``(A) Limitation on home state.--No home State of a 
                member of the Association shall require such member to 
                satisfy any continuing education requirements that are 
                equivalent to any continuing education requirements of 
                the Association that have been satisfied by the member 
                during the applicable licensing period.
                    ``(B) Limitation on association.--The Association 
                shall not require a member to satisfy continuing 
                education requirements that are equivalent to any 
                continuing education requirements of the member's home 
                State that have been satisfied by the member during the 
                applicable licensing period.
            ``(4) Limitation on association.--The Association shall not 
        directly or indirectly offer any continuing education courses 
        for insurance producers.
    ``(h) Probation, Suspension and Revocation.--The Association may 
place an insurance producer that is a member of the Association on 
probation or suspend or revoke such producer's membership in the 
Association, as the Association determines to be appropriate, if--
            ``(1) the producer fails to meet the applicable membership 
        criteria of the Association; or
            ``(2) the producer has been subject to disciplinary action 
        pursuant to a final adjudicatory proceeding under the 
        jurisdiction of a State insurance regulator.
    ``(i) Office of Consumer Complaints.--
            ``(1) In general.--The Association shall establish an 
        office of consumer complaints that shall--
                    ``(A) receive and, when appropriate, investigate 
                complaints from both consumers and State insurance 
                regulators related to members of the Association;
                    ``(B) maintain records of all complaints received 
                in accordance with subparagraph (A) and make such 
                records available to the National Association of 
                Insurance Commissioners (hereinafter in this subtitle 
                referred to as the `NAIC') and to each State insurance 
                regulator for the State of residence of the consumer 
                who filed the complaint; and
                    ``(C) refer, when appropriate, any such complaint 
                to any appropriate State insurance regulator.
            ``(2) Telephone and other access.--The office of consumer 
        complaints shall maintain a toll-free telephone number for the 
        purpose of this subsection and, as practicable, other 
        alternative means of communication with consumers, such as an 
        Internet web page.

``SEC. 324. BOARD OF DIRECTORS.

    ``(a) Establishment.--There is established the board of directors 
of the Association (hereafter in this subtitle referred to as the 
`Board') for the purpose of governing and supervising the activities of 
the Association and the members of the Association.
    ``(b) Powers.--The Board shall have such powers and authority as 
may be specified in the bylaws of the Association.
    ``(c) Composition.--
            ``(1) In general.--The Board shall be composed of 9 
        members, of whom--
                    ``(A) 4 shall be State insurance commissioners 
                appointed in the manner provided in paragraph (2), and
                    ``(B) 5 shall be insurance industry representatives 
                appointed in the manner provided in paragraph (3).
            ``(2) Members appointed by the naic.--
                    ``(A) In general.--The NAIC shall appoint 1 member 
                of the Board from among State insurance commissioners 
                in each of the following 3 categories of States:
                            ``(i) The 18 States with the smallest total 
                        direct written premiums from all insurance 
                        policies written in such States.
                            ``(ii) The 18 States with the largest total 
                        direct written premiums from all insurance 
                        policies written in such States.
                            ``(iii) The States that are not among the 
                        States described in clauses (i) and (ii).
                    ``(B) At-large member.--The Board members appointed 
                pursuant to paragraph (A) shall, by majority vote, 
                elect a 4th State insurance commissioner to serve as an 
                at-large member of the Board.
            ``(3) Members appointed by insurance trade associations.--
                    ``(A) Insurance producer representatives.--3 of the 
                5 members who are insurance industry representatives 
                shall be appointed as follows by the following trade 
                associations or their successor organizations:
                            ``(i) 1 member appointed by the Council of 
                        Insurance Agents and Brokers from among 
                        representatives of such association.
                            ``(ii) 1 member appointed by the 
                        Independent Insurance Agents and Brokers of 
                        America from among representatives of such 
                        association.
                            ``(iii) 1 member appointed by the National 
                        Association of Insurance and Financial Advisors 
                        from among representatives of such association.
                    ``(B) Property and casualty insurer 
                representative.--1 of the 5 members who are insurance 
                industry representatives shall be appointed by the 
                American Insurance Association, the National 
                Association of Mutual Insurance Companies, and the 
                Property and Casualty Insurers Association of America 
                from among representatives of each such association, on 
                a rotating basis.
                    ``(C) Life and health insurer representative.--1 of 
                the 5 members who are insurance industry 
                representatives shall be appointed by the American 
                Council of Life Insurers and the Association of Health 
                Insurance Plans from among representatives of each such 
                association, on a rotating basis.
            ``(4) Alternate appointment.--
                    ``(A) In general.--If the NAIC or a nominating 
                group of insurance trade associations fails to make 
                appointments to the Board as required under paragraph 
                (2) or (3), the President shall appoint such members of 
                the Association's Board from lists of candidates 
                provided by the NAIC, in the case of a member described 
                in paragraph (2) or the nominating group of insurance 
                trade associations pursuant to the relevant 
                subparagraph of paragraph (3), in the case of a member 
                described in any such subparagraph.
                    ``(B) Procedures for obtaining naic appointment 
                recommendations.--
                            ``(i) Presidential appointment from list.--
                        If the NAIC fails to appoint members of the 
                        Board as provided under subparagraph (A) or (B) 
                        of paragraph (2) within 60 days after the date 
                        of the enactment of the National Association of 
                        Registered Agents and Brokers Reform Act of 
                        2008, the President shall, with the advice and 
                        consent of the Senate, appoint 4 members to the 
                        Board who are current State insurance 
                        commissioners in accordance with the 
                        requirements of subparagraphs (A) and (B) of 
                        paragraph (2) from a list of candidates 
                        recommended to the President by the NAIC.
                            ``(ii) Presidential appointment without a 
                        list.--If the NAIC fails to provide a list 
                        within 90 days after the date of the enactment 
                        of the National Association of Registered 
                        Agents and Brokers Reform Act of 2008, or if 
                        any list that is provided does not include at 
                        least 8 recommended candidates or comply with 
                        the requirements of paragraph (2), the 
                        President shall, with the advice and consent of 
                        the Senate, appoint 4 members to the Board 
                        without considering the views of the NAIC, 3 of 
                        whom shall meet the selection requirements of 
                        paragraph (2)(A) and 1 of whom shall meet the 
                        selection requirements of paragraph (3)(B).
                    ``(C) Procedures for obtaining insurance trade 
                association group appointment recommendations.--
                            ``(i) Presidential appointment from list.--
                        If any group of nominating insurance trade 
                        associations identified under subparagraph (A), 
                        (B), or (C) of paragraph (3) fails to appoint 
                        members of the Board as provided under such 
                        subparagraph within 60 days after the date of 
                        the enactment of the National Association of 
                        Registered Agents and Brokers Reform Act of 
                        2008, the President shall, with the advice and 
                        consent of the Senate, make the requisite 
                        appointments pursuant to each such subparagraph 
                        from a list of candidates recommended to the 
                        President by such group.
                            ``(ii) Presidential appointment without a 
                        list.--If the nominating group of insurance 
                        trade associations identified under 
                        subparagraph (A), (B), or (C) of paragraph (3) 
                        fails to provide a list within 90 days after 
                        date of the enactment of the National 
                        Association of Registered Agents and Brokers 
                        Reform Act of 2008, or if any list that is 
                        provided does not comply with the requirements 
                        of the subparagraph, the President shall, with 
                        the advice and consent of the Senate, make the 
                        requisite appointments without considering the 
                        views of such group.
                            ``(iii) List of recommendations.--Any list 
                        of recommended candidates provided to the 
                        President by a nominating group of insurance 
                        trade associations identified under 
                        subparagraph (A), (B), or (C) of paragraph (3) 
                        shall include--
                                    ``(I) at least 2 recommended 
                                candidates from each association 
                                identified under paragraph (3)(A);
                                    ``(II) at least 2 recommended 
                                candidates, in the case of associations 
                                identified under paragraph (3)(B); and
                                    ``(III) at least 2 recommended 
                                candidates, in the case of associations 
                                identified under paragraph (3)(C).
                    ``(D) Alternate appointment of state insurance 
                commissioners.--If fewer than 4 State insurance 
                commissioners accept appointment to the Board pursuant 
                to subparagraph (B), the President, with the advice and 
                consent of the Senate, may appoint the remaining State 
                insurance commissioner members of the Board from among 
                individuals who are current or former State insurance 
                commissioners, to the extent that--
                            ``(i) any former insurance commissioner 
                        appointed by the President shall not be 
                        employed by or have a present direct or 
                        indirect financial interest in any insurer or 
                        other entity in the insurance industry other 
                        than direct or indirect ownership of, or 
                        beneficial interest in, any insurance policy or 
                        annuity contract written or sold by an insurer; 
                        and
                            ``(ii) not more than 2 members appointed to 
                        membership on the Board under this subparagraph 
                        belong to the same political party as the 
                        President.
            ``(5) State insurance commissioner defined.--For purposes 
        of this subsection, the term `State insurance commissioner' 
        means a person who serves in the position in State government, 
        or on the board, commission, or other body that is the 
        principal insurance regulatory authority for the State.
    ``(d) Terms.--
            ``(1) In general.--The term of each Board member shall, 
        after the initial appointment of the members of the Board, be 
        for 2 years, with \1/2\ of the members to be appointed each 
        year and divided as evenly as possible between members 
        appointed under paragraphs (2) and (3) of subsection (c).
            ``(2) Limitation on successive terms.--Only directors 
        appointed under subsection (c)(3)(A) from among representatives 
        of insurance producers may be re-appointed for an additional 
        term.
    ``(e) Board Vacancies.--
            ``(1) In general.--Any vacancy on the board of directors 
        shall be filled as provided under subparagraph (A) or (B) of 
        paragraph (2), and any member appointed to fill a vacancy 
        occurring before the expiration of the term for which the 
        member's predecessor was appointed shall be appointed only for 
        the remainder of that term.
            ``(2) Alternate appointment.--If the NAIC or a nominating 
        group of trade associations fails to appoint a member to the 
        Board to fill a vacancy within 60 days from the date that such 
        vacancy occurs, the President shall, with the advice and 
        consent of the Senate, make the requisite appointment pursuant 
        to the procedures established under the applicable subparagraph 
        of subsection (c)(4).
    ``(f) Meetings.--The Board shall meet at the call of the 
chairperson, or as otherwise provided by the bylaws of the Association.

``SEC. 325. OFFICERS.

    ``(a) Positions.--The officers of the Association shall consist of 
a chairperson and a vice chairperson of the Board, an executive 
director, secretary, and treasurer of the Association, and such other 
officers and assistant officers as may be deemed necessary.
    ``(b) Manner of Selection.--Each officer of the Board and the 
Association shall be elected or appointed at such time, in such manner, 
and for such terms as may be prescribed in the bylaws of the 
Association.

``SEC. 326. BYLAWS, RULES, AND DISCIPLINARY ACTION.

    ``(a) Adoption and Amendment of Bylaws.--
            ``(1) Copy required to be filed.--The board of directors of 
        the Association shall submit to the President and the Congress 
        any proposed bylaw or rules of the Association or any proposed 
        amendment to the bylaws or rules, accompanied by a concise 
        general statement of the basis and purpose of such proposal.
            ``(2) Effective date.--Any proposed bylaw or rule or 
        proposed amendment to the bylaws or rules shall take effect, 
        after notice published in an insurance trade journal and 
        opportunity for comment, upon such date as the Association may 
        designate.
    ``(b) Disciplinary Action by the Association.--
            ``(1) Specification of charges.--In any proceeding to 
        determine whether membership shall be denied, suspended, 
        revoked, or not renewed (hereafter in this section referred to 
        as a `disciplinary action') or to determine whether a member of 
        the Association should be placed on probation, the Association 
        shall bring specific charges, notify such member of such 
        charges, give the member an opportunity to defend against the 
        charges, and keep a record.
            ``(2) Supporting statement.--A determination to take 
        disciplinary action shall be supported by a statement setting 
        forth--
                    ``(A) any act or practice in which such member has 
                been found to have been engaged;
                    ``(B) the specific provision of this subtitle, the 
                rules or regulations under this subtitle, or the rules 
                of the Association which any such act or practice is 
                deemed to violate; and
                    ``(C) the sanction imposed and the reason for such 
                sanction.

``SEC. 327. POWERS.

    ``In addition to all the powers conferred upon a nonprofit 
corporation by the District of Columbia Nonprofit Corporation Act, the 
Association shall have the following powers:
            ``(1) To establish and collect such membership fees as the 
        Association finds necessary to impose to cover the costs of its 
        operations.
            ``(2) To adopt, amend, and repeal bylaws and rules 
        governing the conduct of Association business and performance 
        of its duties.
            ``(3) To establish procedures for providing notice and 
        opportunity for comment pursuant to section 326(a).
            ``(4) To enter into and perform such agreements as 
        necessary to carry out its duties.
            ``(5) To hire employees, professionals or specialists, and 
        elect or appoint officers, and to fix their compensation, 
        define their duties and give them appropriate authority to 
        carry out the purposes of this subtitle, and determine their 
        qualification; and to establish the Association's personnel 
        policies and programs relating to, among other things, 
        conflicts of interest, rates of compensation. and 
        qualifications of personnel.
            ``(6) To borrow money.
            ``(7) To assess board member organizations and associations 
        fees for such amounts that the Association determines to be 
        necessary and appropriate to organize and begin operations of 
        the Association, which shall be treated as loans to be repaid 
        by the Association with interest at market rate.

``SEC. 328. REPORT BY ASSOCIATION.

    ``(a) In General.--As soon as practicable after the close of each 
fiscal year, the Association shall submit to the President and to the 
Congress a written report regarding the conduct of its business, and 
the exercise of the other rights and powers granted by this subtitle, 
during such fiscal year.
    ``(b) Financial Statements.--Each report submitted under subsection 
(a) with respect to any fiscal year shall include financial statements 
setting forth the financial position of the Association at the end of 
such fiscal year and the results of its operations (including the 
source and application of its funds) for such fiscal year.

``SEC. 329. LIABILITY OF THE ASSOCIATION AND THE DIRECTORS, OFFICERS, 
              AND EMPLOYEES OF THE ASSOCIATION.

    ``(a) In General.--The Association shall not be deemed to be an 
insurer or insurance producer within the meaning of any State law, 
rule, regulation, or order regulating or taxing insurers, insurance 
producers, or other entities engaged in the business of insurance, 
including provisions imposing premium taxes, regulating insurer 
solvency or financial condition, establishing guaranty funds and 
levying assessments, or requiring claims settlement practices.
    ``(b) Liability of the Association, Its Directors, Officers, and 
Employees.--Neither the Association nor any of its directors, officers, 
or employees shall have any liability to any person for any action 
taken or omitted in good faith under or in connection with any matter 
subject to this subtitle.

``SEC. 330. PRESIDENTIAL REVIEW.

    ``(a) Removal.--If the President determines and certifies to the 
Speaker of the House, the House Minority Leader, the Senate Majority 
Leader and the Senate Minority Leader that the Association is acting in 
a manner contrary to the purposes of this subtitle or has failed to 
perform its duties under this subtitle, the President may remove the 
entire existing Board for the remainder of the term to which the 
members of the Board were appointed and appoint, in accordance with 
section 324(c)(4) with the advice and consent of the Senate, new 
members to fill the vacancies on the Board for the remainder of such 
terms.
    ``(b) Suspension of Rules or Actions.--The President, or a person 
designated by the President for such purpose, may suspend the 
effectiveness of any rule, or prohibit any action, of the Association 
which the President or the designee determines and certifies to the 
Speaker of the House, the House minority leader, the Senate majority 
leader, and the Senate minority leader is contrary to the purposes of 
this subtitle.

``SEC. 331. RELATIONSHIP TO STATE LAW.

    ``(a) Preemption of State Laws.--State laws, regulations, 
provisions, or other actions purporting to regulate insurance producers 
shall be preempted to the extent provided in subsection (b).
    ``(b) Prohibited Actions.--
            ``(1) In general.--No State shall--
                    ``(A) impede the activities of, take any action 
                against, or apply any provision of law or regulation 
                to, any insurance producer because that insurance 
                producer or any affiliate plans to become, has applied 
                to become, or is a member of the Association;
                    ``(B) impose any requirement upon a member of the 
                Association that it pay different fees to be licensed 
                or otherwise qualified to do business in that State 
                based on its residency;
                    ``(C) impose any continuing education requirements 
                on non-resident insurance producers; or
                    ``(D) impose any licensing, registration, or 
                appointment requirements upon or impede the activities 
                of any non-resident insurance producer that sells, 
                solicits, negotiates, effects, procures, delivers, 
                renews, continues, or binds insurance for commercial 
                property and casualty risks to an insured with risks 
                located in more than one State, provided that such non-
                resident insurance producer is otherwise licensed as an 
                insurance producer in the State where the insured 
                maintains its principal place of business and the 
                contract of insurance insures risks located in that 
                State.
            ``(2) States other than a home state.--No State, other than 
        a member's home State, shall--
                    ``(A) impose any licensing, appointment, integrity, 
                personal or corporate qualifications, education, 
                training, experience, residency, continuing education 
                or bonding requirement upon a member of the Association 
                that is different from the criteria for membership in 
                the Association or renewal of such membership;
                    ``(B) implement the procedures of such State's 
                system of licensing or renewing the licenses of 
                insurance producers in a manner different from the 
                authority of the Association under section 323;
                    ``(C) impose any requirement upon a member of the 
                Association that it be licensed, registered or 
                otherwise qualified to do business or remain in good 
                standing in such State, including any requirement that 
                such insurance producer register as a foreign company 
                with the secretary of state or equivalent State 
                official; or
                    ``(D) require that a member of the Association 
                submit to a criminal history record check as a 
                condition of doing business in such State.

``SEC. 332. COORDINATION WITH OTHER REGULATORS.

    ``(a) Coordination With State Insurance Regulators.--The 
Association may--
            ``(1) issue uniform insurance producer applications and 
        renewal applications that may be used to apply for the issuance 
        or removal of State licenses;
            ``(2) establish or utilize a central clearinghouse through 
        which members of the Association may apply for the issuance or 
        renewal of licenses in multiple States; and
            ``(3) establish or utilize a national database for the 
        collection of regulatory information concerning the activities 
        of insurance producers.
    ``(b) Coordination With the Financial Industry Regulatory 
Authority.--The Association shall coordinate with the Financial 
Industry Regulatory Authority in order to ease any administrative 
burdens that fall on persons that are members of both associations, 
consistent with the purposes of this subtitle and the Federal 
securities laws.

``SEC. 333. JUDICIAL REVIEW AND ENFORCEMENT.

    ``(a) Jurisdiction.--The appropriate United States district court 
shall have exclusive jurisdiction over litigation involving the 
Association, including disputes between the Association and its members 
that arise under this subtitle. Suits brought in State court involving 
the Association shall be deemed to have arisen under Federal law and 
therefore be subject to jurisdiction in the appropriate United States 
district court.
    ``(b) Exhaustion of Remedies.--An aggrieved person shall be 
required to exhaust all available administrative remedies before the 
Association before it may seek judicial review of an Association 
decision.
    ``(c) Enforcement.--In the case of any violation of section 323(e) 
or 331(b), the Association may seek injunctive relief in the United 
States District Court for the District of Columbia.
    ``(d) Standards of Review.--
            ``(1) Judicial review of rules and bylaws.--The standards 
        set forth in section 553 of title 5, United States Code, shall 
        be applied whenever a regulation or bylaw of the Association is 
        under judicial review.
            ``(2) Judicial review of disciplinary actions.--The 
        standards set forth in section 554 of title 5, United States 
        Code, shall be applied whenever a disciplinary action of the 
        Association is judicially reviewed.
            ``(3) Equal weight and deference.--In any other proceeding 
        involving this subtitle, the court shall give at least equal 
        weight and deference to the interpretations of the Association 
        as would be given to any State or Federal agency with respect 
        to any law, regulation, interpretation, or order addressing the 
        same issues.

``SEC. 334. DEFINITIONS.

    ``For purposes of this subtitle, the following definitions shall 
apply:
            ``(1) Home state.--The term `home State' means the State in 
        which the insurance producer maintains its principal place of 
        residence or business and is licensed to act as an insurance 
        producer.
            ``(2) Insurance.--The term `insurance' means any product, 
        other than title insurance, defined or regulated as insurance 
        by the appropriate State insurance regulatory authority.
            ``(3) Insurance producer.--The term `insurance producer' 
        means any insurance agent or broker, excess or surplus lines 
        broker or agent, insurance consultant, limited insurance 
        representative, and any other individual or entity that 
        solicits, negotiates, effects, procures, delivers, renews, 
        continues or binds policies of insurance or offers advice, 
        counsel, opinions or services related to insurance.
            ``(4) State.--The term `State' includes any State, the 
        District of Columbia, any territory of the United States, and 
        Puerto Rico, Guam, American Samoa, the Trust Territory of the 
        Pacific Islands, the Virgin Islands, and the Northern Mariana 
        Islands.
            ``(5) State law.--
                    ``(A) In general.--The term `State law' includes 
                all laws, decisions, rules, regulations, or other State 
                action having the effect of law, of any State.
                    ``(B) Laws applicable in the district of 
                columbia.--A law of the United States applicable only 
                to or within the District of Columbia shall be treated 
                as a State law rather than a law of the United 
                States.''.
    (b) Clerical Amendment.--The table of contents for the Gramm-Leach-
Bliley Act is amended by striking the items relating to subtitle C of 
title III and inserting the following new items:

  ``Subtitle C--National Association of Registered Agents and Brokers

``Sec. 321. National association of registered agents and brokers.
``Sec. 322. Purpose.
``Sec. 323. Membership.
``Sec. 324. Board of directors.
``Sec. 325. Officers.
``Sec. 326. Bylaws, rules, and disciplinary action.
``Sec. 327. Powers.
``Sec. 328. Report by association.
``Sec. 329. Liability of the association and the directors, officers, 
                            and employees of the association.
``Sec. 330. Presidential review.
``Sec. 331. Relationship to state law.
``Sec. 332. Coordination with other regulators.
``Sec. 333. Judicial review and enforcement.
``Sec. 334. Definitions.''.
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