111th CONGRESS
2d Session
H.R. 4173
In the Senate of the United
States,
May 20, 2010.
Amendments:
That the bill from the House of Representatives
(H.R. 4173) entitled An Act to provide for financial regulatory reform,
to protect consumers and investors, to enhance Federal understanding of
insurance issues, to regulate the over-the-counter derivatives markets, and for
other purposes.
, do pass with the following
Strike all after
the enacting clause and insert the
following:
1.Short title; table of contents
(a)This Act may be cited as the
Restoring American Financial Stability
Act of 2010
.
(b)The table of contents for this Act is as
follows:
Sec. 1. Short title; table of
contents.
Sec. 2. Definitions.
Sec. 3. Severability.
Sec. 4. Effective date.
TITLE I—Financial Stability
Sec. 101. Short title.
Sec. 102. Definitions.
Subtitle A—Financial Stability Oversight
Council
Sec. 111. Financial Stability Oversight Council
established.
Sec. 112. Council authority.
Sec. 113. Authority to require supervision and
regulation of certain nonbank financial companies.
Sec. 114. Registration of nonbank financial
companies supervised by the Board of Governors.
Sec. 115. Enhanced supervision and prudential
standards for nonbank financial companies supervised by the Board of Governors
and certain bank holding companies.
Sec. 116. Reports.
Sec. 117. Treatment of certain companies that
cease to be bank holding companies.
Sec. 118. Council funding.
Sec. 119. Resolution of supervisory
jurisdictional disputes among member agencies.
Sec. 120. Additional standards applicable to
activities or practices for financial stability purposes.
Sec. 121. Mitigation of risks to financial
stability.
Subtitle B—Office of Financial
Research
Sec. 151. Definitions.
Sec. 152. Office of Financial Research
established.
Sec. 153. Purpose and duties of the
Office.
Sec. 154. Organizational structure;
responsibilities of primary programmatic units.
Sec. 155. Funding.
Sec. 156. Transition oversight.
Subtitle C—Additional Board of Governors
authority for certain nonbank financial companies and bank holding
companies
Sec. 161. Reports by and examinations of
nonbank financial companies supervised by the Board of Governors.
Sec. 162. Enforcement.
Sec. 163. Acquisitions.
Sec. 164. Prohibition against management
interlocks between certain financial companies.
Sec. 165. Enhanced supervision and prudential
standards for nonbank financial companies supervised by the Board of Governors
and certain bank holding companies.
Sec. 166. Early remediation
requirements.
Sec. 167. Affiliations.
Sec. 168. Regulations.
Sec. 169. Avoiding duplication.
Sec. 170. Safe harbor.
Sec. 171. Leverage and
risk-based capital requirements.
TITLE II—Orderly liquidation
authority
Sec. 201. Definitions.
Sec. 202. Judicial review.
Sec. 203. Systemic risk
determination.
Sec. 204. Orderly liquidation.
Sec. 205. Orderly liquidation of covered
brokers and dealers.
Sec. 206. Mandatory terms and conditions for
all orderly liquidation actions.
Sec. 207. Directors not liable for acquiescing
in appointment of receiver.
Sec. 208. Dismissal and exclusion of other
actions.
Sec. 209. Rulemaking; non-conflicting
law.
Sec. 210. Powers and duties of the
corporation.
Sec. 211. Miscellaneous provisions.
Sec. 212. Prohibition of
circumvention and prevention of conflicts of interest.
Sec. 213. Ban on senior
executives and directors.
Sec. 214. Prohibition on
taxpayer funding.
TITLE III—Transfer of powers to the Comptroller
of the Currency, the Corporation, and the Board of Governors
Sec. 300. Short title.
Sec. 301. Purposes.
Sec. 302. Definition.
Subtitle A—Transfer of powers and
duties
Sec. 311. Transfer date.
Sec. 312. Powers and duties
transferred.
Sec. 313.
Abolishment.
Sec. 314. Amendments to the
revised statutes.
Sec. 315. Federal information
policy.
Sec. 316. Savings
provisions.
Sec. 317. References in Federal
law to Federal banking agencies.
Sec. 318. Funding.
Sec. 319. Contracting and
leasing authority.
Subtitle B—Transitional
provisions
Sec. 321. Interim use of funds,
personnel, and property of the Office of Thrift Supervision.
Sec. 322. Transfer of
employees.
Sec. 323. Property
transferred.
Sec. 324. Funds
transferred.
Sec. 325. Disposition of
affairs.
Sec. 326. Continuation of
services.
Subtitle C—Federal Deposit Insurance
Corporation
Sec. 331. Deposit insurance
reforms.
Sec. 332. Management of the Federal Deposit
Insurance Corporation.
Subtitle D—Termination of Federal Thrift
Charter
Sec. 341. Termination of Federal savings
associations.
Sec. 342. Branching.
TITLE IV—Regulation of advisers to hedge funds
and others
Sec. 401. Short title.
Sec. 402. Definitions.
Sec. 403. Elimination of private adviser
exemption; limited exemption for foreign private advisers; limited intrastate
exemption.
Sec. 404. Collection of systemic risk data;
reports; examinations; disclosures.
Sec. 405. Disclosure provision
eliminated.
Sec. 406. Clarification of rulemaking
authority.
Sec. 407. Exemption of venture capital fund
advisers.
Sec. 408. Exemption of and record keeping by
private equity fund advisers.
Sec. 409. Family offices.
Sec. 410. State and Federal responsibilities;
asset threshold for Federal registration of investment advisers.
Sec. 411. Custody of client assets.
Sec. 412. Adjusting the accredited investor
standard.
Sec. 413. GAO study and report on accredited
investors.
Sec. 414. GAO study on self-regulatory
organization for private funds.
Sec. 415. Commission study and report on short
selling.
Sec. 416. Transition period.
TITLE V—Insurance
Subtitle A—Office of National
Insurance
Sec. 501. Short title.
Sec. 502. Establishment of Office of National
Insurance.
Subtitle B—State-based Insurance
Reform
Sec. 511. Short title.
Sec. 512. Effective date.
PART I—Nonadmitted insurance
Sec. 521. Reporting, payment, and allocation of
premium taxes.
Sec. 522. Regulation of nonadmitted insurance
by insured’s home State.
Sec. 523. Participation in national producer
database.
Sec. 524. Uniform standards for surplus lines
eligibility.
Sec. 525. Streamlined application for
commercial purchasers.
Sec. 526. GAO study of nonadmitted insurance
market.
Sec. 527. Definitions.
PART II—Reinsurance
Sec. 531. Regulation of credit for reinsurance
and reinsurance agreements.
Sec. 532. Regulation of reinsurer
solvency.
Sec. 533. Definitions.
PART III—Rule of construction
Sec. 541. Rule of construction.
Sec. 542. Severability.
TITLE VI—Improvements to regulation of bank and
savings association holding companies and depository institutions
Sec. 601. Short title.
Sec. 602. Definition.
Sec. 603. Moratorium and study on treatment of
credit card banks, industrial loan companies, and certain other companies under
the Bank Holding Company Act of 1956.
Sec. 604. Reports and examinations of holding
companies; regulation of functionally regulated subsidiaries.
Sec. 605. Assuring consistent oversight of
permissible activities of depository institution subsidiaries of holding
companies.
Sec. 606. Requirements for financial holding
companies to remain well capitalized and well managed.
Sec. 607. Standards for interstate
acquisitions.
Sec. 608. Enhancing existing restrictions on
bank transactions with affiliates.
Sec. 609. Eliminating exceptions for
transactions with financial subsidiaries.
Sec. 610. Lending limits applicable to credit
exposure on derivative transactions, repurchase agreements, reverse repurchase
agreements, and securities lending and borrowing transactions.
Sec. 611. Application of national bank lending
limits to insured State banks.
Sec. 612. Restriction on conversions of
troubled banks.
Sec. 613. De novo branching into
States.
Sec. 614. Lending limits to
insiders.
Sec. 615. Limitations on purchases of assets
from insiders.
Sec. 616. Regulations regarding capital levels
of holding companies.
Sec. 617. Elimination of elective investment
bank holding company framework.
Sec. 618. Securities holding
companies.
Sec. 619. Restrictions on capital market
activity by banks and bank holding companies.
Sec. 620. Concentration limits on large
financial firms.
TITLE VII—Wall Street Transparency and
Accountability
Sec. 701. Short title.
Subtitle A—Regulation of Over-the-Counter Swaps
Markets
PART I—Regulatory authority
Sec. 711. Definitions.
Sec. 712. Review of regulatory
authority.
Sec. 713. Recommendations for changes to
portfolio margining laws.
Sec. 714. Abusive swaps.
Sec. 715. Authority to prohibit participation
in swap activities.
Sec. 716. Prohibition against Federal
Government bailouts of swaps entities.
Sec. 717. New product approval—CFTC-SEC
process.
Sec. 718. Determining status of novel
derivative products.
PART II—Regulation of Swap Markets
Sec. 721. Definitions.
Sec. 722. Jurisdiction.
Sec. 723. Clearing.
Sec. 724. Swaps; segregation and bankruptcy
treatment.
Sec. 725. Derivatives clearing
organizations.
Sec. 726. Rulemaking on conflict of
interest.
Sec. 727. Public reporting of swap transaction
data.
Sec. 728. Swap data repositories.
Sec. 729. Reporting and
recordkeeping.
Sec. 730. Large swap trader
reporting.
Sec. 731. Registration and regulation of swap
dealers and major swap participants.
Sec. 732. Conflicts of interest.
Sec. 733. Swap execution
facilities.
Sec. 734. Derivatives transaction execution
facilities and exempt boards of trade.
Sec. 735. Designated contract
markets.
Sec. 736. Margin.
Sec. 737. Position limits.
Sec. 738. Foreign boards of trade.
Sec. 739. Legal certainty for
swaps.
Sec. 740. Multilateral clearing
organizations.
Sec. 741. Enforcement.
Sec. 742. Retail commodity
transactions.
Sec. 743. Other authority.
Sec. 744. Restitution remedies.
Sec. 745. Enhanced compliance by registered
entities.
Sec. 746. Insider trading.
Sec. 747. Antidisruptive practices
authority.
Sec. 748. Commodity whistleblower incentives
and protection.
Sec. 749. Conforming amendments.
Sec. 750. Study on oversight of carbon
markets.
Sec. 751. Energy and Environmental Markets
Advisory Committee.
Sec. 752. International
harmonization.
Sec. 753. Antimarket
manipulation authority.
Sec. 754. Effective date.
Subtitle B—Regulation of Security-Based Swap
Markets
Sec. 761. Definitions under the Securities
Exchange Act of 1934.
Sec. 762. Repeal of prohibition on regulation
of security-based swap agreements.
Sec. 763. Amendments to the Securities Exchange
Act of 1934.
Sec. 764. Registration and regulation of
security-based swap dealers and major security-based swap
participants.
Sec. 765. Rulemaking on conflict of
interest.
Sec. 766. Reporting and
recordkeeping.
Sec. 767. State gaming and bucket shop
laws.
Sec. 768. Amendments to the Securities Act of
1933; treatment of security-based swaps.
Sec. 769. Definitions under the Investment
Company Act of 1940.
Sec. 770. Definitions under the Investment
Advisors Act of 1940.
Sec. 771. Other authority.
Sec. 772. Jurisdiction.
Sec. 773. Effective date.
TITLE VIII—Payment, clearing, and settlement
supervision
Sec. 801. Short title.
Sec. 802. Findings and purposes.
Sec. 803. Definitions.
Sec. 804. Designation of systemic
importance.
Sec. 805. Standards for systemically important
financial market utilities and payment, clearing, or settlement
activities.
Sec. 806. Operations of designated financial
market utilities.
Sec. 807. Examination of and enforcement
actions against designated financial market utilities.
Sec. 808. Examination of and enforcement
actions against financial institutions subject to standards for designated
activities.
Sec. 809. Requests for information, reports, or
records.
Sec. 810. Rulemaking.
Sec. 811. Other authority.
Sec. 812. Effective date.
TITLE IX—Investor protections and improvements
to the regulation of securities
Subtitle A—Increasing investor
protection
Sec. 911. Investor Advisory Committee
established.
Sec. 912. Clarification of authority of the
Commission to engage in investor testing.
Sec. 913. Study and rulemaking regarding
obligations of brokers, dealers, and investment advisers.
Sec. 914. Office of the Investor
Advocate.
Sec. 915. Streamlining of filing procedures for
self-regulatory organizations.
Sec. 916. Study regarding financial literacy
among investors.
Sec. 917. Study regarding mutual fund
advertising.
Sec. 918. Clarification of Commission authority
to require investor disclosures before purchase of investment products and
services.
Sec. 919. Study on conflicts of
interest.
Sec. 919A. Study on improved investor access to
information on investment advisers and broker-dealers.
Sec. 919B. Study on financial planners and the
use of financial designations.
Subtitle B—Increasing regulatory enforcement
and remedies
Sec. 921. Authority to issue rules related to
mandatory predispute arbitration.
Sec. 922. Whistleblower protection.
Sec. 923. Conforming amendments for
whistleblower protection.
Sec. 924. Implementation and transition
provisions for whistleblower protection.
Sec. 925. Collateral bars.
Sec. 926. Disqualifying felons and other “bad
actors” from Regulation D Offerings.
Sec. 927. Equal treatment of self-regulatory
organization rules.
Sec. 928. Clarification that Section 205 of the
Investment Advisers Act of 1940 does not apply to State-registered
advisers.
Sec. 929. Unlawful margin lending.
Sec. 929A. Protection for employees of
subsidiaries and affiliates of publicly traded companies.
Sec. 929B. FAIR Fund amendments.
Sec. 929C. Increasing the borrowing limit on
Treasury loans.
Subtitle C—Improvements to the Regulation of
Credit Rating Agencies
Sec. 931. Findings.
Sec. 932. Enhanced regulation, accountability,
and transparency of nationally recognized statistical rating
organizations.
Sec. 933. State of mind in private
actions.
Sec. 934. Referring tips to law enforcement or
regulatory authorities.
Sec. 935. Consideration of information from
sources other than the issuer in rating decisions.
Sec. 936. Qualification standards for credit
rating analysts.
Sec. 937. Timing of regulations.
Sec. 938. Universal ratings
symbols.
Sec. 939. Removal of statutory
references to credit ratings.
Sec. 939A. Securities and Exchange Commission
study on strengthening credit rating agency independence.
Sec. 939B. Government Accountability Office
study on alternative business models.
Sec. 939C. Government Accountability Office
study on the creation of an independent professional analyst
organization.
Sec. 939D. Initial credit
rating assignments.
Subtitle D—Improvements to the Asset-Backed
Securitization Process
Sec. 941. Regulation of credit risk
retention.
Sec. 942. Disclosures and reporting for
asset-backed securities.
Sec. 943. Representations and warranties in
asset-backed offerings.
Sec. 944. Exempted transactions under the
Securities Act of 1933.
Sec. 945. Due diligence analysis and disclosure
in asset-backed securities issues.
Subtitle E—Accountability and Executive
Compensation
Sec. 951. Shareholder vote on executive
compensation disclosures.
Sec. 952. Compensation committee
independence.
Sec. 953. Executive compensation
disclosures.
Sec. 954. Recovery of erroneously awarded
compensation.
Sec. 955. Disclosure regarding employee and
director hedging.
Sec. 956. Excessive compensation by holding
companies of depository institutions.
Sec. 957. Voting by brokers.
Subtitle F—Improvements to the Management of
the Securities and Exchange Commission
Sec. 961. Report and certification of internal
supervisory controls.
Sec. 962. Triennial report on personnel
management.
Sec. 963. Annual financial controls
audit.
Sec. 964. Report on oversight of national
securities associations.
Sec. 965. Compliance examiners.
Sec. 966. Suggestion program for employees of
the Commission.
Subtitle G—Strengthening Corporate
Governance
Sec. 971. Election of directors by majority
vote in uncontested elections.
Sec. 972. Proxy access.
Sec. 973. Disclosures regarding chairman and
CEO structures.
Subtitle H—Municipal Securities
Sec. 975. Regulation of municipal securities
and changes to the board of the MSRB.
Sec. 976. Government Accountability Office
study of increased disclosure to investors.
Sec. 977. Government Accountability Office
study on the municipal securities markets.
Sec. 978. Study of funding for Government
Accounting Standards Board.
Sec. 979. Commission Office of Municipal
Securities.
Subtitle I—Public Company Accounting Oversight
Board, portfolio margining, and other matters
Sec. 981. Authority to share certain
information with foreign authorities.
Sec. 982. Oversight of brokers and
dealers.
Sec. 983. Portfolio margining.
Sec. 984. Loan or borrowing of
securities.
Sec. 985. Technical corrections to Federal
securities laws.
Sec. 986. Conforming amendments relating to
repeal of the Public Utility Holding Company Act of 1935.
Sec. 987. Amendment to definition of material
loss and nonmaterial losses to the Deposit Insurance Fund for purposes of
Inspector General reviews.
Sec. 988. Amendment to definition of material
loss and nonmaterial losses to the National Credit Union Share Insurance Fund
for purposes of Inspector General reviews.
Sec. 989. Government Accountability Office
study on proprietary trading.
Sec. 989A. Senior investor
protections.
Sec. 989B. Designated Federal
Entity Inspectors General Independence.
Sec. 989C. Strengthening
Inspector General accountability.
Sec. 989D. Removal of
inspectors general of designated Federal entities.
Sec. 989E. Additional oversight
of financial regulatory system.
Subtitle J—Self-funding of the Securities and
Exchange Commission
Sec. 991. Securities and Exchange Commission
self-funding.
TITLE X—Bureau of Consumer Financial
Protection
Sec. 1001. Short title.
Sec. 1002. Definitions.
Subtitle A—Bureau of Consumer Financial
Protection
Sec. 1011. Establishment of the
Bureau.
Sec. 1012. Executive and administrative
powers.
Sec. 1013. Administration.
Sec. 1014. Consumer Advisory Board.
Sec. 1015. Coordination.
Sec. 1016. Appearances before and reports to
Congress.
Sec. 1017. Funding; penalties and
fines.
Sec. 1018. Effective date.
Subtitle B—General Powers of the
Bureau
Sec. 1021. Purpose, objectives, and
functions.
Sec. 1022. Rulemaking authority.
Sec. 1023. Review of Bureau
regulations.
Sec. 1024. Supervision of nondepository covered
persons.
Sec. 1025. Supervision of very large banks,
savings associations, and credit unions.
Sec. 1026. Other banks, savings associations,
and credit unions.
Sec. 1027. Limitations on authorities of the
Bureau; preservation of authorities.
Sec. 1028. Authority to restrict mandatory
pre-dispute arbitration.
Sec. 1029. Effective date.
Subtitle C—Specific Bureau
Authorities
Sec. 1031. Prohibiting unfair, deceptive, or
abusive acts or practices.
Sec. 1032. Disclosures.
Sec. 1033. Consumer rights to access
information.
Sec. 1034. Response to consumer complaints and
inquiries.
Sec. 1035. Private education loan
ombudsman.
Sec. 1036. Prohibited acts.
Sec. 1037. Effective date.
Subtitle D—Preservation of State
Law
Sec. 1041. Relation to State law.
Sec. 1042. Preservation of
enforcement powers of States.
Sec. 1043. Preservation of
existing contracts.
Sec. 1044. State law preemption
standards for national banks and subsidiaries clarified.
Sec. 1045. Clarification of law
applicable to nondepository institution subsidiaries.
Sec. 1046. State law preemption
standards for Federal savings associations and subsidiaries
clarified.
Sec. 1047. Visitorial standards
for national banks and savings associations.
Sec. 1048. Effective date.
Subtitle E—Enforcement Powers
Sec. 1051. Definitions.
Sec. 1052. Investigations and administrative
discovery.
Sec. 1053. Hearings and adjudication
proceedings.
Sec. 1054. Litigation authority.
Sec. 1055. Relief available.
Sec. 1056. Referrals for criminal
proceedings.
Sec. 1057. Employee protection.
Sec. 1058. Effective date.
Subtitle F—Transfer of Functions and Personnel;
Transitional Provisions
Sec. 1061. Transfer of consumer financial
protection functions.
Sec. 1062. Designated transfer
date.
Sec. 1063. Savings provisions.
Sec. 1064. Transfer of certain
personnel.
Sec. 1065. Incidental transfers.
Sec. 1066. Interim authority of the
Secretary.
Sec. 1067. Transition oversight.
Subtitle G—Regulatory Improvements
Sec. 1071. Small business data
collection.
Sec. 1072. GAO study on the effectiveness and
impact of various appraisal methods.
Sec. 1073. Prohibited payments
to mortgage originators.
Sec. 1074. Minimum standards
for residential mortgage loans.
Sec. 1075. Prohibition on certain prepayment
penalties.
Sec. 1076. Assistance for economically
vulnerable individuals and families.
Sec. 1077. Remittance transfers.
Sec. 1078. Department of the
Treasury study on ending the conservatorship of Fannie Mae, Freddie Mac, and
reforming the housing finance system.
Sec. 1079. Reasonable fees and
rules for payment card transactions.
Sec. 1079A. Use of Consumer
Reports.
Subtitle H—Conforming Amendments
Sec. 1081. Amendments to the Inspector General
Act.
Sec. 1082. Amendments to the Privacy Act of
1974.
Sec. 1083. Amendments to the Alternative
Mortgage Transaction Parity Act of 1982.
Sec. 1084. Amendments to the Electronic Fund
Transfer Act.
Sec. 1085. Amendments to the Equal Credit
Opportunity Act.
Sec. 1086. Amendments to the Expedited Funds
Availability Act.
Sec. 1087. Amendments to the Fair Credit
Billing Act.
Sec. 1088. Amendments to the Fair Credit
Reporting Act and the Fair and Accurate Credit Transactions Act.
Sec. 1089. Amendments to the Fair Debt
Collection Practices Act.
Sec. 1090. Amendments to the Federal Deposit
Insurance Act.
Sec. 1091. Amendments to the Gramm-Leach-Bliley
Act.
Sec. 1092. Amendments to the Home Mortgage
Disclosure Act.
Sec. 1093. Amendments to the Homeowners
Protection Act of 1998.
Sec. 1094. Amendments to the Home Ownership and
Equity Protection Act of 1994.
Sec. 1095. Amendments to the Omnibus
Appropriations Act, 2009.
Sec. 1096. Amendments to the Real Estate
Settlement Procedures Act.
Sec. 1097. Amendments to the Right to Financial
Privacy Act of 1978.
Sec. 1098. Amendments to the Secure and Fair
Enforcement for Mortgage Licensing Act of 2008.
Sec. 1099. Amendments to the Truth in Lending
Act.
Sec. 1100. Amendments to the Truth in Savings
Act.
Sec. 1101. Amendments to the Telemarketing and
Consumer Fraud and Abuse Prevention Act.
Sec. 1102. Amendments to the Paperwork
Reduction Act.
Sec. 1103. Adjustments for inflation in the
Truth in Lending Act.
Sec. 1104. Small business
fairness and regulatory transparency.
Sec. 1105. Effective date.
TITLE XI—Federal Reserve System
provisions
Sec. 1151. Federal Reserve Act amendments on
emergency lending authority.
Sec. 1152. Reviews of special Federal Reserve
credit facilities.
Sec. 1153. Public access to
information.
Sec. 1154. Liquidity event
determination.
Sec. 1155. Emergency financial
stabilization.
Sec. 1156. Additional related
amendments.
Sec. 1157. Federal Reserve Act amendments on
Federal reserve bank governance.
Sec. 1158. Amendments to the Federal Reserve
Act relating to supervision and regulation policy.
Sec. 1159. GAO audit of the
Federal Reserve facilities; Publication of Board actions.
TITLE XII—Improving access to mainstream
financial institutions
Sec. 1201. Short title.
Sec. 1202. Purpose.
Sec. 1203. Definitions.
Sec. 1204. Expanded access to mainstream
financial institutions.
Sec. 1205. Low-cost alternatives to payday
loans.
Sec. 1206. Grants to establish loan-loss
reserve funds.
Sec. 1207. Procedural provisions.
Sec. 1208. Authorization of
appropriations.
Sec. 1209. Regulations.
Sec. 1210. Evaluation and reports to
Congress.
TITLE XIII—Pay It Back
Act
Sec. 1301. Short
title.
Sec. 1302. Amendment to reduce
TARP authorization.
Sec. 1303. Report.
Sec. 1304. Amendments to
Housing and Economic Recovery Act of 2008.
Sec. 1305. Federal Housing
Finance Agency report.
Sec. 1306. Repayment of
unobligated ARRA funds.
TITLE
XIV—Miscellaneous
Sec. 1401. Restrictions on use
of Federal funds to finance bailouts of foreign governments.
TITLE XV—Congo Conflict
Minerals
Sec. 1501. Sense of Congress on
exploitation and trade of columbite-tantalite, cassiterite, gold, and
wolframite originating in Democratic Republic of Congo.
Sec. 1502. Disclosure to
Securities and Exchange Commission relating to columbite-tantalite,
cassiterite, gold, and wolframite originating in Democratic Republic of
Congo.
Sec. 1503. Report.
2.As used in this Act, the following
definitions shall apply, except as the context otherwise requires or as
otherwise specifically provided in this Act:
(1)The term affiliate means any
company that controls, is controlled by, or is under common control with
another company.
(2)Appropriate Federal banking
agencyOn and after the
transfer date, the term appropriate Federal banking agency has the
same meaning as in section 3(q) of the Federal Deposit Insurance Act (12 U.S.C.
1813(q)), as amended by title III.
(3)The term Board of Governors
means the Board of Governors of the Federal Reserve System.
(4)The term Bureau means the
Bureau of Consumer Financial Protection established under title X.
(5)The term Commission means the
Securities and Exchange Commission, except in the context of the Commodity
Futures Trading Commission.
(6)The term Corporation means the
Federal Deposit Insurance Corporation.
(7)The term Council
means the
Financial Stability Oversight Council established under title I.
(8)The term credit union means a
Federal credit union, State credit union, or State-chartered credit union, as
those terms are defined in section 101 of the Federal Credit Union Act (12
U.S.C. 1752).
(9)The term—
(A)Federal banking agency means,
individually, the Board of Governors, the Office of the Comptroller of the
Currency, and the Corporation; and
(B)Federal banking agencies means
all of the agencies referred to in subparagraph (A), collectively.
(10)Functionally regulated
subsidiaryThe term
functionally regulated subsidiary has the same meaning as in
section 5(c)(5) of the Bank Holding Company Act of 1956 (12 U.S.C.
1844(c)(5)).
(11)Primary financial regulatory
agencyThe term primary
financial regulatory agency means—
(A)the appropriate Federal banking agency,
with respect to institutions described in section 3(q) of the Federal Deposit
Insurance Act, except to the extent that an institution is or the activities of
an institution are otherwise subject to the jurisdiction of an agency listed in
subparagraph (B), (C), (D), or (E);
(B)the Securities and Exchange Commission,
with respect to—
(i)any broker or dealer that is registered
with the Commission under the Securities Exchange Act of 1934;
(ii)any investment company that is registered
with the Commission under the Investment Company Act of 1940;
(iii)any investment adviser that is registered
with the Commission under the Investment Advisers Act of 1940, with respect to
the investment advisory activities of such company and activities that are
incidental to such advisory activities; and
(iv)any clearing agency registered with the
Commission under the Securities Exchange Act of 1934;
(C)the Commodity Futures Trading Commission,
with respect to any futures commission merchant, any commodity trading adviser,
and any commodity pool operator registered with the Commodity Futures Trading
Commission under the Commodity Exchange Act, with respect to the commodities
activities of such entity and activities that are incidental to such
commodities activities;
(D)the State insurance authority of the State
in which an insurance company is domiciled, with respect to the insurance
activities and activities that are incidental to such insurance activities of
an insurance company that is subject to supervision by the State insurance
authority under State insurance law; and
(E)the Federal Housing Finance Agency, with
respect to Federal Home Loan Banks or the Federal Home Loan Bank System, and
with respect to the Federal National Mortgage Association or the Federal Home
Loan Mortgage Corporation.
(12)The term prudential standards
means enhanced supervision and regulatory standards developed by the Board of
Governors under section 115 or 165.
(13)The term Secretary means the
Secretary of the Treasury.
(14)The—
(A)terms broker,
dealer, issuer, nationally recognized
statistical ratings organization, security, and
securities laws have the same meanings as in section 3 of the
Securities Exchange Act of 1934 (15 U.S.C. 78c);
(B)term investment adviser has
the same meaning as in section 202 of the Investment Advisers Act of 1940 (15
U.S.C. 80b–2); and
(C)term investment company has
the same meaning as in section 3 of the Investment Company Act of 1940 (15
U.S.C. 80a–3).
(15)The term State means any
State, commonwealth, territory, or possession of the United States, the
District of Columbia, the Commonwealth of Puerto Rico, the Commonwealth of the
Northern Mariana Islands, American Samoa, Guam, or the United States Virgin
Islands.
(16)The term transfer date
means
the date established under section 311.
(17)Other incorporated definitions
(A)Federal Deposit insurance actThe terms affiliate
,
bank, bank holding company, control
(when used with respect to a depository institution), deposit,
depository institution, Federal depository
institution
, Federal savings association, foreign
bank
, including, insured branch,
insured depository institution, national member bank,
national nonmember bank, savings association,
State bank, State depository institution
,
State member bank, State nonmember bank, State
savings association, and subsidiary have the same meanings
as in section 3 of the Federal Deposit Insurance Act (12 U.S.C. 1813).
(B)The term—
(i)bank holding company
has
the same meaning as in section 2 of the Bank Holding Company Act of 1956 (12
U.S.C. 1841);
(ii)financial holding company
has the same meaning as in section 2(p) of the Bank Holding Company Act of 1956
(12 U.S.C. 1841(p)); and
(iii)savings and loan holding
company
has the same meaning as in section 10 of the Home Owners' Loan
Act (12 U.S.C. 1467a(a)).
3.If any provision of this Act, an amendment
made by this Act, or the application of such provision or amendment to any
person or circumstance is held to be unconstitutional, the remainder of this
Act, the amendments made by this Act, and the application of the provisions of
such to any person or circumstance shall not be affected thereby.
4.Except as otherwise
specifically provided in this Act or the amendments made by this Act, this Act
and such amendments shall take effect 1 day after the date of enactment of this
Act.
<enum>I</enum><header>Financial
Stability</header>
<section id="idBEF49FCAAD1344DFBE903CFD07343F95"><enum>101.</enum><header>Short
title</header><text display-inline="no-display-inline">This title may be cited
as the <quote>Financial Stability Act of 2010</quote>.</text>
</section><section id="ID43ff47703dd5409e9c53ab6b509f09c4"><enum>102.</enum><header>Definitions</header>
<subsection id="idD55BE637162F4F8FAF7E6372F02237AC"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">For purposes of this
title, unless the context otherwise requires, the following definitions shall
apply:</text>
<paragraph commented="no" id="id79040FD22BC8449F8AD9AA06E0923F03"><enum>(1)</enum><header>Bank holding
company</header><text>The term <term>bank holding company</term> has the same
meaning as in section 2 of the Bank Holding Company Act of 1956 (12 U.S.C.
1841). A foreign bank or company that is treated as a bank holding company for
purposes of the Bank Holding Company Act of 1956, pursuant to section 8(a) of
the International Banking Act of 1978 (12 U.S.C. 3106(a)), shall be treated as
a bank holding company for purposes of this title.</text>
</paragraph><paragraph commented="no" id="id7664CDAC310C43EE9105217B499364F1"><enum>(2)</enum><header>Chairperson</header><text>The
term <term>Chairperson</term> means the Chairperson of the Council.</text>
</paragraph><paragraph commented="no" id="id471E1E9D27114AF18580E5606591D05C"><enum>(3)</enum><header>Member
agency</header><text>The term <term>member agency</term> means an agency
represented by a voting member of the Council.</text>
</paragraph><paragraph commented="no" id="id241BB1EF01D24744B15106DD57033036"><enum>(4)</enum><header>Nonbank financial
company definitions</header>
<subparagraph id="ID06df6277da49470b9d50e810b929ec2d"><enum>(A)</enum><header>Foreign nonbank
financial company</header><text>The term <term>foreign nonbank financial
company</term> means a company (other than a company that is, or is treated in
the United States as, a bank holding company or a subsidiary thereof) that
is—</text>
<clause id="ID37aa497050314b499ae86523d317e544"><enum>(i)</enum><text>incorporated or organized
in a country other than the United States; and</text>
</clause><clause id="ID6113a5103bd542ff8e4614ad286c0829"><enum>(ii)</enum><text>predominantly engaged
in, including through a branch in the United States, financial activities, as
defined in paragraph (6).</text>
</clause></subparagraph><subparagraph id="ID4242697eb5014a6b8e8be53858c72a9d"><enum>(B)</enum><header>U.S. nonbank financial
company</header><text>The term <term>U.S. nonbank financial company</term>
means a company (other than a bank holding company or a subsidiary thereof, or
a Farm Credit System institution chartered and subject to the provisions of the
Farm Credit Act of 1971 (12 U.S.C. 2001 et seq.)) that is—</text>
<clause id="ID72cadd8d14964409839d34ad9b2161c6"><enum>(i)</enum><text>incorporated or organized
under the laws of the United States or any State; and</text>
</clause><clause id="ID2902c82d598e4796b26183352ce57df4"><enum>(ii)</enum><text>predominantly engaged in
financial activities as defined in paragraph (6).</text>
</clause></subparagraph><subparagraph commented="no" id="id928291BBD6BA49DDBEF998E38B334D13"><enum>(C)</enum><header>Nonbank Financial
company</header><text>The term <term>nonbank financial company</term> means a
U.S. nonbank financial company and a foreign nonbank financial company.</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="idE8F20BAECFBC451CB42B9F3C065CC7F9"><enum>(D)</enum><header display-inline="yes-display-inline">Nonbank financial company supervised by the
Board of Governors</header><text display-inline="yes-display-inline">The term
<term>nonbank financial company supervised by the Board of Governors</term>
means a nonbank financial company that the Council has determined under section
113 shall be supervised by the Board of Governors.</text>
</subparagraph></paragraph><paragraph commented="no" id="id9A1DA78427D54E15A8D4D7791D277B57"><enum>(5)</enum><header>Office of Financial
Research</header><text>The term <quote>Office of Financial Research</quote>
means the office established under section 152.</text>
</paragraph><paragraph id="IDb7690a2011904a83926940f525868d01"><enum>(6)</enum><header>Predominantly
engaged</header><text>A company is <term>predominantly engaged in financial
activities</term> if—</text>
<subparagraph id="ID9e1d6650cea3443d8d46ba948ccf76f4"><enum>(A)</enum><text>the annual gross revenues
derived by the company and all of its subsidiaries from activities that are
financial in nature (as defined in section 4(k) of the Bank Holding Company Act
of 1956) and, if applicable, from the ownership or control of one or more
insured depository institutions, represents 85 percent or more of the
consolidated annual gross revenues of the company; or</text>
</subparagraph><subparagraph id="ID2b0deacf60bc424a80345f4f45dcfa9b"><enum>(B)</enum><text>the consolidated assets
of the company and all of its subsidiaries related to activities that are
financial in nature (as defined in section 4(k) of the Bank Holding Company Act
of 1956) and, if applicable, related to the ownership or control of one or more
insured depository institutions, represents 85 percent or more of the
consolidated assets of the company.</text>
</subparagraph></paragraph><paragraph commented="no" id="id8310C02833FB48088D50BCCF569809C4"><enum>(7)</enum><header>Significant
institutions</header><text>The terms <term>significant nonbank financial
company</term> and <term>significant bank holding company</term> have the
meanings given those terms by rule of the Board of Governors.</text>
</paragraph></subsection><subsection id="ID8c0676c82b94461ea4767a2b95cbfb17"><enum>(b)</enum><header>Definitional
criteria</header><text display-inline="yes-display-inline">The Board of
Governors shall establish, by regulation, the requirements for determining if a
company is predominantly engaged in financial activities, as defined in
subsection (a)(6).</text>
</subsection><subsection id="ID018141ea4fc549a7b914b3d781028811"><enum>(c)</enum><header>Foreign nonbank
financial companies</header><text>For purposes of the authority of the Board of
Governors under this title with respect to foreign nonbank financial companies,
references in this title to <quote>company</quote> or <quote>subsidiary</quote>
include only the United States activities and subsidiaries of such foreign
company.</text>
</subsection></section><subtitle id="idCE07D654DCC1452D91630977E1DD627B"><enum>A</enum><header>Financial Stability
Oversight Council</header>
<section id="IDa9aad67a289b4f1397d158d5e3939c8a"><enum>111.</enum><header>Financial Stability
Oversight Council established</header>
<subsection id="ID346f6df17fc04ada86afafa40ae6b7b6"><enum>(a)</enum><header>Establishment</header><text>Effective
on the date of enactment of this Act, there is established the Financial
Stability Oversight Council.</text>
</subsection><subsection id="ID828c38bfe86941a29ed749178a533d1c"><enum>(b)</enum><header>Membership</header><text>The
Council shall consist of the following members:</text>
<paragraph id="ID315a33abdb8448228e34c8e35677a20a"><enum>(1)</enum><header>Voting
members</header><text>The voting members, who shall each have 1 vote on the
Council shall be—</text>
<subparagraph id="idE4AD6FFC1E924BF6814714EB8C65F8E5"><enum>(A)</enum><text>the Secretary of the
Treasury, who shall serve as Chairperson of the Council;</text>
</subparagraph><subparagraph id="ID12fb1b2715cb4494ba1e9682fe9ba0d8"><enum>(B)</enum><text>the Chairman of the Board
of Governors;</text>
</subparagraph><subparagraph id="ID82179efd42a34318adb3de952e02392a"><enum>(C)</enum><text>the Comptroller of the
Currency;</text>
</subparagraph><subparagraph commented="no" id="ID2d915a62bdac4761a16462defe5e4eb9"><enum>(D)</enum><text>the Director of the
Bureau;</text>
</subparagraph><subparagraph id="IDa47826bacc384fa6bfacae0797bf303c"><enum>(E)</enum><text>the Chairman of the
Commission;</text>
</subparagraph><subparagraph id="IDa4c9d7ffeb604e27b8005ef92f675181"><enum>(F)</enum><text>the Chairperson of the
Corporation;</text>
</subparagraph><subparagraph id="id347E6CEB72EA44AD9FF0B7B4ADD876ED"><enum>(G)</enum><text>the Chairperson of the
Commodity Futures Trading Commission;</text>
</subparagraph><subparagraph id="idEBD4E198E9974509A15C203931AE7D33"><enum>(H)</enum><text>the Director of the
Federal Housing Finance Agency; and</text>
</subparagraph><subparagraph id="ID204dadedc4cd4221a8b0c1b977c14e08"><enum>(I)</enum><text>an independent member
appointed by the President, by and with the advice and consent of the Senate,
having insurance expertise.</text>
</subparagraph></paragraph><paragraph id="ID769cfeb9a3604288a1994b6a398db52c"><enum>(2)</enum><header>Nonvoting
Members</header><text>The Director of the Office of Financial Research—</text>
<subparagraph id="idC7EDAA1F70A344BC9A47339EC40EAE94"><enum>(A)</enum><text>shall serve in an
advisory capacity as a nonvoting member of the Council; and</text>
</subparagraph><subparagraph id="id6261C3F9E3214EB381CFFE25B6872E6D"><enum>(B)</enum><text>may not be excluded from
any of the proceedings, meetings, discussions, or deliberations of the
Council.</text>
</subparagraph></paragraph></subsection><subsection commented="no" id="id3D978E64D373462B882A26C0558136C0"><enum>(c)</enum><header>Terms; vacancy</header>
<paragraph commented="no" id="id8EA9212463B048EC8A69CCFDA496B691"><enum>(1)</enum><header>Terms</header><text>The
independent member of the Council shall serve for a term of 6 years.</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="ID4F32BD0996C24FE3BD30B0268D41D692"><enum>(2)</enum><header display-inline="yes-display-inline">Vacancy</header><text>Any vacancy on the
Council shall be filled in the manner in which the original appointment was
made.</text>
</paragraph><paragraph id="IDcec7215a810645fb94b5b4effeb87d68"><enum>(3)</enum><header>Acting officials may
serve</header><text>In the event of a vacancy in the office of the head of a
member agency or department, and pending the appointment of a successor, or
during the absence or disability of the head of a member agency or department,
the acting head of the member agency or department shall serve as a member of
the Council in the place of that agency or department head.</text>
</paragraph></subsection><subsection id="idD03ADF86DBE44B738890229834648DF2"><enum>(d)</enum><header>Technical and
professional advisory committees</header><text display-inline="yes-display-inline">The Council may appoint such special
advisory, technical, or professional committees as may be useful in carrying
out the functions of the Council, including an advisory committee consisting of
State regulators, and the members of such committees may be members of the
Council, or other persons, or both.</text>
</subsection><subsection commented="no" id="idA929A329D0AD485486D8FA0D8F2C8C1F"><enum>(e)</enum><header>Meetings</header>
<paragraph commented="no" id="idCB3D38AD96D648E79C48F330D6F9FE08"><enum>(1)</enum><header>Timing</header><text display-inline="yes-display-inline">The Council shall meet at the call of the
Chairperson or a majority of the members then serving, but not less frequently
than quarterly.</text>
</paragraph><paragraph id="ID53735278198d4a4b98c30d311220cb18"><enum>(2)</enum><header>Rules for conducting
business</header><text>The Council shall adopt such rules as may be necessary
for the conduct of the business of the Council. Such rules shall be rules of
agency organization, procedure, or practice for purposes of section 553 of
title 5, United States Code.</text>
</paragraph></subsection><subsection id="IDfffb7ee0aa454181a7d6269ef75480ed"><enum>(f)</enum><header>Voting</header><text>Unless
otherwise specified, the Council shall make all decisions that it is authorized
or required to make by a majority vote of the members then serving.</text>
</subsection><subsection commented="no" id="IDa01be63e0a5348a1a3313b700b9a5a82"><enum>(g)</enum><header>Nonapplicability of
FACA</header><text display-inline="yes-display-inline">The Federal Advisory
Committee Act (5 U.S.C. App.) shall not apply to the Council, or to any special
advisory, technical, or professional committee appointed by the Council, except
that, if an advisory, technical, or professional committee has one or more
members who are not employees of or affiliated with the United States
Government, the Council shall publish a list of the names of the members of
such committee.</text>
</subsection><subsection commented="no" id="id97D11375F7CC4C57B48EDF802250B2DE"><enum>(h)</enum><header>Assistance from Federal
agencies</header><text display-inline="yes-display-inline">Any department or
agency of the United States may provide to the Council and any special
advisory, technical, or professional committee appointed by the Council, such
services, funds, facilities, staff, and other support services as the Council
may determine advisable.</text>
</subsection><subsection id="ID1d652f1cab4c45999086465bd8d1eb9b"><enum>(i)</enum><header>Compensation of
members</header>
<paragraph id="id6BDE4D4D7EFD4E05979188F91A062D59"><enum>(1)</enum><header>Federal employee
members</header><text>All members of the Council who are officers or employees
of the United States shall serve without compensation in addition to that
received for their services as officers or employees of the United
States.</text>
</paragraph><paragraph id="id7E461A8FA29440FFBC2B1B079041769F"><enum>(2)</enum><header>Compensation for
non-Federal member</header><text display-inline="yes-display-inline">Section
5314 of title 5, United States Code, is amended by adding at the end the
following:</text>
<list changed="added" level="paragraph" reported-display-style="italic">
<list-item><quote>Independent Member of the
Financial Stability Oversight Council (1).</quote>.</list-item></list>
</paragraph></subsection><subsection commented="no" id="ID7F7DD010BD8E4726B1D5367A4FE1E1D4"><enum>(j)</enum><header>Detail of Government
employees</header><text>Any employee of the Federal Government may be detailed
to the Council without reimbursement, and such detail shall be without
interruption or loss of civil service status or privilege. An employee of the
Federal Government detailed to the Council shall report to and be subject to
oversight by the Council during the assignment to the Council, and shall be
compensated by the department or agency from which the employee was
detailed.</text>
</subsection></section><section id="id307581F2025145DBB85DDD4D867C9424"><enum>112.</enum><header>Council
authority</header>
<subsection commented="no" id="id0BFF8F0424AB4015B6779220A64F61E6"><enum>(a)</enum><header>Purposes and duties of
the Council</header>
<paragraph id="id6B5C5AC8CD2B496FB4DFFDBF9D7A4DFA"><enum>(1)</enum><header>In
general</header><text>The purposes of the Council are—</text>
<subparagraph id="id32C1381291E2464FBF84DBC4C1CD6147"><enum>(A)</enum><text>to identify risks to the
financial stability of the United States that could arise from the material
financial distress or failure of large, interconnected bank holding companies
or nonbank financial companies;</text>
</subparagraph><subparagraph id="id7647C922033349C9A665B83EFDB398FA"><enum>(B)</enum><text>to promote market
discipline, by eliminating expectations on the part of shareholders, creditors,
and counterparties of such companies that the Government will shield them from
losses in the event of failure; and</text>
</subparagraph><subparagraph id="idD2BC41E2661F40D3B89C86B511096159"><enum>(C)</enum><text>to respond to emerging
threats to the stability of the United States financial markets.</text>
</subparagraph></paragraph><paragraph id="IDdf016aa9d91647adbddad6090acb5cbe"><enum>(2)</enum><header>Duties</header><text>The
Council shall, in accordance with this title—</text>
<subparagraph id="ID2cdef22e2abd44a2811579e93ed620e2"><enum>(A)</enum><text>collect information from
member agencies and other Federal and State financial regulatory agencies and,
if necessary to assess risks to the United States financial system, direct the
Office of Financial Research to collect information from bank holding companies
and nonbank financial companies;</text>
</subparagraph><subparagraph commented="no" id="ID3b993afbb7a64d7695d1c238fa3b5456"><enum>(B)</enum><text>provide direction to, and
request data and analyses from, the Office of Financial Research to support the
work of the Council;</text>
</subparagraph><subparagraph id="ID228b2d52dfdd4c5ba7049637126a9bf5"><enum>(C)</enum><text>monitor the financial
services marketplace in order to identify potential threats to the financial
stability of the United States;</text>
</subparagraph><subparagraph id="IDccf9210df2d749bc8c070c720ae4462a"><enum>(D)</enum><text>facilitate information
sharing and coordination among the member agencies and other Federal and State
agencies regarding domestic financial services policy development, rulemaking,
examinations, reporting requirements, and enforcement actions;</text>
</subparagraph><subparagraph commented="no" id="ID6da4905b54f24682a8e0840922555f66"><enum>(E)</enum><text>recommend to the member
agencies general supervisory priorities and principles reflecting the outcome
of discussions among the member agencies;</text>
</subparagraph><subparagraph id="ID12532fdd72d64545b2409624a5ab0bf1"><enum>(F)</enum><text>identify gaps in
regulation that could pose risks to the financial stability of the United
States;</text>
</subparagraph><subparagraph id="IDf0d068e3c7b8426d906b9ec980aca734"><enum>(G)</enum><text>require supervision by
the Board of Governors for nonbank financial companies that may pose risks to
the financial stability of the United States in the event of their material
financial distress or failure, pursuant to section 113;</text>
</subparagraph><subparagraph id="IDa01cce578dc142cda8c57a926242ba46"><enum>(H)</enum><text>make recommendations to
the Board of Governors concerning the establishment of heightened prudential
standards for risk-based capital, leverage, liquidity, contingent capital,
resolution plans and credit exposure reports, concentration limits, enhanced
public disclosures, and overall risk management for nonbank financial companies
and large, interconnected bank holding companies supervised by the Board of
Governors;</text>
</subparagraph><subparagraph id="ID646bacb44bb045ae98c5e5a478f6e5eb"><enum>(I)</enum><text>identify systemically
important financial market utilities and payment, clearing, and settlement
activities (as that term is defined in title VIII), and require such utilities
and activities to be subject to standards established by the Board of
Governors;</text>
</subparagraph><subparagraph id="ID8fc781d9a65842e89d3d733cb35aee57"><enum>(J)</enum><text>make recommendations to
primary financial regulatory agencies to apply new or heightened standards and
safeguards for financial activities or practices that could create or increase
risks of significant liquidity, credit, or other problems spreading among bank
holding companies, nonbank financial companies, and United States financial
markets;</text>
</subparagraph><subparagraph id="id5C02333FEE6E4A5FBC34897F4EA94ECE"><enum>(K)</enum><text>make determinations
regarding exemptions in title VII, where necessary;</text>
</subparagraph><subparagraph id="ID915b039ebf0f4b2193283b8ed2667d28"><enum>(L)</enum><text>provide a forum
for—</text>
<clause id="idE3B5FDDB67E049E88A8DDE86FE4EB42F"><enum>(i)</enum><text>discussion and analysis
of emerging market developments and financial regulatory issues; and</text>
</clause><clause id="idCB3FE5E721D3499588C83855755AB45B"><enum>(ii)</enum><text>resolution of
jurisdictional disputes among the members of the Council; and</text>
</clause></subparagraph><subparagraph id="IDcb39d79217cf4a88962cddfc66cfd682"><enum>(M)</enum><text>annually report to and
testify before Congress on—</text>
<clause id="id084AB344F2FC4AAC9E7C9F7E9BC84FFE"><enum>(i)</enum><text>the activities of the
Council;</text>
</clause><clause id="idBC27F8C374884350A2C0B06799B7E6B8"><enum>(ii)</enum><text>significant financial
market developments and potential emerging threats to the financial stability
of the United States;</text>
</clause><clause id="IDaee84593b7f5442cb5f2e97b6da45201"><enum>(iii)</enum><text>all determinations made
under section 113 or title VIII, and the basis for such determinations;
and</text>
</clause><clause id="id056306DED91D47B787F561BBF5381CAF"><enum>(iv)</enum><text>recommendations—</text>
<subclause id="id448D19DCFF0A40BEA833A9ECC75A0D4E"><enum>(I)</enum><text>to enhance the integrity,
efficiency, competitiveness, and stability of United States financial
markets;</text>
</subclause><subclause id="id13BFBAD488A847A09E613044F46205AE"><enum>(II)</enum><text>to promote market
discipline; and</text>
</subclause><subclause id="id6F52B9F5B5A84B35861AE147794AE2D3"><enum>(III)</enum><text>to maintain investor
confidence.</text>
</subclause></clause></subparagraph></paragraph></subsection><subsection id="ID69897924911e4615ab4d813144ac3fd4"><enum>(b)</enum><header>Authority To obtain
information</header>
<paragraph id="IDb41452539c6846b6adb9363cd0fa5b38"><enum>(1)</enum><header>In
general</header><text>The Council may receive, and may request the submission
of, any data or information from the Office of Financial Research and member
agencies, as necessary—</text>
<subparagraph id="IDd1a61147981c4fc5adb13a873a992b33"><enum>(A)</enum><text>to monitor the financial
services marketplace to identify potential risks to the financial stability of
the United States; or</text>
</subparagraph><subparagraph id="ID56b04400f5f1489f8243ebc90fecfa05"><enum>(B)</enum><text>to otherwise carry out
any of the provisions of this title.</text>
</subparagraph></paragraph><paragraph id="IDc23ec729b941459b98cdfe81a3ffd856"><enum>(2)</enum><header>Submissions by the
office and member agencies</header><text>Notwithstanding any other provision of
law, the Office of Financial Research and any member agency are authorized to
submit information to the Council.</text>
</paragraph><paragraph id="ID1cc639a292de4a85ab16f104b2a4e1a2"><enum>(3)</enum><header>Financial data
collection</header>
<subparagraph id="IDce550e802b6a4141ba812906f0fcf0f3"><enum>(A)</enum><header>In
general</header><text>The Council, acting through the Office of Financial
Research, may require the submission of periodic and other reports from any
nonbank financial company or bank holding company for the purpose of assessing
the extent to which a financial activity or financial market in which the
nonbank financial company or bank holding company participates, or the nonbank
financial company or bank holding company itself, poses a threat to the
financial stability of the United States.</text>
</subparagraph><subparagraph id="ID5d43aab0d7bf4744a666d4907f3a4b65"><enum>(B)</enum><header>Mitigation of report
burden</header><text>Before requiring the submission of reports from any
nonbank financial company or bank holding company that is regulated by a member
agency or any primary financial regulatory agency, the Council, acting through
the Office of Financial Research, shall coordinate with such agencies and
shall, whenever possible, rely on information available from the Office of
Financial Research or such agencies.</text>
</subparagraph></paragraph><paragraph id="ID03ba61d5fb7841f4a6dd424cb6fea1ad"><enum>(4)</enum><header>Back-up examination by
the Board of Governors</header><text>If the Council is unable to determine
whether the financial activities of a nonbank financial company pose a threat
to the financial stability of the United States, based on information or
reports obtained under paragraph (3), discussions with management, and publicly
available information, the Council may request the Board of Governors, and the
Board of Governors is authorized, to conduct an examination of the nonbank
financial company for the sole purpose of determining whether the nonbank
financial company should be supervised by the Board of Governors for purposes
of this title.</text>
</paragraph><paragraph id="ID23e3323cb62e452480683c1f66e55c0a"><enum>(5)</enum><header>Confidentiality</header>
<subparagraph id="ID57c811e70d4443aa9c067c97d7436b8c"><enum>(A)</enum><header>In
general</header><text>The Council, the Office of Financial Research, and the
other member agencies shall maintain the confidentiality of any data,
information, and reports submitted under this subsection and subtitle B.</text>
</subparagraph><subparagraph id="ID7e1208027da04333ae85bfe2dead842c"><enum>(B)</enum><header>Retention of
privilege</header><text>The submission of any nonpublicly available data or
information under this subsection and subtitle B shall not constitute a waiver
of, or otherwise affect, any privilege arising under Federal or State law
(including the rules of any Federal or State court) to which the data or
information is otherwise subject.</text>
</subparagraph><subparagraph id="ID1b139d57a58448eda239bab520748bb7"><enum>(C)</enum><header>Freedom of information
Act</header><text>Section 552 of title 5, United States Code, including the
exceptions thereunder, shall apply to any data or information submitted under
this subsection and subtitle B.</text>
</subparagraph></paragraph></subsection></section><section id="ID5973885501e541b1ae164a49ce5af950"><enum>113.</enum><header>Authority to require
supervision and regulation of certain nonbank financial companies</header>
<subsection id="ID38f53a20a58345eb9a3acb5f923f2e50"><enum>(a)</enum><header>U.S. Nonbank Financial
companies supervised by the Board of Governors</header>
<paragraph id="id55D637DE849547ED88300461DA3184F3"><enum>(1)</enum><header>Determination</header><text>The
Council, on a nondelegable basis and by a vote of not fewer than
<fraction>2/3</fraction> of the members then serving, including an affirmative
vote by the Chairperson, may determine that a U.S. nonbank financial company
shall be supervised by the Board of Governors and shall be subject to
prudential standards, in accordance with this title, if the Council determines
that material financial distress at the U.S. nonbank financial company would
pose a threat to the financial stability of the United States.</text>
</paragraph><paragraph id="id691CB9B59E414346B6BA1D05F86210DA"><enum>(2)</enum><header>Considerations</header><text>Each
determination under paragraph (1) shall be based on a consideration by the
Council of—</text>
<subparagraph id="idBFFAB01A2B0047308B299AC81C5BF192"><enum>(A)</enum><text>the degree of leverage of
the company;</text>
</subparagraph><subparagraph id="ID13fcfdcd404b4ab28c3813cf8b1905ac"><enum>(B)</enum><text>the amount and nature of
the financial assets of the company;</text>
</subparagraph><subparagraph id="ID247ac5fba39a402a8b26cf3ae60d803a"><enum>(C)</enum><text>the amount and types of
the liabilities of the company, including the degree of reliance on short-term
funding;</text>
</subparagraph><subparagraph id="IDb6094527b79b410dbab3221705721f86"><enum>(D)</enum><text>the extent and types of
the off-balance-sheet exposures of the company;</text>
</subparagraph><subparagraph id="ID5ebc8d130b7f4310bd1152cbf7343c0d"><enum>(E)</enum><text>the extent and types of
the transactions and relationships of the company with other significant
nonbank financial companies and significant bank holding companies;</text>
</subparagraph><subparagraph id="IDc703573954534f7891d42e8eb11c8633"><enum>(F)</enum><text>the importance of the
company as a source of credit for households, businesses, and State and local
governments and as a source of liquidity for the United States financial
system;</text>
</subparagraph><subparagraph id="IDd074ec6f24d840cfba3d4190a719d815"><enum>(G)</enum><text>the recommendation, if
any, of a member of the Council;</text>
</subparagraph><subparagraph id="IDea0312ffa5e74e1783716b3436e475ca"><enum>(H)</enum><text>the operation of, or
ownership interest in, any clearing, settlement, or payment business of the
company;</text>
</subparagraph><subparagraph commented="no" id="ID431722011b9f42de8dfa49a020921860"><enum>(I)</enum><text>the extent to
which—</text>
<clause commented="no" id="id31F6DFC650F54C699248CA97066ADCFB"><enum>(i)</enum><text>assets are managed rather
than owned by the company; and</text>
</clause><clause commented="no" id="idCD9416DCDD6548A78DEEBBB7E06CC6AA"><enum>(ii)</enum><text>ownership of assets
under management is diffuse; and</text>
</clause></subparagraph><subparagraph id="ID91e0e39932b24ddea1b27b3ee55dc5c9"><enum>(J)</enum><text>any other factors that
the Council deems appropriate.</text>
</subparagraph></paragraph></subsection><subsection id="IDc88c6477f1dd4d3db741eedc30785f0f"><enum>(b)</enum><header>Foreign Nonbank
Financial companies supervised by the Board of Governors</header>
<paragraph id="idCC4855B2BE024DA0A4E9839ABBE7A8E4"><enum>(1)</enum><header>Determination</header><text>The
Council, on a nondelegable basis and by a vote of not fewer than
<fraction>2/3</fraction> of the members then serving, including an affirmative
vote by the Chairperson, may determine that a foreign nonbank financial company
that has substantial assets or operations in the United States shall be
supervised by the Board of Governors and shall be subject to prudential
standards in accordance with this title, if the Council determines that
material financial distress at the foreign nonbank financial company would pose
a threat to the financial stability of the United States.</text>
</paragraph><paragraph id="idE2A7E23D86484F54894B2CB6698C4CC8"><enum>(2)</enum><header>Considerations</header><text>Each
determination under paragraph (1) shall be based on a consideration by the
Council of—</text>
<subparagraph id="id3FE1D21FABB54A67997464F41CDF0796"><enum>(A)</enum><text>the degree of leverage of
the company;</text>
</subparagraph><subparagraph id="ID38d1710431b74e208c51a417e6b0d145"><enum>(B)</enum><text>the amount and nature of
the United States financial assets of the company;</text>
</subparagraph><subparagraph id="IDbece4fc95e40414c94bc6856ca470d31"><enum>(C)</enum><text>the amount and types of
the liabilities of the company used to fund activities and operations in the
United States, including the degree of reliance on short-term funding;</text>
</subparagraph><subparagraph id="IDcd315a72cf4a43fdb4558fa8f6e75bea"><enum>(D)</enum><text>the extent of the United
States-related off-balance-sheet exposure of the company;</text>
</subparagraph><subparagraph id="IDf2726471f47149f69fe4f4182a76668e"><enum>(E)</enum><text>the extent and type of
the transactions and relationships of the company with other significant
nonbank financial companies and bank holding companies;</text>
</subparagraph><subparagraph id="IDafd7c14b0b8e4056987a8d191cf910e1"><enum>(F)</enum><text>the importance of the
company as a source of credit for United States households, businesses, and
State and local governments, and as a source of liquidity for the United States
financial system;</text>
</subparagraph><subparagraph id="IDcdf5f937f03c4575aeee335cdacd364d"><enum>(G)</enum><text>the recommendation, if
any, of a member of the Council;</text>
</subparagraph><subparagraph commented="no" id="id8F7E1FAB304442B8A44887885DC447F0"><enum>(H)</enum><text>the extent to
which—</text>
<clause commented="no" id="id5C55EA8BC974404B91C69F922B03A885"><enum>(i)</enum><text>assets are managed rather
than owned by the company; and</text>
</clause><clause commented="no" id="idD7F87B005E3C4CAB8C02BD146B471030"><enum>(ii)</enum><text>ownership of assets
under management is diffuse; and</text>
</clause></subparagraph><subparagraph id="ID18933fff3c634d959a101fed65e7347f"><enum>(I)</enum><text>any other factors that
the Council deems appropriate.</text>
</subparagraph></paragraph></subsection><subsection id="ID90e3f97357ea458991f5541cd2d79199"><enum>(c)</enum><header>Anti-evasion</header>
<paragraph id="IDbe8fb65923714ff7bff457f55ecf9f4f"><enum>(1)</enum><header>Determinations</header><text>In
order to avoid evasion of this Act, the Council, on its own initiative or at
the request of the Board of Governors, may determine, on a nondelegable basis
and by a vote of not fewer than <fraction>2/3</fraction> of the members then
serving, including an affirmative vote by the Chairperson, that—</text>
<subparagraph id="IDacae7db4007e48449755b2cc3dd1e8f8"><enum>(A)</enum><text>material financial
distress related to financial activities conducted directly or indirectly by a
company incorporated or organized under the laws of the United States or any
State or the financial activities in the United States of a company
incorporated or organized in a country other than the United States would pose
a threat to the financial stability of the United States based on consideration
of the factors in subsection (b)(2);</text>
</subparagraph><subparagraph id="ID72264c68b69f4647b40ad7638dd98000"><enum>(B)</enum><text>the company is organized
or operates in such a manner as to evade the application of this title;</text>
</subparagraph><subparagraph id="ID35cc468174324823a1945b8943d75f74"><enum>(C)</enum><text>such financial activities
of the company shall be supervised by the Board of Governors and subject to
prudential standards in accordance with this title consistent with paragraph
(2); and</text>
</subparagraph><subparagraph id="s2"><enum>(D)</enum><text>upon making a
determination under subsection (c)(1), the Council shall submit a report to the
appropriate committees of Congress detailing the reasons for making such
determination under this subsection.</text>
</subparagraph></paragraph><paragraph id="id6C413597503B4ABD9C83B8BE9BA2C1ED"><enum>(2)</enum><text>Consolidated supervision
of only financial activities; Establishment of an intermediate holding
company.</text>
<subparagraph id="idCB89E3AD19C04215889BD4896A932D0E"><enum>(A)</enum><header>Establishment of an
Intermediate holding company</header><text>Upon a determination under paragraph
(1), the company may establish an intermediate holding company in which the
financial activities of such company and its subsidiaries will be conducted
(other than the activities described in section 167(b)(2) in compliance with
any regulations or guidance provided by the Board of Governors). Such
intermediate holding company shall be subject to the supervision of the Board
of Governors and to prudential standards under this title as if the
intermediate holding company is a nonbank financial company supervised by the
Board of Governors.</text>
</subparagraph><subparagraph id="idB211448027B242B0ACE8ED3A192CD3F2"><enum>(B)</enum><header>Action of the Board of
Governors</header><text>To facilitate the supervision of the financial
activities subject to the determination in paragraph (1), the Board of
Governors may require a company to establish an intermediate holding company,
as provided for in section 167, which would be subject to the supervision of
the Board of Governors and to prudential standards under this title as if the
intermediate holding company is a nonbank financial company supervised by the
Board of Governors.</text>
</subparagraph></paragraph><paragraph id="IDa6debc13f8e4453daa88c09b82aaabea"><enum>(3)</enum><header>Notice and opportunity
for hearing and final determination; judicial review</header><text>Subsections
(d), (f), and (g) shall apply to determinations made by the Council pursuant to
paragraph (1) in the same manner as such subsections apply to nonbank financial
companies.</text>
</paragraph><paragraph id="ID2d4b67a47bca491488da24897cc4071a"><enum>(4)</enum><header>Covered financial
activities</header><text>For purposes of this subsection, the term
<term>financial activities</term> means activities that are financial in nature
(as defined in section 4(k) of the Bank Holding Company Act of 1956) and
include the ownership or control of one or more insured depository institutions
and shall not include internal financial activities conducted for the company
or any affiliates thereof including internal treasury, investment, and employee
benefit functions.</text>
</paragraph><paragraph id="IDb285845ee877400b8fe7aea1db7fa4e3"><enum>(5)</enum><header>Only financial
activities subject to prudential supervision</header><text>Nonfinancial
activities of the company shall not be subject to supervision by the Board of
Governors and prudential standards of the Board. For purposes of this Act, the
financial activities that are the subject of the determination in paragraph (1)
shall be subject to the same requirements as a nonbank financial company.
Nothing in this paragraph shall prohibit or limit the authority of the Board of
Governors to apply prudential standards under this title to the financial
activities that are subject to the determination in paragraph (1).</text>
</paragraph></subsection><subsection id="IDc34c3675f9614fa08d8325ad61ebdbc0"><enum>(d)</enum><header>Reevaluation and
rescission</header><text>The Council shall—</text>
<paragraph id="id9BF58B53311B44249E44BDA1BC9581C0"><enum>(1)</enum><text>not less frequently than
annually, reevaluate each determination made under subsections (a) and (b) with
respect to each nonbank financial company supervised by the Board of Governors;
and</text>
</paragraph><paragraph id="id13A438FE1990479CB281A5A9024536C2"><enum>(2)</enum><text>rescind any such
determination, if the Council, by a vote of not fewer than
<fraction>2/3</fraction> of the members then serving, including an affirmative
vote by the Chairperson, determines that the nonbank financial company no
longer meets the standards under subsection (a) or (b), as applicable.</text>
</paragraph></subsection><subsection id="IDf2de6fdb6d614290b8ca9baf39b0549a"><enum>(e)</enum><header>Notice and opportunity
for hearing and final determination</header>
<paragraph id="idE94EE6B7367A430C9AE5EF955DD38D2F"><enum>(1)</enum><header>In
general</header><text>The Council shall provide to a nonbank financial company
written notice of a proposed determination of the Council, including an
explanation of the basis of the proposed determination of the Council, that
such nonbank financial company shall be supervised by the Board of Governors
and shall be subject to prudential standards in accordance with this
title.</text>
</paragraph><paragraph id="idF1768A5EE2EB4E83BD5CBC80C248F506"><enum>(2)</enum><header>Hearing</header><text>Not
later than 30 days after the date of receipt of any notice of a proposed
determination under paragraph (1), the nonbank financial company may request,
in writing, an opportunity for a written or oral hearing before the Council to
contest the proposed determination. Upon receipt of a timely request, the
Council shall fix a time (not later than 30 days after the date of receipt of
the request) and place at which such company may appear, personally or through
counsel, to submit written materials (or, at the sole discretion of the
Council, oral testimony and oral argument).</text>
</paragraph><paragraph id="id58EF5617559C4205B82132A729622CD3"><enum>(3)</enum><header>Final
determination</header><text>Not later than 60 days after the date of a hearing
under paragraph (2), the Council shall notify the nonbank financial company of
the final determination of the Council, which shall contain a statement of the
basis for the decision of the Council.</text>
</paragraph><paragraph id="id31075B0FB8494C4F80E425FD1ED1493A"><enum>(4)</enum><header>No hearing
requested</header><text>If a nonbank financial company does not make a timely
request for a hearing, the Council shall notify the nonbank financial company,
in writing, of the final determination of the Council under subsection (a) or
(b), as applicable, not later than 10 days after the date by which the company
may request a hearing under paragraph (2).</text>
</paragraph></subsection><subsection id="IDd44b7ff9e5294c5884c21edb56740ddc"><enum>(f)</enum><header>Emergency
exception</header>
<paragraph id="idBBE084B56CF84C3981CF84FD918C0D28"><enum>(1)</enum><header>In
general</header><text>The Council may waive or modify the requirements of
subsection (d) with respect to a nonbank financial company, if the Council
determines, by a vote of not fewer than <fraction>2/3</fraction> of the members
then serving, including an affirmative vote by the Chairperson, that such
waiver or modification is necessary or appropriate to prevent or mitigate
threats posed by the nonbank financial company to the financial stability of
the United States.</text>
</paragraph><paragraph id="idCAEE9FD327614CD68B080C9894FC72D4"><enum>(2)</enum><header>Notice</header><text>The
Council shall provide notice of a waiver or modification under this paragraph
to the nonbank financial company concerned as soon as practicable, but not
later than 24 hours after the waiver or modification is granted.</text>
</paragraph><paragraph id="idFF51E10E251345238C1C8EAF4444E291"><enum>(3)</enum><header>Opportunity for
hearing</header><text>The Council shall allow a nonbank financial company to
request, in writing, an opportunity for a written or oral hearing before the
Council to contest a waiver or modification under this paragraph, not later
than 10 days after the date of receipt of notice of the waiver or modification
by the company. Upon receipt of a timely request, the Council shall fix a time
(not later than 15 days after the date of receipt of the request) and place at
which the nonbank financial company may appear, personally or through counsel,
to submit written materials (or, at the sole discretion of the Council, oral
testimony and oral argument).</text>
</paragraph><paragraph id="idEB11A4960B8F4AEF8398DCE7271F741B"><enum>(4)</enum><header>Notice of final
determination</header><text>Not later than 30 days after the date of any
hearing under paragraph (3), the Council shall notify the subject nonbank
financial company of the final determination of the Council under this
paragraph, which shall contain a statement of the basis for the decision of the
Council.</text>
</paragraph></subsection><subsection id="ID642e905a6cda4db49c3b5e5200197bd2"><enum>(g)</enum><header>Consultation</header><text>The
Council shall consult with the primary financial regulatory agency, if any, for
each nonbank financial company or subsidiary of a nonbank financial company
that is being considered for supervision by the Board of Governors under this
section before the Council makes any final determination with respect to such
nonbank financial company under subsection (a), (b), or (c).</text>
</subsection><subsection id="ID6bb27f99ea0d4f0b98457e020479014a"><enum>(h)</enum><header>Judicial
review</header><text>If the Council makes a final determination under this
section with respect to a nonbank financial company, such nonbank financial
company may, not later than 30 days after the date of receipt of the notice of
final determination under subsection (d)(3) or (e)(4), bring an action in the
United States district court for the judicial district in which the home office
of such nonbank financial company is located, or in the United States District
Court for the District of Columbia, for an order requiring that the final
determination be rescinded, and the court shall, upon review, dismiss such
action or direct the final determination to be rescinded. Review of such an
action shall be limited to whether the final determination made under this
section was arbitrary and capricious.</text>
</subsection></section><section id="IDf1b8127fe3384541be9c325b437313dc"><enum>114.</enum><header>Registration of
nonbank financial companies supervised by the Board of Governors</header><text display-inline="no-display-inline">Not later than 180 days after the date of a
final Council determination under section 113 that a nonbank financial company
is to be supervised by the Board of Governors, such company shall register with
the Board of Governors, on forms prescribed by the Board of Governors, which
shall include such information as the Board of Governors, in consultation with
the Council, may deem necessary or appropriate to carry out this title.</text>
</section><section commented="no" id="id207F550C70AF4C2CBD522285CFB11C99"><enum>115.</enum><header>Enhanced supervision
and prudential standards for nonbank financial companies supervised by the
Board of Governors and certain bank holding companies</header>
<subsection id="IDe3eee1fec29442d0a60e38e14977e506"><enum>(a)</enum><header>In general</header>
<paragraph id="id3BA67A4D4E3E41A8B8DD4C0C82D964C8"><enum>(1)</enum><header>Purpose</header><text>In
order to prevent or mitigate risks to the financial stability of the United
States that could arise from the material financial distress or failure of
large, interconnected financial institutions, the Council may make
recommendations to the Board of Governors concerning the establishment and
refinement of prudential standards and reporting and disclosure requirements
applicable to nonbank financial companies supervised by the Board of Governors
and large, interconnected bank holding companies, that—</text>
<subparagraph id="idEE2D0FFA08164168875AE0F6B9D84131"><enum>(A)</enum><text>are more stringent than
those applicable to other nonbank financial companies and bank holding
companies that do not present similar risks to the financial stability of the
United States; and</text>
</subparagraph><subparagraph id="id423D20329CCA45EDB1A54F8773E2B9D7"><enum>(B)</enum><text>increase in stringency,
based on the considerations identified in subsection (b)(3).</text>
</subparagraph></paragraph><paragraph id="id080F7CBDBC0948C1BFABE73BFAA1306D"><enum>(2)</enum><header>Limitation on bank
holding companies</header><text>Any standards recommended under subsections (b)
through (f) shall not apply to any bank holding company with total consolidated
assets of less than $50,000,000,000. The Council may recommend an asset
threshold greater than $50,000,000,000 for the applicability of any particular
standard under those subsections.</text>
</paragraph></subsection><subsection id="ID06b66d43a0e444b885dbeaf79b93bcbc"><enum>(b)</enum><header>Development of
prudential standards</header>
<paragraph id="idA037E4126AC14373AE157DA5FA8D1DED"><enum>(1)</enum><header>In
general</header><text>The recommendations of the Council under subsection (a)
may include—</text>
<subparagraph id="ID3caf67f5a9d144778b85d9ee8f95e65d"><enum>(A)</enum><text>risk-based capital
requirements;</text>
</subparagraph><subparagraph id="IDdcd5d1a6a6f348ab8fa421811f98a024"><enum>(B)</enum><text>leverage limits;</text>
</subparagraph><subparagraph id="ID385258733a03453baeb9043d399da5d7"><enum>(C)</enum><text>liquidity
requirements;</text>
</subparagraph><subparagraph id="idD4935C3FF39D4C6DB9845A4E3DD7FFC3"><enum>(D)</enum><text>resolution plan and
credit exposure report requirements;</text>
</subparagraph><subparagraph id="id1AD6E158E5E1417390425C9B45132B36"><enum>(E)</enum><text>concentration
limits;</text>
</subparagraph><subparagraph id="id1A0550D283594B34A8C806607098C7E5"><enum>(F)</enum><text>a contingent capital
requirement;</text>
</subparagraph><subparagraph id="id5BE4E2D1D493411FADC9940EF66DEDD6"><enum>(G)</enum><text>enhanced public
disclosures; and</text>
</subparagraph><subparagraph id="ID55aa503176284911b685bca49e64d11a"><enum>(H)</enum><text>overall risk management
requirements.</text>
</subparagraph></paragraph><paragraph id="ID911aaac3021f4dbfb6bfbdbdadd1f2da"><enum>(2)</enum><header>Prudential standards
for foreign financial companies</header><text>In making recommendations
concerning the standards set forth in paragraph (1) that would apply to foreign
nonbank financial companies supervised by the Board of Governors or
foreign-based bank holding companies, the Council shall give due regard to the
principle of national treatment and competitive equity.</text>
</paragraph><paragraph id="idEE079847291548C8B80A5427B6C3E139"><enum>(3)</enum><header>Considerations</header><text>In
making recommendations concerning prudential standards under paragraph (1), the
Council shall—</text>
<subparagraph id="id19CC9D150312427897163FCB58D1B274"><enum>(A)</enum><text>take into account
differences among nonbank financial companies supervised by the Board of
Governors and bank holding companies described in subsection (a), based
on—</text>
<clause id="IDbc2e537e57164da89faf3d6c43c0d961"><enum>(i)</enum><text>the factors described in
subsections (a) and (b) of section 113;</text>
</clause><clause id="ID6fd73f207bcf434c8a1fb844b2691cde"><enum>(ii)</enum><text>whether the company owns
an insured depository institution;</text>
</clause><clause id="ID4b7d468f93f94b1398ad502a39ca641e"><enum>(iii)</enum><text>nonfinancial activities
and affiliations of the company; and</text>
</clause><clause id="ID7b77ae53953443ac90fa3fb6b060d4b9"><enum>(iv)</enum><text>any other factors that
the Council determines appropriate; and</text>
</clause></subparagraph><subparagraph id="IDc72c1131b48e488faec040729ce958f4"><enum>(B)</enum><text>to the extent possible,
ensure that small changes in the factors listed in subsections (a) and (b) of
section 113 would not result in sharp, discontinuous changes in the prudential
standards established under paragraph (1).</text>
</subparagraph></paragraph></subsection><subsection id="IDd984965b4ad749ecb1eb29682ec07351"><enum>(c)</enum><header>Contingent
capital</header>
<paragraph id="ID7c57797f1b134c989cd5c1a8b0660259"><enum>(1)</enum><header>Study
required</header><text>The Council shall conduct a study of the feasibility,
benefits, costs, and structure of a contingent capital requirement for nonbank
financial companies supervised by the Board of Governors and bank holding
companies described in subsection (a), which study shall include—</text>
<subparagraph id="IDbdb9f8697298445dba17ac97eb46ff33"><enum>(A)</enum><text>an evaluation of the
degree to which such requirement would enhance the safety and soundness of
companies subject to the requirement, promote the financial stability of the
United States, and reduce risks to United States taxpayers;</text>
</subparagraph><subparagraph id="ID0c78370f922b4485875fdbf827f3e1ca"><enum>(B)</enum><text>an evaluation of the
characteristics and amounts of convertible debt that should be required;</text>
</subparagraph><subparagraph id="ID552f70432d3b479fbc15203a537ae168"><enum>(C)</enum><text>an analysis of potential
prudential standards that should be used to determine whether the contingent
capital of a company would be converted to equity in times of financial
stress;</text>
</subparagraph><subparagraph id="ID29e602b6160a478bb583c92852a9a9fe"><enum>(D)</enum><text>an evaluation of the
costs to companies, the effects on the structure and operation of credit and
other financial markets, and other economic effects of requiring contingent
capital;</text>
</subparagraph><subparagraph id="ID98e53c0ac1a54b72bc940f7de4755d82"><enum>(E)</enum><text>an evaluation of the
effects of such requirement on the international competitiveness of companies
subject to the requirement and the prospects for international coordination in
establishing such requirement; and</text>
</subparagraph><subparagraph id="IDe2d18820192d48cc9c237d6e42b901f8"><enum>(F)</enum><text>recommendations for
implementing regulations.</text>
</subparagraph></paragraph><paragraph id="id3E7C9A1253294A90A2970CF65E85DBD5"><enum>(2)</enum><header>Report</header><text>The
Council shall submit a report to Congress regarding the study required by
paragraph (1) not later than 2 years after the date of enactment of this
Act.</text>
</paragraph><paragraph id="id01B25AE0F97C4D1FB1382D8B98046ECB"><enum>(3)</enum><header>Recommendations</header>
<subparagraph id="id5F095CF1C50B4370AB7029BF3A77623A"><enum>(A)</enum><header>In
general</header><text>Subsequent to submitting a report to Congress under
paragraph (2), the Council may make recommendations to the Board of Governors
to require any nonbank financial company supervised by the Board of Governors
and any bank holding company described in subsection (a) to maintain a minimum
amount of long-term hybrid debt that is convertible to equity in times of
financial stress.</text>
</subparagraph><subparagraph id="IDf53dd55ce7fd4d21bcb083eaa4594cbe"><enum>(B)</enum><header>Factors to
consider</header><text>In making recommendations under this subsection, the
Council shall consider—</text>
<clause id="IDcd0850a469654881ab45b6b20ba25b93"><enum>(i)</enum><text>an appropriate transition
period for implementation of a conversion under this subsection;</text>
</clause><clause id="ID9c0308d657d34f0eaffa2dc6ef131399"><enum>(ii)</enum><text>the factors described in
subsection (b)(3);</text>
</clause><clause id="ID663c51561073442aadead464bf4c5fb2"><enum>(iii)</enum><text>capital requirements
applicable to a nonbank financial company supervised by the Board of Governors
or a bank holding company described in subsection (a), and subsidiaries
thereof;</text>
</clause><clause id="ID7019155126884e1aabd0fc4e3c9b645c"><enum>(iv)</enum><text>results of the study
required by paragraph (1); and</text>
</clause><clause id="id226EA0CAFAEF4EA6B109FC1164E59418"><enum>(v)</enum><text>any other factor that the
Council deems appropriate.</text>
</clause></subparagraph></paragraph></subsection><subsection id="IDf564c1659abb4d28b5989a4db13fd1fc"><enum>(d)</enum><header>Resolution plan and
credit exposure reports</header>
<paragraph id="ID9eb7cfe46773431ab044eb008b1f9735"><enum>(1)</enum><header>Resolution
plan</header><text>The Council may make recommendations to the Board of
Governors concerning the requirement that each nonbank financial company
supervised by the Board of Governors and each bank holding company described in
subsection (a) report periodically to the Council, the Board of Governors, and
the Corporation, the plan of such company for rapid and orderly resolution in
the event of material financial distress or failure.</text>
</paragraph><paragraph id="ID84f8d8e1d9444e20be5a681e024d5a54"><enum>(2)</enum><header>Credit exposure
report</header><text>The Council may make recommendations to the Board of
Governors concerning the advisability of requiring each nonbank financial
company supervised by the Board of Governors and bank holding company described
in subsection (a) to report periodically to the Council, the Board of
Governors, and the Corporation on—</text>
<subparagraph id="ID5c54d313c5e648f682558eca911ab4d5"><enum>(A)</enum><text>the nature and extent to
which the company has credit exposure to other significant nonbank financial
companies and significant bank holding companies; and</text>
</subparagraph><subparagraph id="IDc98763f05f8d4ceeafce32ed27db3016"><enum>(B)</enum><text>the nature and extent to
which other such significant nonbank financial companies and significant bank
holding companies have credit exposure to that company.</text>
</subparagraph></paragraph></subsection><subsection id="ID612f74aa53b243689849c000910bc59a"><enum>(e)</enum><header>Concentration
limits</header><text>In order to limit the risks that the failure of any
individual company could pose to nonbank financial companies supervised by the
Board of Governors or bank holding companies described in subsection (a), the
Council may make recommendations to the Board of Governors to prescribe
standards to limit such risks, as set forth in section 165.</text>
</subsection><subsection id="ID03b318c0cfb44f03a252750ab0e86e2a"><enum>(f)</enum><header>Enhanced public
disclosures</header><text>The Council may make recommendations to the Board of
Governors to require periodic public disclosures by bank holding companies
described in subsection (a) and by nonbank financial companies supervised by
the Board of Governors, in order to support market evaluation of the risk
profile, capital adequacy, and risk management capabilities thereof.</text>
</subsection></section><section id="ID06390ee5b8f84685affd0a4c562b93ae"><enum>116.</enum><header>Reports</header>
<subsection id="ID9a693de29f0643268d5477a39736ca28"><enum>(a)</enum><header>In
general</header><text>Subject to subsection (b), the Council, acting through
the Office of Financial Research, may require a bank holding company with total
consolidated assets of $50,000,000,000 or greater or a nonbank financial
company supervised by the Board of Governors, and any subsidiary thereof, to
submit certified reports to keep the Council informed as to—</text>
<paragraph id="id0984DE4A4CEF4BC1B775B2F7FC4AD18A"><enum>(1)</enum><text>the financial condition
of the company;</text>
</paragraph><paragraph id="id6537E987486F4361B1A8FE4A36A2AD72"><enum>(2)</enum><text>systems for monitoring
and controlling financial, operating, and other risks;</text>
</paragraph><paragraph id="idC43ECA806D6E408FA2B00454CDC20967"><enum>(3)</enum><text>transactions with any
subsidiary that is a depository institution; and</text>
</paragraph><paragraph id="idBADA0815545545C0AF53169E06B67A94"><enum>(4)</enum><text>the extent to which the
activities and operations of the company and any subsidiary thereof, could,
under adverse circumstances, have the potential to disrupt financial markets or
affect the overall financial stability of the United States.</text>
</paragraph></subsection><subsection id="ID3ab181fcf55848fcb9e2bd59660bbdf3"><enum>(b)</enum><header>Use of existing
reports</header>
<paragraph id="ID34ece810673c4026881d386931823eab"><enum>(1)</enum><header>In
general</header><text>For purposes of compliance with subsection (a), the
Council, acting through the Office of Financial Research, shall, to the fullest
extent possible, use—</text>
<subparagraph id="IDdc2ccccb68924e8391b7f0de9a9bb4be"><enum>(A)</enum><text>reports that a bank
holding company, nonbank financial company supervised by the Board of
Governors, or any functionally regulated subsidiary of such company has been
required to provide to other Federal or State regulatory agencies;</text>
</subparagraph><subparagraph id="IDe53311b1355f4ed89726de9d6e9fd392"><enum>(B)</enum><text>information that is
otherwise required to be reported publicly; and</text>
</subparagraph><subparagraph id="IDacf5306808b64c34bc5967a5a9f3466c"><enum>(C)</enum><text>externally audited
financial statements.</text>
</subparagraph></paragraph><paragraph id="ID4fcb08ccb53846b69f5b52a669cbe2ed"><enum>(2)</enum><header>Availability</header><text>Each
bank holding company described in subsection (a) and nonbank financial company
supervised by the Board of Governors, and any subsidiary thereof, shall provide
to the Council, at the request of the Council, copies of all reports referred
to in paragraph (1).</text>
</paragraph><paragraph id="ID5d4b7eec85594b39bcae011caa8c47f3"><enum>(3)</enum><header>Confidentiality</header><text>The
Council shall maintain the confidentiality of the reports obtained under
subsection (a) and paragraph (1)(A) of this subsection.</text>
</paragraph></subsection></section><section id="id466F79DF66EC44CCBB27CD2C563FC822"><enum>117.</enum><header>Treatment of certain
companies that cease to be bank holding companies</header>
<subsection id="ID0fd108cbd6c04562aacd718e3683e83a"><enum>(a)</enum><header>Applicability</header><text>This
section shall apply to any entity or a successor entity that—</text>
<paragraph id="ID307331d857c34155a37474c799a29468"><enum>(1)</enum><text>was a bank holding
company having total consolidated assets equal to or greater than
$50,000,000,000 as of January 1, 2010; and</text>
</paragraph><paragraph id="IDf5e72a77031543f092c6954e29424bea"><enum>(2)</enum><text>received financial
assistance under or participated in the Capital Purchase Program established
under the Troubled Asset Relief Program authorized by the Emergency Economic
Stabilization Act of 2008.</text>
</paragraph></subsection><subsection id="ID42f8974b5b4747dba4fc812b674bc5f4"><enum>(b)</enum><header>Treatment</header><text>If
an entity described in subsection (a) ceases to be a bank holding company at
any time after January 1, 2010, then such entity shall be treated as a nonbank
financial company supervised by the Board of Governors, as if the Council had
made a determination under section 113 with respect to that entity.</text>
</subsection><subsection id="ID8cf1d4feb1f9411d8e35676a38c4c0f2"><enum>(c)</enum><header>Appeal</header>
<paragraph id="ID3288c9a097b24c23ba1cd77749b97da9"><enum>(1)</enum><header>Request for
hearing</header><text>An entity may request, in writing, an opportunity for a
written or oral hearing before the Council to appeal its treatment as a nonbank
financial company supervised by the Board of Governors in accordance with this
section. Upon receipt of the request, the Council shall fix a time (not later
than 30 days after the date of receipt of the request) and place at which such
entity may appear, personally or through counsel, to submit written materials
(or, at the sole discretion of the Council, oral testimony and oral
argument).</text>
</paragraph><paragraph id="IDc28c8359cd8b4923ab20b14b827e5fdb"><enum>(2)</enum><header>Decision</header>
<subparagraph id="ID80121f282f5e4081bea71b279956d6f6"><enum>(A)</enum><header>Proposed
decision</header><text>Not later than 60 days after the date of a hearing under
paragraph (1), the Council shall submit a report to, and may testify before,
the Committee on Banking, Housing, and Urban Affairs of the Senate and the
Committee on Financial Services of the House of Representatives on the proposed
decision of the Council regarding an appeal under paragraph (1), which report
shall include a statement of the basis for the proposed decision of the
Council.</text>
</subparagraph><subparagraph id="ID7b42eed85d18448193fd1e2c14229736"><enum>(B)</enum><header>Notice of final
decision</header><text>The Council shall notify the subject entity of the final
decision of the Council regarding an appeal under paragraph (1), which notice
shall contain a statement of the basis for the final decision of the Council,
not later than 60 days after the later of—</text>
<clause id="id36939C4989EF49BC9FA0B1352D4D042D"><enum>(i)</enum><text>the date of the
submission of the report under subparagraph (A); or</text>
</clause><clause id="id70F177499A2B4A788154BFE7FA6CBA68"><enum>(ii)</enum><text>if the Committee on
Banking, Housing, and Urban Affairs of the Senate or the Committee on Financial
Services of the House of Representatives holds one or more hearings regarding
such report, the date of the last such hearing.</text>
</clause></subparagraph><subparagraph id="idEE9F76738D1D4AD5A4FA3E8246D07100"><enum>(C)</enum><header>Considerations</header><text>In
making a decision regarding an appeal under paragraph (1), the Council shall
consider whether the company meets the standards under section 113(a) or
113(b), as applicable, and the definition of the term <quote>nonbank financial
company</quote> under section 102. The decision of the Council shall be final,
subject to the review under paragraph (3).</text>
</subparagraph></paragraph><paragraph id="ID272419a7f72d48cebc43015300e9693a"><enum>(3)</enum><header>Review</header><text>If
the Council denies an appeal under this subsection, the Council shall, not less
frequently than annually, review and reevaluate the decision.</text>
</paragraph></subsection></section><section id="id67965F8CF6C042DBAE3E939358BB3946"><enum>118.</enum><header>Council
funding</header><text display-inline="no-display-inline">Any expenses of the
Council shall be treated as expenses of, and paid by, the Office of Financial
Research.</text>
</section><section commented="no" id="id07983F535B7245818B51F6B7A40CAA6C"><enum>119.</enum><header>Resolution of
supervisory jurisdictional disputes among member agencies</header>
<subsection commented="no" id="ID22adc7e4560f4cf8adaa96c8f110b800"><enum>(a)</enum><header>Request for dispute
resolution</header><text>The Council shall resolve a dispute among 2 or more
member agencies, if—</text>
<paragraph commented="no" id="ID231f5aa2b61143e4b69d579dc35613e1"><enum>(1)</enum><text>a member agency has a
dispute with another member agency about the respective jurisdiction over a
particular bank holding company, nonbank financial company, or financial
activity or product (excluding matters for which another dispute mechanism
specifically has been provided under Federal law);</text>
</paragraph><paragraph commented="no" id="IDf19acead8679476eba7db119bfe99b5a"><enum>(2)</enum><text>the Council determines
that the disputing agencies cannot, after a demonstrated good faith effort,
resolve the dispute without the intervention of the Council; and</text>
</paragraph><paragraph commented="no" id="ID3c6638fae4c74f6f9059a24c697205f7"><enum>(3)</enum><text>any of the member
agencies involved in the dispute—</text>
<subparagraph commented="no" id="ID294bdd380d5f47e9a28dc37146dfa45d"><enum>(A)</enum><text>provides all other
disputants prior notice of the intent to request dispute resolution by the
Council; and</text>
</subparagraph><subparagraph commented="no" id="IDc1da06b68f5744f8b0694bbd77c0899a"><enum>(B)</enum><text>requests in writing, not
earlier than 14 days after providing the notice described in subparagraph (A),
that the Council resolve the dispute.</text>
</subparagraph></paragraph></subsection><subsection commented="no" id="ID74f010da4bfd4a409f3912ce11a7d163"><enum>(b)</enum><header>Council
decision</header><text>The Council shall resolve each dispute described in
subsection (a)—</text>
<paragraph commented="no" id="ID79fb7b48a85c4b5dad42eb97343d5fa8"><enum>(1)</enum><text>within a reasonable time
after receiving the dispute resolution request;</text>
</paragraph><paragraph commented="no" id="ID8c87b8ba108b46acbb1e932ca4a42e84"><enum>(2)</enum><text>after consideration of
relevant information provided by each agency party to the dispute; and</text>
</paragraph><paragraph commented="no" id="IDba51653e2ebd4b298eb4f1ec6fc9a23a"><enum>(3)</enum><text>by agreeing with 1 of the
disputants regarding the entirety of the matter, or by determining a compromise
position.</text>
</paragraph></subsection><subsection commented="no" id="IDc78aed743683425fbea1b83d39412a99"><enum>(c)</enum><header>Form and binding
effect</header><text>A Council decision under this section shall—</text>
<paragraph commented="no" id="id940BA586D4B747378E6B8BEE3D9068B8"><enum>(1)</enum><text>be in writing;</text>
</paragraph><paragraph commented="no" id="idCA06E06076384E7EA4E0DFB1BAB539B9"><enum>(2)</enum><text>include an explanation of
the reasons therefor; and</text>
</paragraph><paragraph commented="no" id="id705EC2E9AEAB42C6BE46D176DBAB6C3E"><enum>(3)</enum><text>be binding on all Federal
agencies that are parties to the dispute.</text>
</paragraph></subsection></section><section id="ID44bcd761af3c497286ba5567b3943603"><enum>120.</enum><header>Additional standards
applicable to activities or practices for financial stability purposes</header>
<subsection id="IDc230c0d2204444d9804765a9f437a0af"><enum>(a)</enum><header>In
general</header><text>The Council may issue recommendations to the primary
financial regulatory agencies to apply new or heightened standards and
safeguards, including standards enumerated in section 115, for a financial
activity or practice conducted by bank holding companies or nonbank financial
companies under their respective jurisdictions, if the Council determines that
the conduct of such activity or practice could create or increase the risk of
significant liquidity, credit, or other problems spreading among bank holding
companies and nonbank financial companies or the financial markets of the
United States.</text>
</subsection><subsection id="IDffa9011526d147a9a3c62dc30bdd8847"><enum>(b)</enum><header>Procedure for
recommendations to regulators</header>
<paragraph id="ID5584f98fc163461286f035dd1afc5b18"><enum>(1)</enum><header>Notice and opportunity
for comment</header><text>The Council shall consult with the primary financial
regulatory agencies and provide notice to the public and opportunity for
comment for any proposed recommendation that the primary financial regulatory
agencies apply new or heightened standards and safeguards for a financial
activity or practice.</text>
</paragraph><paragraph id="ID31cd870af43a4b04a1ffe75ed130c9c4"><enum>(2)</enum><header>Criteria</header><text>The
new or heightened standards and safeguards for a financial activity or practice
recommended under paragraph (1)—</text>
<subparagraph id="ID2b6de13526c64cde8f7403a48be686d2"><enum>(A)</enum><text>shall take costs to
long-term economic growth into account; and</text>
</subparagraph><subparagraph id="ID5bcdf37435aa489099412aaf6e417df0"><enum>(B)</enum><text>may include prescribing
the conduct of the activity or practice in specific ways (such as by limiting
its scope, or applying particular capital or risk management requirements to
the conduct of the activity) or prohibiting the activity or practice.</text>
</subparagraph></paragraph></subsection><subsection commented="no" id="IDdc9c1acb2b834557bb09877dfda5dfe2"><enum>(c)</enum><header>Implementation of
recommended standards</header>
<paragraph commented="no" id="ID94d2672d5e75446fb62d9be95f9c71c7"><enum>(1)</enum><header>Role of primary
financial regulatory agency</header>
<subparagraph commented="no" id="idD70E7543E3704617972E05FC34B502F7"><enum>(A)</enum><header>In
general</header><text>Each primary financial regulatory agency may impose,
require reports regarding, examine for compliance with, and enforce standards
in accordance with this section with respect to those entities for which it is
the primary financial regulatory agency.</text>
</subparagraph><subparagraph commented="no" id="id3996A7C050D04C7083A5977E139AE8C4"><enum>(B)</enum><header>Rule of
construction</header><text>The authority under this paragraph is in addition
to, and does not limit, any other authority of a primary financial regulatory
agency. Compliance by an entity with actions taken by a primary financial
regulatory agency under this section shall be enforceable in accordance with
the statutes governing the respective jurisdiction of the primary financial
regulatory agency over the entity, as if the agency action were taken under
those statutes.</text>
</subparagraph></paragraph><paragraph commented="no" id="ID7a4f11769e2c45a2b2447bbdab20a488"><enum>(2)</enum><header>Imposition of
standards</header><text>The primary financial regulatory agency shall impose
the standards recommended by the Council in accordance with subsection (a), or
similar standards that the Council deems acceptable, or shall explain in
writing to the Council, not later than 90 days after the date on which the
Council issues the recommendation, why the agency has determined not to follow
the recommendation of the Council.</text>
</paragraph></subsection><subsection id="ID38e6716e3d7a4b81bccf7b65ab3e6100"><enum>(d)</enum><header>Report to
Congress</header><text>The Council shall report to Congress on—</text>
<paragraph id="ID6a7cf6ad3cd24753b4ba8bbf58b206bf"><enum>(1)</enum><text>any recommendations
issued by the Council under this section;</text>
</paragraph><paragraph id="ID9e0e0794903e455c95452fa7982a1574"><enum>(2)</enum><text>the implementation of, or
failure to implement such recommendation on the part of a primary financial
regulatory agency; and</text>
</paragraph><paragraph id="IDed06f5bc00494ffcb04fe92a8825625f"><enum>(3)</enum><text>in any case in which no
primary financial regulatory agency exists for the nonbank financial company
conducting financial activities or practices referred to in subsection (a),
recommendations for legislation that would prevent such activities or practices
from threatening the stability of the financial system of the United
States.</text>
</paragraph></subsection><subsection id="ID5cc94f98a9da4e66a5ebb95af1d4d1fa"><enum>(e)</enum><header>Effect of rescission of
identification</header>
<paragraph commented="no" id="IDbbda780343b64673bbd0b3ad0db5434d"><enum>(1)</enum><header>Notice</header><text>The
Council may recommend to the relevant primary financial regulatory agency that
a financial activity or practice no longer requires any standards or safeguards
implemented under this section.</text>
</paragraph><paragraph commented="no" id="ID3de5f2fcf6944f2da645fd81b39e00f8"><enum>(2)</enum><header>Determination of
primary financial regulatory agency to continue</header>
<subparagraph commented="no" id="id9FD449D4944F41C98DFF016E959147D0"><enum>(A)</enum><header>In
general</header><text>Upon receipt of a recommendation under paragraph (1), a
primary financial regulatory agency that has imposed standards under this
section shall determine whether standards that it has imposed under this
section should remain in effect.</text>
</subparagraph><subparagraph commented="no" id="idB6AFBC1AFFCD452780F16EB9A6D32BCF"><enum>(B)</enum><header>Appeal
process</header><text>Each primary financial regulatory agency that has imposed
standards under this section shall promulgate regulations to establish a
procedure under which entities under its jurisdiction may appeal a
determination by such agency under this paragraph that standards imposed under
this section should remain in effect.</text>
</subparagraph></paragraph></subsection></section><section id="ID1025f649af8d40e1a5020e43c5f3cc34"><enum>121.</enum><header>Mitigation of risks to
financial stability</header>
<subsection id="IDf5be5ea7e309441fb14f31e3235a2e74"><enum>(a)</enum><header>Mitigatory
actions</header><text>If the Board of Governors determines that a bank holding
company with total consolidated assets of $50,000,000,000 or more, or a nonbank
financial company supervised by the Board of Governors, poses a grave threat to
the financial stability of the United States, the Board of Governors, upon an
affirmative vote of not fewer than <fraction>2/3</fraction> of the Council
members then serving, shall require the subject company—</text>
<paragraph id="id67CF9D91C9FA40E6B6EA89F142AF0BB0"><enum>(1)</enum><text>to terminate one or more
activities;</text>
</paragraph><paragraph id="idF4422E628ED446EB8A74C27DDBFBF7A0"><enum>(2)</enum><text>to impose conditions on
the manner in which the company conducts one or more activities; or</text>
</paragraph><paragraph id="id11E922523CCF424AA4A6D230E4D534C5"><enum>(3)</enum><text>if the Board of Governors
determines that such action is inadequate to mitigate a threat to the financial
stability of the United States in its recommendation, to sell or otherwise
transfer assets or off-balance-sheet items to unaffiliated entities.</text>
</paragraph></subsection><subsection id="ID1a30dbaf86a74eb386f06e2266258352"><enum>(b)</enum><header>Notice and
hearing</header>
<paragraph id="IDe54630ca4f264cea8ecfd463688ff5e4"><enum>(1)</enum><header>In
general</header><text>The Board of Governors, in consultation with the Council,
shall provide to a company described in subsection (a) written notice that such
company is being considered for mitigatory action pursuant to this section,
including an explanation of the basis for, and description of, the proposed
mitigatory action.</text>
</paragraph><paragraph id="IDa64ae5547cc440b79adfe07af6f4cbd7"><enum>(2)</enum><header>Hearing</header><text>Not
later than 30 days after the date of receipt of notice under paragraph (1), the
company may request, in writing, an opportunity for a written or oral hearing
before the Board of Governors to contest the proposed mitigatory action. Upon
receipt of a timely request, the Board of Governors shall fix a time (not later
than 30 days after the date of receipt of the request) and place at which such
company may appear, personally or through counsel, to submit written materials
(or, at the discretion of the Board of Governors, in consultation with the
Council, oral testimony and oral argument).</text>
</paragraph><paragraph id="IDd4d9a8a0a92f4fc5bc864de9a54471ae"><enum>(3)</enum><header>Decision</header><text>Not
later than 60 days after the date of a hearing under paragraph (2), or not
later than 60 days after the provision of a notice under paragraph (1) if no
hearing was held, the Board of Governors shall notify the company of the final
decision of the Board of Governors, including the results of the vote of the
Council, as described in subsection (a).</text>
</paragraph></subsection><subsection id="ID6b4963dfff5044cea46d2ff066c1f678"><enum>(c)</enum><header>Factors for
consideration</header><text>The Board of Governors and the Council shall take
into consideration the factors set forth in subsection (a) or (b) of section
113, as applicable, in a determination described in subsection (a) and in a
decision described in subsection (b).</text>
</subsection><subsection id="IDc0a906ecd0b844e78901bfbb1da684f2"><enum>(d)</enum><header>Application to foreign
financial companies</header><text>The Board of Governors may prescribe
regulations regarding the application of this section to foreign nonbank
financial companies supervised by the Board of Governors and foreign-based bank
holding companies, giving due regard to the principle of national treatment and
competitive equity.</text>
</subsection></section></subtitle><subtitle id="id140A67DFF0934A2F8DB268F4B6F4F041"><enum>B</enum><header>Office of Financial
Research</header>
<section id="id90E76FF1B6344EC186EBA45A87AD7E0D"><enum>151.</enum><header>Definitions</header><text display-inline="no-display-inline">For purposes of this subtitle—</text>
<paragraph id="idBF758C24924A447EB963A16B292EA91D"><enum>(1)</enum><text>the terms
<term>Office</term> and <term>Director</term> mean the Office of Financial
Research established under this subtitle and the Director thereof,
respectively;</text>
</paragraph><paragraph id="id2A50F418A5BA4B15AC3B1C6A8B681918"><enum>(2)</enum><text>the term <term>financial
company</term> has the same meaning as in title II, and includes an insured
depository institution and an insurance company;</text>
</paragraph><paragraph id="idF9EAB41C70C04AF1B4ECA56A738A78D9"><enum>(3)</enum><text>the term <term>Data
Center</term> means the data center established under section 154;</text>
</paragraph><paragraph id="id465A2214312D49E290D9386A06E9AC57"><enum>(4)</enum><text>the term <term>Research
and Analysis Center</term> means the research and analysis center established
under section 154;</text>
</paragraph><paragraph id="ID7cf2c308236e4a9ba78bfcc19f3df6db"><enum>(5)</enum><text>the term <term>financial
transaction data</term> means the structure and legal description of a
financial contract, with sufficient detail to describe the rights and
obligations between counterparties and make possible an independent
valuation;</text>
</paragraph><paragraph id="ID13499d05b6ea48cb9ca53468a9d13571"><enum>(6)</enum><text>the term <term>position
data</term>—</text>
<subparagraph id="idFBB20D7888B44FAFB9FB6EC1EAD7654C"><enum>(A)</enum><text>means data on financial
assets or liabilities held on the balance sheet of a financial company, where
positions are created or changed by the execution of a financial transaction;
and</text>
</subparagraph><subparagraph id="id29F361420C38429C8685CBBC42033163"><enum>(B)</enum><text>includes information that
identifies counterparties, the valuation by the financial company of the
position, and information that makes possible an independent valuation of the
position;</text>
</subparagraph></paragraph><paragraph id="IDde65725646ba41bebe11d4d32fc1aba4"><enum>(7)</enum><text>the term <term>financial
contract</term> means a legally binding agreement between 2 or more
counterparties, describing rights and obligations relating to the future
delivery of items of intrinsic or extrinsic value among the counterparties;
and</text>
</paragraph><paragraph id="IDdf8bcab9f04b4c43bf694b5714c79f92"><enum>(8)</enum><text>the term <term>financial
instrument</term> means a financial contract in which the terms and conditions
are publicly available, and the roles of one or more of the counterparties are
assignable without the consent of any of the other counterparties (including
common stock of a publicly traded company, government bonds, or exchange traded
futures and options contracts).</text>
</paragraph></section><section id="IDc6d7767736e342d7a2a94d1cdbdfb5dd"><enum>152.</enum><header>Office of Financial
Research established</header>
<subsection id="IDad19a9fb1da14ea0840ab221b7e0abf6"><enum>(a)</enum><header>Establishment</header><text>There
is established within the Department of the Treasury the Office of Financial
Research.</text>
</subsection><subsection id="IDaaaf9cdd3c124c0abebfa3d398c273cc"><enum>(b)</enum><header>Director</header>
<paragraph id="ID62aedbfacc924e9f827fa2999edd161d"><enum>(1)</enum><header>In
general</header><text>The Office shall be headed by a Director, who shall be
appointed by the President, by and with the advice and consent of the
Senate.</text>
</paragraph><paragraph id="ID52e056b63932493da58a35efb5e45058"><enum>(2)</enum><header>Term of
service</header><text>The Director shall serve for a term of 6 years, except
that, in the event that a successor is not nominated and confirmed by the end
of the term of service of a Director, the Director may continue to serve until
such time as the next Director is appointed and confirmed.</text>
</paragraph><paragraph id="ID623ad09c86de4d5296e463c112113bf2"><enum>(3)</enum><header>Executive
level</header><text>The Director shall be compensated at level III of the
Executive Schedule.</text>
</paragraph><paragraph id="IDa279d8acff0746e29fd1d9691e6d4b61"><enum>(4)</enum><header>Prohibition on dual
service</header><text>The individual serving in the position of Director may
not, during such service, also serve as the head of any financial regulatory
agency.</text>
</paragraph><paragraph id="IDde7644ff958848519326478dbe3b7861"><enum>(5)</enum><header>Responsibilities,
duties, and authority</header><text>The Director shall have sole discretion in
the manner in which the Director fulfills the responsibilities and duties and
exercises the authorities described in this subtitle.</text>
</paragraph></subsection><subsection id="ID7d023c87e2b441bdaf5b26f370cf36bf"><enum>(c)</enum><header>Budget</header><text>The
Director, in consultation with the Chairperson, shall establish the annual
budget of the Office.</text>
</subsection><subsection id="ID6cc67004a6ab4059a5de34b68bbcf70e"><enum>(d)</enum><header>Office
Personnel</header>
<paragraph id="ID4202a348bc93430db41c0609927a2993"><enum>(1)</enum><header>In
general</header><text>The Director, in consultation with the Chairperson, may
fix the number of, and appoint and direct, all employees of the Office.</text>
</paragraph><paragraph id="IDc0d12653e6b04abb94cc10f3ecfea501"><enum>(2)</enum><header>Compensation</header><text>The
Director, in consultation with the Chairperson, shall fix, adjust, and
administer the pay for all employees of the Office, without regard to chapter
51 or subchapter III of chapter 53 of title 5, United States Code, relating to
classification of positions and General Schedule pay rates.</text>
</paragraph><paragraph commented="no" id="IDcb1404b80ca14627ae7ca27586cecbbb"><enum>(3)</enum><header>Comparability</header><text>Section
1206(a) of the Financial Institutions Reform, Recovery, and Enforcement Act of
1989 (12 U.S.C. 1833b(a)) is amended—</text>
<subparagraph commented="no" id="IDb053159bc9794181b670712170b05a52"><enum>(A)</enum><text>by striking
<quote>Finance Board,</quote> and inserting <quote>Finance Board, the Office of
Financial Research, and the Bureau of Consumer Financial Protection</quote>;
and</text>
</subparagraph><subparagraph commented="no" id="ID9b07e2902b764459af2ab1fb9983bb94"><enum>(B)</enum><text>by striking <quote>and
the Office of Thrift Supervision,</quote>.</text>
</subparagraph></paragraph></subsection><subsection id="ID3acf0fa00e4445948646e049a4b54be4"><enum>(e)</enum><header>Assistance from Federal
agencies</header><text>Any department or agency of the United States may
provide to the Office and any special advisory, technical, or professional
committees appointed by the Office, such services, funds, facilities, staff,
and other support services as the Office may determine advisable. Any Federal
Government employee may be detailed to the Office without reimbursement, and
such detail shall be without interruption or loss of civil service status or
privilege.</text>
</subsection><subsection id="ID494ba5a84aed40e2bf0a7cc15bfa4313"><enum>(f)</enum><header>Procurement of
temporary and intermittent services</header><text>The Director may procure
temporary and intermittent services under section 3109(b) of title 5, United
States Code, at rates for individuals which do not exceed the daily equivalent
of the annual rate of basic pay prescribed for level V of the Executive
Schedule under section 5316 of such title.</text>
</subsection><subsection id="ID1aff7e9ec0eb494db3841a2cf3a2ebe2"><enum>(g)</enum><header>Contracting and leasing
authority</header><text>Notwithstanding the Federal Property and Administrative
Services Act of 1949 (41 U.S.C. 251 et seq.) or any other provision of law, the
Director may—</text>
<paragraph id="ID9eb7bffc135f4e1998445c2f4cb2c9eb"><enum>(1)</enum><text>enter into and perform
contracts, execute instruments, and acquire, in any lawful manner, such goods
and services, or personal or real property (or property interest), as the
Director deems necessary to carry out the duties and responsibilities of the
Office; and</text>
</paragraph><paragraph id="IDc744608f1f2243bf88a44d3c92e3b691"><enum>(2)</enum><text>hold, maintain, sell,
lease, or otherwise dispose of the property (or property interest) acquired
under paragraph (1).</text>
</paragraph></subsection><subsection id="ID5391aaf69c3a467ea518eac5f7465cb4"><enum>(h)</enum><header>Non-compete</header><text>The
Director and any staff of the Office who has had access to the transaction or
position data maintained by the Data Center or other business confidential
information about financial entities required to report to the Office, may not,
for a period of 1 year after last having access to such transaction or position
data or business confidential information, be employed by or provide advice or
consulting services to a financial company, regardless of whether that entity
is required to report to the Office. For staff whose access to business
confidential information was limited, the Director may provide, on a
case-by-case basis, for a shorter period of post-employment prohibition,
provided that the shorter period does not compromise business confidential
information.</text>
</subsection><subsection commented="no" id="ID187b300b685a409cab869ed5b6614dd3"><enum>(i)</enum><header>Technical and
professional advisory committees</header><text>The Office, in consultation with
the Chairperson, may appoint such special advisory, technical, or professional
committees as may be useful in carrying out the functions of the Office, and
the members of such committees may be staff of the Office, or other persons, or
both.</text>
</subsection><subsection id="IDade0e9aee3be41b688dec3f0003ea7f8"><enum>(j)</enum><header>Fellowship
Program</header><text>The Office, in consultation with the Chairperson, may
establish and maintain an academic and professional fellowship program, under
which qualified academics and professionals shall be invited to spend not
longer than 2 years at the Office, to perform research and to provide advanced
training for Office personnel.</text>
</subsection><subsection id="ID645107706f6e4f2ebba6023c3be25e46"><enum>(k)</enum><header>Executive schedule
compensation</header><text>Section 5314 of title 5, United States Code, is
amended by adding at the end the following new item:</text>
<paragraph id="ID0d7398e05b884a14830f62623de9a7ce"><enum></enum><text><quote>Director of the Office of
Financial Research.</quote>.</text>
</paragraph></subsection></section><section id="ID4821919fbb104b07b8d033d55c29ab8f"><enum>153.</enum><header>Purpose and duties of
the Office</header>
<subsection id="IDf9c030a4724d4251a93aad4a63cc57f6"><enum>(a)</enum><header>Purpose and
duties</header><text>The purpose of the Office is to support the Council in
fulfilling the purposes and duties of the Council, as set forth in subtitle A,
and to support member agencies, by—</text>
<paragraph id="ID6ebc013df34c45c3b45215f65ccaf8cc"><enum>(1)</enum><text>collecting data on behalf
of the Council, and providing such data to the Council and member
agencies;</text>
</paragraph><paragraph id="ID13ff446bfeb44982bd9d1c17425abbc7"><enum>(2)</enum><text>standardizing the types
and formats of data reported and collected;</text>
</paragraph><paragraph id="IDc6983bda19014e65a554cb040486c262"><enum>(3)</enum><text>performing applied
research and essential long-term research;</text>
</paragraph><paragraph id="ID4f66848d5bbc4a38935f955017eb5f08"><enum>(4)</enum><text>developing tools for risk
measurement and monitoring;</text>
</paragraph><paragraph id="IDa5b503f3b1654a969d596caedcaeb97a"><enum>(5)</enum><text>performing other related
services;</text>
</paragraph><paragraph id="IDfcacece584ba4d76871c417fe97430e7"><enum>(6)</enum><text>making the results of the
activities of the Office available to financial regulatory agencies; and</text>
</paragraph><paragraph id="IDc74fca3d12c24e68b376678f2e660ea2"><enum>(7)</enum><text>assisting such member
agencies in determining the types and formats of data authorized by this Act to
be collected by such member agencies.</text>
</paragraph></subsection><subsection id="ID79ba032e2dfe4a779259460d433aaa7b"><enum>(b)</enum><header>Administrative
authority</header><text>The Office may—</text>
<paragraph id="ID292202eee1454708aed5f0f735856e40"><enum>(1)</enum><text>share data and
information, including software developed by the Office, with the Council and
member agencies, which shared data, information, and software—</text>
<subparagraph id="idCFE3A5B8CAAE428DAD9F4856CB7A4D2F"><enum>(A)</enum><text>shall be maintained with
at least the same level of security as is used by the Office; and</text>
</subparagraph><subparagraph id="id7197793A7AB54DE0AAB8B0210F0CEF9A"><enum>(B)</enum><text>may not be shared with
any individual or entity without the permission of the Council;</text>
</subparagraph></paragraph><paragraph id="ID388c1149a2fa4f78a9c85c72a76ad48c"><enum>(2)</enum><text>sponsor and conduct
research projects; and</text>
</paragraph><paragraph id="ID0b0299b47ebd42089e6aa0245b2a8871"><enum>(3)</enum><text>assist, on a reimbursable
basis, with financial analyses undertaken at the request of other Federal
agencies that are not member agencies.</text>
</paragraph></subsection><subsection id="id8342B024B5EF4B7593D48D1119C70EA5"><enum>(c)</enum><header>Rulemaking
authority</header>
<paragraph id="id34A5CE5CD04042F3A4EDFE8FEE9C861D"><enum>(1)</enum><header>Scope</header><text>The
Office, in consultation with the Chairperson, shall issue rules, regulations,
and orders only to the extent necessary to carry out the purposes and duties
described in paragraphs (1), (2), and (7) of subsection (a).</text>
</paragraph><paragraph id="idD0095C07926C45D2AAC759C7728C3F3E"><enum>(2)</enum><header>Standardization</header><text>Member
agencies, in consultation with the Office, shall implement regulations
promulgated by the Office under paragraph (1) to standardize the types and
formats of data reported and collected on behalf of the Council, as described
in subsection (a)(2). If a member agency fails to implement such regulations
prior to the expiration of the 3-year period following the date of publication
of final regulations, the Office, in consultation with the Chairperson, may
implement such regulations with respect to the financial entities under the
jurisdiction of the member agency.</text>
</paragraph></subsection><subsection id="id070D1759C4654C548E21B45648562D04"><enum>(d)</enum><header>Testimony</header>
<paragraph id="id20D8EED3FB66427FBC150116320D5BF1"><enum>(1)</enum><header>In
general</header><text>The Director of the Office shall report to and testify
before the Committee on Banking, Housing, and Urban Affairs of the Senate and
the Committee on Financial Services of the House of Representatives annually on
the activities of the Office, including the work of the Data Center and the
Research and Analysis Center, and the assessment of the Office of significant
financial market developments and potential emerging threats to the financial
stability of the United States.</text>
</paragraph><paragraph id="IDb91276196be740eea0c30808a4a1bfa5"><enum>(2)</enum><header>No prior
review</header><text>No officer or agency of the United States shall have any
authority to require the Director to submit the testimony required under
paragraph (1) or other Congressional testimony to any officer or agency of the
United States for approval, comment, or review prior to the submission of such
testimony. Any such testimony to Congress shall include a statement that the
views expressed therein are those of the Director and do not necessarily
represent the views of the President.</text>
</paragraph></subsection><subsection commented="no" id="IDcf6eaed981a64a65bd5e9e18874caabe"><enum>(e)</enum><header>Additional
reports</header><text>The Director may provide additional reports to Congress
concerning the financial stability of the United States. The Director shall
notify the Council of any such additional reports provided to Congress.</text>
</subsection><subsection commented="no" id="ID58f93d3a742045cb9b978fecb469045f"><enum>(f)</enum><header>Subpoena</header>
<paragraph commented="no" id="id917FD4B2B5D148DAB73A8CEA4C8EABBA"><enum>(1)</enum><header>In
general</header><text>The Director may require, by subpoena, the production of
the data requested under subsection (a)(1) and section 154(b)(1), but only upon
a written finding by the Director that—</text>
<subparagraph commented="no" id="idDFAC59133DBC47ABBA316B704BBAA202"><enum>(A)</enum><text>such data is required to
carry out the functions described under this subtitle; and</text>
</subparagraph><subparagraph commented="no" id="idC00209C8F1134CE1AE7AFA8BCD7F0627"><enum>(B)</enum><text>the Office has
coordinated with such agency, as required under section
154(b)(1)(B)(ii).</text>
</subparagraph></paragraph><paragraph commented="no" id="id703663A5871849B697FE0E2AFB18D07E"><enum>(2)</enum><header>Format</header><text>Subpoenas
under paragraph (1) shall bear the signature of the Director, and shall be
served by any person or class of persons designated by the Director for that
purpose.</text>
</paragraph><paragraph commented="no" id="id32B0F0C9BB364B88975217BD8FF1D2E9"><enum>(3)</enum><header>Enforcement</header><text>In
the case of contumacy or failure to obey a subpoena, the subpoena shall be
enforceable by order of any appropriate district court of the United States.
Any failure to obey the order of the court may be punished by the court as a
contempt of court.</text>
</paragraph></subsection></section><section id="ID91fdbac6a65948d2bf78965f4725bdb9"><enum>154.</enum><header>Organizational
structure; responsibilities of primary programmatic units</header>
<subsection id="id451E93132C1D45C198A07A0F7D86F354"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">There are established
within the Office, to carry out the programmatic responsibilities of the
Office—</text>
<paragraph id="ID71470bf7e3164df5aa1f8335b34f24e3"><enum>(1)</enum><text>the Data Center;
and</text>
</paragraph><paragraph id="ID5ddfc59a6ab74441a2c309e10a33d235"><enum>(2)</enum><text>the Research and Analysis
Center.</text>
</paragraph></subsection><subsection id="IDda5c88a8782d4c8ab92a346e15a17d4d"><enum>(b)</enum><header>Data Center</header>
<paragraph id="IDa9a3dd7db0054346b47af9969a6a4fa0"><enum>(1)</enum><header>General duties</header>
<subparagraph id="idA9FFCF9BEA1B44D7A0FC8B74B6AF9959"><enum>(A)</enum><header>Data
collection</header><text>The Data Center, on behalf of the Council, shall
collect, validate, and maintain all data necessary to carry out the duties of
the Data Center, as described in this subtitle. The data assembled shall be
obtained from member agencies, commercial data providers, publicly available
data sources, and financial entities under subparagraph (B).</text>
</subparagraph><subparagraph commented="no" id="ID5517673da3294848adf98aad6a45e8ee"><enum>(B)</enum><header>Authority</header>
<clause commented="no" id="ID9910cc3e5e974698a8b81d6ce7a3a1c9"><enum>(i)</enum><header>In
general</header><text>The Office may, as determined by the Council or by the
Director in consultation with the Council, require the submission of periodic
and other reports from any financial company for the purpose of assessing the
extent to which a financial activity or financial market in which the financial
company participates, or the financial company itself, poses a threat to the
financial stability of the United States.</text>
</clause><clause commented="no" id="IDebb32d78a53a4ca6938488843d7d9f1d"><enum>(ii)</enum><header>Mitigation of report
burden</header><text>Before requiring the submission of a report from any
financial company that is regulated by a member agency or any primary financial
regulatory agency, the Office shall coordinate with such agencies and shall,
whenever possible, rely on information available from such agencies.</text>
</clause></subparagraph><subparagraph id="IDc2c03d33840f43d3869e723719bbf1d9"><enum>(C)</enum><header>Rulemaking</header><text>The
Office shall promulgate regulations pursuant to subsections (a)(1), (a)(2),
(a)(7), and (c)(1) of section 153 regarding the type and scope of the data to
be collected by the Data Center under this paragraph.</text>
</subparagraph></paragraph><paragraph id="IDf9c696df8fdd4ca0a668c74c0d51c8a1"><enum>(2)</enum><header>Responsibilities</header>
<subparagraph id="idE934017F2F9143649ECD48F4658FEC49"><enum>(A)</enum><header>Publication</header><text>The
Data Center shall prepare and publish, in a manner that is easily accessible to
the public—</text>
<clause id="ID9df54289cdce4d8c938a267cdaa4bad5"><enum>(i)</enum><text>a financial company
reference database;</text>
</clause><clause id="ID70c83e1ec38647f7ad22910e74dabba4"><enum>(ii)</enum><text>a financial instrument
reference database; and</text>
</clause><clause id="IDb8a1d48709c44d009fd64f217803b676"><enum>(iii)</enum><text>formats and standards
for Office data, including standards for reporting financial transaction and
position data to the Office.</text>
</clause></subparagraph><subparagraph id="idA18CEA57B9D34C0CAFCBA65A78522E65"><enum>(B)</enum><header>Confidentiality</header><text>The
Data Center shall not publish any confidential data under subparagraph
(A).</text>
</subparagraph></paragraph><paragraph id="ID779c389109bf454fab015a602e194e3f"><enum>(3)</enum><header>Information
security</header><text>The Director shall ensure that data collected and
maintained by the Data Center are kept secure and protected against
unauthorized disclosure.</text>
</paragraph><paragraph id="ID0fdc3c0fa9fe4bbdb6a812c6a6a5421b"><enum>(4)</enum><header>Catalog of financial
entities and instruments</header><text>The Data Center shall maintain a catalog
of the financial entities and instruments reported to the Office.</text>
</paragraph><paragraph id="ID43f7885c6e4d46899b8bbca2660ef5a7"><enum>(5)</enum><header>Availability to the
council and member agencies</header><text>The Data Center shall make data
collected and maintained by the Data Center available to the Council and member
agencies, as necessary to support their regulatory responsibilities.</text>
</paragraph><paragraph id="IDb1b23f3ce4d1415d973b4ae2eefc7bc8"><enum>(6)</enum><header>Other
authority</header><text>The Office shall, after consultation with the member
agencies, provide certain data to financial industry participants and to the
general public to increase market transparency and facilitate research on the
financial system, to the extent that intellectual property rights are not
violated, business confidential information is properly protected, and the
sharing of such information poses no significant threats to the financial
system of the United States.</text>
</paragraph></subsection><subsection id="ID67683f85dd034fb6900a30cfb4d59964"><enum>(c)</enum><header>Research and analysis
center</header>
<paragraph commented="no" display-inline="no-display-inline" id="id0091C0276F0C4651B464624010CF3D20"><enum>(1)</enum><header display-inline="yes-display-inline">General duties</header><text>The Research
and Analysis Center, on behalf of the Council, shall develop and maintain
independent analytical capabilities and computing resources—</text>
<subparagraph id="ID2aaa5553de914b4cab4acd41755adad0"><enum>(A)</enum><text>to develop and maintain
metrics and reporting systems for risks to the financial stability of the
United States;</text>
</subparagraph><subparagraph id="ID16d9f2bbc9d24fae9b1093b7fbfcd30a"><enum>(B)</enum><text>to monitor, investigate,
and report on changes in system-wide risk levels and patterns to the Council
and Congress;</text>
</subparagraph><subparagraph id="ID426f9cf0313f4a5ea75db56b53c22632"><enum>(C)</enum><text>to conduct, coordinate,
and sponsor research to support and improve regulation of financial entities
and markets;</text>
</subparagraph><subparagraph id="ID9a92fcf0f2b04c179ce2a3d285d0ed45"><enum>(D)</enum><text>to evaluate and report on
stress tests or other stability-related evaluations of financial entities
overseen by the member agencies;</text>
</subparagraph><subparagraph id="ID236d22c252a949dd96c5da49f486e7d6"><enum>(E)</enum><text>to maintain expertise in
such areas as may be necessary to support specific requests for advice and
assistance from financial regulators;</text>
</subparagraph><subparagraph id="IDd1e9983a6f134e8f94f812214ea0310b"><enum>(F)</enum><text>to investigate
disruptions and failures in the financial markets, report findings, and make
recommendations to the Council based on those findings;</text>
</subparagraph><subparagraph id="ID32c663debab844da8ed9cfa9ca2bea8f"><enum>(G)</enum><text>to conduct studies and
provide advice on the impact of policies related to systemic risk; and</text>
</subparagraph><subparagraph id="id78F8C091AA7A46A1A2A0EE14B86A91B4"><enum>(H)</enum><text>to promote best practices
for financial risk management.</text>
</subparagraph></paragraph></subsection><subsection id="IDdd0b9d8b529a4964b59d42e91db1444b"><enum>(d)</enum><header>Reporting
responsibilities</header>
<paragraph id="ID99c5ae4ca0b6479bac8fc9a93fefe206"><enum>(1)</enum><header>Required
reports</header><text>Not later than 2 years after the date of enactment of
this Act, and not later than 120 days after the end of each fiscal year
thereafter, the Office shall prepare and submit a report to Congress.</text>
</paragraph><paragraph id="IDcc33b0baf0ba489a9d321ab46b11ae0e"><enum>(2)</enum><header>Content</header><text>Each
report required by this subsection shall assess the state of the United States
financial system, including—</text>
<subparagraph id="id90039730280D42E98FC74165D3AE6212"><enum>(A)</enum><text>an analysis of any
threats to the financial stability of the United States;</text>
</subparagraph><subparagraph id="idC3E45A3B72F949ABB3A02097AD18E658"><enum>(B)</enum><text>the status of the efforts
of the Office in meeting the mission of the Office; and</text>
</subparagraph><subparagraph id="id4263CF4D783C4DA6A7CA06BD2839383D"><enum>(C)</enum><text>key findings from the
research and analysis of the financial system by the Office.</text>
</subparagraph></paragraph></subsection></section><section id="ID121bf35483a34c83917ccda5b5fac062"><enum>155.</enum><header>Funding</header>
<subsection id="IDec33b1a92d6a4fb9a7131283025ecfc2"><enum>(a)</enum><header>Financial research
fund</header>
<paragraph id="ID3e25372905d14aff88d6268cd7e9e0ce"><enum>(1)</enum><header>Fund
established</header><text>There is established in the Treasury of the United
States a separate fund to be known as the <quote>Financial Research
Fund</quote>.</text>
</paragraph><paragraph id="IDe0e82a01af084f7abfe7882d35b09c2e"><enum>(2)</enum><header>Fund
receipts</header><text>All amounts provided to the Office under subsection (c),
and all assessments that the Office receives under subsection (d) shall be
deposited into the Financial Research Fund.</text>
</paragraph><paragraph id="IDe3e5d5494395454699355cc68bd47915"><enum>(3)</enum><header>Investments
authorized</header>
<subparagraph id="ID1f8a54825c4d45b79e2afd4664ba0ca8"><enum>(A)</enum><header>Amounts in fund may be
invested</header><text>The Director may request the Secretary to invest the
portion of the Financial Research Fund that is not, in the judgment of the
Director, required to meet the needs of the Office.</text>
</subparagraph><subparagraph id="ID3568d3a3029b429e883799cc69a8540e"><enum>(B)</enum><header>Eligible
investments</header><text>Investments shall be made by the Secretary in
obligations of the United States or obligations that are guaranteed as to
principal and interest by the United States, with maturities suitable to the
needs of the Financial Research Fund, as determined by the Director.</text>
</subparagraph></paragraph><paragraph id="IDa726f49b446d45b4a866ff9453b3be22"><enum>(4)</enum><header>Interest and proceeds
credited</header><text>The interest on, and the proceeds from the sale or
redemption of, any obligations held in the Financial Research Fund shall be
credited to and form a part of the Financial Research Fund.</text>
</paragraph></subsection><subsection id="ID7b37c8a52f63420cb90af9853df01f87"><enum>(b)</enum><header>Use of funds</header>
<paragraph id="ID84774d2393144349857ec162a7cee9d7"><enum>(1)</enum><header>In
general</header><text>Funds obtained by, transferred to, or credited to the
Financial Research Fund shall be immediately available to the Office, and shall
remain available until expended, to pay the expenses of the Office in carrying
out the duties and responsibilities of the Office.</text>
</paragraph><paragraph id="ID86cb398c9f694d52bd93edb4d4ec7465"><enum>(2)</enum><header>Fees, assessments, and
other funds not government funds</header><text>Funds obtained by, transferred
to, or credited to the Financial Research Fund shall not be construed to be
Government funds or appropriated monies.</text>
</paragraph><paragraph id="IDeeb8410e9f9b4114b7c4229fb26c875c"><enum>(3)</enum><header>Amounts not subject to
apportionment</header><text>Notwithstanding any other provision of law, amounts
in the Financial Research Fund shall not be subject to apportionment for
purposes of chapter 15 of title 31, United States Code, or under any other
authority, or for any other purpose.</text>
</paragraph></subsection><subsection id="IDca6761557a554d958e2988a81cb1df40"><enum>(c)</enum><header>Interim
funding</header><text>During the 2-year period following the date of enactment
of this Act, the Board of Governors shall provide to the Office an amount
sufficient to cover the expenses of the Office.</text>
</subsection><subsection id="IDaa64937190014f8da476304a33093831"><enum>(d)</enum><header>Permanent
self-funding</header>
<paragraph id="ID698fe331e2c548cf985dc0312be51538"><enum>(1)</enum><header>In
general</header><text>Beginning 2 years after the date of enactment of this
Act, the Secretary shall establish, by regulation, and with the approval of the
Council, an assessment schedule, including the assessment base and rates,
applicable to bank holding companies with total consolidated assets of
$50,000,000,000 or greater and nonbank financial companies supervised by the
Board of Governors, that takes into account differences among such companies,
based on the considerations for establishing the prudential standards under
section 115, to collect assessments equal to the estimated total expenses of
the Office.</text>
</paragraph><paragraph id="ID4034aa162db94d9b97114b760aafb062"><enum>(2)</enum><header>Shortfall</header><text>To
the extent that the assessments under paragraph (1) do not fully cover the
total expenses of the Office, the Board of Governors shall provide to the
Office an amount sufficient to cover the difference.</text>
</paragraph></subsection></section><section id="IDf26610b1f3c54c3f94fbf051cacd4ba7"><enum>156.</enum><header>Transition
oversight</header>
<subsection id="ID35a909d0ecb74225a2f88341c235b23e"><enum>(a)</enum><header>Purpose</header><text>The
purpose of this section is to ensure that the Office—</text>
<paragraph id="IDec67619ea8cd4d37ae8905c33d1f99a1"><enum>(1)</enum><text>has an orderly and
organized startup;</text>
</paragraph><paragraph id="ID994c792dcfb549a6a4fe6ac8423ef549"><enum>(2)</enum><text>attracts and retains a
qualified workforce; and</text>
</paragraph><paragraph id="IDe678c959fe1f417792c62e0e9e3e07a4"><enum>(3)</enum><text>establishes comprehensive
employee training and benefits programs.</text>
</paragraph></subsection><subsection id="IDf1ed49c8851a4f18b4a740fde0598b8b"><enum>(b)</enum><header>Reporting
requirement</header>
<paragraph id="ID00d4da149a014df1a9ad8b072ba41f9a"><enum>(1)</enum><header>In
general</header><text>The Office shall submit an annual report to the Committee
on Banking, Housing, and Urban Affairs of the Senate and the Committee on
Financial Services of the House of Representatives that includes the plans
described in paragraph (2).</text>
</paragraph><paragraph id="id2BD88EC30DFA48A1A485A5CBE959D3E0"><enum>(2)</enum><header>Plans</header><text>The
plans described in this paragraph are as follows:</text>
<subparagraph id="ID733b00efd1fe4997925325c0b47db4c7"><enum>(A)</enum><header>Training and workforce
development plan</header><text>The Office shall submit a training and workforce
development plan that includes, to the extent practicable—</text>
<clause id="ID236194c1fb1d411faa4e8fa693677f28"><enum>(i)</enum><text>identification of skill
and technical expertise needs and actions taken to meet those
requirements;</text>
</clause><clause id="IDc7521e92cab545948735f37e29fee2ef"><enum>(ii)</enum><text>steps taken to foster
innovation and creativity;</text>
</clause><clause id="IDd4446e4a3f224a7882cf61f18365c3aa"><enum>(iii)</enum><text>leadership development
and succession planning; and</text>
</clause><clause id="ID242e436f82be4004ab44903d081c8283"><enum>(iv)</enum><text>effective use of
technology by employees.</text>
</clause></subparagraph><subparagraph id="ID39696dd1b4064732b62a41c521dc0d6b"><enum>(B)</enum><header>Workplace flexibility
plan</header><text>The Office shall submit a workforce flexibility plan that
includes, to the extent practicable—</text>
<clause id="ID573f4f86995b40b59f97c02bb3d23442"><enum>(i)</enum><text>telework;</text>
</clause><clause id="ID774e905fa4084cc6992b05d564b4e4dc"><enum>(ii)</enum><text>flexible work
schedules;</text>
</clause><clause id="IDbd8afe5f134a4fb199cfec6299eba343"><enum>(iii)</enum><text>phased
retirement;</text>
</clause><clause id="ID6bba2c1762b14470a5204b2f1dd8b6c6"><enum>(iv)</enum><text>reemployed
annuitants;</text>
</clause><clause id="ID819af94fd5ce442582b0bb2bb56c101c"><enum>(v)</enum><text>part-time work;</text>
</clause><clause id="ID4edd664d45a8425eb9a419db1e69c628"><enum>(vi)</enum><text>job sharing;</text>
</clause><clause id="IDc0e624e985e44931bbc9220a7a8edb40"><enum>(vii)</enum><text>parental leave benefits
and childcare assistance;</text>
</clause><clause id="ID2bc617f9d6994171a8e9dd5aa4ae38c1"><enum>(viii)</enum><text>domestic partner
benefits;</text>
</clause><clause id="ID59251f69bc2f4999a2fde5f75e501192"><enum>(ix)</enum><text>other workplace
flexibilities; or</text>
</clause><clause id="IDefca83db22e34c0dbdc7b599dc3bf84d"><enum>(x)</enum><text>any combination of the
items described in clauses (i) through (ix).</text>
</clause></subparagraph><subparagraph id="IDee9bed709e8e4d6297a91cf4d70ae749"><enum>(C)</enum><header>Recruitment and
retention plan</header><text>The Office shall submit a recruitment and
retention plan that includes, to the extent practicable, provisions relating
to—</text>
<clause id="ID207d7746d7a7407e8dd950aa081ee3ea"><enum>(i)</enum><text>the steps necessary to
target highly qualified applicant pools with diverse backgrounds;</text>
</clause><clause id="IDc7a34c0654b049b6856e800d6eeea6b4"><enum>(ii)</enum><text>streamlined employment
application processes;</text>
</clause><clause id="ID5a03ac185b0a4c4681218a64d12824ba"><enum>(iii)</enum><text>the provision of timely
notification of the status of employment applications to applicants; and</text>
</clause><clause id="IDead2c9dbad4d4eaf93b71ff69fd8b669"><enum>(iv)</enum><text>the collection of
information to measure indicators of hiring effectiveness.</text>
</clause></subparagraph></paragraph></subsection><subsection id="ID6ebe55c8ec9849b49d28e0584b3e3fda"><enum>(c)</enum><header>Expiration</header><text>The
reporting requirement under subsection (b) shall terminate 5 years after the
date of enactment of this Act.</text>
</subsection><subsection id="ID6d84533cedd74aabaac3c8b9f9dc51b7"><enum>(d)</enum><header>Rule of
construction</header><text>Nothing in this section may be construed to
affect—</text>
<paragraph id="ID76d5585e9fcc471f9a14dee2d46d33de"><enum>(1)</enum><text>a collective bargaining
agreement, as that term is defined in section 7103(a)(8) of title 5, United
States Code, that is in effect on the date of enactment of this Act; or</text>
</paragraph><paragraph id="IDc88d8107a4fb4d369728c13ddbcc30d9"><enum>(2)</enum><text>the rights of employees
under chapter 71 of title 5, United States Code.</text>
</paragraph></subsection></section></subtitle><subtitle id="idA12C32A268914A6C92A7204EDA64E46F"><enum>C</enum><header>Additional Board of
Governors authority for certain nonbank financial companies and bank holding
companies</header>
<section id="id42C11493266347A0A1DEA34AA67452E0"><enum>161.</enum><header>Reports by and
examinations of nonbank financial companies by the Board of Governors</header>
<subsection id="ID9f2cb63e3f3644f7b5776527d100f421"><enum>(a)</enum><header>Reports</header>
<paragraph id="ID2ef3b7326c0b477eb436066697b060bd"><enum>(1)</enum><header>In
General</header><text>The Board of Governors may require each nonbank financial
company supervised by the Board of Governors, and any subsidiary thereof, to
submit reports under oath, to keep the Board of Governors informed as
to—</text>
<subparagraph id="ID16b304d1a38f4eb693b083d44ab520e6"><enum>(A)</enum><text>the financial condition
of the company or subsidiary, systems of the company or subsidiary for
monitoring and controlling financial, operating, and other risks, and the
extent to which the activities and operations of the company or subsidiary pose
a threat to the financial stability of the United States; and</text>
</subparagraph><subparagraph id="ID029adeb5d49c4a6fa1326abb360b62ce"><enum>(B)</enum><text>compliance by the company
or subsidiary with the requirements of this subtitle.</text>
</subparagraph></paragraph><paragraph id="ID528d68205cc540da940239688098e2ca"><enum>(2)</enum><header>Use of existing reports
and information</header><text>In carrying out subsection (a), the Board of
Governors shall, to the fullest extent possible, use—</text>
<subparagraph id="ID97f42c807d37424f8b418da8bc9b7004"><enum>(A)</enum><text>reports and supervisory
information that a nonbank financial company or subsidiary thereof has been
required to provide to other Federal or State regulatory agencies;</text>
</subparagraph><subparagraph id="ID963301a417984ce7b32957593624faf6"><enum>(B)</enum><text>information otherwise
obtainable from Federal or State regulatory agencies;</text>
</subparagraph><subparagraph id="ID273141b8d35447879e1862474dcad045"><enum>(C)</enum><text>information that is
otherwise required to be reported publicly; and</text>
</subparagraph><subparagraph id="ID57cece10fe484926aa21c3252311cb11"><enum>(D)</enum><text>externally audited
financial statements of such company or subsidiary.</text>
</subparagraph></paragraph><paragraph id="IDb24e87d699df4eb8bd621a18b75b91c1"><enum>(3)</enum><header>Availability</header><text>Upon
the request of the Board of Governors, a nonbank financial company supervised
by the Board of Governors, or a subsidiary thereof, shall promptly provide to
the Board of Governors any information described in paragraph (2).</text>
</paragraph></subsection><subsection commented="no" id="ID7f2dd7e2c0444cc48af3429a7765f16d"><enum>(b)</enum><header>Examinations</header>
<paragraph commented="no" id="id245B227A13024067AFB1B74664AC0318"><enum>(1)</enum><header>In
general</header><text>Subject to paragraph (2), the Board of Governors may
examine any nonbank financial company supervised by the Board of Governors and
any subsidiary of such company, to determine—</text>
<subparagraph commented="no" id="ID7782e1a4f49f42c6b3cb7e0c009fb8a0"><enum>(A)</enum><text>the nature of the
operations and financial condition of the company and such subsidiary;</text>
</subparagraph><subparagraph commented="no" id="ID37a14b9aae0a454d97bc9385b4cabc62"><enum>(B)</enum><text>the financial,
operational, and other risks within the company that may pose a threat to the
safety and soundness of such company or to the financial stability of the
United States;</text>
</subparagraph><subparagraph commented="no" id="IDeaec952d888c44d8bb2c0651bd88d5d4"><enum>(C)</enum><text>the systems for
monitoring and controlling such risks; and</text>
</subparagraph><subparagraph commented="no" id="ID81826630037d4559a90dfbe5b0fd2ee5"><enum>(D)</enum><text>compliance by the company
with the requirements of this subtitle.</text>
</subparagraph></paragraph><paragraph commented="no" id="IDcd471f287f33417ab7ea632e75c6ff7c"><enum>(2)</enum><header>Use of examination
reports and information</header><text>For purposes of this subsection, the
Board of Governors shall, to the fullest extent possible, rely on reports of
examination of any depository institution subsidiary or functionally regulated
subsidiary made by the primary financial regulatory agency for that subsidiary,
and on information described in subsection (a)(2).</text>
</paragraph></subsection><subsection id="IDf891c4eddd7a41ce80f70ec2068067b9"><enum>(c)</enum><header>Coordination with
primary financial regulatory agency</header><text>The Board of Governors
shall—</text>
<paragraph id="id427E55FF2FE8428C9B2B29876C1A57E4"><enum>(1)</enum><text>provide to the primary
financial regulatory agency for any company or subsidiary, reasonable notice
before requiring a report, requesting information, or commencing an examination
of such subsidiary under this section; and</text>
</paragraph><paragraph id="id1F29333F088940AF99822559928A04DA"><enum>(2)</enum><text>avoid duplication of
examination activities, reporting requirements, and requests for information,
to the extent possible.</text>
</paragraph></subsection></section><section id="IDe339ee32cdaa4ac68387673de03b42c0"><enum>162.</enum><header>Enforcement</header>
<subsection id="IDb44d9b63a08f4547bf1111c203cbb0af"><enum>(a)</enum><header>In
general</header><text>Except as provided in subsection (b), a nonbank financial
company supervised by the Board of Governors and any subsidiaries of such
company (other than any depository institution subsidiary) shall be subject to
the provisions of subsections (b) through (n) of section 8 of the Federal
Deposit Insurance Act (12 U.S.C. 1818), in the same manner and to the same
extent as if the company were a bank holding company, as provided in section
8(b)(3) of the Federal Deposit Insurance Act (12 U.S.C. 1818(b)(3)).</text>
</subsection><subsection id="IDe64c52778aa64916957a41f94ce17309"><enum>(b)</enum><header>Enforcement authority
for functionally regulated subsidiaries</header>
<paragraph id="ID501a91592e394a379d9897aa1d61262b"><enum>(1)</enum><header>Referral</header><text>If
the Board of Governors determines that a condition, practice, or activity of a
depository institution subsidiary or functionally regulated subsidiary of a
nonbank financial company supervised by the Board of Governors does not comply
with the regulations or orders prescribed by the Board of Governors under this
Act, or otherwise poses a threat to the financial stability of the United
States, the Board of Governors may recommend, in writing, to the primary
financial regulatory agency for the subsidiary that such agency initiate a
supervisory action or enforcement proceeding. The recommendation shall be
accompanied by a written explanation of the concerns giving rise to the
recommendation.</text>
</paragraph><paragraph id="IDe454a7adcfc843c78df72f6e4a3cb077"><enum>(2)</enum><header>Back-up authority of
the Board of Governors</header><text>If, during the 60-day period beginning on
the date on which the primary financial regulatory agency receives a
recommendation under paragraph (1), the primary financial regulatory agency
does not take supervisory or enforcement action against a subsidiary that is
acceptable to the Board of Governors, the Board of Governors (upon a vote of
its members) may take the recommended supervisory or enforcement action, as if
the subsidiary were a bank holding company subject to supervision by the Board
of Governors.</text>
</paragraph></subsection></section><section commented="no" id="ID493adc090f1f47a8bc700b5ffdbf2d08"><enum>163.</enum><header>Acquisitions</header>
<subsection commented="no" id="ID11bce29f705e47b7a3a8b87fda3350ef"><enum>(a)</enum><header>Acquisitions of banks;
treatment as a bank holding company</header><text>For purposes of section 3 of
the Bank Holding Company Act of 1956 (12 U.S.C. 1842), a nonbank financial
company supervised by the Board of Governors shall be deemed to be, and shall
be treated as, a bank holding company.</text>
</subsection><subsection commented="no" id="ID8a890c14e94744319e920225a4afae3b"><enum>(b)</enum><header>Acquisition of nonbank
companies</header>
<paragraph commented="no" id="ID66a87ae46f66481995ef1215f1aae0fc"><enum>(1)</enum><header>Prior notice for large
acquisitions</header><text>Notwithstanding section 4(k)(6)(B) of the Bank
Holding Company Act of 1956 (12 U.S.C. 1843(k)(6)(B)), a bank holding company
with total consolidated assets equal to or greater than $50,000,000,000 or a
nonbank financial company supervised by the Board of Governors shall not
acquire direct or indirect ownership or control of any voting shares of any
company (other than an insured depository institution) that is engaged in
activities described in section 4(k) of the Bank Holding Company Act of 1956
having total consolidated assets of $10,000,000,000 or more, without providing
written notice to the Board of Governors in advance of the transaction.</text>
</paragraph><paragraph commented="no" id="IDfbc9edd0a0ea48008ae912e8aca60699"><enum>(2)</enum><header>Exemptions</header><text>The
prior notice requirement in paragraph (1) shall not apply with regard to the
acquisition of shares that would qualify for the exemptions in section 4(c) or
section 4(k)(4)(E) of the Bank Holding Company Act of 1956 (12 U.S.C. 1843(c)
and (k)(4)(E)).</text>
</paragraph><paragraph commented="no" id="ID1989b25cd9b6470b864ea8523fa6bf3e"><enum>(3)</enum><header>Notice
procedures</header><text>The notice procedures set forth in section 4(j)(1) of
the Bank Holding Company Act of 1956 (12 U.S.C. 1843(j)(1)), without regard to
section 4(j)(3) of that Act, shall apply to an acquisition of any company
(other than an insured depository institution) by a bank holding company with
total consolidated assets equal to or greater than $50,000,000,000 or a nonbank
financial company supervised by the Board of Governors, as described in
paragraph (1), including any such company engaged in activities described in
section 4(k) of that Act.</text>
</paragraph><paragraph commented="no" id="IDeb1fc379dc3149a98b253e69ebae4ec3"><enum>(4)</enum><header>Standards for
review</header><text>In addition to the standards provided in section 4(j)(2)
of the Bank Holding Company Act of 1956 (12 U.S.C. 1843(j)(2)), the Board of
Governors shall consider the extent to which the proposed acquisition would
result in greater or more concentrated risks to global or United States
financial stability or the United States economy.</text>
</paragraph></subsection></section><section commented="no" id="IDc92c8ee04e9a49f895079b3fad705f88"><enum>164.</enum><header>Prohibition against
management interlocks between certain financial companies</header><text display-inline="no-display-inline">A nonbank financial company supervised by
the Board of Governors shall be treated as a bank holding company for purposes
of the Depository Institutions Management Interlocks Act (12 U.S.C. 3201 et
seq.), except that the Board of Governors shall not exercise the authority
provided in section 7 of that Act (12 U.S.C. 3207) to permit service by a
management official of a nonbank financial company supervised by the Board of
Governors as a management official of any bank holding company with total
consolidated assets equal to or greater than $50,000,000,000, or other
nonaffiliated nonbank financial company supervised by the Board of Governors
(other than to provide a temporary exemption for interlocks resulting from a
merger, acquisition, or consolidation).</text>
</section><section commented="no" id="idECDA6EA47A0646C99BE083A152B2890F"><enum>165.</enum><header>Enhanced supervision
and prudential standards for nonbank financial companies supervised by the
Board of Governors and certain bank holding companies</header>
<subsection commented="no" id="id4A517872398B4EDC89DA0C11584B5E3B"><enum>(a)</enum><header>In general</header>
<paragraph id="idDC6D2271143640EE8C13A561F2445150"><enum>(1)</enum><header>Purpose</header><text>In
order to prevent or mitigate risks to the financial stability of the United
States that could arise from the material financial distress or failure of
large, interconnected financial institutions, the Board of Governors shall, on
its own or pursuant to recommendations by the Council under section 115,
establish prudential standards and reporting and disclosure requirements
applicable to nonbank financial companies supervised by the Board of Governors
and large, interconnected bank holding companies that—</text>
<subparagraph id="id0B4E0E52C5994118A9F8B28FE8FE2FCF"><enum>(A)</enum><text>are more stringent than
the standards and requirements applicable to nonbank financial companies and
bank holding companies that do not present similar risks to the financial
stability of the United States; and</text>
</subparagraph><subparagraph id="idC45C6E443A4C474CB181B6847EC4985F"><enum>(B)</enum><text>increase in stringency,
based on the considerations identified in subsection (b)(3).</text>
</subparagraph></paragraph><paragraph id="idD6E100D3972E45758597A9D52556C7D9"><enum>(2)</enum><header>Limitation on bank
holding companies</header><text>Any standards established under subsections (b)
through (f) shall not apply to any bank holding company with total consolidated
assets of less than $50,000,000,000, but the Board of Governors may establish
an asset threshold greater than $50,000,000,000 for the applicability of any
particular standard under subsections (b) through (f).</text>
</paragraph></subsection><subsection id="id04296FA6078E46BB9AB152875035F127"><enum>(b)</enum><header>Development of
prudential standards</header>
<paragraph id="id31338A0AA7E448CFA41C6BA9C4AB2C69"><enum>(1)</enum><header>In general</header>
<subparagraph id="id99D2D3C0ECEA482296AE4EF3AC9D6D89"><enum>(A)</enum><header>Required
standards</header><text>The Board of Governors shall, by regulation or order,
establish prudential standards for nonbank financial companies supervised by
the Board of Governors and bank holding companies described in subsection (a),
that shall include—</text>
<clause id="id5F29CEDAE1E449E594123C25B4201889"><enum>(i)</enum><text>risk-based capital
requirements;</text>
</clause><clause id="id95640C670E7040D8B1948C792CCFE9CA"><enum>(ii)</enum><text>leverage limits;</text>
</clause><clause id="id3C0CAAFA0120451A8EB352C97D21FBCE"><enum>(iii)</enum><text>liquidity
requirements;</text>
</clause><clause id="id7E3F2F3DA31D421F959500BCC938B6C5"><enum>(iv)</enum><text>resolution plan and
credit exposure report requirements; and</text>
</clause><clause id="id72834BF43EDB43838217C370A59724B7"><enum>(v)</enum><text>concentration
limits.</text>
</clause></subparagraph><subparagraph id="ID3bf64a08dfba462bbe23797fca9761db"><enum>(B)</enum><header>Additional standards
authorized</header><text>The Board of Governors may, by regulation or order,
establish prudential standards for nonbank financial companies supervised by
the Board of Governors and bank holding companies described in subsection (a),
that include—</text>
<clause id="IDdc67107b439348c2b6408a78db231bf4"><enum>(i)</enum><text>a contingent capital
requirement;</text>
</clause><clause id="ID31d6e715689a4dc0824dfccf69853afd"><enum>(ii)</enum><text>enhanced public
disclosures; and</text>
</clause><clause id="IDb378eccead794d6faac8ae19e63a1994"><enum>(iii)</enum><text>overall risk management
requirements.</text>
</clause></subparagraph></paragraph><paragraph id="id740DCE7CE1E34A3884EE2EB3A472F0C2"><enum>(2)</enum><header>Prudential standards
for foreign financial companies</header><text>In applying the standards set
forth in paragraph (1) to foreign nonbank financial companies supervised by the
Board of Governors and to foreign-based bank holding companies, the Board of
Governors shall give due regard to the principle of national treatment and
competitive equity.</text>
</paragraph><paragraph id="id28F78C0E2A0F41D7AA638B6C92442B17"><enum>(3)</enum><header>Considerations</header><text>In
prescribing prudential standards under paragraph (1), the Board of Governors
shall—</text>
<subparagraph id="idEE8E1507B5CD4CFF98BA72D19CB52CA5"><enum>(A)</enum><text>take into account
differences among nonbank financial companies supervised by the Board of
Governors and bank holding companies described in subsection (a), based
on—</text>
<clause id="id5D5D11F7474A494CA1DC2260DB793387"><enum>(i)</enum><text>the factors described in
subsections (a) and (b) of section 113;</text>
</clause><clause id="idA71F95465704411D8EEF4CD145119E8C"><enum>(ii)</enum><text>whether the company owns
an insured depository institution;</text>
</clause><clause id="id8D1D3B8A21454925AC90F3DE9B919E8D"><enum>(iii)</enum><text>nonfinancial activities
and affiliations of the company; and</text>
</clause><clause id="id7DCDAF86703942EA98E9EBA0AC8F731C"><enum>(iv)</enum><text>any other factors that
the Board of Governors determines appropriate;</text>
</clause></subparagraph><subparagraph id="idF994C55DFB31442AAC9B6D11271D5B7D"><enum>(B)</enum><text>to the extent possible,
ensure that small changes in the factors listed in subsections (a) and (b) of
section 113 would not result in sharp, discontinuous changes in the prudential
standards established under paragraph (1) of this subsection; and</text>
</subparagraph><subparagraph id="id8661946958CE46DD9C03E1B27540628D"><enum>(C)</enum><text>take into account any
recommendations of the Council under section 115.</text>
</subparagraph></paragraph><paragraph id="ID870dbabc6009482a9f4db3b99b9cf8e7"><enum>(4)</enum><header>Report</header><text>The
Board of Governors shall submit an annual report to Congress regarding the
implementation of the prudential standards required pursuant to paragraph (1),
including the use of such standards to mitigate risks to the financial
stability of the United States.</text>
</paragraph></subsection><subsection id="idD815BADA012B44AFA36D9D1E62A8C523"><enum>(c)</enum><header>Contingent
capital</header>
<paragraph id="id97F51A1FC885408F9D927D04D9DCDAAE"><enum>(1)</enum><header>In
general</header><text>Subsequent to submission by the Council of a report to
Congress under section 115(c), the Board of Governors may promulgate
regulations that require each nonbank financial company supervised by the Board
of Governors and bank holding companies described in subsection (a) to maintain
a minimum amount of long-term hybrid debt that is convertible to equity in
times of financial stress.</text>
</paragraph><paragraph id="id48B120D4FDEA4532898BDBE9BE0F8025"><enum>(2)</enum><header>Factors to
consider</header><text>In establishing regulations under this subsection, the
Board of Governors shall consider—</text>
<subparagraph id="ID90f0e5f96dc741ad8205d9c2f6014acd"><enum>(A)</enum><text>the results of the study
undertaken by the Council, and any recommendations of the Council, under
section 115(c);</text>
</subparagraph><subparagraph id="idF06E6B2BE0584E8C854554F1D2A85EA5"><enum>(B)</enum><text>an appropriate transition
period for implementation of a conversion under this subsection;</text>
</subparagraph><subparagraph id="id9C25312321A647C8BC2C87B608CF0354"><enum>(C)</enum><text>the factors described in
subsection (b)(3)(A);</text>
</subparagraph><subparagraph id="id03C0A68D22D24E149819124261A2FA59"><enum>(D)</enum><text>capital requirements
applicable to the nonbank financial company supervised by the Board of
Governors or a bank holding company described in subsection (a), and
subsidiaries thereof; and</text>
</subparagraph><subparagraph id="id02478FB7E8F74092AF8D89CC00C6B35A"><enum>(E)</enum><text>any other factor that the
Board of Governors deems appropriate.</text>
</subparagraph></paragraph></subsection><subsection id="idBBFE08499D044BB48FBC390F69EEA3A3"><enum>(d)</enum><header>Resolution plan and
credit exposure reports</header>
<paragraph id="id8E0063AD4DEA423198F762B9DE6F186C"><enum>(1)</enum><header>Resolution
plan</header><text>The Board of Governors shall require each nonbank financial
company supervised by the Board of Governors and bank holding companies
described in subsection (a) to report periodically to the Board of Governors,
the Council, and the Corporation the plan of such company for rapid and orderly
resolution in the event of material financial distress or failure.</text>
</paragraph><paragraph id="id729C28B752064F649ED462FFCA72C9AF"><enum>(2)</enum><header>Credit exposure
report</header><text>The Board of Governors shall require each nonbank
financial company supervised by the Board of Governors and bank holding
companies described in subsection (a) to report periodically to the Board of
Governors, the Council, and the Corporation on—</text>
<subparagraph id="id49E0B6EAF7B24BF8B938ECEC2BCA866C"><enum>(A)</enum><text>the nature and extent to
which the company has credit exposure to other significant nonbank financial
companies and significant bank holding companies; and</text>
</subparagraph><subparagraph id="id6BB0D437B0C54ED2B32DE0B41F3541C4"><enum>(B)</enum><text>the nature and extent to
which other significant nonbank financial companies and significant bank
holding companies have credit exposure to that company.</text>
</subparagraph></paragraph><paragraph id="IDa0d5ca3e534c4c54b9744811ff4c813a"><enum>(3)</enum><header>Review</header><text>The
Board of Governors and the Corporation shall review the information provided in
accordance with this section by each nonbank financial company supervised by
the Board of Governors and bank holding company described in subsection
(a).</text>
</paragraph><paragraph id="ID14cbbd0ef2be467b8262f48b05363436"><enum>(4)</enum><header>Notice of
deficiencies</header><text>If the Board of Governors and the Corporation
jointly determine, based on their review under paragraph (3), that the
resolution plan of a nonbank financial company supervised by the Board of
Governors or a bank holding company described in subsection (a) is not credible
or would not facilitate an orderly resolution of the company under title 11,
United States Code—</text>
<subparagraph id="IDf8742ee9db944c42b9f2b75f017e9fba"><enum>(A)</enum><text>the Board of Governors
and the Corporation shall notify the company, as applicable, of the
deficiencies in the resolution plan; and</text>
</subparagraph><subparagraph id="IDfb29bb674ad648748f0e481a68a02135"><enum>(B)</enum><text>the company shall
resubmit the resolution plan within a time frame determined by the Board of
Governors and the Corporation, with revisions demonstrating that the plan is
credible and would result in an orderly resolution under title 11, United
States Code, including any proposed changes in business operations and
corporate structure to facilitate implementation of the plan.</text>
</subparagraph></paragraph><paragraph id="IDe451a8ecc8894e1d97a6e8916d7b6e77"><enum>(5)</enum><header>Failure to resubmit
credible plan</header>
<subparagraph id="ID56f9e6699f56403db167d3fba46f411f"><enum>(A)</enum><header>In
general</header><text>If a nonbank financial company supervised by the Board of
Governors or a bank holding company described in subsection (a) fails to timely
resubmit the resolution plan as required under paragraph (4), with such
revisions as are required under subparagraph (B), the Board of Governors and
the Corporation may jointly impose more stringent capital, leverage, or
liquidity requirements, or restrictions on the growth, activities, or
operations of the company, or any subsidiary thereof, until such time as the
company resubmits a plan that remedies the deficiencies.</text>
</subparagraph><subparagraph id="IDf02d0f0d87ca427e845dd5a9a4cc7dc0"><enum>(B)</enum><header>Divestiture</header><text>The
Board of Governors and the Corporation, in consultation with the Council, may
direct a nonbank financial company supervised by the Board of Governors or a
bank holding company described in subsection (a), by order, to divest certain
assets or operations identified by the Board of Governors and the Corporation,
to facilitate an orderly resolution of such company under title 11, United
States Code, in the event of the failure of such company, in any case in
which—</text>
<clause id="id23A88D847BE945708F07072920999AEE"><enum>(i)</enum><text>the Board of Governors
and the Corporation have jointly imposed more stringent requirements on the
company pursuant to subparagraph (A); and</text>
</clause><clause id="idA190EE9A57954F798F56E9F04AB8D8B9"><enum>(ii)</enum><text>the company has failed,
within the 2-year period beginning on the date of the imposition of such
requirements under subparagraph (A), to resubmit the resolution plan with such
revisions as were required under paragraph (4)(B).</text>
</clause></subparagraph></paragraph><paragraph id="ID84edd99be9f04631bb850466b61739d2"><enum>(6)</enum><header>Rules</header><text>Not
later than 18 months after the date of enactment of this Act, the Board of
Governors and the Corporation shall jointly issue final rules implementing this
subsection.</text>
</paragraph></subsection><subsection id="id51DB465BD27B4D229D8F0A7713DC3EA0"><enum>(e)</enum><header>Concentration
limits</header>
<paragraph id="ID50fdf3cb3f0847b7995d2d44e73434e3"><enum>(1)</enum><header>Standards</header><text>In
order to limit the risks that the failure of any individual company could pose
to a nonbank financial company supervised by the Board of Governors or a bank
holding company described in subsection (a), the Board of Governors, by
regulation, shall prescribe standards that limit such risks.</text>
</paragraph><paragraph id="ID45cad5d62bcf4da3a2f2bff4bdfc3323"><enum>(2)</enum><header>Limitation on credit
exposure</header><text>The regulations prescribed by the Board of Governors
under paragraph (1) shall prohibit each nonbank financial company supervised by
the Board of Governors and bank holding company described in subsection (a)
from having credit exposure to any unaffiliated company that exceeds 25 percent
of the capital stock and surplus (or such lower amount as the Board of
Governors may determine by regulation to be necessary to mitigate risks to the
financial stability of the United States) of the company.</text>
</paragraph><paragraph id="ID717eb4214c1d4c87bcb96b392728ab37"><enum>(3)</enum><header>Credit
exposure</header><text>For purposes of paragraph (2), <quote>credit
exposure</quote> to a company means—</text>
<subparagraph id="ID8cfb337ac1d242a9bd91a7fbe1764aa5"><enum>(A)</enum><text>all extensions of credit
to the company, including loans, deposits, and lines of credit;</text>
</subparagraph><subparagraph id="ID22140d7943b645f2836eb36c1b386459"><enum>(B)</enum><text>all repurchase agreements
and reverse repurchase agreements with the company;</text>
</subparagraph><subparagraph id="ID690cd3f9e7f24a1fa0e09d613c5b11b6"><enum>(C)</enum><text>all securities borrowing
and lending transactions with the company, to the extent that such transactions
create credit exposure for the nonbank financial company supervised by the
Board of Governors or a bank holding company described in subsection
(a);</text>
</subparagraph><subparagraph id="ID76a5c71e59774bf68bd25e6cf99f769c"><enum>(D)</enum><text>all guarantees,
acceptances, or letters of credit (including endorsement or standby letters of
credit) issued on behalf of the company;</text>
</subparagraph><subparagraph id="IDc888c7a5a1274b2cab500d0f7ea87fcd"><enum>(E)</enum><text>all purchases of or
investment in securities issued by the company;</text>
</subparagraph><subparagraph id="ID1afe7c2d52db4afa81e97e2fc51758c8"><enum>(F)</enum><text>counterparty credit
exposure to the company in connection with a derivative transaction between the
nonbank financial company supervised by the Board of Governors or a bank
holding company described in subsection (a) and the company; and</text>
</subparagraph><subparagraph id="ID4eed2fbab87b4e3e9172c66465bf87be"><enum>(G)</enum><text>any other similar
transactions that the Board of Governors, by regulation, determines to be a
credit exposure for purposes of this section.</text>
</subparagraph></paragraph><paragraph id="ID567f80dcc7114dac92f3ae42d1e7d167"><enum>(4)</enum><header>Attribution
rule</header><text>For purposes of this subsection, any transaction by a
nonbank financial company supervised by the Board of Governors or a bank
holding company described in subsection (a) with any person is a transaction
with a company, to the extent that the proceeds of the transaction are used for
the benefit of, or transferred to, that company.</text>
</paragraph><paragraph id="ID3dd777e2846f42da8d72e4fb9680579d"><enum>(5)</enum><header>Rulemaking</header><text>The
Board of Governors may issue such regulations and orders, including definitions
consistent with this section, as may be necessary to administer and carry out
this subsection.</text>
</paragraph><paragraph id="ID97aabd233cb944f6bed185f1566c3ade"><enum>(6)</enum><header>Exemptions</header><text>The
Board of Governors may, by regulation or order, exempt transactions, in whole
or in part, from the definition of <quote>credit exposure</quote> for purposes
of this subsection, if the Board of Governors finds that the exemption is in
the public interest and is consistent with the purpose of this
subsection.</text>
</paragraph><paragraph id="IDd1a545c8841e4420984818f774151bb6"><enum>(7)</enum><header>Transition
period</header>
<subparagraph id="idE70F5FBE61B54C30B341FD28C38F8CCA"><enum>(A)</enum><header>In
general</header><text>This subsection and any regulations and orders of the
Board of Governors under this subsection shall not be effective until 3 years
after the date of enactment of this Act.</text>
</subparagraph><subparagraph id="idCB453C93DAD5403B8230306F0D0656E8"><enum>(B)</enum><header>Extension
authorized</header><text>The Board of Governors may extend the period specified
in subparagraph (A) for not longer than an additional 2 years.</text>
</subparagraph></paragraph></subsection><subsection id="ID862809a536884cad9b428096a2ffd29e"><enum>(f)</enum><header>Enhanced public
disclosures</header><text>The Board of Governors may prescribe, by regulation,
periodic public disclosures by nonbank financial companies supervised by the
Board of Governors and bank holding companies described in subsection (a) in
order to support market evaluation of the risk profile, capital adequacy, and
risk management capabilities thereof.</text>
</subsection><subsection id="ID01454c8a2cc04321b080f1e2c6ad1fc5"><enum>(g)</enum><header>Risk committee</header>
<paragraph id="id98EE38DEA6014153A6421D32B0916D4A"><enum>(1)</enum><header>Nonbank financial
companies supervised by the Board of Governors</header><text>The Board of
Governors shall require each nonbank financial company supervised by the Board
of Governors that is a publicly traded company to establish a risk committee,
as set forth in paragraph (3), not later than 1 year after the date of receipt
of a notice of final determination under section 113(d)(3) with respect to such
nonbank financial company supervised by the Board of Governors.</text>
</paragraph><paragraph commented="no" id="idC2F7F3327D0A4982952B7ED196282EBB"><enum>(2)</enum><header>Certain bank holding
companies</header>
<subparagraph commented="no" id="id6ED392E8342142CFB6AE85DD21C96666"><enum>(A)</enum><header>Mandatory
regulations</header><text>The Board of Governors shall issue regulations
requiring each bank holding company that is a publicly traded company and that
has total consolidated assets of not less than $10,000,000,000 to establish a
risk committee, as set forth in paragraph (3).</text>
</subparagraph><subparagraph commented="no" id="idBF13F48D4CDD4CA78253DF2E8B182869"><enum>(B)</enum><header>Permissive
regulations</header><text>The Board of Governors may require each bank holding
company that is a publicly traded company and that has total consolidated
assets of less than $10,000,000,000 to establish a risk committee, as set forth
in paragraph (3), as determined necessary or appropriate by the Board of
Governors to promote sound risk management practices.</text>
</subparagraph></paragraph><paragraph id="ID2a6e52acecba447dbccf5be014c0a0ff"><enum>(3)</enum><header>Risk
committee</header><text>A risk committee required by this subsection
shall—</text>
<subparagraph id="ID448d6d83e41b4513a4b8ec3465894b4f"><enum>(A)</enum><text>be responsible for the
oversight of the enterprise-wide risk management practices of the nonbank
financial company supervised by the Board of Governors or bank holding company
described in subsection (a), as applicable;</text>
</subparagraph><subparagraph id="ID17c0fdff6cc94a41902364273bb27821"><enum>(B)</enum><text>include such number of
independent directors as the Board of Governors may determine appropriate,
based on the nature of operations, size of assets, and other appropriate
criteria related to the nonbank financial company supervised by the Board of
Governors or a bank holding company described in subsection (a), as applicable;
and</text>
</subparagraph><subparagraph id="IDd8f683c7673f4cd284bf0b0eb431e18e"><enum>(C)</enum><text>include at least 1 risk
management expert having experience in identifying, assessing, and managing
risk exposures of large, complex firms.</text>
</subparagraph></paragraph><paragraph id="IDe5bc63626be142329cfe4cee47763374"><enum>(4)</enum><header>Rulemaking</header><text>The
Board of Governors shall issue final rules to carry out this subsection, not
later than 1 year after the transfer date, to take effect not later than 15
months after the transfer date.</text>
</paragraph></subsection><subsection id="IDdfb93ea7012e4fd7a2ee434e69e49d87"><enum>(h)</enum><header>Stress
tests</header><text>The Board of Governors shall conduct analyses in which
nonbank financial companies supervised by the Board of Governors and bank
holding companies described in subsection (a) are subject to evaluation of
whether the companies have the capital, on a total consolidated basis,
necessary to absorb losses as a result of adverse economic conditions. The
Board of Governors may develop and apply such other analytic techniques as are
necessary to identify, measure, and monitor risks to the financial stability of
the United States.</text>
</subsection></section><section id="IDe62ecad33c704f76be84b35d9a44f6cb"><enum>166.</enum><header>Early remediation
requirements</header>
<subsection id="ID7b35fbe4c45c4d9d938ca21b996df381"><enum>(a)</enum><header>In
general</header><text>The Board of Governors, in consultation with the Council
and the Corporation, shall prescribe regulations establishing requirements to
provide for the early remediation of financial distress of a nonbank financial
company supervised by the Board of Governors or a bank holding company
described in section 165(a), except that nothing in this subsection authorizes
the provision of financial assistance from the Federal Government.</text>
</subsection><subsection id="ID2adc42183e6e4609a7419847d0ce45c1"><enum>(b)</enum><header>Purpose of the early
remediation requirements</header><text>The purpose of the early remediation
requirements under subsection (a) shall be to establish a series of specific
remedial actions to be taken by a nonbank financial company supervised by the
Board of Governors or a bank holding company described in section 165(a) that
is experiencing increasing financial distress, in order to minimize the
probability that the company will become insolvent and the potential harm of
such insolvency to the financial stability of the United States.</text>
</subsection><subsection id="IDc7ff6b3f1efb4e88b356fce91040b626"><enum>(c)</enum><header>Remediation
requirements</header><text>The regulations prescribed by the Board of Governors
under subsection (a) shall—</text>
<paragraph id="ID63660e1029504fa68dbd4cb2d7c54293"><enum>(1)</enum><text>define measures of the
financial condition of the company, including regulatory capital, liquidity
measures, and other forward-looking indicators; and</text>
</paragraph><paragraph id="IDe87ebe92afc54bce8d1ddbb089c9aaea"><enum>(2)</enum><text>establish requirements
that increase in stringency as the financial condition of the company declines,
including—</text>
<subparagraph id="ID9683b994280c4d3488beffa2a6ed1ba0"><enum>(A)</enum><text>requirements in the
initial stages of financial decline, including limits on capital distributions,
acquisitions, and asset growth; and</text>
</subparagraph><subparagraph id="ID08af5975990b4548821b15cbdb09f9d1"><enum>(B)</enum><text>requirements at later
stages of financial decline, including a capital restoration plan and
capital-raising requirements, limits on transactions with affiliates,
management changes, and asset sales.</text>
</subparagraph></paragraph></subsection></section><section id="idC2E12D84CDF24D568E4CE4381EB25169"><enum>167.</enum><header>Affiliations</header>
<subsection id="ID9cc46a0b0e1c4a478f26b40f6de3721e"><enum>(a)</enum><header>Affiliations</header><text>Nothing
in this subtitle shall be construed to require a nonbank financial company
supervised by the Board of Governors, or a company that controls a nonbank
financial company supervised by the Board of Governors, to conform the
activities thereof to the requirements of section 4 of the Bank Holding Company
Act of 1956 (12 U.S.C. 1843).</text>
</subsection><subsection id="IDbb966e0ed2fe4dbdb5bfae07dd0602cb"><enum>(b)</enum><header>Requirement</header>
<paragraph id="ID36d6897386ee4905aeb77235d1850277"><enum>(1)</enum><header>In
general</header><text>If a nonbank financial company supervised by the Board of
Governors conducts activities other than those that are determined to be
financial in nature or incidental thereto under section 4(k) of the Bank
Holding Company Act of 1956, the Board of Governors may require such company to
establish and conduct such activities that are determined to be financial in
nature or incidental thereto in an intermediate holding company established
pursuant to regulation of the Board of Governors, not later than 90 days after
the date on which the nonbank financial company supervised by the Board of
Governors was notified of the determination under section 113(a).</text>
</paragraph><paragraph id="ID16f8ee384fe348fea06b13d07d18b20e"><enum>(2)</enum><header>Internal financial
activities</header><text>For purposes of this subsection, activities that are
determined to be financial in nature or incidental thereto under section 4(k)
of the Bank Holding Company Act of 1956, as described in paragraph (1), shall
not include internal financial activities conducted for a nonbank financial
company supervised by the Board of Governors or any affiliate, including
internal treasury, investment, and employee benefit functions. With respect to
any internal financial activity of such company during the year prior to the
date of enactment of this Act, such company may continue to engage in such
activity as long as at least <fraction>2/3</fraction> of the assets or
<fraction>2/3</fraction> of the revenues generated from the activity are from
or attributable to such company, subject to review by the Board of Governors,
to determine whether engaging in such activity presents undue risk to such
company or to the financial stability of the United States.</text>
</paragraph></subsection><subsection id="id79968A501A5E4177B4951E5D56A40EA9"><enum>(c)</enum><header>Regulations</header><text display-inline="yes-display-inline">The Board of Governors—</text>
<paragraph id="IDb72bfed1f4ab4bb1a6ce4736423bf2d6"><enum>(1)</enum><text>shall promulgate
regulations to establish the criteria for determining whether to require a
nonbank financial company supervised by the Board of Governors to establish an
intermediate holding company under subsection (a); and</text>
</paragraph><paragraph id="IDca169e99e6f14ecc819c10e6b18db151"><enum>(2)</enum><text>may promulgate
regulations to establish any restrictions or limitations on transactions
between an intermediate holding company or a nonbank financial company
supervised by the Board of Governors and its affiliates, as necessary to
prevent unsafe and unsound practices in connection with transactions between
such company, or any subsidiary thereof, and its parent company or affiliates
that are not subsidiaries of such company, except that such regulations shall
not restrict or limit any transaction in connection with the bona fide
acquisition or lease by an unaffiliated person of assets, goods, or
services.</text>
</paragraph></subsection></section><section commented="no" id="ID1e186906ffd0481ea97ecd29a2347b37"><enum>168.</enum><header>Regulations</header><text display-inline="no-display-inline">Except as otherwise specified in this
subtitle, not later than 18 months after the transfer date, the Board of
Governors shall issue final regulations to implement this subtitle and the
amendments made by this subtitle.</text>
</section><section commented="no" id="ID3e13afc190b64d29946a768f6dec04e2"><enum>169.</enum><header>Avoiding
duplication</header><text display-inline="no-display-inline">The Board of
Governors shall take any action that the Board of Governors deems appropriate
to avoid imposing requirements under this subtitle that are duplicative of
requirements applicable to bank holding companies and nonbank financial
companies under other provisions of law.</text>
</section><section commented="no" id="id860FD53FE1F04A778DB86006CC3DCEB1"><enum>170.</enum><header>Safe harbor</header>
<subsection id="IDbdb1130076654ad895a3130899361ecc"><enum>(a)</enum><header>Regulations</header><text>The
Board of Governors shall promulgate regulations on behalf of, and in
consultation with, the Council setting forth the criteria for exempting certain
types or classes of U.S. nonbank financial companies or foreign nonbank
financial companies from supervision by the Board of Governors.</text>
</subsection><subsection id="ID805c08f8e54c49ef8cc8e07630e29ebc"><enum>(b)</enum><header>Considerations</header><text>In
developing the criteria under subsection (a), the Board of Governors shall take
into account the factors for consideration described in subsections (a) and (b)
of section 113 in determining whether a U.S. nonbank financial company or
foreign nonbank financial company shall be supervised by the Board of
Governors.</text>
</subsection><subsection id="ID1c38c47675de4880a10cd848eb178d66"><enum>(c)</enum><header>Rule of
construction</header><text>Nothing in this section shall be construed to
require supervision by the Board of Governors of a U.S. nonbank financial
company or foreign nonbank financial company, if such company does not meet the
criteria for exemption established under subsection (a).</text>
</subsection><subsection id="ID3464dbd2929143829a3b8e3591b57a34"><enum>(d)</enum><header>Update</header><text>The
Board of Governors shall, in consultation with the Council, review the
regulations promulgated under subsection (a), not less frequently than every 5
years, and based upon the review, the Board of Governors may revise such
regulations on behalf of, and in consultation with, the Council to update as
necessary the criteria set forth in such regulations.</text>
</subsection><subsection id="ID374e3c33c9c34aa4a8ba60e49630c6ec"><enum>(e)</enum><header>Transition
period</header><text>No revisions under subsection (d) shall take effect before
the end of the 2-year period after the date of publication of such revisions in
final form.</text>
</subsection><subsection commented="no" display-inline="no-display-inline" id="IDe54a58b931304c039c06bf05cfc4e9a8"><enum>(f)</enum><header>Report</header><text>The
Chairperson of the Board of Governors and the Chairperson of the Council shall
submit a joint report to the Committee on Banking, Housing, and Urban Affairs
of the Senate and the Committee on Financial Services of the House of
Representatives not later than 30 days after the date of the issuance in final
form of the regulations under subsection (a), or any subsequent revision to
such regulations under subsection (d), as applicable. Such report shall
include, at a minimum, the rationale for exemption and empirical evidence to
support the criteria for exemption.</text>
</subsection></section><section id="id3B1F563D256746DB9808623EFEEE117D"><enum>171.</enum><header>Leverage and
risk-based capital requirements</header>
<subsection id="idD8E71A6C76B44FEF98867CF687A2B0FD"><enum>(a)</enum><header>Definitions</header>
<paragraph id="idC4CB5B722F2F46EE9281FC110E9E3901"><enum>(1)</enum><header>Generally applicable
leverage capital requirements</header><text>The term <term>generally applicable
leverage capital requirements</term> means—</text>
<subparagraph id="id883739B7AB584A6CA2B88FB1DBCD3CE6"><enum>(A)</enum><text>the minimum ratios of
tier 1 capital to average total assets, as established by the appropriate
Federal banking agencies to apply to insured depository institutions under the
prompt corrective action regulations implementing section 38 of the Federal
Deposit Insurance Act, regardless of total consolidated asset size or foreign
financial exposure; and</text>
</subparagraph><subparagraph id="idE6A12B9E3F3E4753A8FF4946C3550D63"><enum>(B)</enum><text>includes the regulatory
capital components in the numerator of that capital requirement, average total
assets in the denominator of that capital requirement, and the required ratio
of the numerator to the denominator.</text>
</subparagraph></paragraph><paragraph id="IDa48019a5995f4bc097a701a3653ea428"><enum>(2)</enum><header>Generally applicable
risk-based capital requirements</header><text>The term <term>generally
applicable risk-based capital requirements</term> means—</text>
<subparagraph id="idB9F91E85521A4C869A9C069ACB22C175"><enum>(A)</enum><text>the risk-based capital
requirements as established by the appropriate Federal banking agencies to
apply to insured depository institutions under the agency’s Prompt Corrective
Action regulations that implement section 38 of the Federal Deposit Insurance
Act, regardless of total consolidated asset size or foreign financial exposure;
and</text>
</subparagraph><subparagraph id="id8A912D7DC74241EE8414BB880616E8CB"><enum>(B)</enum><text>includes the regulatory
capital components in the numerator of those capital requirements, the
risk-weighted assets in the denominator of those capital requirements, and the
required ratio of the numerator to the denominator.</text>
</subparagraph></paragraph></subsection><subsection id="ID71f90f51721042e6afa3a3301aa0c936"><enum>(b)</enum><header>Minimum capital
requirements</header>
<paragraph id="id3CC21E75CAD54638A9F6B94441333721"><enum>(1)</enum><header>Minimum leverage
capital requirements</header><text>The appropriate Federal banking agencies
shall establish minimum leverage capital requirements on a consolidated basis
for insured depository institutions, depository institution holding companies,
and nonbank financial companies identified under section 113. The minimum
leverage capital requirements established under this paragraph shall not be
less than the generally applicable leverage capital requirements, which shall
serve as a floor for any capital requirements the agency may require, nor
quantitatively lower than the generally applicable leverage capital
requirements that were in effect for insured depository institutions as of the
date of enactment of this Act.</text>
</paragraph><paragraph id="ID4d052195f958489c8f3bab438bc309a6"><enum>(2)</enum><header>Minimum risk-based
capital requirements</header><text>The appropriate Federal banking agencies
shall establish minimum risk-based capital requirements on a consolidated basis
for insured depository institutions, depository institution holding companies,
and nonbank financial companies identified under section 113. The minimum
risk-based capital requirements established under this paragraph shall not be
less than the generally applicable risk-based capital requirements, which shall
serve as a floor for any capital requirements the agency may require, nor
quantitatively lower than the generally applicable risk-based capital
requirements that were in effect for insured depository institutions as of the
date of enactment of this Act.</text>
</paragraph><paragraph id="IDa4fa0522deba419ca075974e82dc1faa"><enum>(3)</enum><header>Capital requirements to
address activities that pose risks to the financial system</header>
<subparagraph id="id6A84D2B060384943BD850AB0E3F417F1"><enum>(A)</enum><header>In
general</header><text>Subject to the recommendations of the Council, in
accordance with section 120, the Federal banking agencies shall develop capital
requirements applicable to all institutions covered by this section that
address the risks that the activities of such institutions pose, not only to
the institution engaging in the activity, but to other public and private
stakeholders in the event of adverse performance, disruption, or failure of the
institution or the activity.</text>
</subparagraph><subparagraph id="id1157FF37A0F64EC580788916AA7E5203"><enum>(B)</enum><header>Content</header><text>Such
rules shall address, at a minimum, the risks arising from—</text>
<clause id="id2BEB847762CC477CBBFFD5F7FDA70963"><enum>(i)</enum><text>significant volumes of
activity in derivatives, securitized products purchased and sold, financial
guarantees purchased and sold, securities borrowing and lending, and repurchase
agreements and reverse repurchase agreements;</text>
</clause><clause id="idA4CA0247694B478A9B373D4F989B329B"><enum>(ii)</enum><text>concentrations in assets
for which the values presented in financial reports are based on models rather
than historical cost or prices deriving from deep and liquid 2-way markets;
and</text>
</clause><clause id="idD88D1432AF1343B49CABC3D3324F430E"><enum>(iii)</enum><text>concentrations in
market share for any activity that would substantially disrupt financial
markets if the institution is forced to unexpectedly cease the activity.</text>
</clause></subparagraph></paragraph></subsection></section></subtitle><enum>II</enum><header>Orderly liquidation
authority</header>
<section id="ID5d94b38c22a74642b9717c714bb50ed5"><enum>201.</enum><header>Definitions</header>
<subsection id="id69F4F5FF8F394F2EAAA6B176C881A8F0"><enum>(a)</enum><header>In
general</header><text>In this title, the following definitions shall
apply:</text>
<paragraph id="IDacec689363a74830bf9c119e9c240963"><enum>(1)</enum><header>Administrative expenses
of the receiver</header><text>The term <term>administrative expenses of the
receiver</term> includes—</text>
<subparagraph id="IDe1415d8036624f679aaefec9afb2c0a5"><enum>(A)</enum><text>the actual, necessary
costs and expenses incurred by the Corporation as receiver for a covered
financial company in liquidating a covered financial company; and</text>
</subparagraph><subparagraph id="IDad304c256f4e4157bfd64f34ba95f33b"><enum>(B)</enum><text>any obligations that the
Corporation as receiver for a covered financial company determines are
necessary and appropriate to facilitate the smooth and orderly liquidation of
the covered financial company.</text>
</subparagraph></paragraph><paragraph id="ID60587d7a888148699717bef4419a5b44"><enum>(2)</enum><header>Bankruptcy
code</header><text>The term <term>Bankruptcy Code</term> means title 11, United
States Code.</text>
</paragraph><paragraph id="ID4f55a61b2d614a0d82ff23c468bc0936"><enum>(3)</enum><header>Bridge financial
company</header><text>The term <term>bridge financial company</term> means a
new financial company organized by the Corporation in accordance with section
210(h) for the purpose of resolving a covered financial company.</text>
</paragraph><paragraph id="IDb860865f41a54c9ea7e890a295af8660"><enum>(4)</enum><header>Claim</header><text>The
term <term>claim</term> means any right of payment, whether or not such right
is reduced to judgment, liquidated, unliquidated, fixed, contingent, matured,
unmatured, disputed, undisputed, legal, equitable, secured, or
unsecured.</text>
</paragraph><paragraph commented="no" id="ID52ac79ce6e784bf8905cbf86404ca08d"><enum>(5)</enum><header>Company</header><text>The
term <term>company</term> has the same meaning as in section 2(b) of the Bank
Holding Company Act of 1956 (12 U.S.C. 1841(b)), except that such term includes
any company described in paragraph (11), the majority of the securities of
which are owned by the United States or any State.</text>
</paragraph><paragraph commented="no" id="IDe192652b932149e79edadd4b60606a81"><enum>(6)</enum><header>Covered broker or
dealer</header><text>The term <quote>covered broker or dealer</quote> means a
covered financial company that is a broker or dealer that—</text>
<subparagraph commented="no" id="id7C01C2A0AE09484C9843B1B8E7348C22"><enum>(A)</enum><text>is registered with the
Commission under section 15(b) of the Securities Exchange Act of 1934 (15
U.S.C. 78o(b)); and</text>
</subparagraph><subparagraph commented="no" id="idF9DB7991BE1D453A979C1D80BEE2A3D4"><enum>(B)</enum><text>is a member of
SIPC.</text>
</subparagraph></paragraph><paragraph id="idC972A7BDB71C4ADEA8ACC2FF9933A48E"><enum>(7)</enum><header>Covered financial
company</header><text>The term <term>covered financial company</term>—</text>
<subparagraph id="id98A3C95B4352464A926CC5C0AAEAC4FB"><enum>(A)</enum><text>means a financial company
for which a determination has been made under section 203(b); and</text>
</subparagraph><subparagraph id="id713701FAD5254BB6821361209B80CB49"><enum>(B)</enum><text>does not include an
insured depository institution.</text>
</subparagraph></paragraph><paragraph id="ID10bea620cd544a7ead46f328e8d3a9f5"><enum>(8)</enum><header>Covered
subsidiary</header><text>The term <term>covered subsidiary</term> means a
subsidiary of a covered financial company, other than—</text>
<subparagraph id="ID2bc1d146d5f9442193280fed7597f56f"><enum>(A)</enum><text>an insured depository
institution;</text>
</subparagraph><subparagraph commented="no" id="ID00af3114c0004abeb025f3fdbc321f05"><enum>(B)</enum><text>an insurance company;
or</text>
</subparagraph><subparagraph id="ID04f2403447574c8e86e5f9bad50fee48"><enum>(C)</enum><text>a covered broker or
dealer.</text>
</subparagraph></paragraph><paragraph id="ID5d359cb3407e4eb1be4e0e0a3285d589"><enum>(9)</enum><header>Definitions relating to
covered brokers and dealers</header><text>The terms <term>customer</term>,
<term>customer name securities</term>, <term>customer property</term>, and
<term>net equity</term> in the context of a covered broker or dealer, have the
same meanings as in section 16 of the Securities Investor Protection Act of
1970 (15 U.S.C. 78lll).</text>
</paragraph><paragraph id="ID382a03895b9145e690c638fb29feba8a"><enum>(10)</enum><header>Financial
company</header><text>The term <term>financial company</term> means any company
that—</text>
<subparagraph id="IDd4fce797157e4d92802392b6ae2c4cc1"><enum>(A)</enum><text>is incorporated or
organized under any provision of Federal law or the laws of any State;</text>
</subparagraph><subparagraph id="ID1bbca9fb4652463d927154e95d77f806"><enum>(B)</enum><text>is—</text>
<clause id="IDa5ef16f202e2466a899c72d373f180aa"><enum>(i)</enum><text>a bank holding company,
as defined in section 2(a) of the Bank Holding Company Act of 1956 (12 U.S.C.
1841(a)), and including any company described in paragraph (5);</text>
</clause><clause id="ID08b0f0dd8aa24c15bf918f89491d8213"><enum>(ii)</enum><text>a nonbank financial
company supervised by the Board of Governors;</text>
</clause><clause id="IDbdf80941c7d9402ab0c209419912f916"><enum>(iii)</enum><text>any company that is
predominantly engaged in activities that the Board of Governors has determined
are financial in nature or incidental thereto for purposes of section 4(k) of
the Bank Holding Company Act of 1956 (12 U.S.C. 1843(k)) other than a company
described in clause (i) or (ii); or</text>
</clause><clause id="IDd8ce03988d284d19ae391d4bd177cdb3"><enum>(iv)</enum><text>any subsidiary of any
company described in any of clauses (i) through (iii) that is predominantly
engaged in activities that the Board of Governors has determined are financial
in nature or incidental thereto for purposes of section 4(k) of the Bank
Holding Company Act of 1956 (12 U.S.C. 1843(k)) (other than a subsidiary that
is an insured depository institution or an insurance company); and</text>
</clause></subparagraph><subparagraph id="idECECFBAB4D4B4FB2B1E998996D66468E"><enum>(C)</enum><text>is not a Farm Credit
System institution chartered under and subject to the provisions of the Farm
Credit Act of 1971, as amended (12 U.S.C. 2001 et seq.), a governmental entity,
or a regulated entity, as defined under section 1303 of the Federal Housing
Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C.
4502(20)).</text>
</subparagraph></paragraph><paragraph id="IDe9ff2b4e53944feaae1a91e9e1867030"><enum>(11)</enum><header>Fund</header><text>The
term <term>Fund</term> means the Orderly Liquidation Fund established under
section 210(n).</text>
</paragraph><paragraph id="IDfb192bd94fe14adfa915b4db48d3f536"><enum>(12)</enum><header>Insurance
company</header><text>The term <term>insurance company</term> means any entity
that is—</text>
<subparagraph id="idD07EC265D8BF4D74B3EDF687345619E1"><enum>(A)</enum><text>engaged in the business
of insurance;</text>
</subparagraph><subparagraph id="id943F270C3C724A4C9F8A1C36E19D9691"><enum>(B)</enum><text>subject to regulation by
a State insurance regulator; and</text>
</subparagraph><subparagraph commented="no" id="id71ECD6C099064E03B13C6AFBF2420346"><enum>(C)</enum><text>covered by a State law
that is designed to specifically deal with the rehabilitation, liquidation, or
insolvency of an insurance company.</text>
</subparagraph></paragraph><paragraph id="idEB633692F8A646D9A15A4160A5B281A9"><enum>(13)</enum><header>Nonbank financial
company</header><text>The term <term>nonbank financial company</term> has the
same meaning as in section 102(a)(4)(C).</text>
</paragraph><paragraph id="idEF9F1F251F6A4D80BF5D3355681B24C6"><enum>(14)</enum><header>Nonbank financial
company supervised by the board of governors</header><text>The term
<term>nonbank financial company supervised by the Board of Governors</term> has
the same meaning as in section 102(a)(3)(D).</text>
</paragraph><paragraph id="id3DE68CA6957E476C93CDCE60C95300C1"><enum>(15)</enum><header>Court</header><text>The
term <term>Court</term> means the United States District Court for the District
of Columbia.</text>
</paragraph><paragraph id="id0C32275D8BFD4514BF0807AB3F046E16"><enum>(16)</enum><header>SIPC</header><text>The
term <term>SIPC</term> means the Securities Investor Protection
Corporation.</text>
</paragraph></subsection><subsection commented="no" id="ID9a2f9ffe40784d51ab18de83d8a73333"><enum>(b)</enum><header>Definitional
criteria</header><text>For purpose of the definition of the term
<term>financial company</term> under subsection (a)(10), no company shall be
deemed to be predominantly engaged in activities that the Board of Governors
has determined are financial in nature or incidental thereto for purposes of
section 4(k) of the Bank Holding Company Act of 1956 (12 U.S.C. 1843(k)), if
the consolidated revenues of such company from such activities constitute less
than 85 percent of the total consolidated revenues of such company, as the
Corporation, in consultation with the Secretary, shall establish by regulation.
In determining whether a company is a financial company under this title, the
consolidated revenues derived from the ownership or control of a depository
institution shall be included.</text>
</subsection></section><section id="ID0f042d86940c4194a8cb2f03face8d88"><enum>202.</enum><header>Judicial
Review</header>
<subsection id="IDc75b664ca5034968bbdfcdd5ff78b1fa"><enum>(a)</enum><header>Commencement of orderly
liquidation</header>
<paragraph id="idA0592D1350A2408CB93809A4968C0C73"><enum>(1)</enum><header>Petition to district
court</header>
<subparagraph id="idB41B7B1DE36B4A7588E402CFDBE3C178"><enum>(A)</enum><header>District court
review</header>
<clause id="idFC78B3ADCB8B448FBAB7ABE0B86E2B9C"><enum>(i)</enum><header>Petition to district
court</header><text>Subsequent to a determination by the Secretary under
section 203 that a financial company satisfies the criteria in section 203(b),
the Secretary shall notify the Corporation and the covered financial company.
If the board of directors (or body performing similar functions) of the covered
financial company acquiesces or consents to the appointment of the Corporation
as a receiver, the Secretary shall appoint the Corporation as a receiver. If
the board of directors (or body performing similar functions) of the covered
financial company does not acquiesce or consent to the appointment of the
Corporation as receiver, the Secretary shall petition the United States
District Court for the District of Columbia for an order authorizing the
Secretary to appoint the Corporation as a receiver.</text>
</clause><clause id="ID1fe67008bf8648ea8bad5a5aa0be4621"><enum>(ii)</enum><header>Form and content of
order</header><text>The Secretary shall present all relevant findings and the
recommendation made pursuant to section 203(a) to the Court. The petition shall
be filed under seal.</text>
</clause><clause id="ID7569c9e7fe544cd09c376c10b13f3e8c"><enum>(iii)</enum><header>Determination</header><text>On
a strictly confidential basis, and without any prior public disclosure, the
Court, after notice to the covered financial company and a hearing in which the
covered financial company may oppose the petition, shall determine whether the
determination of the Secretary that the covered financial company is in default
or in danger of default and satisfies the definition of a financial company
under section 201(10) is arbitrary and capricious.</text>
</clause><clause id="IDf699021607a2473296c4104a897a4e26"><enum>(iv)</enum><header>Issuance of
order</header><text>If the Court determines that the determination of the
Secretary that the covered financial company is in default or in danger of
default and satisfies the definition of a financial company under section
201(10)—</text>
<subclause id="id62ECA202EDF742DDADE55233E4BC7DE0"><enum>(I)</enum><text>is not arbitrary and
capricious, the Court shall issue an order immediately authorizing the
Secretary to appoint the Corporation as receiver of the covered financial
company; or</text>
</subclause><subclause id="id4912E0979050434895F1A59AF08DBF81"><enum>(II)</enum><text>is arbitrary and
capricious, the Court shall immediately provide to the Secretary a written
statement of each reason supporting its determination, and afford the Secretary
an immediate opportunity to amend and refile the petition under clause
(i).</text>
</subclause></clause><clause commented="no" id="id0E4C1C817B9046DB9F697A497F8031CD"><enum>(v)</enum><header>Petition granted by
operation of law</header><text>If the Court does not make a determination
within 24 hours of receipt of the petition—</text>
<subclause commented="no" id="id45791392E52E40CF9EEB3F17771ABAE8"><enum>(I)</enum><text>the petition shall be
granted by operation of law;</text>
</subclause><subclause commented="no" id="id55462830FF2A429E8E7114441A646DF2"><enum>(II)</enum><text>the Secretary shall
appoint the Corporation as receiver; and</text>
</subclause><subclause commented="no" id="id6DEE797783AF47C99E3AEB879DCCB931"><enum>(III)</enum><text>liquidation under this
title shall automatically and without further notice or action be commenced and
the Corporation may immediately take all actions authorized under this
title.</text>
</subclause></clause></subparagraph><subparagraph id="IDf5f7414cd9974b0ba9c525b9cbca418a"><enum>(B)</enum><header>Effect of
determination</header><text>The determination of the Court under subparagraph
(A) shall be final, and shall be subject to appeal only in accordance with
paragraph (2). The decision shall not be subject to any stay or injunction
pending appeal. Upon conclusion of its proceedings under subparagraph (A), the
Court shall provide immediately for the record a written statement of each
reason supporting the decision of the Court, and shall provide copies thereof
to the Secretary and the covered financial company.</text>
</subparagraph><subparagraph id="ID69e3cd98fb9248189d060090747f83e3"><enum>(C)</enum><header>Criminal
penalties</header><text>A person who recklessly discloses a determination of
the Secretary under section 203(b) or a petition of the Secretary under
subparagraph (A), or the pendency of court proceedings as provided for under
subparagraph (A), shall be fined not more than $250,000, or imprisoned for not
more than 5 years, or both.</text>
</subparagraph></paragraph><paragraph id="ID4c63fbcc880045749c3cfea9cc2d18f8"><enum>(2)</enum><header>Appeal of decisions of
the district court</header>
<subparagraph id="ID681bc59aa8024fbb9d8446d7383f8587"><enum>(A)</enum><header>Appeal to court of
appeals</header>
<clause id="IDed829191de5940708361cab8cbba540e"><enum>(i)</enum><header>In
general</header><text>Subject to clause (ii), the United States Court of
Appeals for the District of Columbia Circuit shall have jurisdiction of an
appeal of a final decision of the Court filed by the Secretary or a covered
financial company, through its board of directors, notwithstanding section
210(a)(1)(A)(i), not later than 30 days after the date on which the decision of
the Court is rendered or deemed rendered under this subsection.</text>
</clause><clause id="ID2dfad3f1fb4f4fb5b5371f66079485da"><enum>(ii)</enum><header>Condition of
jurisdiction</header><text>The Court of Appeals shall have jurisdiction of an
appeal by a covered financial company only if the covered financial company did
not acquiesce or consent to the appointment of a receiver by the Secretary
under paragraph (1)(A).</text>
</clause><clause id="IDadd5c33ec877445fb34ec1ed88f43ad5"><enum>(iii)</enum><header>Expedition</header><text>The
Court of Appeals shall consider any appeal under this subparagraph on an
expedited basis.</text>
</clause><clause id="IDc31e7e4194084afb9f41b5f8ec0dd90f"><enum>(iv)</enum><header>Scope of
review</header><text>For an appeal taken under this subparagraph, review shall
be limited to whether the determination of the Secretary that a covered
financial company is in default or in danger of default and satisfies the
definition of a financial company under section 201(10) is arbitrary and
capricious.</text>
</clause></subparagraph><subparagraph id="IDe5266a2d70bd4ed081c559778f9137cc"><enum>(B)</enum><header>Appeal to the supreme
court</header>
<clause id="IDc65e22916ba842f0b012b65aa0d7aca2"><enum>(i)</enum><header>In
general</header><text>A petition for a writ of certiorari to review a decision
of the Court of Appeals under subparagraph (A) may be filed by the Secretary or
the covered financial company, through its board of directors, notwithstanding
section 210(a)(1)(A)(i), with the Supreme Court of the United States, not later
than 30 days after the date of the final decision of the Court of Appeals, and
the Supreme Court shall have discretionary jurisdiction to review such
decision.</text>
</clause><clause id="IDf31b0b56571e462fbf76c5ec3fc61a0b"><enum>(ii)</enum><header>Written
statement</header><text>In the event of a petition under clause (i), the Court
of Appeals shall immediately provide for the record a written statement of each
reason for its decision.</text>
</clause><clause id="IDe23f3bc1b734422a828468a2879aec15"><enum>(iii)</enum><header>Expedition</header><text>The
Supreme Court shall consider any petition under this subparagraph on an
expedited basis.</text>
</clause><clause id="IDb704f26d48664e74b4c0ab6d6fdb3863"><enum>(iv)</enum><header>Scope of
review</header><text>Review by the Supreme Court under this subparagraph shall
be limited to whether the determination of the Secretary that the covered
financial company is in default or in danger of default and satisfies the
definition of a financial company under section 201(10) is arbitrary and
capricious.</text>
</clause></subparagraph></paragraph></subsection><subsection id="ID9fa9f8057e1741dda6a6e5bc4fa3a316"><enum>(b)</enum><header>Establishment and
transmittal of rules and procedures</header>
<paragraph id="IDb2c1878c24d246238ab835a62acbf85e"><enum>(1)</enum><header>In
general</header><text>Not later than 6 months after the date of enactment of
this Act, the Court shall establish such rules and procedures as may be
necessary to ensure the orderly conduct of proceedings, including rules and
procedures to ensure that the 24-hour deadline is met and that the Secretary
shall have an ongoing opportunity to amend and refile petitions under
subsection (a)(1).</text>
</paragraph><paragraph id="IDb31f9e8281af465182ccc69f3b7d6885"><enum>(2)</enum><header>Publication of
rules</header><text>The rules and procedures established under paragraph (1),
and any modifications of such rules and procedures, shall be recorded and shall
be transmitted to—</text>
<subparagraph id="ID71d7229911944ea6abdddb391cec0624"><enum>(A)</enum><text>the Committee on the
Judiciary of the Senate;</text>
</subparagraph><subparagraph id="IDf68fd531ddc04992997a5ded3b43c6b8"><enum>(B)</enum><text>the Committee on Banking,
Housing, and Urban Affairs of the Senate;</text>
</subparagraph><subparagraph id="IDce742c68d6fd4d9895105008b833c7e6"><enum>(C)</enum><text>the Committee on the
Judiciary of the House of Representatives; and</text>
</subparagraph><subparagraph id="ID29629c01ef9d4d578a318a034bc25f19"><enum>(D)</enum><text>the Committee on
Financial Services of the House of Representatives.</text>
</subparagraph></paragraph></subsection><subsection id="IDd3ab19ec8c4c4d84be4acb7819b88fa1"><enum>(c)</enum><header>Provisions applicable
to financial companies</header>
<paragraph id="IDa4ea6e0a09eb4b2d996d3ac8b8016177"><enum>(1)</enum><header>Bankruptcy
code</header><text>Except as provided in this subsection, the provisions of the
Bankruptcy Code and rules issued thereunder, and not the provisions of this
title, shall apply to financial companies that are not covered financial
companies for which the Corporation has been appointed as receiver.</text>
</paragraph><paragraph id="ID8083c516aa2c4c67a9a9f2cdc7e64916"><enum>(2)</enum><header>This
title</header><text>The provisions of this title shall exclusively apply to and
govern all matters relating to covered financial companies for which the
Corporation is appointed as receiver, and no provisions of the Bankruptcy Code
or the rules issued thereunder shall apply in such cases.</text>
</paragraph></subsection><subsection id="ID6182f7a9f4154aa99277998d1e24ebf4"><enum>(d)</enum><header>Time limit on
receivership authority</header>
<paragraph id="IDc56b7a409913419e8a9487c72f420bb5"><enum>(1)</enum><header>Baseline
period</header><text>Any appointment of the Corporation as receiver under this
section shall terminate at the end of the 3-year period beginning on the date
on which such appointment is made.</text>
</paragraph><paragraph id="ID5d3ded489da848e3b47a6fd1c6b6ac92"><enum>(2)</enum><header>Extension of time
limit</header><text>The time limit established in paragraph (1) may be extended
by the Corporation for up to 1 additional year, if the Chairperson of the
Corporation determines and certifies in writing to the Committee on Banking,
Housing, and Urban Affairs of the Senate and the Committee on Financial
Services of the House of Representatives that continuation of the receivership
is necessary—</text>
<subparagraph id="ID65a1164c5005419d901033437b0ec24b"><enum>(A)</enum><text>to—</text>
<clause id="idD50E869E427E46E3993C5FF1FF96DF40"><enum>(i)</enum><text>maximize the net present
value return from the sale or other disposition of the assets of the covered
financial company; or</text>
</clause><clause id="ID0a10d0d266254058b10bb85e4c45c161"><enum>(ii)</enum><text>minimize the amount of
loss realized upon the sale or other disposition of the assets of the covered
financial company; and</text>
</clause></subparagraph><subparagraph id="ID18070e5415314638b0a5b26138594012"><enum>(B)</enum><text>to protect the stability
of the financial system of the United States.</text>
</subparagraph></paragraph><paragraph id="ID769092ed743844908cd21d615c4430e8"><enum>(3)</enum><header>Second extension of
time limit</header>
<subparagraph id="idCCE304A8558A43C4ADBC3D41B73C1F50"><enum>(A)</enum><header>In
general</header><text>The time limit under this subsection, as extended under
paragraph (2), may be extended for up to 1 additional year, if the Chairperson
of the Corporation, with the concurrence of the Secretary, submits the
certifications described in paragraph (2).</text>
</subparagraph><subparagraph id="IDeac9db479d954081b27d6362881bef34"><enum>(B)</enum><header>Additional report
required</header><text>Not later than 30 days after the date of commencement of
the extension under subparagraph (A), the Corporation shall submit a report to
the Committee on Banking, Housing, and Urban Affairs of the Senate and the
Committee on Financial Services of the House of Representatives describing the
need for the extension and the specific plan of the Corporation to conclude the
receivership before the end of the second extension.</text>
</subparagraph></paragraph><paragraph commented="no" id="ID5429b371378941de8ecce0ca08083523"><enum>(4)</enum><header>Ongoing
litigation</header><text>The time limit under this subsection, as extended
under paragraph (3), may be further extended solely for the purpose of
completing ongoing litigation in which the Corporation as receiver is a party,
provided that the appointment of the Corporation as receiver shall terminate
not later than 90 days after the date of completion of such litigation,
if—</text>
<subparagraph commented="no" id="IDbd75a7e004a1498793c2539df646c62b"><enum>(A)</enum><text>the Council determines
that the Corporation used its best efforts to conclude the receivership in
accordance with its plan before the end of the time limit described in
paragraph (3);</text>
</subparagraph><subparagraph commented="no" id="IDd215411918b2489aa9a2b7aab633ce5b"><enum>(B)</enum><text>the Council determines
that the completion of longer-term responsibilities in the form of ongoing
litigation justifies the need for an extension; and</text>
</subparagraph><subparagraph commented="no" id="ID41992d33b260417bafd5a8da5afc8103"><enum>(C)</enum><text>the Corporation submits a
report approved by the Council not later than 30 days after the date of the
determinations by the Council under subparagraphs (A) and (B) to the Committee
on Banking, Housing, and Urban Affairs of the Senate and the Committee on
Financial Services of the House of Representatives, describing—</text>
<clause commented="no" id="IDf8194a3a48b44223b3f1185177304d66"><enum>(i)</enum><text>the ongoing litigation
justifying the need for an extension; and</text>
</clause><clause commented="no" id="ID975975845a8744089a7cc923eeb49d93"><enum>(ii)</enum><text>the specific plan of the
Corporation to complete the litigation and conclude the receivership.</text>
</clause></subparagraph></paragraph><paragraph commented="no" display-inline="no-display-inline" id="ID6c8bc7a1abde4d259a8e73bc3bd083e4"><enum>(5)</enum><header>Regulations</header><text>The
Corporation may issue regulations governing the termination of receiverships
under this title.</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="ID407d931651d4451ebcfbf98a36e43f5a"><enum>(6)</enum><header>No
liability</header><text>The Corporation and the Deposit Insurance Fund shall
not be liable for unresolved claims arising from the receivership after the
termination of the receivership.</text>
</paragraph></subsection><subsection id="ID1bdf136e1739400aa1d1eeb11a85806a"><enum>(e)</enum><header>Study of bankruptcy and
orderly liquidation process for financial companies</header>
<paragraph id="ID1a77a48f937e4dc6bf3eda35c77cd73a"><enum>(1)</enum><header>Study</header>
<subparagraph id="ID7ea152ba8a294badb3d79cc83c80da98"><enum>(A)</enum><header>In
general</header><text>The Administrative Office of the United States Courts and
the Comptroller General of the United States shall each monitor the activities
of the Court, and each such Office shall conduct separate studies regarding the
bankruptcy and orderly liquidation process for financial companies under the
Bankruptcy Code.</text>
</subparagraph><subparagraph id="IDaed59ebe184e461bad0767a5497cb0b5"><enum>(B)</enum><header>Issues to be
studied</header><text>In conducting the study under subparagraph (A), the
Administrative Office of the United States Courts and the Comptroller General
of the United States each shall evaluate—</text>
<clause id="IDe5b797b5a91a421580821e5b846fd2dd"><enum>(i)</enum><text>the effectiveness of
chapter 7 or chapter 11 of the Bankruptcy Code in facilitating the orderly
liquidation or reorganization of financial companies;</text>
</clause><clause id="ID64e769adc5de46b886774c0e7cb245d2"><enum>(ii)</enum><text>ways to maximize the
efficiency and effectiveness of the Court; and</text>
</clause><clause id="ID5b4d305f1bb04001815270be6dda45cb"><enum>(iii)</enum><text>ways to make the
orderly liquidation process under the Bankruptcy Code for financial companies
more effective.</text>
</clause></subparagraph></paragraph><paragraph id="IDa30c634671b048df83f4126c69841883"><enum>(2)</enum><header>Reports</header><text>Not
later than 1 year after the date of enactment of this Act, in each successive
year until the third year, and every fifth year after that date of enactment,
the Administrative Office of the United States Courts and the Comptroller
General of the United States shall submit to the Committee on Banking, Housing,
and Urban Affairs and the Committee on the Judiciary of the Senate and the
Committee on Financial Services and the Committee on the Judiciary of the House
of Representatives separate reports summarizing the results of the studies
conducted under paragraph (1).</text>
</paragraph></subsection><subsection id="ID914c4311f99745278efa8d541f28d2c2"><enum>(f)</enum><header>Study of international
coordination relating to bankruptcy process for financial companies</header>
<paragraph id="IDa593290668104ba4b3e190c199283044"><enum>(1)</enum><header>Study</header>
<subparagraph id="ID2a9b82044d4b4174bb6cefae0449db77"><enum>(A)</enum><header>In
general</header><text>The Comptroller General of the United States shall
conduct a study regarding international coordination relating to the orderly
liquidation of financial companies under the Bankruptcy Code.</text>
</subparagraph><subparagraph id="IDefd4582bdf3944c4a1fe7f3eabbbaab8"><enum>(B)</enum><header>Issues to be
studied</header><text>In conducting the study under subparagraph (A), the
Comptroller General of the United States shall evaluate, with respect to the
bankruptcy process for financial companies—</text>
<clause id="ID6900447687bb4e4eaa81e82a1eeee8a0"><enum>(i)</enum><text>the extent to which
international coordination currently exists;</text>
</clause><clause id="ID653ee5bd65ca4a75a5697669504da1cb"><enum>(ii)</enum><text>current mechanisms and
structures for facilitating international cooperation;</text>
</clause><clause id="ID984cef67175a4c8e8d00f805fc7960f0"><enum>(iii)</enum><text>barriers to effective
international coordination; and</text>
</clause><clause id="IDd832d08d80b346d0b0395b8d8a2299ad"><enum>(iv)</enum><text>ways to increase and
make more effective international coordination.</text>
</clause></subparagraph></paragraph><paragraph id="ID53f328ce56e54ece87591a87fb7d74bb"><enum>(2)</enum><header>Report</header><text>Not
later than 1 year after the date of enactment of this Act, the Comptroller
General of the United States shall submit to the Committee on Banking, Housing,
and Urban Affairs and the Committee on the Judiciary of the Senate and the
Committee on Financial Services and the Committee on the Judiciary of the House
of Representatives and the Secretary a report summarizing the results of the
study conducted under paragraph (1).</text>
</paragraph></subsection><subsection id="IDff5a4e52355c4354b6d6e369ef93c8e4"><enum>(g)</enum><header>Study of prompt
corrective action implementation by the appropriate Federal agencies</header>
<paragraph id="IDfdc66bcd377647e8bd146ee14d713793"><enum>(1)</enum><header>Study</header><text>The
Comptroller General of the United States shall conduct a study regarding the
implementation of prompt corrective action by the appropriate Federal banking
agencies.</text>
</paragraph><paragraph id="ID26fdd5773a5c402d931683e499ba6d81"><enum>(2)</enum><header>Issues to be
studied</header><text>In conducting the study under paragraph (1), the
Comptroller General shall evaluate—</text>
<subparagraph id="ID03429c48d6004c5cb1fd0222d5212f7f"><enum>(A)</enum><text>the effectiveness of
implementation of prompt corrective action by the appropriate Federal banking
agencies and the resolution of insured depository institutions by the
Corporation; and</text>
</subparagraph><subparagraph id="IDa38c472af3424a19b824f5d345624e1d"><enum>(B)</enum><text>ways to make prompt
corrective action a more effective tool to resolve the insured depository
institutions at the least possible long-term cost to the Deposit Insurance
Fund.</text>
</subparagraph></paragraph><paragraph id="IDb165d49b71d24a9cb544e21a6e01be76"><enum>(3)</enum><header>Report to
council</header><text>Not later than 1 years after the date of enactment of
this Act, the Comptroller General shall submit a report to the Council on the
results of the study conducted under this subsection.</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="ID26d64776caaa4466bafbde530e2dcdae"><enum>(4)</enum><header>Council report of
action</header><text>Not later than 6 months after the date of receipt of the
report from the Comptroller General under paragraph (3), the Council shall
submit a report to the Committee on Banking, Housing, and Urban Affairs of the
Senate and the Committee on Financial Services of the House of Representatives
on actions taken in response to the report, including any recommendations made
to the Federal primary financial regulatory agencies under section 120.</text>
</paragraph></subsection></section><section id="ID34f378e5325b46d39f3f44d726f79ee0"><enum>203.</enum><header>Systemic risk
determination</header>
<subsection id="IDefc72a32ee7d4d61a105736e8eedeeb8"><enum>(a)</enum><header>Written recommendation
and determination</header>
<paragraph id="IDfb4d48e829df4b52b7b4e8d145033e15"><enum>(1)</enum><header>Vote required</header>
<subparagraph id="ID6303396d045a4f28959e0b0222d73f45"><enum>(A)</enum><header>In
general</header><text>On their own initiative, or at the request of the
Secretary, the Corporation and the Board of Governors shall consider whether to
make a written recommendation described in paragraph (2) with respect to
whether the Secretary should appoint the Corporation as receiver for a
financial company. Such recommendation shall be made upon a vote of not fewer
than <fraction>2/3</fraction> of the members of the Board of Governors then
serving and <fraction>2/3</fraction> of the members of the board of directors
of the Corporation then serving.</text>
</subparagraph><subparagraph id="IDb8a9ea4938ef45b69b11af9f130241a7"><enum>(B)</enum><header>Cases involving covered
brokers or dealers</header><text>In the case of a covered broker or dealer, or
in which the largest United States subsidiary (as measured by total assets as
of the end of the previous calendar quarter) of a financial company is a
covered broker or dealer, the Commission and the Board of Governors, at the
request of the Secretary, or on their own initiative, shall consider whether to
make the written recommendation described in paragraph (2) with respect to the
financial company. Subject to the requirements in paragraph (2), such
recommendation shall be made upon a vote of not fewer than
<fraction>2/3</fraction> of the members of the Board of Governors then serving
and the members of the Commission then serving, and in consultation with the
Corporation.</text>
</subparagraph></paragraph><paragraph id="ID2c614701e1c34faa803d98499533ec10"><enum>(2)</enum><header>Recommendation
required</header><text>Any written recommendation pursuant to paragraph (1)
shall contain—</text>
<subparagraph id="IDef1008dfe92a43f498c158beb4133ec9"><enum>(A)</enum><text>an evaluation of whether
the financial company is in default or in danger of default;</text>
</subparagraph><subparagraph id="IDa8e408bf49874613944c21588d1394df"><enum>(B)</enum><text>a description of the
effect that the default of the financial company would have on financial
stability in the United States;</text>
</subparagraph><subparagraph id="IDb32b7ca9d9cf400884d3435a52c3ca56"><enum>(C)</enum><text>a recommendation
regarding the nature and the extent of actions to be taken under this title
regarding the financial company;</text>
</subparagraph><subparagraph id="ID82988fada28b4411b5cb1cfc5fcab8a5"><enum>(D)</enum><text>an evaluation of the
likelihood of a private sector alternative to prevent the default of the
financial company;</text>
</subparagraph><subparagraph id="ID95f2f09b53584bc09edc14ab05f3579b"><enum>(E)</enum><text>an evaluation of why a
case under the Bankruptcy Code is not appropriate for the financial
company;</text>
</subparagraph><subparagraph id="ID4103f60f08224f198e415beeda2efb0f"><enum>(F)</enum><text>an evaluation of the
effects on creditors, counterparties, and shareholders of the financial company
and other market participants; and</text>
</subparagraph><subparagraph id="id5AC3B9EDD7264B04987858E5CB18EEF0"><enum>(G)</enum><text>an evaluation of whether
the company satisfies the definition of a financial company under section
201.</text>
</subparagraph></paragraph></subsection><subsection id="ID0fc1b6ccda0a43e0a7ae6739262b7180"><enum>(b)</enum><header>Determination by the
Secretary</header><text>Notwithstanding any other provision of Federal or State
law, the Secretary shall take action in accordance with section 202(a)(1)(A),
if, upon the written recommendation under subsection (a), the Secretary (in
consultation with the President) determines that—</text>
<paragraph id="IDcfeb46683c0f48e980b56260ac823ef2"><enum>(1)</enum><text>the financial company is
in default or in danger of default;</text>
</paragraph><paragraph id="ID35d1d0d5386e41ac833795f10cc5f471"><enum>(2)</enum><text>the failure of the
financial company and its resolution under otherwise applicable Federal or
State law would have serious adverse effects on financial stability in the
United States;</text>
</paragraph><paragraph id="IDee1beedb61274dde809298b95c18377b"><enum>(3)</enum><text>no viable private sector
alternative is available to prevent the default of the financial
company;</text>
</paragraph><paragraph id="ID104dfd460d69456a87dbfab0f399e5c4"><enum>(4)</enum><text>any effect on the claims
or interests of creditors, counterparties, and shareholders of the financial
company and other market participants as a result of actions to be taken under
this title is appropriate, given the impact that any action taken under this
title would have on financial stability in the United States;</text>
</paragraph><paragraph id="IDee9e6ab9ddb8450c98a7fba5f70badde"><enum>(5)</enum><text>any action under section
204 would avoid or mitigate such adverse effects, taking into consideration the
effectiveness of the action in mitigating potential adverse effects on the
financial system, the cost to the general fund of the Treasury, and the
potential to increase excessive risk taking on the part of creditors,
counterparties, and shareholders in the financial company;</text>
</paragraph><paragraph commented="no" id="IDb7b8edb8cfd24c698e7fe4f6b2e24db4"><enum>(6)</enum><text>a Federal regulatory
agency has ordered the financial company to convert all of its convertible debt
instruments that are subject to the regulatory order; and</text>
</paragraph><paragraph id="id8854B4056411473DB8BCF1E0EF950774"><enum>(7)</enum><text>the company satisfies the
definition of a financial company under section 201.</text>
</paragraph></subsection><subsection id="IDb1795765f6f34c269fbbc7e0fbee2a07"><enum>(c)</enum><header>Documentation and
review</header>
<paragraph id="IDdf884bf7e0a94958a901913953c7b179"><enum>(1)</enum><header>In
general</header><text>The Secretary shall—</text>
<subparagraph id="ID623dc81f786444b2a021e4caf918ed5d"><enum>(A)</enum><text>document any
determination under subsection (b);</text>
</subparagraph><subparagraph id="IDe3b68c2e121648f884d1e50538f5889e"><enum>(B)</enum><text>retain the documentation
for review under paragraph (2); and</text>
</subparagraph><subparagraph id="IDeca02977e10448f1ab99eef6e980156c"><enum>(C)</enum><text>notify the covered
financial company and the Corporation of such determination.</text>
</subparagraph></paragraph><paragraph id="IDbd5cf04f2dba439198b5720ff7324d45"><enum>(2)</enum><header>Report to
congress</header><text>Not later than 24 hours after the date of appointment of
the Corporation as receiver for a covered financial company, the Secretary
shall provide written notice of the recommendations and determinations reached
in accordance with subsections (a) and (b) to the Majority Leader and the
Minority Leader of the Senate and the Speaker and the Minority Leader of the
House of Representatives, the Committee on Banking, Housing, and Urban Affairs
of the Senate, and the Committee on Financial Services of the House of
Representatives, which shall consist of a summary of the basis for the
determination, including, to the extent available at the time of the
determination—</text>
<subparagraph id="IDaa5454359098418e8f51d4caaf7b08fa"><enum>(A)</enum><text>the size and financial
condition of the covered financial company;</text>
</subparagraph><subparagraph id="ID91bda9e24e0447a68afc46a377abbf1c"><enum>(B)</enum><text>the sources of capital
and credit support that were available to the covered financial company;</text>
</subparagraph><subparagraph id="ID2159f0adeeff45f5b07110e8daf568e9"><enum>(C)</enum><text>the operations of the
covered financial company that could have had a significant impact on financial
stability, markets, or both;</text>
</subparagraph><subparagraph id="ID0ab42c79783e4359857bf27bfa65e11d"><enum>(D)</enum><text>identification of the
banks and financial companies which may be able to provide the services offered
by the covered financial company;</text>
</subparagraph><subparagraph id="IDc2e945976cc746dbadca61ba66906f37"><enum>(E)</enum><text>any potential
international ramifications of resolution of the covered financial company
under other applicable insolvency law;</text>
</subparagraph><subparagraph id="ID16a67204daa74db1848a4786c8738b01"><enum>(F)</enum><text>an estimate of the
potential effect of the resolution of the covered financial company under other
applicable insolvency law on the financial stability of the United
States;</text>
</subparagraph><subparagraph id="ID62d60b85fae84b919bd6f68eeee89ad4"><enum>(G)</enum><text>the potential effect of
the appointment of a receiver by the Secretary on consumers;</text>
</subparagraph><subparagraph id="IDa9941bcf87974f9fad095dbee7233916"><enum>(H)</enum><text>the potential effect of
the appointment of a receiver by the Secretary on the financial system,
financial markets, and banks and other financial companies; and</text>
</subparagraph><subparagraph id="ID693d29c2e1be4d13acb4df09e91bf1ab"><enum>(I)</enum><text>whether resolution of the
covered financial company under other applicable insolvency law would cause
banks or other financial companies to experience severe liquidity
distress.</text>
</subparagraph></paragraph><paragraph id="ID1fc3163911784cd3aa672aed55de06b9"><enum>(3)</enum><header>Reports to Congress and
the public</header>
<subparagraph id="IDacd16d151c7d461897894491c5f5d365"><enum>(A)</enum><header>In
general</header><text>Not later than 60 days after the date of appointment of
the Corporation as receiver for a covered financial company, the Corporation
shall file a report with the Committee on Banking, Housing, and Urban Affairs
of the Senate and the Committee on Financial Services of the House of
Representatives—</text>
<clause id="ID257df89ca9a34afca098af881605b731"><enum>(i)</enum><text>setting forth information
on the financial condition of the covered financial company as of the date of
the appointment, including a description of its assets and liabilities;</text>
</clause><clause id="ID59793c866f204dc9852d6e677131ce13"><enum>(ii)</enum><text>describing the plan of,
and actions taken by, the Corporation to wind down the covered financial
company;</text>
</clause><clause id="ID8d08ec6d4de04e1180d7e8b420138e6a"><enum>(iii)</enum><text>explaining each
instance in which the Corporation waived any applicable requirements of part
366 of title 12, Code of Federal Regulations (or any successor thereto) with
respect to conflicts of interest by any person in the private sector who was
retained to provide services to the Corporation in connection with such
receivership;</text>
</clause><clause id="ID8a4aa035f96d4e87bde1467bdb6c2845"><enum>(iv)</enum><text>describing the reasons
for the provision of any funding to the receivership out of the Fund;</text>
</clause><clause id="idF5F9BAEE9EB7469D99094E18B98C6C1E"><enum>(v)</enum><text>setting forth the
expected costs of the orderly liquidation of the covered financial
company;</text>
</clause><clause id="ID31c2865f85f543c3844ad2df7e042015"><enum>(vi)</enum><text>setting forth the
identity of any claimant that is treated in a manner different from other
similarly situated claimants under subsection (b)(4), (d)(4), or (h)(5)(E), the
amount of any additional payment to such claimant under subsection (d)(4), and
the reason for any such action; and</text>
</clause><clause id="ID7e505d369be948389cc11fadbde59780"><enum>(vii)</enum><text>which report the
Corporation shall publish on an online website maintained by the Corporation,
subject to maintaining appropriate confidentiality.</text>
</clause></subparagraph><subparagraph id="id7A44D58DB77343EA97E4802A2C988055"><enum>(B)</enum><header>Amendments</header><text>The
Corporation shall, on a timely basis, not less frequently than quarterly, amend
or revise and resubmit the reports prepared under this paragraph, as
necessary.</text>
</subparagraph><subparagraph id="IDf5d7ab52699e4ded8647086b6122eb19"><enum>(C)</enum><header>Congressional
testimony</header><text>The Corporation and the primary financial regulatory
agency, if any, of the financial company for which the Corporation was
appointed receiver under this title shall appear before Congress, if requested,
not later than 30 days after the date on which the Corporation first files the
reports required under subparagraph (A).</text>
</subparagraph></paragraph><paragraph id="ID60ff15fe4ea1440abd7e467025bf44b4"><enum>(4)</enum><header>Default or in danger of
default</header><text>For purposes of this title, a financial company shall be
considered to be in default or in danger of default if, as determined in
accordance with subsection (b)—</text>
<subparagraph id="ID5f475869d242489f994dcad9c8977570"><enum>(A)</enum><text>a case has been, or
likely will promptly be, commenced with respect to the financial company under
the Bankruptcy Code;</text>
</subparagraph><subparagraph id="IDfd5389f6cbb44a9892d49971b419e0b4"><enum>(B)</enum><text>the financial company has
incurred, or is likely to incur, losses that will deplete all or substantially
all of its capital, and there is no reasonable prospect for the company to
avoid such depletion;</text>
</subparagraph><subparagraph id="ID2c610d06ac75479e8ebc32dd27fe6613"><enum>(C)</enum><text>the assets of the
financial company are, or are likely to be, less than its obligations to
creditors and others; or</text>
</subparagraph><subparagraph id="IDd432bf5c9b0040e59741618b45d7c654"><enum>(D)</enum><text>the financial company is,
or is likely to be, unable to pay its obligations (other than those subject to
a bona fide dispute) in the normal course of business.</text>
</subparagraph></paragraph><paragraph id="ID37c323f6ffcc408aa475d03da3bd3710"><enum>(5)</enum><header>GAO
review</header><text>The Comptroller General of the United States shall review
and report to Congress on any determination under subsection (b), that results
in the appointment of the Corporation as receiver, including—</text>
<subparagraph id="ID270f8d1c81f74fd4aeb0de65b8f44a7b"><enum>(A)</enum><text>the basis for the
determination;</text>
</subparagraph><subparagraph id="ID4a232cb76adb4cc1a3e3f7d5a1fba978"><enum>(B)</enum><text>the purpose for which any
action was taken pursuant thereto;</text>
</subparagraph><subparagraph id="ID808867b1e02f4c0db0d807b4d0a4b4bc"><enum>(C)</enum><text>the likely effect of the
determination and such action on the incentives and conduct of financial
companies and their creditors, counterparties, and shareholders; and</text>
</subparagraph><subparagraph id="IDa88198485d744fac9dcdcec37a8fddcc"><enum>(D)</enum><text>the likely disruptive
effect of the determination and such action on the reasonable expectations of
creditors, counterparties, and shareholders, taking into account the impact any
action under this title would have on financial stability in the United States,
including whether the rights of such parties will be disrupted.</text>
</subparagraph></paragraph></subsection><subsection id="ID46f7ff40f569420d92d86e1d9f29159a"><enum>(d)</enum><header>Corporation policies
and procedures</header><text>As soon as is practicable after the date of
enactment of this Act, the Corporation shall establish policies and procedures
that are acceptable to the Secretary governing the use of funds available to
the Corporation to carry out this title, including the terms and conditions for
the provision and use of funds under sections 204(d), 210(h)(2)(G)(iv), and
210(h)(9).</text>
</subsection><subsection id="ID85cf9b92b5ef42cda363963246667bbb"><enum>(e)</enum><header>Treatment of insurance
companies and insurance company subsidiaries</header>
<paragraph id="IDb3ffc522b32747ccbe9c287c00be3b7a"><enum>(1)</enum><header>In
general</header><text>Notwithstanding subsection (b), if an insurance company
is a covered financial company or a subsidiary or affiliate of a covered
financial company, the liquidation or rehabilitation of such insurance company,
and any subsidiary or affiliate of such company that is not excepted under
paragraph (2), shall be conducted as provided under such State law.</text>
</paragraph><paragraph id="ID12a942227d034117b2ac64fab8575fe6"><enum>(2)</enum><header>Exception for
subsidiaries and affiliates</header><text>The requirement of paragraph (1)
shall not apply with respect to any subsidiary or affiliate of an insurance
company that is not itself an insurance company.</text>
</paragraph><paragraph id="IDe04c84dcd9924b1b82f237ad1ac4a539"><enum>(3)</enum><header>Backup
authority</header><text>Notwithstanding paragraph (1), with respect to a
covered financial company described in paragraph (1), if, after the end of the
60-day period beginning on the date on which a determination is made under
section 202(a) with respect to such company, the appropriate regulatory agency
has not filed the appropriate judicial action in the appropriate State court to
place such company into orderly liquidation under the laws and requirements of
the State, the Corporation shall have the authority to stand in the place of
the appropriate regulatory agency and file the appropriate judicial action in
the appropriate State court to place such company into orderly liquidation
under the laws and requirements of the State.</text>
</paragraph></subsection></section><section id="ID1ec759fbce914228826879e435b0fcc8"><enum>204.</enum><header>Orderly
liquidation</header>
<subsection id="IDea73d34e5d6c4e1f8d72e09319d9afe2"><enum>(a)</enum><header>Purpose of orderly
liquidation authority</header><text>It is the purpose of this title to provide
the necessary authority to liquidate failing financial companies that pose a
significant risk to the financial stability of the United States in a manner
that mitigates such risk and minimizes moral hazard. The authority provided in
this title shall be exercised in the manner that best fulfills such purpose, so
that—</text>
<paragraph id="idEE281FED2C5B4003AFC12468D883DADE"><enum>(1)</enum><text>creditors and
shareholders will bear the losses of the financial company;</text>
</paragraph><paragraph id="idB056FC372A3249CA81AD292D60DFF339"><enum>(2)</enum><text>management responsible
for the condition of the financial company will not be retained; and</text>
</paragraph><paragraph id="idC629532AE4954B35AD076A84E4AAD30C"><enum>(3)</enum><text>the Corporation and other
appropriate agencies will take all steps necessary and appropriate to assure
that all parties, including management and third parties, having responsibility
for the condition of the financial company bear losses consistent with their
responsibility, including actions for damages, restitution, and recoupment of
compensation and other gains not compatible with such responsibility.</text>
</paragraph></subsection><subsection id="IDdb3d21c18ff44ec2b23eb8b7188e5987"><enum>(b)</enum><header>Corporation as
receiver</header><text>Upon the appointment of the Corporation under section
202, the Corporation shall act as the receiver for the covered financial
company, with all of the rights and obligations set forth in this title.</text>
</subsection><subsection id="ID9d67abbc01874e0797d09b559a2d2d85"><enum>(c)</enum><header>Consultation</header><text>The
Corporation, as receiver—</text>
<paragraph id="ID23141ef88bc24988a8e303316017899d"><enum>(1)</enum><text>shall consult with the
primary financial regulatory agency or agencies of the covered financial
company and its covered subsidiaries for purposes of ensuring an orderly
liquidation of the covered financial company;</text>
</paragraph><paragraph id="IDe4f670f22c9a4d63ae392c21e5663cfc"><enum>(2)</enum><text>may consult with, or
under subsection (a)(1)(B)(v) or (a)(1)(L) of section 210, acquire the services
of, any outside experts, as appropriate to inform and aid the Corporation in
the orderly liquidation process;</text>
</paragraph><paragraph id="ID18f7b476d42f47358b2a53e4c89e53af"><enum>(3)</enum><text>shall consult with the
primary financial regulatory agency or agencies of any subsidiaries of the
covered financial company that are not covered subsidiaries, and coordinate
with such regulators regarding the treatment of such solvent subsidiaries and
the separate resolution of any such insolvent subsidiaries under other
governmental authority, as appropriate; and</text>
</paragraph><paragraph id="IDa952fc96fda04c8d9b1927d622984708"><enum>(4)</enum><text>shall consult with the
Commission and the Securities Investor Protection Corporation in the case of
any covered financial company for which the Corporation has been appointed as
receiver that is a broker or dealer registered with the Commission under
section 15(b) of the Securities Exchange Act of 1934 (15 U.S.C. 78o(b)) and is
a member of the Securities Investor Protection Corporation, for the purpose of
determining whether to transfer to a bridge financial company organized by the
Corporation as receiver, without consent of any customer, customer accounts of
the covered financial company.</text>
</paragraph></subsection><subsection id="ID7ba1440496ec45d0b5f4453e9438691b"><enum>(d)</enum><header>Funding for orderly
liquidation</header><text>Upon its appointment as receiver for a covered
financial company, and thereafter as the Corporation may, in its discretion,
determine to be necessary or appropriate, the Corporation may make available to
the receivership, subject to the conditions set forth in section 206 and
subject to the plan described in section 210(n)(11), funds for the orderly
liquidation of the covered financial company. All funds provided by the
Corporation under this subsection shall have a priority of claims under
subparagraph (A) or (B) of section 210(b)(1), as applicable, including funds
used for—</text>
<paragraph id="id096DF57DAF7E4B9FB6E9DACC6F924E60"><enum>(1)</enum><text>making loans to, or
purchasing any debt obligation of, the covered financial company or any covered
subsidiary;</text>
</paragraph><paragraph id="ID9e5fc170712c41ce925d98427b3165ec"><enum>(2)</enum><text>purchasing or
guaranteeing against loss the assets of the covered financial company or any
covered subsidiary, directly or through an entity established by the
Corporation for such purpose;</text>
</paragraph><paragraph id="IDf86c04d6817b4c7eb6a8922e0ba4419d"><enum>(3)</enum><text>assuming or guaranteeing
the obligations of the covered financial company or any covered subsidiary to 1
or more third parties;</text>
</paragraph><paragraph id="IDee11f26a886c407ea085ac07e3fbc3a2"><enum>(4)</enum><text>taking a lien on any or
all assets of the covered financial company or any covered subsidiary,
including a first priority lien on all unencumbered assets of the covered
financial company or any covered subsidiary to secure repayment of any
transactions conducted under this subsection;</text>
</paragraph><paragraph id="ID444ae753455b43f692e33e5f31dfd765"><enum>(5)</enum><text>selling or transferring
all, or any part, of such acquired assets, liabilities, or obligations of the
covered financial company or any covered subsidiary; and</text>
</paragraph><paragraph id="ID50cdc51c9e2f486da133f444327d800f"><enum>(6)</enum><text>making payments pursuant
to subsections (b)(4), (d)(4), and (h)(5)(E) of section 210.</text>
</paragraph></subsection></section><section id="ID1923e41b9bb44567a5579c6085148b4e"><enum>205.</enum><header>Orderly liquidation of
covered brokers and dealers</header>
<subsection id="IDd875868b85fa43f887842ce668451a6a"><enum>(a)</enum><header>Appointment of SIPC as
trustee for protection of customer securities and property</header><text>Upon
the appointment of the Corporation as receiver for any covered broker or
dealer, the Corporation shall appoint, without any need for court approval, the
Securities Investor Protection Corporation to act as trustee for liquidation
under the Securities Investor Protection Act of 1970 (15 U.S.C. 78aaa et seq.)
of the covered broker or dealer.</text>
</subsection><subsection id="IDb314673870f84fd58c44ae98a0b004f5"><enum>(b)</enum><header>Powers and duties of
SIPC</header>
<paragraph id="ID794a6d6e46ca4c6093bcec3719eab105"><enum>(1)</enum><header>In
general</header><text>Except as provided in this section, upon its appointment
as trustee for the liquidation of a covered broker or dealer, SIPC shall have
all of the powers and duties provided by the Securities Investor Protection Act
of 1970 (15 U.S.C. 78aaa et seq.), including, without limitation, all rights of
action against third parties, but shall have no powers or duties with respect
to assets and liabilities transferred by the Corporation from the covered
broker or dealer to any bridge financial company established in accordance with
this title.</text>
</paragraph><paragraph id="ID111d87603ec546469ba5ae30f96b135b"><enum>(2)</enum><header>Limitation of
powers</header><text>The exercise by SIPC of powers and functions as trustee
under subsection (a) shall not impair or impede the exercise of the powers and
duties of the Corporation with regard to—</text>
<subparagraph id="ID0387537b627748b9b9207ed560b40247"><enum>(A)</enum><text>any action, except as
otherwise provided in this title—</text>
<clause id="idA4075C2EA54042EB8056CE1FC5B6911C"><enum>(i)</enum><text>to make funds available
under section 204(d);</text>
</clause><clause id="id9B10AF2550FE454286C671A6889AC156"><enum>(ii)</enum><text>to organize, establish,
operate, or terminate any bridge financial company;</text>
</clause><clause id="id3E326E209F8C4081992584A27E1ADEB9"><enum>(iii)</enum><text>to transfer assets and
liabilities;</text>
</clause><clause id="idC7434C39A18E442EB67F3F16BAD2A25E"><enum>(iv)</enum><text>to enforce or repudiate
contracts; or</text>
</clause><clause id="idD529CA070D3840238197FA28C36E2D19"><enum>(v)</enum><text>to take any other action
relating to such bridge financial company under section 210; or</text>
</clause></subparagraph><subparagraph id="ID5b75b26dfcfe4fbca87d853044a1286b"><enum>(B)</enum><text>determining claims under
subsection (d).</text>
</subparagraph></paragraph><paragraph id="ID19ddc5a0418a46119e3d984faf78155c"><enum>(3)</enum><header>Qualified financial
contracts</header><text>Notwithstanding any provision of the Securities
Investor Protection Act of 1970 to the contrary (including section 5(b)(2)(C)
of that Act (15 U.S.C. 78eee(b)(2)(C))), the rights and obligations of any
party to a qualified financial contract (as that term is defined in section
210(c)(8)) to which a covered broker or dealer described in subsection (a) is a
party shall be governed exclusively by section 210, including the limitations
and restrictions contained in section 210(c)(10)(B).</text>
</paragraph></subsection><subsection id="ID218fd40fcade4f78bdab119dd725ecbf"><enum>(c)</enum><header>Limitation on court
action</header><text>Except as otherwise provided in this title, no court may
take any action, including any action pursuant to the Securities Investor
Protection Act of 1970 or the Bankruptcy Code, to restrain or affect the
exercise of powers or functions of the Corporation as receiver for a covered
broker or dealer and any claims against the Corporation as such receiver shall
be determined in accordance with subsection (e) and such claims shall be
limited to money damages.</text>
</subsection><subsection id="ID35c68aa70e134b89ac7c9ee0159436dd"><enum>(d)</enum><header>Actions by corporation
as receiver</header>
<paragraph id="id84E8386B5DE542B1AE31AE2D023AD9DC"><enum>(1)</enum><header>In
general</header><text>Notwithstanding any other provision of this title, no
action taken by the Corporation, as receiver with respect to a covered broker
or dealer, shall—</text>
<subparagraph id="idC3E1E3EAF5D2481EA4CC5C942AE7AD9F"><enum>(A)</enum><text>adversely affect the
rights of a customer to customer property or customer name securities;</text>
</subparagraph><subparagraph id="id0119841825FE4978B985A39D98DF3F22"><enum>(B)</enum><text>diminish the amount or
timely payment of net equity claims of customers; or</text>
</subparagraph><subparagraph id="id819F826DA75C4B6A88A9209642402281"><enum>(C)</enum><text>otherwise impair the
recoveries provided to a customer under the Securities Investor Protection Act
of 1970 (15 U.S.C. 78aaa et seq.).</text>
</subparagraph></paragraph><paragraph id="idE214DEC18F084AC9971BE2B0025116F7"><enum>(2)</enum><header>net
proceeds</header><text>The net proceeds from any transfer, sale, or disposition
of assets by the Corporation as receiver for the covered broker or dealer shall
be for the benefit of the estate of the covered broker or dealer, as provided
in this title.</text>
</paragraph></subsection><subsection id="ID4ed6eac3acdb46c4a9232163f91af112"><enum>(e)</enum><header>Claims against the
corporation as receiver</header><text>Any claim against the Corporation as
receiver for a covered broker or dealer for assets transferred to a bridge
financial company established with respect to such covered broker or
dealer—</text>
<paragraph id="IDe3cbf904e46a40ab87ce5c4b946425d5"><enum>(1)</enum><text>shall be determined in
accordance with section 210(a)(2); and</text>
</paragraph><paragraph id="ID439a462dbc5d47ef9da0007531c77578"><enum>(2)</enum><text>may be reviewed by the
appropriate district or territorial court of the United States in accordance
with section 210(a)(5).</text>
</paragraph></subsection><subsection id="IDec5add68250e4f5a8120c97879bae3b4"><enum>(f)</enum><header>Satisfaction of
customer claims</header>
<paragraph id="id1E49C271505D47BB99BCD9A7EB68173D"><enum>(1)</enum><header>Obligations to
customers</header><text>Notwithstanding any other provision of this title, all
obligations of a covered broker or dealer or of any bridge financial company
established with respect to such covered broker or dealer to a customer
relating to, or net equity claims based upon, customer property shall be
promptly discharged by the delivery of securities or the making of payments to
or for the account of such customer, in a manner and in an amount at least as
beneficial to the customer as would have been the case had the covered broker
or dealer been subject to a proceeding under the Securities Investor Protection
Act of 1970 (15 U.S.C. 78aaa et seq.) without the appointment of the
Corporation as receiver, and with a filing date as of the date on which the
Corporation is appointed as receiver.</text>
</paragraph><paragraph id="idFBF260C2CF994F0283ECDD60972DAF54"><enum>(2)</enum><header>Satisfaction of claims
by SIPC</header><text>SIPC, as trustee for a covered broker or dealer, shall
satisfy customer claims in the manner and amount provided under the Securities
Investor Protection Act of 1970 (15 U.S.C. 78aaa et seq.), as if the
appointment of the Corporation as receiver had not occurred, and with a filing
date as of the date on which the Corporation is appointed as receiver. The
Corporation shall satisfy customer claims, to the extent that a customer would
have received more securities or cash with respect to the allocation of
customer property had the covered financial company been subject to a
proceeding under the Securities Investor Protection Act (15 U.S.C. 78aaa et
seq.) without the appointment of the Corporation as receiver, and with a filing
date as of the date on which the Corporation is appointed as receiver.</text>
</paragraph></subsection><subsection commented="no" id="IDcb6a45995161427c9f4c02821ed4eb98"><enum>(g)</enum><header>Priorities</header>
<paragraph id="IDef114c1d881b43e79f9cbf57c3c93b0c"><enum>(1)</enum><header>Customer
property</header><text>As trustee for a covered broker or dealer, SIPC shall
allocate customer property and deliver customer name securities in accordance
with section 8(c) of the Securities Investor Protection Act of 1970 (15 U.S.C.
78fff–2(c)).</text>
</paragraph><paragraph id="ID2048e9663b8e47009bc7dc17e1a44113"><enum>(2)</enum><header>Other
claims</header><text>All claims other than those described in paragraph (1)
(including any unpaid claim by a customer for the allowed net equity claim of
such customer from customer property) shall be paid in accordance with the
priorities in section 210(b).</text>
</paragraph></subsection><subsection id="ID024fad40eb224112ac40df5475408ba5"><enum>(h)</enum><header>Rulemaking</header><text>The
Commission and the Corporation, after consultation with SIPC, shall jointly
issue rules to implement this section.</text>
</subsection></section><section id="id1DE08EB9F6284321A6E7A7CF374E7A6A"><enum>206.</enum><header>Mandatory terms and
conditions for all orderly liquidation actions</header><text display-inline="no-display-inline">In taking action under this title, the
Corporation shall—</text>
<paragraph id="IDdcf4b6dca86b48d9a91355931f6c4a3c"><enum>(1)</enum><text>determine that such
action is necessary for purposes of the financial stability of the United
States, and not for the purpose of preserving the covered financial
company;</text>
</paragraph><paragraph id="IDf1350d2ba5e442cf81601736d12a5302"><enum>(2)</enum><text>ensure that the
shareholders of a covered financial company do not receive payment until after
all other claims and the Fund are fully paid;</text>
</paragraph><paragraph id="IDc46d3ece9cab4f729773409a0fbf63bb"><enum>(3)</enum><text>ensure that unsecured
creditors bear losses in accordance with the priority of claim provisions in
section 210;</text>
</paragraph><paragraph id="IDb8692ce826ed4b1989cb9addeae795fc"><enum>(4)</enum><text>ensure that management
responsible for the failed condition of the covered financial company is
removed (if such management has not already been removed at the time at which
the Corporation is appointed receiver); and</text>
</paragraph><paragraph id="id834773F7694E4B768BD26F40C123BFBF"><enum>(5)</enum><text>not take an equity
interest in or become a shareholder of any covered financial company or any
covered subsidiary.</text>
</paragraph></section><section id="ID4e8f1291b7074fecb50329bbb6b56688"><enum>207.</enum><header>Directors not liable
for acquiescing in appointment of receiver</header><text display-inline="no-display-inline">The members of the board of directors (or
body performing similar functions) of a covered financial company shall not be
liable to the shareholders or creditors thereof for acquiescing in or
consenting in good faith to the appointment of the Corporation as receiver for
the covered financial company under section 203.</text>
</section><section id="IDcf5c1097f6874b458ddf67e92a48957b"><enum>208.</enum><header>Dismissal and
exclusion of other actions</header>
<subsection id="idF7105B63D9184E858907F4D354CD81BB"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">Effective as of the
date of the appointment of the Corporation as receiver for the covered
financial company under section 202 or the appointment of SIPC as trustee for a
covered broker or dealer under section 205, as applicable, any case or
proceeding commenced with respect to the covered financial company under the
Bankruptcy Code or the Securities Investor Protection Act of 1970 shall be
dismissed, upon notice to the Bankruptcy Court (with respect to a case
commenced under the Bankruptcy Code), and upon notice to SIPC (with respect to
a covered broker or dealer) and no such case or proceeding may be commenced
with respect to a covered financial company at any time while the orderly
liquidation is pending.</text>
</subsection><subsection id="id6CE0D1F3E0D947BDB0A1E817B3F4986E"><enum>(b)</enum><header>Revesting of
assets</header><text display-inline="yes-display-inline">Effective as of the
date of appointment of the Corporation as receiver, the assets of a covered
financial company shall, to the extent they have vested in any entity other
than the covered financial company as a result of any case or proceeding
commenced with respect to the covered financial company under the Bankruptcy
Code, the Securities Investor Protection Act of 1970, or any similar provision
of State liquidation or insolvency law applicable to the covered financial
company, revest in the covered financial company.</text>
</subsection><subsection id="IDb7f1728ef8a44d28aa35ba5891916f18"><enum>(c)</enum><header>Limitation</header><text display-inline="yes-display-inline">Notwithstanding subsections (a) and (b),
any order entered or other relief granted by a bankruptcy court prior to the
date of appointment of the Corporation as receiver shall continue with the same
validity as if an orderly liquidation had not been commenced.</text>
</subsection></section><section id="IDe0a8335a48894df58a47c517d97a87ec"><enum>209.</enum><header>Rulemaking;
non-conflicting law</header><text display-inline="no-display-inline">The
Corporation shall, in consultation with the Council, prescribe such rules or
regulations as the Corporation considers necessary or appropriate to implement
this title, including rules and regulations with respect to the rights,
interests, and priorities of creditors, counterparties, security entitlement
holders, or other persons with respect to any covered financial company or any
assets or other property of or held by such covered financial company, and
address the potential for conflicts of interest between or among individual
receiverships established under this title or under the Federal Deposit
Insurance Act. To the extent possible, the Corporation shall seek to harmonize
applicable rules and regulations promulgated under this section with the
insolvency laws that would otherwise apply to a covered financial
company.</text>
</section><section id="IDa9786f7505504656920acd368ddda49c"><enum>210.</enum><header>Powers and duties of
the corporation</header>
<subsection id="ID580052496fa94776910515c4cbc19ebc"><enum>(a)</enum><header>Powers and
authorities</header>
<paragraph id="ID9607c0a5986143aab3ae922ee4c3e4a9"><enum>(1)</enum><header>General powers</header>
<subparagraph id="ID59ed94393763424daef598dbbaa91446"><enum>(A)</enum><header>Successor to covered
financial company</header><text>The Corporation shall, upon appointment as
receiver for a covered financial company under this title, succeed to—</text>
<clause id="IDe0654f72fb8f4f439ab32032b6bd3f1e"><enum>(i)</enum><text>all rights, titles,
powers, and privileges of the covered financial company and its assets, and of
any stockholder, member, officer, or director of such company; and</text>
</clause><clause id="IDd353323cf5e442419bb14b3095c11119"><enum>(ii)</enum><text>title to the books,
records, and assets of any previous receiver or other legal custodian of such
covered financial company.</text>
</clause></subparagraph><subparagraph id="IDbcc5166d257a4936817a82beb5e22139"><enum>(B)</enum><header>Operation of the
covered financial company during the period of orderly
liquidation</header><text>The Corporation, as receiver for a covered financial
company, may—</text>
<clause id="ID99efe9689e654a199993c17667a8e9a0"><enum>(i)</enum><text>take over the assets of
and operate the covered financial company with all of the powers of the members
or shareholders, the directors, and the officers of the covered financial
company, and conduct all business of the covered financial company;</text>
</clause><clause id="ID296bb0e42e4746aba0e64ae4581ce50a"><enum>(ii)</enum><text>collect all obligations
and money owed to the covered financial company;</text>
</clause><clause id="ID7d00dfe164c543a79892ef22fda7c4d7"><enum>(iii)</enum><text>perform all functions
of the covered financial company, in the name of the covered financial
company;</text>
</clause><clause id="ID2cd692a4502641efb87dd0bffdcd13f1"><enum>(iv)</enum><text>manage the assets and
property of the covered financial company, consistent with maximization of the
value of the assets in the context of the orderly liquidation; and</text>
</clause><clause id="ID408629bce0e24f7f95707db560f024fb"><enum>(v)</enum><text>provide by contract for
assistance in fulfilling any function, activity, action, or duty of the
Corporation as receiver.</text>
</clause></subparagraph><subparagraph id="ID1e180e3dde5245bbbb922790ea2c5073"><enum>(C)</enum><header>Functions of covered
financial company officers, directors, and shareholders</header>
<clause id="ID943f61c471dc477f8facd67ccf8c094c"><enum>(i)</enum><header>In
general</header><text>The Corporation may provide for the exercise of any
function by any member or stockholder, director, or officer of any covered
financial company for which the Corporation has been appointed as receiver
under this title.</text>
</clause><clause id="ID1c9eedbe976e48dea10e0b1ed410de66"><enum>(ii)</enum><header>Presumption</header><text>There
shall be a strong presumption that the Corporation, as receiver for a covered
financial company, will remove management responsible for the failed condition
of the covered financial company.</text>
</clause></subparagraph><subparagraph id="ID67a4b9ab2319465fbfad82333688936f"><enum>(D)</enum><header>Additional powers as
receiver</header><text>The Corporation shall, as receiver for a covered
financial company, and subject to all legally enforceable and perfected
security interests and all legally enforceable security entitlements in respect
of assets held by the covered financial company, liquidate, and wind-up the
affairs of a covered financial company, including taking steps to realize upon
the assets of the covered financial company, in such manner as the Corporation
deems appropriate, including through the sale of assets, the transfer of assets
to a bridge financial company established under subsection (h), or the exercise
of any other rights or privileges granted to the receiver under this
section.</text>
</subparagraph><subparagraph id="ID0301c830d11b4610ad9576d632e5a69f"><enum>(E)</enum><header>Additional powers with
respect to failing subsidiaries of a covered financial company</header>
<clause id="IDc7850f2217024faab86bee1671976aa6"><enum>(i)</enum><header>In
general</header><text>In any case in which a receiver is appointed for a
covered financial company under section 202, the Corporation may appoint itself
as receiver of any subsidiary (other than an insured depository institution,
any covered broker or dealer, or an insurance company) of the covered financial
company that is organized under Federal law or the laws of any State, if the
Corporation and the Secretary jointly determine that—</text>
<subclause id="ID33399690c936488f9ff6a3e6a6a1a2ab"><enum>(I)</enum><text>the subsidiary is in
default or in danger of default;</text>
</subclause><subclause id="ID7d20222258fc43bdb0dbaf16bd63fe67"><enum>(II)</enum><text>such action would avoid
or mitigate serious adverse effects on the financial stability or economic
conditions of the United States; and</text>
</subclause><subclause id="IDf6330b8afb754139825bafeffc4ff57c"><enum>(III)</enum><text>such action would
facilitate the orderly liquidation of the covered financial company.</text>
</subclause></clause><clause id="ID2c473089182845d7b46cebfecc2d3990"><enum>(ii)</enum><header>Treatment as covered
financial company</header><text>If the Corporation is appointed as receiver of
a subsidiary of a covered financial company under clause (i), the subsidiary
shall thereafter be considered a covered financial company under this title,
and the Corporation shall thereafter have all the powers and rights with
respect to that subsidiary as it has with respect to a covered financial
company under this title.</text>
</clause></subparagraph><subparagraph id="ID4df1aab81dc34a11b03ec49ecbfde817"><enum>(F)</enum><header>Organization of bridge
companies</header><text>The Corporation, as receiver for a covered financial
company, may organize a bridge financial company under subsection (h).</text>
</subparagraph><subparagraph id="ID4cecd92c4fda482395ac58c2b9079f9d"><enum>(G)</enum><header>Merger; transfer of
assets and liabilities</header>
<clause id="IDe0011364d94d43228201700561c3233e"><enum>(i)</enum><header>In
general</header><text>Subject to clauses (ii) and (iii), the Corporation, as
receiver for a covered financial company, may—</text>
<subclause id="ID0c79df1353ee4ec3b2119ed573fdd2c8"><enum>(I)</enum><text>merge the covered
financial company with another company; or</text>
</subclause><subclause id="IDb1de05e86de4428a97ecd13ae655607c"><enum>(II)</enum><text>transfer any asset or
liability of the covered financial company (including any assets and
liabilities held by the covered financial company for security entitlement
holders, any customer property, or any assets and liabilities associated with
any trust or custody business) without obtaining any approval, assignment, or
consent with respect to such transfer.</text>
</subclause></clause><clause id="ID057f9bafcaa841fd86b8f72a87048173"><enum>(ii)</enum><header>Federal agency
approval; antitrust review</header><text>With respect to a transaction
described in clause (i)(I) that requires approval by a Federal agency—</text>
<subclause id="ID0e6ccabbf02546e0b7a5e7d2bb113586"><enum>(I)</enum><text>the transaction may not
be consummated before the 5th calendar day after the date of approval by the
Federal agency responsible for such approval;</text>
</subclause><subclause id="ID8a3ebe7d2a09424e83d2437354158759"><enum>(II)</enum><text>if, in connection with
any such approval, a report on competitive factors is required, the Federal
agency responsible for such approval shall promptly notify the Attorney General
of the United States of the proposed transaction, and the Attorney General
shall provide the required report not later than 10 days after the date of the
request; and</text>
</subclause><subclause id="ID5e69642e4e124cb7b873e9edb8333a4f"><enum>(III)</enum><text>if notification under
section 7A of the Clayton Act is required with respect to such transaction,
then the required waiting period shall end on the 15th day after the date on
which the Attorney General and the Federal Trade Commission receive such
notification, unless the waiting period is terminated earlier under subsection
(b)(2) of such section 7A, or is extended pursuant to subsection (e)(2) of such
section 7A.</text>
</subclause></clause><clause id="ID17dc90fbb55140c489cdfad37c98078a"><enum>(iii)</enum><header>Setoff</header><text>Subject
to the other provisions of this title, any transferee of assets from a
receiver, including a bridge financial company, shall be subject to such claims
or rights as would prevail over the rights of such transferee in such assets
under applicable noninsolvency law.</text>
</clause></subparagraph><subparagraph id="ID6d7b5aeb2f2643d9a6b9d93ec33c5a2f"><enum>(H)</enum><header>Payment of valid
obligations</header><text>The Corporation, as receiver for a covered financial
company, shall, to the extent that funds are available, pay all valid
obligations of the covered financial company that are due and payable at the
time of the appointment of the Corporation as receiver, in accordance with the
prescriptions and limitations of this title.</text>
</subparagraph><subparagraph id="ID9bca048c935340e4ad58dd42cd67d82e"><enum>(I)</enum><header>Applicable
noninsolvency law</header><text>Except as may otherwise be provided in this
title, the applicable noninsolvency law shall be determined by the
noninsolvency choice of law rules otherwise applicable to the claims, rights,
titles, persons, or entities at issue.</text>
</subparagraph><subparagraph id="IDde9219d07f094c5395ac471ae8be9b1d"><enum>(J)</enum><header>Subpoena
authority</header>
<clause id="ID44ed07db2afe4a89a27855f18738d4d5"><enum>(i)</enum><header>In
general</header><text>The Corporation, as receiver for a covered financial
company, may, for purposes of carrying out any power, authority, or duty with
respect to the covered financial company (including determining any claim
against the covered financial company and determining and realizing upon any
asset of any person in the course of collecting money due the covered financial
company), exercise any power established under section 8(n) of the Federal
Deposit Insurance Act, as if the Corporation were the appropriate Federal
banking agency for the covered financial company, and the covered financial
company were an insured depository institution.</text>
</clause><clause id="ID9be95fd2df4d4b8593248e615b95e963"><enum>(ii)</enum><header>Rule of
construction</header><text>This subparagraph may not be construed as limiting
any rights that the Corporation, in any capacity, might otherwise have to
exercise any powers described in clause (i) or under any other provision of
law.</text>
</clause></subparagraph><subparagraph id="IDe4c21cf950084e5eb52c2fb6e87856ac"><enum>(K)</enum><header>Incidental
powers</header><text>The Corporation, as receiver for a covered financial
company, may exercise all powers and authorities specifically granted to
receivers under this title, and such incidental powers as shall be necessary to
carry out such powers under this title.</text>
</subparagraph><subparagraph id="ID43a8184ac6bd4b3a87fd7dc3ec024a66"><enum>(L)</enum><header>Utilization of private
sector</header><text>In carrying out its responsibilities in the management and
disposition of assets from the covered financial company, the Corporation, as
receiver for a covered financial company, may utilize the services of private
persons, including real estate and loan portfolio asset management, property
management, auction marketing, legal, and brokerage services, if such services
are available in the private sector, and the Corporation determines that
utilization of such services is practicable, efficient, and cost
effective.</text>
</subparagraph><subparagraph id="ID4fe627d29d1542eca8a5da167c01d5dc"><enum>(M)</enum><header>Shareholders and
creditors of covered financial company</header><text>Notwithstanding any other
provision of law, the Corporation, as receiver for a covered financial company,
shall succeed by operation of law to the rights, titles, powers, and privileges
described in subparagraph (A), and shall terminate all rights and claims that
the stockholders and creditors of the covered financial company may have
against the assets of the covered financial company or the Corporation arising
out of their status as stockholders or creditors, except for their right to
payment, resolution, or other satisfaction of their claims, as permitted under
this section. The Corporation shall ensure that shareholders and unsecured
creditors bear losses, consistent with the priority of claims provisions under
this section.</text>
</subparagraph><subparagraph id="ID058aacb766224bde8ce920a5ddcdb89f"><enum>(N)</enum><header>Coordination with
foreign financial authorities</header><text>The Corporation, as receiver for a
covered financial company, shall coordinate, to the maximum extent possible,
with the appropriate foreign financial authorities regarding the orderly
liquidation of any covered financial company that has assets or operations in a
country other than the United States.</text>
</subparagraph><subparagraph id="IDfe1994b4573d4a6e8496f2ddf6200e6c"><enum>(O)</enum><header>Restriction on
transfers to bridge financial company</header>
<clause id="ID9e88461e37094166b14c93d124ddc391"><enum>(i)</enum><header>Section of accounts for
transfer</header><text>If the Corporation establishes one or more bridge
financial companies with respect to a covered broker or dealer, the Corporation
shall transfer to a bridge financial company, all customer accounts of the
covered financial company, unless the Corporation, after consulting with the
Commission and SIPC, determines that—</text>
<subclause id="IDa75af1c6c63e4885bd8db3f21fccee37"><enum>(I)</enum><text>the customer accounts are
likely to be promptly transferred to another covered broker or dealer;
or</text>
</subclause><subclause id="IDd1d0d994fdca46c486ce8a4eed48f656"><enum>(II)</enum><text>the transfer of the
accounts to a bridge financial company would materially interfere with the
ability of the Corporation to avoid or mitigate serious adverse effects on
financial stability or economic conditions in the United States.</text>
</subclause></clause><clause id="ID9a47e9904990421da55ea0349bc76e7b"><enum>(ii)</enum><header>Transfer of
property</header><text>SIPC, as trustee for the liquidation of the covered
broker or dealer, and the Commission, shall provide any and all reasonable
assistance necessary to complete such transfers by the Corporation.</text>
</clause><clause id="ID6187c2d4ce4748e6a1ba1e8516acf25e"><enum>(iii)</enum><header>Customer consent and
court approval not required</header><text>Neither customer consent nor court
approval shall be required to transfer any customer accounts and associated
customer property to a bridge financial company in accordance with this
section.</text>
</clause><clause id="ID286cd4cf00fb4924a7e74f764c0ef85f"><enum>(iv)</enum><header>Notification of sipc
and sharing of information</header><text>The Corporation shall identify to SIPC
the customer accounts and associated customer property transferred to the
bridge financial company. The Corporation and SIPC shall cooperate in the
sharing of any information necessary for each entity to discharge its
obligations under this title and under the Securities Investor Protection Act
of 1970 (15 U.S.C. 78aaa et seq.) including by providing access to the books
and records of the covered financial company and any bridge financial company
established in accordance with this title.</text>
</clause></subparagraph></paragraph><paragraph id="ID4766004a693640c783e5e59057e5af87"><enum>(2)</enum><header>Determination of
claims</header>
<subparagraph id="ID05f7234a2e4740228dc18fb23ee82d49"><enum>(A)</enum><header>In
general</header><text>The Corporation, as receiver for a covered financial
company, shall report on claims, as set forth in section 203(c)(3). Subject to
paragraph (4) of this subsection, the Corporation, as receiver for a covered
financial company, shall determine claims in accordance with the requirements
of this subsection and regulations prescribed under section 209.</text>
</subparagraph><subparagraph id="ID61de1d3576fb42cc926be838b4ee9452"><enum>(B)</enum><header>Notice
requirements</header><text>The Corporation, as receiver for a covered financial
company, in any case involving the liquidation or winding up of the affairs of
a covered financial company, shall—</text>
<clause id="IDdcb36f616b544221b0f7cf4e4e14bd61"><enum>(i)</enum><text>promptly publish a notice
to the creditors of the covered financial company to present their claims,
together with proof, to the receiver by a date specified in the notice, which
shall be not earlier than 90 days after the date of publication of such notice;
and</text>
</clause><clause id="ID80ec1974d0f24619bd0a9f7fd7375164"><enum>(ii)</enum><text>republish such notice 1
month and 2 months, respectively, after the date of publication under clause
(i).</text>
</clause></subparagraph><subparagraph id="ID2d9e28baf6a4427aa80c291a76a6e241"><enum>(C)</enum><header>Mailing
required</header><text>The Corporation as receiver shall mail a notice similar
to the notice published under clause (i) or (ii) of subparagraph (B), at the
time of such publication, to any creditor shown on the books and records of the
covered financial company—</text>
<clause id="ID6e84aaf4095942de8e70db08bfb589c9"><enum>(i)</enum><text>at the last address of
the creditor appearing in such books;</text>
</clause><clause id="IDe61c02bb76cb4e90b916a8865a706875"><enum>(ii)</enum><text>in any claim filed by
the claimant; or</text>
</clause><clause id="ID0ac05e00a80b49d08537b18ea42a4e15"><enum>(iii)</enum><text>upon discovery of the
name and address of a claimant not appearing on the books and records of the
covered financial company, not later than 30 days after the date of the
discovery of such name and address.</text>
</clause></subparagraph></paragraph><paragraph id="ID5ea936e63aff494bae07dcd574b0fb48"><enum>(3)</enum><header>Procedures for
resolution of claims</header>
<subparagraph id="ID58101c9733c9408ab9892266dbc55033"><enum>(A)</enum><header>Decision
period</header>
<clause id="ID65dd6d782df54016a405a998469436a4"><enum>(i)</enum><header>In
general</header><text>Prior to the 180th day after the date on which a claim
against a covered financial company is filed with the Corporation as receiver,
or such later date as may be agreed as provided in clause (ii), the Corporation
shall notify the claimant whether it accepts or objects to the claim, in
accordance with subparagraphs (B), (C), and (D).</text>
</clause><clause id="ID2f030d75503247b48460b3cd15cfab4e"><enum>(ii)</enum><header>Extension of
time</header><text>By written agreement executed not later than 180 days after
the date on which a claim against a covered financial company is filed with the
Corporation, the period described in clause (i) may be extended by written
agreement between the claimant and the Corporation. Failure to notify the
claimant of any disallowance within the time period set forth in clause (i), as
it may be extended by agreement under this clause, shall be deemed to be a
disallowance of such claim, and the claimant may file or continue an action in
court, as provided in paragraph (4).</text>
</clause><clause id="ID88b85d6cbc4540129bc5665f1c85c5f2"><enum>(iii)</enum><header>Mailing of notice
sufficient</header><text>The requirements of clause (i) shall be deemed to be
satisfied if the notice of any decision with respect to any claim is mailed to
the last address of the claimant which appears—</text>
<subclause id="IDdd934374f52a4515aadaa0513e46fe8a"><enum>(I)</enum><text>on the books, records, or
both of the covered financial company;</text>
</subclause><subclause id="ID47ec484031f9433d8433d9478a5a41a7"><enum>(II)</enum><text>in the claim filed by
the claimant; or</text>
</subclause><subclause id="ID115f287692244d3c9a0f97b520869fa6"><enum>(III)</enum><text>in documents submitted
in proof of the claim.</text>
</subclause></clause><clause id="ID7a532763bb6b42adbcc0e5aa8df89950"><enum>(iv)</enum><header>Contents of notice of
disallowance</header><text>If the Corporation as receiver objects to any claim
filed under clause (i), the notice to the claimant shall contain—</text>
<subclause id="IDf1a93a0bc90044e6a3232cf2664b0823"><enum>(I)</enum><text>a statement of each
reason for the disallowance; and</text>
</subclause><subclause id="ID40fba77f005e421da5c8c00a603d7299"><enum>(II)</enum><text>the procedures required
to file or continue an action in court, as provided in paragraph (4).</text>
</subclause></clause></subparagraph><subparagraph id="ID62f2ffe7e4f54817ac39244ed1adabc8"><enum>(B)</enum><header>Allowance of proven
claim</header><text>The receiver shall allow any claim received by the receiver
on or before the date specified in the notice under paragraph (2)(B)(i), which
is proved to the satisfaction of the receiver.</text>
</subparagraph><subparagraph id="ID245a048cafe14b199f55b8a629e6debc"><enum>(C)</enum><header>Disallowance of claims
filed after end of filing period</header>
<clause id="IDc84285f9b00347d09416226c5d547c37"><enum>(i)</enum><header>In
general</header><text>Except as provided in clause (ii), claims filed after the
date specified in the notice published under paragraph (2)(B)(i) shall be
disallowed, and such disallowance shall be final.</text>
</clause><clause id="IDc054a5c4032c40a1a1dec3b138d5886d"><enum>(ii)</enum><header>Certain
exceptions</header><text>Clause (i) shall not apply with respect to any claim
filed by a claimant after the date specified in the notice published under
paragraph (2)(B)(i), and such claim may be considered by the receiver under
subparagraph (B), if—</text>
<subclause id="ID6c48402dc13b45d2a844c507cd9243a8"><enum>(I)</enum><text>the claimant did not
receive notice of the appointment of the receiver in time to file such claim
before such date; and</text>
</subclause><subclause id="ID53f304df99014059b455cff50c4e8857"><enum>(II)</enum><text>such claim is filed in
time to permit payment of such claim.</text>
</subclause></clause></subparagraph><subparagraph id="ID28a1365cf11b436c95bc3e892ee4b160"><enum>(D)</enum><header>Authority to disallow
claims</header>
<clause id="ID2a2569d6875d4fa68fd0ef174fb511fa"><enum>(i)</enum><header>In
general</header><text>The Corporation may object to any portion of any claim by
a creditor or claim of a security, preference, setoff, or priority which is not
proved to the satisfaction of the Corporation.</text>
</clause><clause id="IDbd8918754817427aa4903213bf0ce380"><enum>(ii)</enum><header>Payments to
undersecured creditors</header><text>In the case of a claim against a covered
financial company that is secured by any property or other asset of such
covered financial company, the receiver—</text>
<subclause id="ID25a9d9207546470d874eb15e6f603b7d"><enum>(I)</enum><text>may treat the portion of
such claim which exceeds an amount equal to the fair market value of such
property or other asset as an unsecured claim; and</text>
</subclause><subclause id="ID219f02b4a72540cf89d055e3aaf97e9e"><enum>(II)</enum><text>may not make any payment
with respect to such unsecured portion of the claim, other than in connection
with the disposition of all claims of unsecured creditors of the covered
financial company.</text>
</subclause></clause><clause id="IDdd464e61298b48e3b5fd161bf4caaf66"><enum>(iii)</enum><header>Exceptions</header><text>No
provision of this paragraph shall apply with respect to—</text>
<subclause id="IDfa3ba968db0442cf8bec02557dda4b31"><enum>(I)</enum><text>any extension of credit
from any Federal reserve bank, or the Corporation, to any covered financial
company; or</text>
</subclause><subclause id="IDacea3d7b3e2647f59a39fe0c3fdbe6e1"><enum>(II)</enum><text>subject to clause (ii),
any legally enforceable and perfected security interest in the assets of the
covered financial company securing any such extension of credit.</text>
</subclause></clause></subparagraph><subparagraph id="ID9fb51d579ac0453bbf993bbc51e2a7b4"><enum>(E)</enum><header>Legal effect of
filing</header>
<clause id="IDa0d98ad0cbcb4b809557a78e92aa6752"><enum>(i)</enum><header>Statute of limitations
tolled</header><text>For purposes of any applicable statute of limitations, the
filing of a claim with the receiver shall constitute a commencement of an
action.</text>
</clause><clause id="IDdef46d5c62254dc59cbf77f258de7e3f"><enum>(ii)</enum><header>No prejudice to other
actions</header><text>Subject to paragraph (8), the filing of a claim with the
receiver shall not prejudice any right of the claimant to continue any action
which was filed before the date of appointment of the receiver for the covered
financial company.</text>
</clause></subparagraph></paragraph><paragraph id="ID32fa20b7f0c843a396cfbe919e4d2405"><enum>(4)</enum><header>Judicial determination
of claims</header>
<subparagraph id="idC929170A87354CB98A49392DB3F93E9B"><enum>(A)</enum><header>In
general</header><text>Subject to subparagraph (B), a claimant may file suit on
a claim (or continue an action commenced before the date of appointment of the
Corporation as receiver) in the district or territorial court of the United
States for the district within which the principal place of business of the
covered financial company is located (and such court shall have jurisdiction to
hear such claim).</text>
</subparagraph><subparagraph id="ID203f03c13e794c8fae09433227d23fd1"><enum>(B)</enum><header>Timing</header><text>A
claim under subparagraph (A) may be filed before the end of the 60-day period
beginning on the earlier of—</text>
<clause id="IDef9f7a5dce0f4d9394fc7d742ea774d8"><enum>(i)</enum><text>the end of the period
described in paragraph (3)(A)(i) (or, if extended by agreement of the
Corporation and the claimant, the period described in paragraph (3)(A)(ii))
with respect to any claim against a covered financial company for which the
Corporation is receiver; or</text>
</clause><clause id="ID73e3b9461f884034b6ebb514d63a3c26"><enum>(ii)</enum><text>the date of any notice
of disallowance of such claim pursuant to paragraph (3)(A)(i).</text>
</clause></subparagraph><subparagraph id="ID75d0c0a846f648a0a5702421558b70a3"><enum>(C)</enum><header>Statute of
limitations</header><text>If any claimant fails to file suit on such claim (or
to continue an action on such claim commenced before the date of appointment of
the Corporation as receiver) prior to the end of the 60-day period described in
subparagraph (B), the claim shall be deemed to be disallowed (other than any
portion of such claim which was allowed by the receiver) as of the end of such
period, such disallowance shall be final, and the claimant shall have no
further rights or remedies with respect to such claim.</text>
</subparagraph></paragraph><paragraph id="IDa320556aafa147989acfbbbad2e67e64"><enum>(5)</enum><header>Expedited determination
of claims</header>
<subparagraph id="IDb395f70ccf1c490097d08489835636b6"><enum>(A)</enum><header>Procedure
required</header><text>The Corporation shall establish a procedure for
expedited relief outside of the claims process established under paragraph (3),
for any claimant that alleges—</text>
<clause id="IDde8bbcc6b06149dc86d9f8f4b8bf13a4"><enum>(i)</enum><text>the existence of a
legally valid and enforceable or perfected security interest in property of a
covered financial company, or is an entitlement holder that has obtained
control of any legally valid and enforceable security entitlement in respect of
any asset held by the covered financial company for which the Corporation has
been appointed receiver; and</text>
</clause><clause id="ID319933c9649547fc9b89d855d1d6694f"><enum>(ii)</enum><text>that irreparable injury
will occur if the claims procedure established under paragraph (3) is
followed.</text>
</clause></subparagraph><subparagraph id="ID5b4e3267263e471c83762279a010c2bb"><enum>(B)</enum><header>Determination
period</header><text>Prior to the end of the 90-day period beginning on the
date on which a claim is filed in accordance with the procedures established
pursuant to subparagraph (A), the Corporation shall—</text>
<clause id="IDdfe353e5a7984a61b3938efba2716bf2"><enum>(i)</enum><text>determine—</text>
<subclause id="IDb7e1601a63ec4d5ca850b25f657f5034"><enum>(I)</enum><text>whether to allow or
disallow such claim, or any portion thereof; or</text>
</subclause><subclause id="ID9261a12fbaf942bc888612e3025c16af"><enum>(II)</enum><text>whether such claim
should be determined pursuant to the procedures established pursuant to
paragraph (3);</text>
</subclause></clause><clause id="ID04fa2786496642feb732a3f08518125b"><enum>(ii)</enum><text>notify the claimant of
the determination; and</text>
</clause><clause id="ID16522a64a8cd42af98bcb55865b928a9"><enum>(iii)</enum><text>if the claim is
disallowed, provide a statement of each reason for the disallowance and the
procedure for obtaining a judicial determination.</text>
</clause></subparagraph><subparagraph id="ID1b304076c71a4d0ea37560583a372c29"><enum>(C)</enum><header>Period for filing or
renewing suit</header><text>Any claimant who files a request for expedited
relief shall be permitted to file suit (or continue a suit filed before the
date of appointment of the Corporation as receiver seeking a determination of
the rights of the claimant with respect to such security interest (or such
security entitlement) after the earlier of—</text>
<clause id="IDf1c89b9bf8f746eda2de71c6e83bc3ab"><enum>(i)</enum><text>the end of the 90-day
period beginning on the date of the filing of a request for expedited relief;
or</text>
</clause><clause id="IDd7d64e781939462cae731e2f1d6b309e"><enum>(ii)</enum><text>the date on which the
Corporation denies the claim or a portion thereof.</text>
</clause></subparagraph><subparagraph id="ID4d01a2d3d72449aba9a172c2ce813171"><enum>(D)</enum><header>Statute of
limitations</header><text>If an action described in subparagraph (C) is not
filed, or the motion to renew a previously filed suit is not made, before the
end of the 30-day period beginning on the date on which such action or motion
may be filed in accordance with subparagraph (C), the claim shall be deemed to
be disallowed as of the end of such period (other than any portion of such
claim which was allowed by the receiver), such disallowance shall be final, and
the claimant shall have no further rights or remedies with respect to such
claim.</text>
</subparagraph><subparagraph id="IDf762500e25dd47549c1337ed0cc6fad9"><enum>(E)</enum><header>Legal effect of
filing</header>
<clause id="ID14b99f9684fe40888d88aeebee0834a4"><enum>(i)</enum><header>Statute of limitations
tolled</header><text>For purposes of any applicable statute of limitations, the
filing of a claim with the receiver shall constitute a commencement of an
action.</text>
</clause><clause id="ID54b52cdc71294612a50216c69e5bc8c1"><enum>(ii)</enum><header>No prejudice to other
actions</header><text>Subject to paragraph (8), the filing of a claim with the
receiver shall not prejudice any right of the claimant to continue any action
which was filed before the appointment of the Corporation as receiver for the
covered financial company.</text>
</clause></subparagraph></paragraph><paragraph id="IDf35ae8bb4ddf4152876a05a309ec349e"><enum>(6)</enum><header>Agreements against
interest of the receiver</header><text>No agreement that tends to diminish or
defeat the interest of the Corporation as receiver in any asset acquired by the
receiver under this section shall be valid against the receiver, unless such
agreement—</text>
<subparagraph id="idF92ABC37AB37475BA930A0B138530B5C"><enum>(A)</enum><text>is in writing;</text>
</subparagraph><subparagraph id="id5854353B7DA94460813243BDA941D9F4"><enum>(B)</enum><text>was executed by an
authorized officer or representative of the covered financial company, or
confirmed in the ordinary course of business by the covered financial company;
and</text>
</subparagraph><subparagraph id="id59013B821EC64FF5A90DB61687E3E852"><enum>(C)</enum><text>has been, since the time
of its execution, an official record of the company or the party claiming under
the agreement provides documentation, acceptable to the receiver, of such
agreement and its authorized execution or confirmation by the covered financial
company.</text>
</subparagraph></paragraph><paragraph id="IDb1af25164fef4de2bca884f235c8b5f4"><enum>(7)</enum><header>Payment of
claims</header>
<subparagraph id="ID6ae2d3bc37114526832f8f5971834240"><enum>(A)</enum><header>In
general</header><text>Subject to subparagraph (B), the Corporation as receiver
may, in its discretion and to the extent that funds are available, pay creditor
claims, in such manner and amounts as are authorized under this section, which
are—</text>
<clause id="ID429edd09235f4977a481ef7321eaaa34"><enum>(i)</enum><text>allowed by the
receiver;</text>
</clause><clause id="IDaeae74897b9b4367a8b90a22091db401"><enum>(ii)</enum><text>approved by the receiver
pursuant to a final determination pursuant to paragraph (3) or (5), as
applicable; or</text>
</clause><clause id="ID9a836ad2fbfe4a7bb6ead3eafff78125"><enum>(iii)</enum><text>determined by the final
judgment of a court of competent jurisdiction.</text>
</clause></subparagraph><subparagraph id="id9FD73195C34C402CBFD58A6D1CB736E0"><enum>(B)</enum><header>Limitation</header><text>A
creditor shall, in no event, receive less than the amount that the creditor is
entitled to receive under paragraphs (2) and (3) of subsection (d), as
applicable.</text>
</subparagraph><subparagraph id="ID7c28a1199a9f42b581d80fcc5a3a5af9"><enum>(C)</enum><header>Payment of dividends on
claims</header><text>The Corporation as receiver may, in its sole discretion,
and to the extent otherwise permitted by this section, pay dividends on proven
claims at any time, and no liability shall attach to the Corporation as
receiver, by reason of any such payment or for failure to pay dividends to a
claimant whose claim is not proved at the time of any such payment.</text>
</subparagraph><subparagraph id="IDd92a6caa2da049cbb9bb42a7ee9293e3"><enum>(D)</enum><header>Rulemaking by the
corporation</header><text>The Corporation may prescribe such rules, including
definitions of terms, as the Corporation deems appropriate to establish an
interest rate for or to make payments of post-insolvency interest to creditors
holding proven claims against the receivership estate of a covered financial
company, except that no such interest shall be paid until the Corporation as
receiver has satisfied the principal amount of all creditor claims.</text>
</subparagraph></paragraph><paragraph id="ID2cd19eb65c9f4c2e9e94e7ed704016e9"><enum>(8)</enum><header>Suspension of legal
actions</header>
<subparagraph id="IDeb396ec4de3c439ea1533c22ab16d6dc"><enum>(A)</enum><header>In
general</header><text>After the appointment of the Corporation as receiver for
a covered financial company, the Corporation may request a stay in any judicial
action or proceeding in which such covered financial company is or becomes a
party, for a period of not to exceed 90 days.</text>
</subparagraph><subparagraph id="IDb49c71a73af24207bc62f24628e32cfb"><enum>(B)</enum><header>Grant of stay by all
courts required</header><text>Upon receipt of a request by the Corporation
pursuant to subparagraph (A), the court shall grant such stay as to all
parties.</text>
</subparagraph></paragraph><paragraph id="ID2ab1ccc2761d4de4aedbadb6781300a4"><enum>(9)</enum><header>Additional rights and
duties</header>
<subparagraph id="ID9ad6b0190aed43508835ba804f0a3f14"><enum>(A)</enum><header>Prior final
adjudication</header><text>The Corporation shall abide by any final,
non-appealable judgment of any court of competent jurisdiction that was
rendered before the appointment of the Corporation as receiver.</text>
</subparagraph><subparagraph id="ID8b7b8c516dec4dc9ba32bd4ba45bf1a2"><enum>(B)</enum><header>Rights and remedies of
receiver</header><text>In the event of any appealable judgment, the Corporation
as receiver shall—</text>
<clause id="ID4f38c84ac0a5409fb1e0636cd5fb55d2"><enum>(i)</enum><text>have all the rights and
remedies available to the covered financial company (before the date of
appointment of the Corporation as receiver under section 202) and the
Corporation, including removal to Federal court and all appellate rights;
and</text>
</clause><clause id="ID5e3ce13d3e474575b534bf7135b91797"><enum>(ii)</enum><text>not be required to post
any bond in order to pursue such remedies.</text>
</clause></subparagraph><subparagraph id="ID8e322b46e4b64d6fb6675473cc792c40"><enum>(C)</enum><header>No attachment or
execution</header><text>No attachment or execution may be issued by any court
upon assets in the possession of the Corporation as receiver for a covered
financial company.</text>
</subparagraph><subparagraph id="IDdd99983d05484ad2b72f13edce7c3887"><enum>(D)</enum><header>Limitation on judicial
review</header><text>Except as otherwise provided in this title, no court shall
have jurisdiction over—</text>
<clause id="ID21a88aaeffae4fcf839967a46a266a8f"><enum>(i)</enum><text>any claim or action for
payment from, or any action seeking a determination of rights with respect to,
the assets of any covered financial company for which the Corporation has been
appointed receiver, including any assets which the Corporation may acquire from
itself as such receiver; or</text>
</clause><clause id="ID6a95f77f69ea4e2fa3daee5028d77da2"><enum>(ii)</enum><text>any claim relating to
any act or omission of such covered financial company or the Corporation as
receiver.</text>
</clause></subparagraph><subparagraph id="ID2e64e8afbd114851a7adbe79f6846559"><enum>(E)</enum><header>Disposition of
assets</header><text>In exercising any right, power, privilege, or authority as
receiver in connection with any covered financial company for which the
Corporation is acting as receiver under this section, the Corporation shall, to
the greatest extent practicable, conduct its operations in a manner
that—</text>
<clause id="ID60fc124225e94cc6bb7b0a30f3bc82af"><enum>(i)</enum><text>maximizes the net present
value return from the sale or disposition of such assets;</text>
</clause><clause id="ID3537767cd73f4c3b8b755c39009f02da"><enum>(ii)</enum><text>minimizes the amount of
any loss realized in the resolution of cases;</text>
</clause><clause id="ID433289046e1944a8b194c04080705e4b"><enum>(iii)</enum><text>mitigates the potential
for serious adverse effects to the financial system;</text>
</clause><clause id="IDe26cbaa9a7b1438687be5c0f04b47bd4"><enum>(iv)</enum><text>ensures timely and
adequate competition and fair and consistent treatment of offerors; and</text>
</clause><clause id="ID289009bfb2af446ba0b2428a260df538"><enum>(v)</enum><text>prohibits discrimination
on the basis of race, sex, or ethnic group in the solicitation and
consideration of offers.</text>
</clause></subparagraph></paragraph><paragraph id="ID39ed30f752434582bdf9b175bd1cc243"><enum>(10)</enum><header>Statute of limitations
for actions brought by receiver</header>
<subparagraph id="ID32a2a8fd800244da9196130b3498f812"><enum>(A)</enum><header>In
general</header><text>Notwithstanding any provision of any contract, the
applicable statute of limitations with regard to any action brought by the
Corporation as receiver for a covered financial company shall be—</text>
<clause id="ID2939cbac0ff14e3e8f73fa33b1438602"><enum>(i)</enum><text>in the case of any
contract claim, the longer of—</text>
<subclause id="ID66b48a4dfd9d4b9fae0fcfbaad750502"><enum>(I)</enum><text>the 6-year period
beginning on the date on which the claim accrues; or</text>
</subclause><subclause id="IDda8616a8202b414fb2a43d4c0d66ef5b"><enum>(II)</enum><text>the period applicable
under State law; and</text>
</subclause></clause><clause id="ID149f9c8acf27453993baef0dd76aae22"><enum>(ii)</enum><text>in the case of any tort
claim, the longer of—</text>
<subclause id="ID31af5dd1693c46e9b182d20086e7dfae"><enum>(I)</enum><text>the 3-year period
beginning on the date on which the claim accrues; or</text>
</subclause><subclause id="IDa52dee2c96b54c53a9dc531d51588732"><enum>(II)</enum><text>the period applicable
under State law.</text>
</subclause></clause></subparagraph><subparagraph id="IDf313416c2b0b41fe899452e84e16f910"><enum>(B)</enum><header>Date on which a claim
accrues</header><text>For purposes of subparagraph (A), the date on which the
statute of limitations begins to run on any claim described in subparagraph (A)
shall be the later of—</text>
<clause id="ID391df935e7964eec8a2532f4e6ba0c1a"><enum>(i)</enum><text>the date of the
appointment of the Corporation as receiver under this title; or</text>
</clause><clause id="ID00de7d941b3f4584bff029ea4476d801"><enum>(ii)</enum><text>the date on which the
cause of action accrues.</text>
</clause></subparagraph><subparagraph id="ID3c4ff6a192e7466a98ba4b0dfc18e82b"><enum>(C)</enum><header>Revival of expired
State causes of action</header>
<clause id="IDd5ecd6f997af47849a1e44c22d52b113"><enum>(i)</enum><header>In
general</header><text>In the case of any tort claim described in clause (ii)
for which the applicable statute of limitations under State law has expired not
more than 5 years before the date of appointment of the Corporation as receiver
for a covered financial company, the Corporation may bring an action as
receiver on such claim without regard to the expiration of the statute of
limitations.</text>
</clause><clause id="ID82731384b7b94c4d9e57a49ed1ccae48"><enum>(ii)</enum><header>Claims
described</header><text>A tort claim referred to in clause (i) is a claim
arising from fraud, intentional misconduct resulting in unjust enrichment, or
intentional misconduct resulting in substantial loss to the covered financial
company.</text>
</clause></subparagraph></paragraph><paragraph id="ID5564509352584dcf815d00339092035d"><enum>(11)</enum><header>Avoidable
transfers</header>
<subparagraph id="IDf5e5517c68d8487eb886d790362d36bb"><enum>(A)</enum><header>Fraudulent
transfers</header><text>The Corporation, as receiver for any covered financial
company, may avoid a transfer of any interest of the covered financial company
in property, or any obligation incurred by the covered financial company, that
was made or incurred at or within 2 years before the time of commencement,
if—</text>
<clause id="id3E8AFAFB9AAD46BFBB8F6FE3DD22912C"><enum>(i)</enum><text>the covered financial
company voluntarily or involuntarily—</text>
<subclause id="IDf86141a9d8084274a8d27639314bf882"><enum>(I)</enum><text>made such transfer or
incurred such obligation with actual intent to hinder, delay, or defraud any
entity to which the covered financial company was or became, on or after the
date on which such transfer was made or such obligation was incurred, indebted;
or</text>
</subclause><subclause id="ID249e5d3b4908425e8e383b027734c279"><enum>(II)</enum><text>received less than a
reasonably equivalent value in exchange for such transferor obligation;
and</text>
</subclause></clause><clause id="IDd58d22161f6247b18d3411e0c8d8f66c"><enum>(ii)</enum><text>the covered financial
company voluntarily or involuntarily—</text>
<subclause id="idB87A4BEB71B54A1585748802CC3AE734"><enum>(I)</enum><text>was insolvent on the date
that such transfer was made or such obligation was incurred, or became
insolvent as a result of such transfer or obligation;</text>
</subclause><subclause id="idE927EE28F888450F90C78A869A983FDB"><enum>(II)</enum><text>was engaged in business
or a transaction, or was about to engage in business or a transaction, for
which any property remaining with the covered financial company was an
unreasonably small capital;</text>
</subclause><subclause id="id7241507F2F8E43EC8BCE969D0DA3556B"><enum>(III)</enum><text>intended to incur, or
believed that the covered financial company would incur, debts that would be
beyond the ability of the covered financial company to pay as such debts
matured; or</text>
</subclause><subclause id="id4EC26C4ED03C47C18254A4ADDF88C6E3"><enum>(IV)</enum><text>made such transfer to or
for the benefit of an insider, or incurred such obligation to or for the
benefit of an insider, under an employment contract and not in the ordinary
course of business.</text>
</subclause></clause></subparagraph><subparagraph id="IDa877dddcf7e74d89883833aeef716d7f"><enum>(B)</enum><header>Preferential
transfers</header><text>The Corporation as receiver for any covered financial
company may avoid a transfer of an interest of the covered financial company in
property—</text>
<clause id="ID011308415372438a9ebeeb35ab15cdae"><enum>(i)</enum><text>to or for the benefit of
a creditor;</text>
</clause><clause id="ID40dff61268404f6d8102aced62c2b40f"><enum>(ii)</enum><text>for or on account of an
antecedent debt that was owed by the covered financial company before the
transfer was made;</text>
</clause><clause id="IDd139f9c3bab941a38b84f186156d804b"><enum>(iii)</enum><text>that was made while the
covered financial company was insolvent;</text>
</clause><clause id="ID4523e8df78c14abd935da98a0924aa14"><enum>(iv)</enum><text>that was made—</text>
<subclause id="ID5ec4204854854b9a850d5ac05d6ec6de"><enum>(I)</enum><text>90 days or less before
the date on which the Corporation was appointed receiver; or</text>
</subclause><subclause id="ID4af60c90a2e94989b04ef272e82238a3"><enum>(II)</enum><text>more than 90 days, but
less than 1 year before the date on which the Corporation was appointed
receiver, if such creditor at the time of the transfer was an insider;
and</text>
</subclause></clause><clause id="ID024bf251cade4efda94046041ddfaed9"><enum>(v)</enum><text>that enables the creditor
to receive more than the creditor would receive if—</text>
<subclause id="ID69c67db95133404bbb6254623f787044"><enum>(I)</enum><text>the covered financial
company had been liquidated under chapter 7 of the Bankruptcy Code;</text>
</subclause><subclause id="IDf687b69b79394ec7a85729680c8b4c7d"><enum>(II)</enum><text>the transfer had not
been made; and</text>
</subclause><subclause id="IDc31d791a927448dfa9e258ad3d70cbc0"><enum>(III)</enum><text>the creditor received
payment of such debt to the extent provided by the provisions of chapter 7 of
the Bankruptcy Code.</text>
</subclause></clause></subparagraph><subparagraph id="IDebea84b5f45845b385b76edd15e8f4c0"><enum>(C)</enum><header>Post-receivership
transactions</header><text>The Corporation as receiver for any covered
financial company may avoid a transfer of property of the receivership that
occurred after the Corporation was appointed receiver that was not authorized
under this title by the Corporation as receiver.</text>
</subparagraph><subparagraph id="ID9938ff98f4be4098b8eaa326653ec8e2"><enum>(D)</enum><header>Right of
recovery</header><text>To the extent that a transfer is avoided under
subparagraph (A), (B), or (C), the Corporation may recover, for the benefit of
the covered financial company, the property transferred or, if a court so
orders, the value of such property (at the time of such transfer) from—</text>
<clause id="ID2d52f785f0bf459687b5bad928103902"><enum>(i)</enum><text>the initial transferee of
such transfer or the person for whose benefit such transfer was made; or</text>
</clause><clause id="IDc18a05433d4e499eb620e38cf5d979e9"><enum>(ii)</enum><text>any immediate or mediate
transferee of any such initial transferee.</text>
</clause></subparagraph><subparagraph id="IDd61021ec38e945d0a09f9795db080907"><enum>(E)</enum><header>Rights of transferee or
obligee</header><text>The Corporation may not recover under subparagraph
(D)(ii) from—</text>
<clause id="ID0a8d4610fdb140bc91636028d42de3ef"><enum>(i)</enum><text>any transferee that takes
for value, including in satisfaction of or to secure a present or antecedent
debt, in good faith, and without knowledge of the voidability of the transfer
avoided; or</text>
</clause><clause id="ID36b64f99dd684e538e740b307cadebb9"><enum>(ii)</enum><text>any immediate or mediate
good faith transferee of such transferee.</text>
</clause></subparagraph><subparagraph id="IDd990c198f6954f28afccc556e4ddd9e8"><enum>(F)</enum><header>Defenses</header><text>Subject
to the other provisions of this title—</text>
<clause id="idAD7436D826104E0FAF17FB9BEBBDDA7A"><enum>(i)</enum><text>a transferee or obligee
from which the Corporation seeks to recover a transfer or to avoid an
obligation under subparagraph (A), (B), (C), or (D) shall have the same
defenses available to a transferee or obligee from which a trustee seeks to
recover a transfer or avoid an obligation under; and</text>
</clause><clause id="id5351576304C24A019FF9C6EE25B4B62A"><enum>(ii)</enum><text>the authority of the
Corporation to recover a transfer or avoid an obligation shall be subject to
subsections (b) and (c) of section 546, section 547(c), and section 548(c) of
the Bankruptcy Code.</text>
</clause></subparagraph><subparagraph id="IDde6d86ff1be140569e8ab5700db39e9d"><enum>(G)</enum><header>Rights under this
section</header><text>The rights of the Corporation as receiver under this
section shall be superior to any rights of a trustee or any other party (other
than a Federal agency) under the Bankruptcy Code.</text>
</subparagraph><subparagraph id="ID9bf9ebcb7ef74718852dc83b08693fc5"><enum>(H)</enum><header>Rules of construction;
definitions</header><text>For purposes of—</text>
<clause id="id98C5B95CD090453FAEEA25FBFEC58B4A"><enum>(i)</enum><text>subparagraphs (A) and
(B)—</text>
<subclause id="IDc0dbc31221584dcaa41c841b361969d2"><enum>(I)</enum><text>the term
<term>insider</term> has the same meaning as in section 101(31) of the
Bankruptcy Code;</text>
</subclause><subclause id="ID7c151d30b801467bba224408fd9af419"><enum>(II)</enum><text>a transfer is made when
such transfer is so perfected that a bona fide purchaser from the covered
financial company against whom applicable law permits such transfer to be
perfected cannot acquire an interest in the property transferred that is
superior to the interest in such property of the transferee, but if such
transfer is not so perfected before the date on which the Corporation is
appointed as receiver for the covered financial company, such transfer is made
immediately before the date of such appointment; and</text>
</subclause><subclause id="IDa9c6ecb632b64cb49c68e0b42157bce1"><enum>(III)</enum><text>the term
<term>value</term> means property, or satisfaction or securing of a present or
antecedent debt of the covered financial company, but does not include an
unperformed promise to furnish support to the covered financial company;
and</text>
</subclause></clause><clause id="IDbd99da032e6f490b87f02a99cce27159"><enum>(ii)</enum><text>subparagraph (B)—</text>
<subclause id="id9DA0AA4464F34BCE95F969D3CA8E2610"><enum>(I)</enum><text>the covered financial
company is presumed to have been insolvent on and during the 90-day period
immediately preceding the date of appointment of the Corporation as receiver;
and</text>
</subclause><subclause id="id8AFC83B4A79A4F64BD382DF4C2F9F009"><enum>(II)</enum><text>the term
<term>insolvent</term> has the same meaning as in section 101(32) of the
Bankruptcy Code.</text>
</subclause></clause></subparagraph></paragraph><paragraph id="ID6e99796874124e45a3705bab7a9601ac"><enum>(12)</enum><header>Setoff</header>
<subparagraph id="IDe4c5aff4341443eb91db67657207b1b4"><enum>(A)</enum><header>Generally</header><text>Except
as otherwise provided in this title, any right of a creditor to offset a mutual
debt owed by the creditor to any covered financial company that arose before
the Corporation was appointed as receiver for the covered financial company
against a claim of such creditor may be asserted if enforceable under
applicable noninsolvency law, except to the extent that—</text>
<clause id="ID43e4b764efa545c4a1635387e416d5ac"><enum>(i)</enum><text>the claim of the creditor
against the covered financial company is disallowed;</text>
</clause><clause id="IDf1cc9ff9b03e4de994d796a70b4d0c2a"><enum>(ii)</enum><text>the claim was
transferred, by an entity other than the covered financial company, to the
creditor—</text>
<subclause id="ID9b0a5c29043648f180772c2172fddd3f"><enum>(I)</enum><text>after the Corporation was
appointed as receiver of the covered financial company; or</text>
</subclause><subclause id="IDefc8747356794445a61dcbd6f47dd910"><enum>(II)</enum><item commented="no" display-inline="yes-display-inline" id="id3FA3AD0CE12C402096271E6893FD7229"><enum>(aa)</enum><text>after the 90-day
period preceding the date on which the Corporation was appointed as receiver
for the covered financial company; and</text>
</item><item changed="added" id="id91629B33F6124B4099C94754D68B0451" indent="up1" reported-display-style="italic"><enum>(bb)</enum><text>while
the covered financial company was insolvent (except for a setoff in connection
with a qualified financial contract); or</text>
</item></subclause></clause><clause id="ID17408518ba604cb4945c5f8338c16408"><enum>(iii)</enum><text>the debt owed to the
covered financial company was incurred by the covered financial company—</text>
<subclause id="IDef1707aa30b0469fb721c870501948f9"><enum>(I)</enum><text>after the 90-day period
preceding the date on which the Corporation was appointed as receiver for the
covered financial company;</text>
</subclause><subclause id="IDa42cb3ef412445d590a395f81605e053"><enum>(II)</enum><text>while the covered
financial company was insolvent; and</text>
</subclause><subclause id="ID94be7d08ab454fcb8a72d590937a9b77"><enum>(III)</enum><text>for the purpose of
obtaining a right of setoff against the covered financial company (except for a
setoff in connection with a qualified financial contract).</text>
</subclause></clause></subparagraph><subparagraph id="IDb006c4269f4842b4ab5bd82eaa709f7e"><enum>(B)</enum><header>Insufficiency</header>
<clause id="IDea833b6412ed4f14a89a611e830d0660"><enum>(i)</enum><header>In
general</header><text>Except with respect to a setoff in connection with a
qualified financial contract, if a creditor offsets a mutual debt owed to the
covered financial company against a claim of the covered financial company on
or within the 90-day period preceding the date on which the Corporation is
appointed as receiver for the covered financial company, the Corporation may
recover from the creditor the amount so offset, to the extent that any
insufficiency on the date of such setoff is less than the insufficiency on the
later of—</text>
<subclause id="IDe22b50297816430c9e7ded041910e64d"><enum>(I)</enum><text>the date that is 90 days
before the date on which the Corporation is appointed as receiver for the
covered financial company; or</text>
</subclause><subclause id="IDf6e5d8f1128a40c198d0bbb64350bb69"><enum>(II)</enum><text>the first day on which
there is an insufficiency during the 90-day period preceding the date on which
the Corporation is appointed as receiver for the covered financial
company.</text>
</subclause></clause><clause id="IDa58f995242fd44d9b8fae4f6a7e299fc"><enum>(ii)</enum><header>Definition of
insufficiency</header><text>In this subparagraph, the term
<quote>insufficiency</quote> means the amount, if any, by which a claim against
the covered financial company exceeds a mutual debt owed to the covered
financial company by the holder of such claim.</text>
</clause></subparagraph><subparagraph id="idEDEB814B541548C3AE04A008F3A5A87D"><enum>(C)</enum><header>Insolvency</header><text>The
term <term>insolvent</term> has the same meaning as in section 101(32) of the
Bankruptcy Code.</text>
</subparagraph><subparagraph id="ID03dd97c23a3845f78b04e073d39e8c5a"><enum>(D)</enum><header>Presumption of
insolvency</header><text>For purposes of this paragraph, the covered financial
company is presumed to have been insolvent on and during the 90-day period
preceding the date of appointment of the Corporation as receiver.</text>
</subparagraph><subparagraph id="ID3236b0dbd580415c9d1c49b90065554b"><enum>(E)</enum><header>Limitation</header><text>Nothing
in this paragraph (12) shall be the basis for any right of setoff where no such
right exists under applicable noninsolvency law.</text>
</subparagraph><subparagraph id="IDfc2a4a2a40e940598c422d45584e6ee5"><enum>(F)</enum><header>Priority
claim</header><text>Except as otherwise provided in this title, the Corporation
as receiver for the covered financial company may sell or transfer any assets
free and clear of the setoff rights of any party, except that such party shall
be entitled to a claim, subordinate to the claims payable under subparagraphs
(A), (B), (C), and (D) of subsection (b)(1), but senior to all other unsecured
liabilities defined in subsection (b)(1)(E), in an amount equal to the value of
such setoff rights.</text>
</subparagraph></paragraph><paragraph id="ID733aaf6a74bb4e039d86382bf6b9f540"><enum>(13)</enum><header>Attachment of assets
and other injunctive relief</header><text>Subject to paragraph (14), any court
of competent jurisdiction may, at the request of the Corporation as receiver
for a covered financial company, issue an order in accordance with Rule 65 of
the Federal Rules of Civil Procedure, including an order placing the assets of
any person designated by the Corporation under the control of the court and
appointing a trustee to hold such assets.</text>
</paragraph><paragraph id="ID468125b4d5054a11a50ac35e0fdd3638"><enum>(14)</enum><header>Standards</header>
<subparagraph id="ID99daf4b4accd43478a641d45a09de2dc"><enum>(A)</enum><header>Showing</header><text>Rule
65 of the Federal Rules of Civil Procedure shall apply with respect to any
proceeding under paragraph (13), without regard to the requirement that the
applicant show that the injury, loss, or damage is irreparable and
immediate.</text>
</subparagraph><subparagraph id="ID4095e24a12874de082589adf1b1e093a"><enum>(B)</enum><header>State
proceeding</header><text>If, in the case of any proceeding in a State court,
the court determines that rules of civil procedure available under the laws of
the State provide substantially similar protections of the right of the parties
to due process as provided under Rule 65 (as modified with respect to such
proceeding by subparagraph (A)), the relief sought by the Corporation pursuant
to paragraph (14) may be requested under the laws of such State.</text>
</subparagraph></paragraph><paragraph id="ID90ffcba451af4c499fc68cb9a2317e3b"><enum>(15)</enum><header>Treatment of claims
arising from breach of contracts executed by the corporation as
receiver</header><text>Notwithstanding any other provision of this title, any
final and non-appealable judgment for monetary damages entered against the
Corporation as receiver for a covered financial company for the breach of an
agreement executed or approved by the Corporation after the date of its
appointment shall be paid as an administrative expense of the receiver. Nothing
in this paragraph shall be construed to limit the power of a receiver to
exercise any rights under contract or law, including to terminate, breach,
cancel, or otherwise discontinue such agreement.</text>
</paragraph><paragraph id="ID7ecf415a083948e895167d7fca24ea85"><enum>(16)</enum><header>Accounting and
recordkeeping requirements</header>
<subparagraph id="IDa616344c254b44fb9a8b22b2ecf97d39"><enum>(A)</enum><header>In
general</header><text>The Corporation as receiver for a covered financial
company shall, consistent with the accounting and reporting practices and
procedures established by the Corporation, maintain a full accounting of each
receivership or other disposition of any covered financial company.</text>
</subparagraph><subparagraph id="IDdc132dd335224c759af7fc52260b25ee"><enum>(B)</enum><header>Annual accounting or
report</header><text>With respect to each receivership to which the Corporation
is appointed, the Corporation shall make an annual accounting or report, as
appropriate, available to the Secretary and the Comptroller General of the
United States.</text>
</subparagraph><subparagraph id="ID022ce252039f43f98c61770eddcb6230"><enum>(C)</enum><header>Availability of
reports</header><text>Any report prepared pursuant to subparagraph (B) and
section 203(c)(3) shall be made available to the public by the
Corporation.</text>
</subparagraph><subparagraph id="ID259ec9392deb4002b803c2c7ab57cb7f"><enum>(D)</enum><header>Recordkeeping
requirement</header>
<clause commented="no" id="IDad74565d36bc45dfb96f20aa44e86127"><enum>(i)</enum><header>In
general</header><text>The Corporation shall prescribe such regulations and
establish such retention schedules as are necessary to maintain the documents
and records of the Corporation generated in exercising the authorities of this
title and the records of a covered financial company for which the Corporation
is appointed receiver, with due regard for—</text>
<subclause commented="no" id="ID0234902199fa48a3b7717bc6f2a36bc7"><enum>(I)</enum><text>the avoidance of
duplicative record retention; and</text>
</subclause><subclause commented="no" id="IDff16ed13f61849a7bb73dcc57b0ca86d"><enum>(II)</enum><text>the expected evidentiary
needs of the Corporation as receiver for a covered financial company and the
public regarding the records of covered financial companies.</text>
</subclause></clause><clause commented="no" id="ID08ecec7fbff14690844c701d8410915e"><enum>(ii)</enum><header>Retention of
records</header><text>Unless otherwise required by applicable Federal law or
court order, the Corporation may not, at any time, destroy any records that are
subject to clause (i).</text>
</clause><clause id="ID0723933ef1004f46918f797710676e01"><enum>(iii)</enum><header>Records
defined</header><text>As used in this subparagraph, the terms
<term>records</term> and <term>records of a covered financial company</term>
mean any document, book, paper, map, photograph, microfiche, microfilm,
computer or electronically-created record generated or maintained by the
covered financial company in the course of and necessary to its transaction of
business.</text>
</clause></subparagraph></paragraph></subsection><subsection id="ID51e5e0fbc9c44c64829c2127679237c5"><enum>(b)</enum><header>Priority of expenses
and unsecured claims</header>
<paragraph id="ID1fae47b7e45649689fa418b03c800846"><enum>(1)</enum><header>In
general</header><text>Unsecured claims against a covered financial company, or
the Corporation as receiver for such covered financial company under this
section, that are proven to the satisfaction of the receiver shall have
priority in the following order:</text>
<subparagraph id="IDd8ff047ec37a42148a743c24d914281a"><enum>(A)</enum><text>Administrative expenses
of the receiver.</text>
</subparagraph><subparagraph id="IDaec817ae21604959b3fba0eb8201589a"><enum>(B)</enum><text>Any amounts owed to the
United States, unless the United States agrees or consents otherwise.</text>
</subparagraph><subparagraph id="IDa4b23ad202494ac690e271f2742c0f08"><enum>(C)</enum><text>Wages, salaries, or
commissions, including vacation, severance, and sick leave pay earned by an
individual (other than an individual described in subparagraph (G)), but only
to the extent of $11,725 for each individual (as indexed for inflation, by
regulation of the Corporation) earned not later than 180 days before the date
of appointment of the Corporation as receiver.</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="IDd3115740c3c843049eabddf394feac7f"><enum>(D)</enum><text>Contributions owed to
employee benefit plans arising from services rendered not later than 180 days
before the date of appointment of the Corporation as receiver, to the extent of
the number of employees covered by each such plan, multiplied by $11,725 (as
indexed for inflation, by regulation of the Corporation), less the aggregate
amount paid to such employees under subparagraph (C), plus the aggregate amount
paid by the receivership on behalf of such employees to any other employee
benefit plan.</text>
</subparagraph><subparagraph id="ID48cb702f4a8e4089b4041eea38d66365"><enum>(E)</enum><text>Any other general or
senior liability of the covered financial company (which is not a liability
described under subparagraph (F), (G), or (H)).</text>
</subparagraph><subparagraph id="IDde929aaff7f44187b913c04215be01e6"><enum>(F)</enum><text>Any obligation
subordinated to general creditors (which is not an obligation described under
subparagraph (G) or (H)).</text>
</subparagraph><subparagraph id="IDe3b1a61a8f2a4ef38a7e67e4ff95e641"><enum>(G)</enum><text>Any wages, salaries, or
commissions including vacation, severance, and sick leave pay earned, owed to
senior executives and directors of the covered financial company.</text>
</subparagraph><subparagraph id="IDca7ccad3ab6841a4a05b7b29ee37dc07"><enum>(H)</enum><text>Any obligation to
shareholders, members, general partners, limited partners, or other persons,
with interests in the equity of the covered financial company arising as a
result of their status as shareholders, members, general partners, limited
partners, or other persons with interests in the equity of the covered
financial company.</text>
</subparagraph></paragraph><paragraph id="IDa76758ac318841fcb8851da3dbab0ee2"><enum>(2)</enum><header>Post-receivership
financing priority</header><text>In the event that the Corporation, as receiver
for a covered financial company, is unable to obtain unsecured credit for the
covered financial company from commercial sources, the Corporation as receiver
may obtain credit or incur debt on the part of the covered financial company,
which shall have priority over any or all administrative expenses of the
receiver under paragraph (1)(A).</text>
</paragraph><paragraph id="ID67c8c274d4594cf4bc1751742228c9cc"><enum>(3)</enum><header>Claims of the United
States</header><text>Unsecured claims of the United States shall, at a minimum,
have a higher priority than liabilities of the covered financial company that
count as regulatory capital.</text>
</paragraph><paragraph id="ID0cf0c46885a843d6b010026a9ed2fca8"><enum>(4)</enum><header>Creditors similarly
situated</header><text>All claimants of a covered financial company that are
similarly situated under paragraph (1) shall be treated in a similar manner,
except that the Corporation as receiver may take any action (including making
payments, subject to subsection (o)(1)(E)(ii)) that does not comply with this
subsection, if—</text>
<subparagraph id="ID03b01dd041224e428e1a567fbb48312e"><enum>(A)</enum><text>the Corporation
determines that such action is necessary—</text>
<clause id="ID95228600faff4226956a82171c3b04aa"><enum>(i)</enum><text>to maximize the value of
the assets of the covered financial company;</text>
</clause><clause id="ID2b6b01f9d28244528fb388d402440b5d"><enum>(ii)</enum><text>to initiate and continue
operations essential to implementation of the receivership or any bridge
financial company;</text>
</clause><clause id="ID67585c4faa294dbfb070d2ba53791ca1"><enum>(iii)</enum><text>to maximize the present
value return from the sale or other disposition of the assets of the covered
financial company; or</text>
</clause><clause id="ID299a0897eb8d4d3c9a6167ee63cbff9d"><enum>(iv)</enum><text>to minimize the amount
of any loss realized upon the sale or other disposition of the assets of the
covered financial company; and</text>
</clause></subparagraph><subparagraph id="IDc47e8b4a33ad4aa09536b0f60b39e1e5"><enum>(B)</enum><text>all claimants that are
similarly situated under paragraph (1) receive not less than the amount
provided in paragraphs (2) and (3) of subsection (d).</text>
</subparagraph></paragraph><paragraph id="IDcb1baf40d84d4000a9c3a2f6681e8218"><enum>(5)</enum><header>Secured claims
unaffected</header><text>This section shall not affect secured claims or
security entitlements in respect of assets or property held by the covered
financial company, except to the extent that the security is insufficient to
satisfy the claim, and then only with regard to the difference between the
claim and the amount realized from the security.</text>
</paragraph><paragraph id="IDad139667d7204859bb4acf75ea9d37b2"><enum>(6)</enum><header>Priority of expenses
and unsecured claims in the orderly liquidation of sipc
member</header><text>Where the Corporation is appointed as receiver for a
covered broker or dealer, unsecured claims against such covered broker or
dealer, or the Corporation as receiver for such covered broker or dealer under
this section, that are proven to the satisfaction of the receiver under section
205(e), shall have the priority prescribed in paragraph (1), except
that—</text>
<subparagraph id="ID5599ba7fcdcd441a833f39e8adcf70cf"><enum>(A)</enum><text>SIPC shall be entitled to
recover administrative expenses incurred in performing its responsibilities
under section 205 on an equal basis with the Corporation, in accordance with
paragraph (1)(A);</text>
</subparagraph><subparagraph id="IDb595f40e70674dafbdcdbfe231d895bb"><enum>(B)</enum><text>the Corporation shall be
entitled to recover any amounts paid to customers or to SIPC pursuant to
section 205(f), in accordance with paragraph (1)(B);</text>
</subparagraph><subparagraph id="IDb714b8734a2843ba823f1155560fc0f9"><enum>(C)</enum><text>SIPC shall be entitled to
recover any amounts paid out of the SIPC Fund to meet its obligations under
section 205 and under the Securities Investor Protection Act of 1970 (15 U.S.C.
78aaa et seq.), which claim shall be subordinate to the claims payable under
subparagraphs (A) and (B) of paragraph (1), but senior to all other claims;
and</text>
</subparagraph><subparagraph id="IDd60e8dfbb38b4236a0a6293e4a70df97"><enum>(D)</enum><text>the Corporation may,
after paying any proven claims to customers under section 205 and the
Securities Investor Protection Act of 1970 (15 U.S.C. 78aaa et seq.), and as
provided above, pay dividends on other proven claims, in its discretion, and to
the extent that funds are available, in accordance with the priorities set
forth in paragraph (1).</text>
</subparagraph></paragraph></subsection><subsection id="IDd247137845424a058eaa3197e2d2dff8"><enum>(c)</enum><header>Provisions relating to
contracts entered into before appointment of receiver</header>
<paragraph id="ID0ea510cf91324e6aad567e38ba74b446"><enum>(1)</enum><header>Authority to repudiate
contracts</header><text>In addition to any other rights that a receiver may
have, the Corporation as receiver for any covered financial company may
disaffirm or repudiate any contract or lease—</text>
<subparagraph id="IDffd7bdd89a4c4f59a4485fd42e0c9b02"><enum>(A)</enum><text>to which the covered
financial company is a party;</text>
</subparagraph><subparagraph id="IDb9f67d487b15416496ec4cacda6c2f2a"><enum>(B)</enum><text>the performance of which
the Corporation as receiver, in the discretion of the Corporation, determines
to be burdensome; and</text>
</subparagraph><subparagraph id="IDa212b73588eb4cdf86509785c7cd0f4e"><enum>(C)</enum><text>the disaffirmance or
repudiation of which the Corporation as receiver determines, in the discretion
of the Corporation, will promote the orderly administration of the affairs of
the covered financial company.</text>
</subparagraph></paragraph><paragraph id="ID531bcc1323b0402aa37b5bf2d1502ae6"><enum>(2)</enum><header>Timing of
repudiation</header><text>The Corporation, as receiver for any covered
financial company, shall determine whether or not to exercise the rights of
repudiation under this section within a reasonable period of time.</text>
</paragraph><paragraph id="ID3f4bc85d05b64b85809dbffc6fb295e2"><enum>(3)</enum><header>Claims for damages for
repudiation</header>
<subparagraph id="ID5380f67eb1674b76a7925acd0cd8d409"><enum>(A)</enum><header>In
general</header><text>Except as provided in paragraphs (4), (5), and (6) and in
subparagraphs (C), (D), and (E) of this paragraph, the liability of the
Corporation as receiver for a covered financial company for the disaffirmance
or repudiation of any contract pursuant to paragraph (1) shall be—</text>
<clause id="IDfba047be7d064687ba3ad672ea794aaf"><enum>(i)</enum><text>limited to actual direct
compensatory damages; and</text>
</clause><clause id="IDb51a2569ffc84d459031f0417df1f8ef"><enum>(ii)</enum><text>determined as of—</text>
<subclause id="ID51bdbf0cf4654c75a72b00be3db22f2b"><enum>(I)</enum><text>the date of the
appointment of the Corporation as receiver; or</text>
</subclause><subclause id="IDf7f5260bf98942518c9733ff4e67cddb"><enum>(II)</enum><text>in the case of any
contract or agreement referred to in paragraph (8), the date of the
disaffirmance or repudiation of such contract or agreement.</text>
</subclause></clause></subparagraph><subparagraph id="ID85caa8fecd0c4dd3b2518374c90900d5"><enum>(B)</enum><header>No liability for other
damages</header><text>For purposes of subparagraph (A), the term <quote>actual
direct compensatory damages</quote> does not include—</text>
<clause id="IDd1fb5e0b9c344a38b8113daed2d2ab40"><enum>(i)</enum><text>punitive or exemplary
damages;</text>
</clause><clause id="IDea06df1a2bfa47c2acf8c1301b56d552"><enum>(ii)</enum><text>damages for lost profits
or opportunity; or</text>
</clause><clause id="IDd5e0339197da455db7017b1dd8d5472a"><enum>(iii)</enum><text>damages for pain and
suffering.</text>
</clause></subparagraph><subparagraph id="IDedb8f2dc60a94ae4904d7c8f2434d0da"><enum>(C)</enum><header>Measure of damages for
repudiation of qualified financial contracts</header><text>In the case of any
qualified financial contract or agreement to which paragraph (8) applies,
compensatory damages shall be—</text>
<clause id="IDaeea8740de5043cb83b129dbe335198f"><enum>(i)</enum><text>deemed to include normal
and reasonable costs of cover or other reasonable measures of damages utilized
in the industries for such contract and agreement claims; and</text>
</clause><clause id="IDb851eb2f00944cf486027665abd6a19b"><enum>(ii)</enum><text>paid in accordance with
this paragraph and subsection (d), except as otherwise specifically provided in
this subsection.</text>
</clause></subparagraph><subparagraph id="ID6457eb8fe9074ad0a61ed21d7ec1f1b7"><enum>(D)</enum><header>Measure of damages for
repudiation or disaffirmance of debt obligation</header><text>In the case of
any debt for borrowed money or evidenced by a security, actual direct
compensatory damages shall be no less than the amount lent plus accrued
interest plus any accreted original issue discount as of the date the
Corporation was appointed receiver of the covered financial company and, to the
extent that an allowed secured claim is secured by property the value of which
is greater than the amount of such claim and any accrued interest through the
date of repudiation or disaffirmance, such accrued interest pursuant to
paragraph (1).</text>
</subparagraph><subparagraph id="IDdf34dfd906f547ce8355e39045ad14f4"><enum>(E)</enum><header>Measure of damages for
repudiation or disaffirmance of contingent obligation</header><text>In the case
of any contingent obligation of a covered financial company consisting of any
obligation under a guarantee, letter of credit, loan commitment, or similar
credit obligation, the Corporation may, by rule or regulation, prescribe that
actual direct compensatory damages shall be no less than the estimated value of
the claim as of the date the Corporation was appointed receiver of the covered
financial company, as such value is measured based on the likelihood that such
contingent claim would become fixed and the probable magnitude thereof.</text>
</subparagraph></paragraph><paragraph id="IDac0b26ec7f614597876e80da6a06b18b"><enum>(4)</enum><header>Leases under which the
covered financial company is the lessee</header>
<subparagraph id="ID4cfddbc0f2ee4168b1a9c110236698e3"><enum>(A)</enum><header>In
general</header><text>If the Corporation as receiver disaffirms or repudiates a
lease under which the covered financial company is the lessee, the receiver
shall not be liable for any damages (other than damages determined pursuant to
subparagraph (B)) for the disaffirmance or repudiation of such lease.</text>
</subparagraph><subparagraph id="IDf52b6dde095b4c698341019adf655421"><enum>(B)</enum><header>Payments of
rent</header><text>Notwithstanding subparagraph (A), the lessor under a lease
to which subparagraph (A) would otherwise apply shall—</text>
<clause id="ID32895b0bc4234cfe82c718ac8ded309d"><enum>(i)</enum><text>be entitled to the
contractual rent accruing before the later of the date on which—</text>
<subclause id="ID05346f86a7e54b058359791faf8b5c48"><enum>(I)</enum><text>the notice of
disaffirmance or repudiation is mailed; or</text>
</subclause><subclause id="IDfdf3ac6b4ec049a197a11450fe668646"><enum>(II)</enum><text>the disaffirmance or
repudiation becomes effective, unless the lessor is in default or breach of the
terms of the lease;</text>
</subclause></clause><clause id="ID658f940b43d146268e61c16ecd4de713"><enum>(ii)</enum><text>have no claim for
damages under any acceleration clause or other penalty provision in the lease;
and</text>
</clause><clause id="ID21d483f75efa489c94ac084df41c9f14"><enum>(iii)</enum><text>have a claim for any
unpaid rent, subject to all appropriate offsets and defenses, due as of the
date of the appointment which shall be paid in accordance with this paragraph
and subsection (d).</text>
</clause></subparagraph></paragraph><paragraph id="ID585ab513a4bf498c9950a3e86754ed44"><enum>(5)</enum><header>Leases under which the
covered financial company is the lessor</header>
<subparagraph id="ID9353507b0a4c4225bb84be2ab6ed09f9"><enum>(A)</enum><header>In
general</header><text>If the Corporation as receiver for a covered financial
company repudiates an unexpired written lease of real property of the covered
financial company under which the covered financial company is the lessor and
the lessee is not, as of the date of such repudiation, in default, the lessee
under such lease may either—</text>
<clause id="IDc54bda6cf7ed4ef3b0fb37abebe3860c"><enum>(i)</enum><text>treat the lease as
terminated by such repudiation; or</text>
</clause><clause id="IDec7b50d7c47b4796845dd6566f3735ba"><enum>(ii)</enum><text>remain in possession of
the leasehold interest for the balance of the term of the lease, unless the
lessee defaults under the terms of the lease after the date of such
repudiation.</text>
</clause></subparagraph><subparagraph id="IDd1b5c9d92ad44d979ea50d471045ce24"><enum>(B)</enum><header>Provisions applicable
to lessee remaining in possession</header><text>If any lessee under a lease
described in subparagraph (A) remains in possession of a leasehold interest
pursuant to clause (ii) of subparagraph (A)—</text>
<clause id="ID3501a6521c404da292fa6f57bc26d16e"><enum>(i)</enum><text>the lessee—</text>
<subclause id="IDdc9f89fb81584294aa4ce335f684caea"><enum>(I)</enum><text>shall continue to pay the
contractual rent pursuant to the terms of the lease after the date of the
repudiation of such lease; and</text>
</subclause><subclause id="IDe2a67c0116184dea803fa784b255ba30"><enum>(II)</enum><text>may offset against any
rent payment which accrues after the date of the repudiation of the lease, any
damages which accrue after such date due to the nonperformance of any
obligation of the covered financial company under the lease after such date;
and</text>
</subclause></clause><clause id="IDc859cc9563414276a48c065a09699bff"><enum>(ii)</enum><text>the Corporation as
receiver shall not be liable to the lessee for any damages arising after such
date as a result of the repudiation, other than the amount of any offset
allowed under clause (i)(II).</text>
</clause></subparagraph></paragraph><paragraph id="ID1d5688c95d754b088b60f24a2e850028"><enum>(6)</enum><header>Contracts for the sale
of real property</header>
<subparagraph id="ID0d56dd65319e4ff186d19037a81e258c"><enum>(A)</enum><header>In
general</header><text>If the receiver repudiates any contract (which meets the
requirements of subsection (a)(6)) for the sale of real property, and the
purchaser of such real property under such contract is in possession and is
not, as of the date of such repudiation, in default, such purchaser may
either—</text>
<clause id="ID820d489c5093475c89895e207894e81c"><enum>(i)</enum><text>treat the contract as
terminated by such repudiation; or</text>
</clause><clause id="ID0e50be96e53a420f94019b2951f5bf56"><enum>(ii)</enum><text>remain in possession of
such real property.</text>
</clause></subparagraph><subparagraph id="ID2aee923ee439445c8cd68e73c268360f"><enum>(B)</enum><header>Provisions applicable
to purchaser remaining in possession</header><text>If any purchaser of real
property under any contract described in subparagraph (A) remains in possession
of such property pursuant to clause (ii) of subparagraph (A)—</text>
<clause id="ID6bc8e12bf298496aa36443657ec75034"><enum>(i)</enum><text>the purchaser—</text>
<subclause id="ID2fea5b61e50d4b4dba9f9c3b3444926b"><enum>(I)</enum><text>shall continue to make
all payments due under the contract after the date of the repudiation of the
contract; and</text>
</subclause><subclause id="IDcfac396e5590429f9ce5d09b9be9df2e"><enum>(II)</enum><text>may offset against any
such payments any damages which accrue after such date due to the
nonperformance (after such date) of any obligation of the covered financial
company under the contract; and</text>
</subclause></clause><clause id="ID69d82f658c2f4e0688d61204eaaa7579"><enum>(ii)</enum><text>the Corporation as
receiver shall—</text>
<subclause id="IDfd68d9f9272c424fbc3e284ef242002e"><enum>(I)</enum><text>not be liable to the
purchaser for any damages arising after such date as a result of the
repudiation, other than the amount of any offset allowed under clause
(i)(II);</text>
</subclause><subclause id="IDcb7cafca4b27494b97fa6f6df3edd828"><enum>(II)</enum><text>deliver title to the
purchaser in accordance with the provisions of the contract; and</text>
</subclause><subclause id="ID263f343fe5694f3b8d9da7f03e81e925"><enum>(III)</enum><text>have no obligation
under the contract other than the performance required under subclause
(II).</text>
</subclause></clause></subparagraph><subparagraph id="ID44206711bd0342e09969e0611c377bff"><enum>(C)</enum><header>Assignment and sale
allowed</header>
<clause id="IDc7003a3951194c86a93e85a06c7d51b8"><enum>(i)</enum><header>In
general</header><text>No provision of this paragraph shall be construed as
limiting the right of the Corporation as receiver to assign the contract
described in subparagraph (A) and sell the property, subject to the contract
and the provisions of this paragraph.</text>
</clause><clause id="ID41ed40c8a6ab469696c5440895ea5f0d"><enum>(ii)</enum><header>No liability after
assignment and sale</header><text>If an assignment and sale described in clause
(i) is consummated, the Corporation as receiver shall have no further liability
under the contract described in subparagraph (A) or with respect to the real
property which was the subject of such contract.</text>
</clause></subparagraph></paragraph><paragraph id="ID96444b8f980940258a026f4daafc12e7"><enum>(7)</enum><header>Provisions applicable
to service contracts</header>
<subparagraph id="ID1af31cd90ce64f6999635919ce6df5c5"><enum>(A)</enum><header>Services performed
before appointment</header><text>In the case of any contract for services
between any person and any covered financial company for which the Corporation
has been appointed receiver, any claim of such person for services performed
before the date of appointment shall be—</text>
<clause id="ID0ee374865f7e486ab6aba51280fc3228"><enum>(i)</enum><text>a claim to be paid in
accordance with subsections (a), (b), and (d); and</text>
</clause><clause id="IDe3bb258293494e78963f839c2be987cd"><enum>(ii)</enum><text>deemed to have arisen as
of the date on which the receiver was appointed.</text>
</clause></subparagraph><subparagraph id="ID3ffde239ab844c1fba81299510a91be6"><enum>(B)</enum><header>Services performed
after appointment and prior to repudiation</header><text>If, in the case of any
contract for services described in subparagraph (A), the Corporation as
receiver accepts performance by the other person before making any
determination to exercise the right of repudiation of such contract under this
section—</text>
<clause id="ID15bd04dee2ca4255a95a9c55b7c4ac6a"><enum>(i)</enum><text>the other party shall be
paid under the terms of the contract for the services performed; and</text>
</clause><clause id="IDb99470ac16da4e5ba921dba8629db966"><enum>(ii)</enum><text>the amount of such
payment shall be treated as an administrative expense of the
receivership.</text>
</clause></subparagraph><subparagraph id="ID1f061be2de0d43c2b077a820ca57b12c"><enum>(C)</enum><header>Acceptance of
performance no bar to subsequent repudiation</header><text>The acceptance by
the Corporation as receiver for services referred to in subparagraph (B) in
connection with a contract described in subparagraph (B) shall not affect the
right of the Corporation as receiver to repudiate such contract under this
section at any time after such performance.</text>
</subparagraph></paragraph><paragraph id="IDf29706c8adfb451d95c2e70af2dc8040"><enum>(8)</enum><header>Certain qualified
financial contracts</header>
<subparagraph id="ID60c7e69e537d45528149648f745c7ad5"><enum>(A)</enum><header>Rights of parties to
contracts</header><text>Subject to subsection (a)(8) and paragraphs (9) and
(10) of this subsection, and notwithstanding any other provision of this
section, any other provision of Federal law, or the law of any State, no person
shall be stayed or prohibited from exercising—</text>
<clause id="IDa5f3544dd0db48899c4012b41656dbb4"><enum>(i)</enum><text>any right that such
person has to cause the termination, liquidation, or acceleration of any
qualified financial contract with a covered financial company which arises upon
the date of appointment of the Corporation as receiver for such covered
financial company at any time after such appointment;</text>
</clause><clause id="IDdfc5c0f442f54338aed91b9bb416ec89"><enum>(ii)</enum><text>any right under any
security agreement or arrangement or other credit enhancement related to one or
more qualified financial contracts described in clause (i); or</text>
</clause><clause id="ID22d55843e1cf4c44a1dfb1845b601d1e"><enum>(iii)</enum><text>any right to offset or
net out any termination value, payment amount, or other transfer obligation
arising under or in connection with 1 or more contracts or agreements described
in clause (i), including any master agreement for such contracts or
agreements.</text>
</clause></subparagraph><subparagraph id="IDaa6cd9bd722a4cf4a1586d693533ef4c"><enum>(B)</enum><header>Applicability of other
provisions</header><text>Subsection (a)(8) shall apply in the case of any
judicial action or proceeding brought against the Corporation as receiver
referred to in subparagraph (A), or the subject covered financial company, by
any party to a contract or agreement described in subparagraph (A)(i) with such
covered financial company.</text>
</subparagraph><subparagraph id="IDda27617a38414635b878f2e9a77b3378"><enum>(C)</enum><header>Certain transfers not
avoidable</header>
<clause id="IDe2b63b1223f7485aa7ccf550a69a5c8f"><enum>(i)</enum><header>In
general</header><text>Notwithstanding subsection (a)(11), (a)(12), or (c)(12),
section 5242 of the Revised Statutes of the United States, or any other
provision of Federal or State law relating to the avoidance of preferential or
fraudulent transfers, the Corporation, whether acting as the Corporation or as
receiver for a covered financial company, may not avoid any transfer of money
or other property in connection with any qualified financial contract with a
covered financial company.</text>
</clause><clause id="IDb8e3977be0544643b96e473569fbcc02"><enum>(ii)</enum><header>Exception for certain
transfers</header><text>Clause (i) shall not apply to any transfer of money or
other property in connection with any qualified financial contract with a
covered financial company if the transferee had actual intent to hinder, delay,
or defraud such company, the creditors of such company, or the Corporation as
receiver appointed for such company.</text>
</clause></subparagraph><subparagraph id="IDba5b1cb1c06e457a9cf202cfe8cdf14f"><enum>(D)</enum><header>Certain contracts and
agreements defined</header><text>For purposes of this subsection, the following
definitions shall apply:</text>
<clause id="IDc78a629c36434e6795264d339e6ed4d3"><enum>(i)</enum><header>Qualified financial
contract</header><text>The term <term>qualified financial contract</term> means
any securities contract, commodity contract, forward contract, repurchase
agreement, swap agreement, and any similar agreement that the Corporation
determines by regulation, resolution, or order to be a qualified financial
contract for purposes of this paragraph.</text>
</clause><clause id="IDdb105bc649264166b018de75ba2ec24a"><enum>(ii)</enum><header>Securities
contract</header><text>The term <term>securities contract</term>—</text>
<subclause id="ID2cc2c49a11dc45f5bf05c9d7bdf09384"><enum>(I)</enum><text>means a contract for the
purchase, sale, or loan of a security, a certificate of deposit, a mortgage
loan, any interest in a mortgage loan, a group or index of securities,
certificates of deposit, or mortgage loans or interests therein (including any
interest therein or based on the value thereof), or any option on any of the
foregoing, including any option to purchase or sell any such security,
certificate of deposit, mortgage loan, interest, group or index, or option, and
including any repurchase or reverse repurchase transaction on any such
security, certificate of deposit, mortgage loan, interest, group or index, or
option (whether or not such repurchase or reverse repurchase transaction is a
<quote>repurchase agreement</quote>, as defined in clause (v));</text>
</subclause><subclause id="IDd1329572d76c46ca8d98db6a137bf059"><enum>(II)</enum><text>does not include any
purchase, sale, or repurchase obligation under a participation in a commercial
mortgage loan unless the Corporation determines by regulation, resolution, or
order to include any such agreement within the meaning of such term;</text>
</subclause><subclause id="ID1a0ad7a1747d49498ad499e19f55c50d"><enum>(III)</enum><text>means any option
entered into on a national securities exchange relating to foreign
currencies;</text>
</subclause><subclause id="IDefcba79b3574439392522a6ec9b1fe68"><enum>(IV)</enum><text>means the guarantee
(including by novation) by or to any securities clearing agency of any
settlement of cash, securities, certificates of deposit, mortgage loans or
interests therein, group or index of securities, certificates of deposit or
mortgage loans or interests therein (including any interest therein or based on
the value thereof) or an option on any of the foregoing, including any option
to purchase or sell any such security, certificate of deposit, mortgage loan,
interest, group or index, or option (whether or not such settlement is in
connection with any agreement or transaction referred to in subclauses (I)
through (XII) (other than subclause (II)));</text>
</subclause><subclause id="IDe4460152c8d24d1a8eff70a6052c1c38"><enum>(V)</enum><text>means any margin
loan;</text>
</subclause><subclause id="IDc9158ab772d94231b1044418a059e4ad"><enum>(VI)</enum><text>means any extension of
credit for the clearance or settlement of securities transactions;</text>
</subclause><subclause id="ID9689ea2e15574debb0244ad85b2f3fc9"><enum>(VII)</enum><text>means any loan
transaction coupled with a securities collar transaction, any prepaid
securities forward transaction, or any total return swap transaction coupled
with a securities sale transaction;</text>
</subclause><subclause id="IDa5cf02baa6a94668a82d2b4ed54f19ec"><enum>(VIII)</enum><text>means any other
agreement or transaction that is similar to any agreement or transaction
referred to in this clause;</text>
</subclause><subclause id="IDfdf9dfbdf18b493f8735878a5474c3ec"><enum>(IX)</enum><text>means any combination of
the agreements or transactions referred to in this clause;</text>
</subclause><subclause id="IDd0be77b1491744439cf6ef2176b2f1e0"><enum>(X)</enum><text>means any option to enter
into any agreement or transaction referred to in this clause;</text>
</subclause><subclause id="IDf6c0cad17beb459db5150ff5ffd8722c"><enum>(XI)</enum><text>means a master agreement
that provides for an agreement or transaction referred to in any of subclauses
(I) through (X), other than subclause (II), together with all supplements to
any such master agreement, without regard to whether the master agreement
provides for an agreement or transaction that is not a securities contract
under this clause, except that the master agreement shall be considered to be a
securities contract under this clause only with respect to each agreement or
transaction under the master agreement that is referred to in any of subclauses
(I) through (X), other than subclause (II); and</text>
</subclause><subclause id="IDa3f7ef58acbc4557bce97eaf720eac05"><enum>(XII)</enum><text>means any security
agreement or arrangement or other credit enhancement related to any agreement
or transaction referred to in this clause, including any guarantee or
reimbursement obligation in connection with any agreement or transaction
referred to in this clause.</text>
</subclause></clause><clause id="ID4dce4babb9024454a20a704c44fb8011"><enum>(iii)</enum><header>Commodity
contract</header><text>The term <term>commodity contract</term> means—</text>
<subclause id="IDdea8ef67a2b342a1b8a1c7e97335554e"><enum>(I)</enum><text>with respect to a futures
commission merchant, a contract for the purchase or sale of a commodity for
future delivery on, or subject to the rules of, a contract market or board of
trade;</text>
</subclause><subclause id="ID41dd2b02f3b74e088e889a1a0242ce9b"><enum>(II)</enum><text>with respect to a
foreign futures commission merchant, a foreign future;</text>
</subclause><subclause id="ID349b5109edc748f7bc5d25c987d87cdc"><enum>(III)</enum><text>with respect to a
leverage transaction merchant, a leverage transaction;</text>
</subclause><subclause id="ID8c52d8627cff484b9ff73a7209f1b7d7"><enum>(IV)</enum><text>with respect to a
clearing organization, a contract for the purchase or sale of a commodity for
future delivery on, or subject to the rules of, a contract market or board of
trade that is cleared by such clearing organization, or commodity option traded
on, or subject to the rules of, a contract market or board of trade that is
cleared by such clearing organization;</text>
</subclause><subclause id="ID486150a99c244856b67beab4edf2a154"><enum>(V)</enum><text>with respect to a
commodity options dealer, a commodity option;</text>
</subclause><subclause id="ID8017bfec3ab845e4bce43515936244c7"><enum>(VI)</enum><text>any other agreement or
transaction that is similar to any agreement or transaction referred to in this
clause;</text>
</subclause><subclause id="ID9effd0d7a10c40848e0745e3c88c52da"><enum>(VII)</enum><text>any combination of the
agreements or transactions referred to in this clause;</text>
</subclause><subclause id="ID74d65a9bad994f0db83550d20a8c0a2a"><enum>(VIII)</enum><text>any option to enter
into any agreement or transaction referred to in this clause;</text>
</subclause><subclause id="ID383cbd23e84641d2a7a5f8ef318f3273"><enum>(IX)</enum><text>a master agreement that
provides for an agreement or transaction referred to in any of subclauses (I)
through (VIII), together with all supplements to any such master agreement,
without regard to whether the master agreement provides for an agreement or
transaction that is not a commodity contract under this clause, except that the
master agreement shall be considered to be a commodity contract under this
clause only with respect to each agreement or transaction under the master
agreement that is referred to in any of subclauses (I) through (VIII);
or</text>
</subclause><subclause id="IDb829d224d46a475ab83211110fe5310b"><enum>(X)</enum><text>any security agreement or
arrangement or other credit enhancement related to any agreement or transaction
referred to in this clause, including any guarantee or reimbursement obligation
in connection with any agreement or transaction referred to in this
clause.</text>
</subclause></clause><clause id="ID14e01b6518f7434db0914e7e518d18dc"><enum>(iv)</enum><header>Forward
contract</header><text>The term <term>forward contract</term> means—</text>
<subclause id="ID75e906e050ff45d2837248e34380156c"><enum>(I)</enum><text>a contract (other than a
commodity contract) for the purchase, sale, or transfer of a commodity or any
similar good, article, service, right, or interest which is presently or in the
future becomes the subject of dealing in the forward contract trade, or product
or byproduct thereof, with a maturity date that is more than 10 days after the
date on which the contract is entered into, including a repurchase or reverse
repurchase transaction (whether or not such repurchase or reverse repurchase
transaction is a <quote>repurchase agreement</quote>, as defined in clause
(v)), consignment, lease, swap, hedge transaction, deposit, loan, option,
allocated transaction, unallocated transaction, or any other similar
agreement;</text>
</subclause><subclause id="IDe76108d055f44f448438bfbaebcb4384"><enum>(II)</enum><text>any combination of
agreements or transactions referred to in subclauses (I) and (III);</text>
</subclause><subclause id="IDece1b5bc060349cb9ec54c809cba114c"><enum>(III)</enum><text>any option to enter
into any agreement or transaction referred to in subclause (I) or (II);</text>
</subclause><subclause id="IDdb54c9824954485bad40682fd878895d"><enum>(IV)</enum><text>a master agreement that
provides for an agreement or transaction referred to in subclause (I), (II), or
(III), together with all supplements to any such master agreement, without
regard to whether the master agreement provides for an agreement or transaction
that is not a forward contract under this clause, except that the master
agreement shall be considered to be a forward contract under this clause only
with respect to each agreement or transaction under the master agreement that
is referred to in subclause (I), (II), or (III); or</text>
</subclause><subclause id="IDffd695a77ad241e29b3867d6f71eae4d"><enum>(V)</enum><text>any security agreement or
arrangement or other credit enhancement related to any agreement or transaction
referred to in subclause (I), (II), (III), or (IV), including any guarantee or
reimbursement obligation in connection with any agreement or transaction
referred to in any such subclause.</text>
</subclause></clause><clause id="ID76729b0fc1d0421fa1acb81b72ccfbbc"><enum>(v)</enum><header>Repurchase
agreement</header><text>The term <term>repurchase agreement</term> (which
definition also applies to a reverse repurchase agreement)—</text>
<subclause id="ID9a9c236e2ef747bca1a34878243c06ea"><enum>(I)</enum><text>means an agreement,
including related terms, which provides for the transfer of one or more
certificates of deposit, mortgage related securities (as such term is defined
in section 3 of the Securities Exchange Act of 1934), mortgage loans, interests
in mortgage-related securities or mortgage loans, eligible bankers’
acceptances, qualified foreign government securities (which, for purposes of
this clause, means a security that is a direct obligation of, or that is fully
guaranteed by, the central government of a member of the Organization for
Economic Cooperation and Development, as determined by regulation or order
adopted by the Board of Governors), or securities that are direct obligations
of, or that are fully guaranteed by, the United States or any agency of the
United States against the transfer of funds by the transferee of such
certificates of deposit, eligible bankers’ acceptances, securities, mortgage
loans, or interests with a simultaneous agreement by such transferee to
transfer to the transferor thereof certificates of deposit, eligible bankers’
acceptances, securities, mortgage loans, or interests as described above, at a
date certain not later than 1 year after such transfers or on demand, against
the transfer of funds, or any other similar agreement;</text>
</subclause><subclause id="ID9f6e59681f414b5caa45f05299ce3021"><enum>(II)</enum><text>does not include any
repurchase obligation under a participation in a commercial mortgage loan,
unless the Corporation determines, by regulation, resolution, or order to
include any such participation within the meaning of such term;</text>
</subclause><subclause id="IDd0e0c918ede04780b76f90bfcc109daf"><enum>(III)</enum><text>means any combination
of agreements or transactions referred to in subclauses (I) and (IV);</text>
</subclause><subclause id="IDc5b204a61d5f49da8bb2bb6b32000734"><enum>(IV)</enum><text>means any option to
enter into any agreement or transaction referred to in subclause (I) or
(III);</text>
</subclause><subclause id="ID6170d792a34b42b8972f5df46040eb12"><enum>(V)</enum><text>means a master agreement
that provides for an agreement or transaction referred to in subclause (I),
(III), or (IV), together with all supplements to any such master agreement,
without regard to whether the master agreement provides for an agreement or
transaction that is not a repurchase agreement under this clause, except that
the master agreement shall be considered to be a repurchase agreement under
this subclause only with respect to each agreement or transaction under the
master agreement that is referred to in subclause (I), (III), or (IV);
and</text>
</subclause><subclause id="ID29eba3d408f144cca644f143fcb2c7c1"><enum>(VI)</enum><text>means any security
agreement or arrangement or other credit enhancement related to any agreement
or transaction referred to in subclause (I), (III), (IV), or (V), including any
guarantee or reimbursement obligation in connection with any agreement or
transaction referred to in any such subclause.</text>
</subclause></clause><clause id="IDa16967c944c74aae96fcc48890e5c4ff"><enum>(vi)</enum><header>Swap
agreement</header><text>The term <term>swap agreement</term> means—</text>
<subclause id="IDcdb4db7bfcd64f968514aa13d5d4ef5b"><enum>(I)</enum><text>any agreement, including
the terms and conditions incorporated by reference in any such agreement, which
is an interest rate swap, option, future, or forward agreement, including a
rate floor, rate cap, rate collar, cross-currency rate swap, and basis swap; a
spot, same day-tomorrow, tomorrow-next, forward, or other foreign exchange,
precious metals, or other commodity agreement; a currency swap, option, future,
or forward agreement; an equity index or equity swap, option, future, or
forward agreement; a debt index or debt swap, option, future, or forward
agreement; a total return, credit spread or credit swap, option, future, or
forward agreement; a commodity index or commodity swap, option, future, or
forward agreement; weather swap, option, future, or forward agreement; an
emissions swap, option, future, or forward agreement; or an inflation swap,
option, future, or forward agreement;</text>
</subclause><subclause id="ID33786e2cea0c407b814726ce29b39472"><enum>(II)</enum><text>any agreement or
transaction that is similar to any other agreement or transaction referred to
in this clause and that is of a type that has been, is presently, or in the
future becomes, the subject of recurrent dealings in the swap or other
derivatives markets (including terms and conditions incorporated by reference
in such agreement) and that is a forward, swap, future, option, or spot
transaction on one or more rates, currencies, commodities, equity securities or
other equity instruments, debt securities or other debt instruments,
quantitative measures associated with an occurrence, extent of an occurrence,
or contingency associated with a financial, commercial, or economic
consequence, or economic or financial indices or measures of economic or
financial risk or value;</text>
</subclause><subclause id="ID3d3c0421f63f468691889272681e976b"><enum>(III)</enum><text>any combination of
agreements or transactions referred to in this clause;</text>
</subclause><subclause id="ID86385fb580904900957504a508f9be4a"><enum>(IV)</enum><text>any option to enter into
any agreement or transaction referred to in this clause;</text>
</subclause><subclause id="ID650e59fea17d43e7bce6a2a29e9e6519"><enum>(V)</enum><text>a master agreement that
provides for an agreement or transaction referred to in subclause (I), (II),
(III), or (IV), together with all supplements to any such master agreement,
without regard to whether the master agreement contains an agreement or
transaction that is not a swap agreement under this clause, except that the
master agreement shall be considered to be a swap agreement under this clause
only with respect to each agreement or transaction under the master agreement
that is referred to in subclause (I), (II), (III), or (IV); and</text>
</subclause><subclause id="ID8ecabeb5678944f3b1b0719ab6f0bf6a"><enum>(VI)</enum><text>any security agreement
or arrangement or other credit enhancement related to any agreement or
transaction referred to in any of clauses (I) through (V), including any
guarantee or reimbursement obligation in connection with any agreement or
transaction referred to in any such clause.</text>
</subclause></clause><clause id="ID523fe3446fd24ab69c8e1db728ec1465"><enum>(vii)</enum><header>Definitions relating
to default</header><text>When used in this paragraph and paragraph (10)—</text>
<subclause id="ID8e83294736f7407c84c403c240665c36"><enum>(I)</enum><text>the term
<term>default</term> means, with respect to a covered financial company, any
adjudication or other official decision by any court of competent jurisdiction,
or other public authority pursuant to which the Corporation has been appointed
receiver; and</text>
</subclause><subclause id="IDb90115f4f4a049d3869942347beeaed8"><enum>(II)</enum><text>the term <term>in danger
of default</term> means a covered financial company with respect to which the
Corporation or appropriate State authority has determined that—</text>
<item id="IDa3d04ccbcc23467d9e6f74c7552ffc5a"><enum>(aa)</enum><text>in the opinion of the
Corporation or such authority—</text>
<subitem id="IDd518234a580a4b82a0b0a409432e8fc1"><enum>(AA)</enum><text>the covered financial
company is not likely to be able to pay its obligations in the normal course of
business; and</text>
</subitem><subitem id="ID6d70a13a13674360af783e412a63b20e"><enum>(BB)</enum><text>there is no reasonable
prospect that the covered financial company will be able to pay such
obligations without Federal assistance; or</text>
</subitem></item><item id="ID461ae377a7324751b797b894015039b0"><enum>(bb)</enum><text>in the opinion of the
Corporation or such authority—</text>
<subitem id="IDc67555d9d92d437ebe2162ddca8fa10a"><enum>(AA)</enum><text>the covered financial
company has incurred or is likely to incur losses that will deplete all or
substantially all of its capital; and</text>
</subitem><subitem id="ID1910f02572b548b2a658d0773899905b"><enum>(BB)</enum><text>there is no reasonable
prospect that the capital will be replenished without Federal
assistance.</text>
</subitem></item></subclause></clause><clause id="ID48f2e8bb90804edbbfed2f85183b19c4"><enum>(viii)</enum><header>Treatment of master
agreement as one agreement</header><text>Any master agreement for any contract
or agreement described in any of clauses (i) through (vi) (or any master
agreement for such master agreement or agreements), together with all
supplements to such master agreement, shall be treated as a single agreement
and a single qualified financial contact. If a master agreement contains
provisions relating to agreements or transactions that are not themselves
qualified financial contracts, the master agreement shall be deemed to be a
qualified financial contract only with respect to those transactions that are
themselves qualified financial contracts.</text>
</clause><clause id="ID9c4e71d5aa8644fe98bfb0f8e6ea21e8"><enum>(ix)</enum><header>Transfer</header><text>The
term <term>transfer</term> means every mode, direct or indirect, absolute or
conditional, voluntary or involuntary, of disposing of or parting with property
or with an interest in property, including retention of title as a security
interest and foreclosure of the equity of redemption of the covered financial
company.</text>
</clause><clause id="ID04acc28bf72d439bbb38a8ed1dc50133"><enum>(x)</enum><header>Person</header><text>The
term <term>person</term> includes any governmental entity in addition to any
entity included in the definition of such term in section 1, title 1, United
States Code.</text>
</clause></subparagraph><subparagraph id="IDd26aebb6ea384b248ef0f8c44b088338"><enum>(E)</enum><header>Clarification</header><text>No
provision of law shall be construed as limiting the right or power of the
Corporation, or authorizing any court or agency to limit or delay, in any
manner, the right or power of the Corporation to transfer any qualified
financial contract in accordance with paragraphs (9) and (10) of this
subsection or to disaffirm or repudiate any such contract in accordance with
subsection (c)(1).</text>
</subparagraph><subparagraph id="ID7e7298c059b14d6ab5c11851d649304e"><enum>(F)</enum><header>Walkaway clauses not
effective</header>
<clause id="IDf02345f07a804bdbb9c2c4c7ddc4f425"><enum>(i)</enum><header>In
general</header><text>Notwithstanding the provisions of subparagraph (A) of
this paragraph and sections 403 and 404 of the Federal Deposit Insurance
Corporation Improvement Act of 1991, no walkaway clause shall be enforceable in
a qualified financial contract of a covered financial company in
default.</text>
</clause><clause id="IDcbf99ce1799842c6ae2f83ca82321983"><enum>(ii)</enum><header>Limited suspension of
certain obligations</header><text>In the case of a qualified financial contract
referred to in clause (i), any payment or delivery obligations otherwise due
from a party pursuant to the qualified financial contract shall be suspended
from the time at which the Corporation is appointed as receiver until the
earlier of—</text>
<subclause id="ID17629d558763444193b7641df272e485"><enum>(I)</enum><text>the time at which such
party receives notice that such contract has been transferred pursuant to
paragraph (10)(A); or</text>
</subclause><subclause id="IDcf29c72c1a894ee99260a8ded95698fe"><enum>(II)</enum><text>5:00 p.m. (eastern time)
on the 3rd business day following the date of the appointment of the
Corporation as receiver.</text>
</subclause></clause><clause id="ID7d5a0c054d01427a8a7b373c2394abb5"><enum>(iii)</enum><header>Walkaway clause
defined</header><text>For purposes of this subparagraph, the term
<term>walkaway clause</term> means any provision in a qualified financial
contract that suspends, conditions, or extinguishes a payment obligation of a
party, in whole or in part, or does not create a payment obligation of a party
that would otherwise exist, solely because of the status of such party as a
nondefaulting party in connection with the insolvency of a covered financial
company that is a party to the contract or the appointment of or the exercise
of rights or powers by the Corporation as receiver for such covered financial
company, and not as a result of the exercise by a party of any right to offset,
setoff, or net obligations that exist under the contract, any other contract
between those parties, or applicable law.</text>
</clause><clause id="ID03ed6db8a65d40b6bf37a302c4ca2d3f"><enum>(iv)</enum><header>Certain obligations to
clearing organizations</header><text>In the event that the Corporation has been
appointed as receiver for a covered financial company which is a party to any
qualified financial contract cleared by or subject to the rules of a clearing
organization (as defined in subsection (c)(9)(D)), the receiver shall use its
best efforts to meet all margin, collateral, and settlement obligations of the
covered financial company that arise under qualified financial contracts (other
than any margin, collateral, or settlement obligation that is not enforceable
against the receiver under paragraph (8)(F)(i) or paragraph (10)(B)), as
required by the rules of the clearing organization when due, and such
obligations shall not be suspended pursuant to paragraph (8)(F)(ii).
Notwithstanding paragraph (8)(F)(ii) or (10)(B), if the receiver fails to
satisfy any such margin, collateral, or settlement obligations under the rules
of the clearing organization, the clearing organization shall have the
immediate right to exercise, and shall not be stayed from exercising, all of
its rights and remedies under its rules and applicable law with respect to any
qualified financial contract of the covered financial company, including,
without limitation, the right to liquidate all positions and collateral of such
covered financial company under the company's qualified financial contracts,
and suspend or cease to act for such covered financial company, all in
accordance with the rules of the clearing organization.</text>
</clause></subparagraph><subparagraph commented="no" id="ID22b9b785ef3b4a82bcff7a4e860021af"><enum>(G)</enum><header>Recordkeeping</header>
<clause commented="no" id="ID6a9a56fc8969494282228e5d03ac21cd"><enum>(i)</enum><header>Joint
rulemaking</header><text>The Federal primary financial regulatory agencies
shall jointly prescribe regulations requiring that financial companies maintain
such records with respect to qualified financial contracts (including market
valuations) that the Federal primary financial regulatory agencies determine to
be necessary or appropriate in order to assist the Corporation as receiver for
a covered financial company in being able to exercise its rights and fulfill
its obligations under this paragraph or paragraph (9) or (10).</text>
</clause><clause commented="no" id="IDd58a01151dff43cf9327f4ad5e7e3fa7"><enum>(ii)</enum><header>Timeframe</header><text>The
Federal primary financial regulatory agencies shall prescribe joint final or
interim final regulations not later than 24 months after the date of enactment
of this Act.</text>
</clause><clause commented="no" id="ID95275699a97c41c9b54776e14662ad02"><enum>(iii)</enum><header>Back-Up rulemaking
authority</header><text>If the Federal primary financial regulatory agencies do
not prescribe joint final or interim final regulations within the time frame in
clause (ii), the Chairperson of the Council shall prescribe, in consultation
with the Corporation, the regulations required by clause (i).</text>
</clause><clause commented="no" id="ID10e4e55828434e868b02d1903e1df117"><enum>(iv)</enum><header>Categorization and
tiering</header><text>The joint regulations prescribed under clause (i) shall,
as appropriate, differentiate among financial companies by taking into
consideration their size, risk, complexity, leverage, frequency and dollar
amount of qualified financial contracts, interconnectedness to the financial
system, and any other factors deemed appropriate.</text>
</clause></subparagraph></paragraph><paragraph id="ID4740cdff8fcf4e2b961567285aba0c40"><enum>(9)</enum><header>Transfer of qualified
financial contracts</header>
<subparagraph id="ID73876042bf474c94822415ca7b4be639"><enum>(A)</enum><header>In
general</header><text>In making any transfer of assets or liabilities of a
covered financial company in default, which includes any qualified financial
contract, the Corporation as receiver for such covered financial company shall
either—</text>
<clause id="ID8b92f208c5ad4aaf94cd5a5a2ec66676"><enum>(i)</enum><text>transfer to one financial
institution, other than a financial institution for which a conservator,
receiver, trustee in bankruptcy, or other legal custodian has been appointed or
which is otherwise the subject of a bankruptcy or insolvency proceeding—</text>
<subclause id="IDad65f7b1cd6a46c782d06f7d79850c81"><enum>(I)</enum><text>all qualified financial
contracts between any person or any affiliate of such person and the covered
financial company in default;</text>
</subclause><subclause id="IDcd25ec8527a040d6a1c4a5983d193de3"><enum>(II)</enum><text>all claims of such
person or any affiliate of such person against such covered financial company
under any such contract (other than any claim which, under the terms of any
such contract, is subordinated to the claims of general unsecured creditors of
such company);</text>
</subclause><subclause id="ID246d34a1f9454e36923efeaf3c4ca6ba"><enum>(III)</enum><text>all claims of such
covered financial company against such person or any affiliate of such person
under any such contract; and</text>
</subclause><subclause id="IDdaf00883a9524da1bddfcd72ec86f4a5"><enum>(IV)</enum><text>all property securing or
any other credit enhancement for any contract described in subclause (I) or any
claim described in subclause (II) or (III) under any such contract; or</text>
</subclause></clause><clause id="IDb379e5440c844317b4a62d1b74fe6930"><enum>(ii)</enum><text>transfer none of the
qualified financial contracts, claims, property or other credit enhancement
referred to in clause (i) (with respect to such person and any affiliate of
such person).</text>
</clause></subparagraph><subparagraph id="ID2fac87e98dcd4f47adc4284f05ecaee8"><enum>(B)</enum><header>Transfer to foreign
bank, financial institution, or branch or agency thereof</header><text>In
transferring any qualified financial contracts and related claims and property
under subparagraph (A)(i), the Corporation as receiver for the covered
financial company shall not make such transfer to a foreign bank, financial
institution organized under the laws of a foreign country, or a branch or
agency of a foreign bank or financial institution unless, under the law
applicable to such bank, financial institution, branch or agency, to the
qualified financial contracts, and to any netting contract, any security
agreement or arrangement or other credit enhancement related to one or more
qualified financial contracts, the contractual rights of the parties to such
qualified financial contracts, netting contracts, security agreements or
arrangements, or other credit enhancements are enforceable substantially to the
same extent as permitted under this section.</text>
</subparagraph><subparagraph id="ID2179eb5d74c84ee9a3bb71873bc5e49e"><enum>(C)</enum><header>Transfer of contracts
subject to the rules of a clearing organization</header><text>In the event that
the Corporation as receiver for a financial institution transfers any qualified
financial contract and related claims, property, or credit enhancement pursuant
to subparagraph (A)(i) and such contract is cleared by or subject to the rules
of a clearing organization, the clearing organization shall not be required to
accept the transferee as a member by virtue of the transfer.</text>
</subparagraph><subparagraph id="ID3de4299546b94e1a92a8a6cc9fe04d2c"><enum>(D)</enum><header>Definitions</header><text>For
purposes of this paragraph—</text>
<clause id="ID9ab143eb99e541e1b4504cef7934e939"><enum>(i)</enum><text>the term <term>financial
institution</term> means a broker or dealer, a depository institution, a
futures commission merchant, a bridge financial company, or any other
institution determined by the Corporation, by regulation, to be a financial
institution; and</text>
</clause><clause id="IDfd6849ff02ec4687bc6453e001a1a98f"><enum>(ii)</enum><text>the term <term>clearing
organization</term> has the same meaning as in section 402 of the Federal
Deposit Insurance Corporation Improvement Act of 1991.</text>
</clause></subparagraph></paragraph><paragraph id="IDb94b3aea1f8c417785f9bc46cfe33677"><enum>(10)</enum><header>Notification of
transfer</header>
<subparagraph id="IDf8364137af1748c19326ae102b589b0e"><enum>(A)</enum><header>In general</header>
<clause id="ID267ecfafb6314f2e8b76711b0293cb1e"><enum>(i)</enum><header>Notice</header><text>The
Corporation shall provide notice in accordance with clause (ii), if—</text>
<subclause id="ID6063f169b16d45439f723437125bff47"><enum>(I)</enum><text>the Corporation as
receiver for a covered financial company in default or in danger of default
transfers any assets or liabilities of the covered financial company;
and</text>
</subclause><subclause id="IDdcf969fd09174680b0b6186422de3eff"><enum>(II)</enum><text>the transfer includes
any qualified financial contract.</text>
</subclause></clause><clause id="ID04aa6f12b28a4886b4ed759bf34dcafc"><enum>(ii)</enum><header>Timing</header><text>The
Corporation as receiver for a covered financial company shall notify any person
who is a party to any contract described in clause (i) of such transfer not
later than 5:00 p.m. (eastern time) on the 3rd business day following the date
of the appointment of the Corporation as receiver.</text>
</clause></subparagraph><subparagraph id="ID9954e2e8bc5a4f87ba00d81abf5f0601"><enum>(B)</enum><header>Certain rights not
enforceable</header>
<clause id="IDd59fef08a7514d96b5cd4bcd428a0396"><enum>(i)</enum><header>Receivership</header><text>A
person who is a party to a qualified financial contract with a covered
financial company may not exercise any right that such person has to terminate,
liquidate, or net such contract under paragraph (8)(A) solely by reason of or
incidental to the appointment under this section of the Corporation as receiver
for the covered financial company (or the insolvency or financial condition of
the covered financial company for which the Corporation has been appointed as
receiver)—</text>
<subclause id="IDd4f5acef498a451fbeef7e28bf272f38"><enum>(I)</enum><text>until 5:00 p.m. (eastern
time) on the 3rd business day following the date of the appointment; or</text>
</subclause><subclause id="ID50eaf61a6e6343e2b6b6e09ff0cb2428"><enum>(II)</enum><text>after the person has
received notice that the contract has been transferred pursuant to paragraph
(9)(A).</text>
</subclause></clause><clause id="IDd862547cd2564e4892ef836cb7d2588b"><enum>(ii)</enum><header>Notice</header><text>For
purposes of this paragraph, the Corporation as receiver for a covered financial
company shall be deemed to have notified a person who is a party to a qualified
financial contract with such covered financial company, if the Corporation has
taken steps reasonably calculated to provide notice to such person by the time
specified in subparagraph (A).</text>
</clause></subparagraph><subparagraph id="ID3868b652e9fa45a6bce6e7c765b77f48"><enum>(C)</enum><header>Treatment of bridge
financial company</header><text>For purposes of paragraph (9), a bridge
financial company shall not be considered to be a covered financial company for
which a conservator, receiver, trustee in bankruptcy, or other legal custodian
has been appointed, or which is otherwise the subject of a bankruptcy or
insolvency proceeding.</text>
</subparagraph><subparagraph id="ID09f711030a884ba093084e1e12bdbd48"><enum>(D)</enum><header>Business day
defined</header><text>For purposes of this paragraph, the term <term>business
day</term> means any day other than any Saturday, Sunday, or any day on which
either the New York Stock Exchange or the Federal Reserve Bank of New York is
closed.</text>
</subparagraph></paragraph><paragraph id="IDbb261e38757a4af385e0dc1ffd09e960"><enum>(11)</enum><header>Disaffirmance or
repudiation of qualified financial contracts</header><text>In exercising the
rights of disaffirmance or repudiation of the Corporation as receiver with
respect to any qualified financial contract to which a covered financial
company is a party, the Corporation shall either—</text>
<subparagraph id="IDa27418c0720f44f3b3cc64795886cd21"><enum>(A)</enum><text>disaffirm or repudiate
all qualified financial contracts between—</text>
<clause id="ID1b3c5c63b93a41f9bc31d81563f12d2f"><enum>(i)</enum><text>any person or any
affiliate of such person; and</text>
</clause><clause id="IDf912fc4297bd45859ad70900ad486a54"><enum>(ii)</enum><text>the covered financial
company in default; or</text>
</clause></subparagraph><subparagraph id="ID80bf843cdc2442b98992c733a5fed6f2"><enum>(B)</enum><text>disaffirm or repudiate
none of the qualified financial contracts referred to in subparagraph (A) (with
respect to such person or any affiliate of such person).</text>
</subparagraph></paragraph><paragraph id="ID3b1a3f69a514433fbc398f2c0e597932"><enum>(12)</enum><header>Certain security and
customer interests not avoidable</header><text>No provision of this subsection
shall be construed as permitting the avoidance of any—</text>
<subparagraph id="ID06379db16e464b5f8c35970843bccd5d"><enum>(A)</enum><text>legally enforceable or
perfected security interest in any of the assets of any covered financial
company, except in accordance with subsection (a)(11); or</text>
</subparagraph><subparagraph id="IDeacc47292a95460e9651475899cad496"><enum>(B)</enum><text>legally enforceable
interest in customer property, security entitlements in respect of assets or
property held by the covered financial company for any security entitlement
holder.</text>
</subparagraph></paragraph><paragraph id="ID32f8ad8a474440319f6ed4211ab9b80f"><enum>(13)</enum><header>Authority to enforce
contracts</header>
<subparagraph id="ID23c5722f3d1a425da77af9737a9a68ee"><enum>(A)</enum><header>In
general</header><text>The Corporation, as receiver for a covered financial
company, may enforce any contract, other than a liability insurance contract of
a director or officer, a financial institution bond entered into by the covered
financial company, notwithstanding any provision of the contract providing for
termination, default, acceleration, or exercise of rights upon, or solely by
reason of, insolvency, the appointment of or the exercise of rights or powers
by the Corporation as receiver, the filing of the petition pursuant to section
202(a)(1), or the issuance of the recommendations or determination, or any
actions or events occurring in connection therewith or as a result thereof,
pursuant to section 203.</text>
</subparagraph><subparagraph id="IDefd92c8c669e4b9f9185dc40e5e260a7"><enum>(B)</enum><header>Certain rights not
affected</header><text>No provision of this paragraph may be construed as
impairing or affecting any right of the Corporation as receiver to enforce or
recover under a liability insurance contract of a director or officer or
financial institution bond under other applicable law.</text>
</subparagraph><subparagraph id="ID9d537810100e431d83f4fe897894cc5f"><enum>(C)</enum><header>Consent requirement and
ipso facto clauses</header>
<clause id="IDb4e5083cf6a64e56a7f873069d66ee9f"><enum>(i)</enum><header>In
general</header><text>Except as otherwise provided by this section, no person
may exercise any right or power to terminate, accelerate, or declare a default
under any contract to which the covered financial company is a party (and no
provision in any such contract providing for such default, termination, or
acceleration shall be enforceable), or to obtain possession of or exercise
control over any property of the covered financial company or affect any
contractual rights of the covered financial company, without the consent of the
Corporation as receiver for the covered financial company during the 90 day
period beginning from the appointment of the Corporation as receiver.</text>
</clause><clause id="ID7486579cfe7b4e2ab8b41bf95da25008"><enum>(ii)</enum><header>Exceptions</header><text>No
provision of this subparagraph shall apply to a director or officer liability
insurance contract or a financial institution bond, to the rights of parties to
certain qualified financial contracts pursuant to paragraph (8), or to the
rights of parties to netting contracts pursuant to subtitle A of title IV of
the Federal Deposit Insurance Corporation Improvement Act of 1991 (12 U.S.C.
4401 et seq.), or shall be construed as permitting the Corporation as receiver
to fail to comply with otherwise enforceable provisions of such
contract.</text>
</clause></subparagraph><subparagraph id="IDbd678d20b5b1416f86709922c20342df"><enum>(D)</enum><header>Contracts to extend
credit</header><text>Notwithstanding any other provision in this title, if the
Corporation as receiver enforces any contract to extend credit to the covered
financial company or bridge financial company, any valid and enforceable
obligation to repay such debt shall be paid by the Corporation as receiver, as
an administrative expense of the receivership.</text>
</subparagraph></paragraph><paragraph id="IDbada4b84d8954e4ba7b35593b749630d"><enum>(14)</enum><header>Exception for Federal
reserve banks and corporation security interest</header><text>No provision of
this subsection shall apply with respect to—</text>
<subparagraph id="ID0c7888cb652d42ab830e97d8cb9831b0"><enum>(A)</enum><text>any extension of credit
from any Federal reserve bank or the Corporation to any covered financial
company; or</text>
</subparagraph><subparagraph id="IDc38d32616e5c4c339a146a689ed3a77e"><enum>(B)</enum><text>any security interest in
the assets of the covered financial company securing any such extension of
credit.</text>
</subparagraph></paragraph><paragraph id="ID91dd809db0f64903bdb1780a85a310ad"><enum>(15)</enum><header>Savings
clause</header><text>The meanings of terms used in this subsection are
applicable for purposes of this subsection only, and shall not be construed or
applied so as to challenge or affect the characterization, definition, or
treatment of any similar terms under any other statute, regulation, or rule,
including the Gramm-Leach-Bliley Act, the Legal Certainty for Bank Products Act
of 2000, the securities laws (as that term is defined in section 3(a)(47) of
the Securities Exchange Act of 1934), and the Commodity Exchange Act.</text>
</paragraph><paragraph id="ID5352c1b0129546d49c3f2c9b8d3f328c"><enum>(16)</enum><header>Enforcement of
contracts guaranteed by the covered financial company</header>
<subparagraph id="ID58544144ddd24667bfbe68b96769b1f5"><enum>(A)</enum><header>In
General</header><text>The Corporation, as receiver for a covered financial
company or as receiver for a subsidiary of a covered financial company
(including an insured depository institution) shall have the power to enforce
contracts of subsidiaries or affiliates of the covered financial company, the
obligations under which are guaranteed or otherwise supported by or linked to
the covered financial company, notwithstanding any contractual right to cause
the termination, liquidation, or acceleration of such contracts based solely on
the insolvency, financial condition, or receivership of the covered financial
company, if—</text>
<clause id="IDbc906ea14b2c407d82f999a1fb25e569"><enum>(i)</enum><text>such guaranty or other
support and all related assets and liabilities are transferred to and assumed
by a bridge financial company or a third party (other than a third party for
which a conservator, receiver, trustee in bankruptcy, or other legal custodian
has been appointed, or which is otherwise the subject of a bankruptcy or
insolvency proceeding) within the same period of time as the Corporation is
entitled to transfer the qualified financial contracts of such covered
financial company; or</text>
</clause><clause id="id5C1B6FAB25214F6D936947C6286A34F5"><enum>(ii)</enum><text>the Corporation, as
receiver, otherwise provides adequate protection with respect to such
obligations.</text>
</clause></subparagraph><subparagraph commented="no" id="id3BEA71CF01A2491B9D290758A2D886E8"><enum>(B)</enum><header>Rule of
construction</header><text>For purposes of this paragraph, a bridge financial
company shall not be considered to be a third party for which a conservator,
receiver, trustee in bankruptcy, or other legal custodian has been appointed,
or which is otherwise the subject of a bankruptcy or insolvency
proceeding.</text>
</subparagraph></paragraph></subsection><subsection id="ID0818150e32544e49bdffe761050adc07"><enum>(d)</enum><header>Valuation of claims in
default</header>
<paragraph id="ID9765df72512c4ed2a08a0b71604c60f7"><enum>(1)</enum><header>In
general</header><text>Notwithstanding any other provision of Federal law or the
law of any State, and regardless of the method utilized by the Corporation for
a covered financial company, including transactions authorized under subsection
(h), this subsection shall govern the rights of the creditors of any such
covered financial company.</text>
</paragraph><paragraph id="IDb03d98803f81485eb26891da4410cec5"><enum>(2)</enum><header>Maximum
liability</header><text>The maximum liability of the Corporation, acting as
receiver for a covered financial company or in any other capacity, to any
person having a claim against the Corporation as receiver or the covered
financial company for which the Corporation is appointed shall equal the amount
that such claimant would have received if—</text>
<subparagraph id="ID8f58cd19f6ee4c79a2a6db927d60d0d5"><enum>(A)</enum><text>the Corporation had not
been appointed receiver with respect to the covered financial company;
and</text>
</subparagraph><subparagraph id="ID4db2a18aee734c538a54fb61ffc137ad"><enum>(B)</enum><text>the covered financial
company had been liquidated under chapter 7 of the Bankruptcy Code, or any
similar provision of State insolvency law applicable to the covered financial
company.</text>
</subparagraph></paragraph><paragraph id="IDa732216b805f4fb9a6a8218bb1e74d9b"><enum>(3)</enum><header>Special provision for
orderly liquidation by sipc</header><text>The maximum liability of the
Corporation, acting as receiver or in its corporate capacity for any covered
broker or dealer to any customer of such covered broker or dealer, with respect
to customer property of such customer, shall be—</text>
<subparagraph id="id6007732CEB0E406DA6D70F1F024BC937"><enum>(A)</enum><text>equal to the amount that
such customer would have received with respect to such customer property in a
case initiated by SIPC under the Securities Investor Protection Act of 1970 (15
U.S.C. 78aaa et seq.); and</text>
</subparagraph><subparagraph id="id39134223ED6E4E5AB3A32EC3B08842FB"><enum>(B)</enum><text>determined as of the
close of business on the date on which the Corporation is appointed as
receiver.</text>
</subparagraph></paragraph><paragraph id="ID44ab552ec4744d438fa26531c25fba83"><enum>(4)</enum><header>Additional payments
authorized</header>
<subparagraph id="ID25dca7f1b03d40f188045c56abcac7b6"><enum>(A)</enum><header>In
general</header><text>Subject to subsection (o)(1)(E)(ii), the Corporation,
with the approval of the Secretary, may make additional payments or credit
additional amounts to or with respect to or for the account of any claimant or
category of claimants of the covered financial company, if the Corporation
determines that such payments or credits are necessary or appropriate to
minimize losses to the Corporation as receiver from the orderly liquidation of
the covered financial company under this section.</text>
</subparagraph><subparagraph id="IDcccb4b29f8134fa1ae585755a21c87af"><enum>(B)</enum><header>Limitations</header>
<clause id="ID4b1c48c92d05458eb33eb56c254ed0ba"><enum>(i)</enum><header>Prohibition</header><text>The
Corporation shall not make any payments or credit amounts to any claimant or
category of claimants that would result in any claimant receiving more than the
face value amount of any claim that is proven to the satisfaction of the
Corporation.</text>
</clause><clause commented="no" display-inline="no-display-inline" id="IDa6eb8a9d74d54b8097dc7400ff337ef3"><enum>(ii)</enum><header>No
obligation</header><text>Notwithstanding any other provision of Federal or
State law, or the Constitution of any State, the Corporation shall not be
obligated, as a result of having made any payment under subparagraph (A) or
credited any amount described in subparagraph (A) to or with respect to, or for
the account, of any claimant or category of claimants, to make payments to any
other claimant or category of claimants.</text>
</clause></subparagraph><subparagraph id="ID016eb54c4e464cd7bd9fd94653352bcf"><enum>(C)</enum><header>Manner of
payment</header><text>The Corporation may make payments or credit amounts under
subparagraph (A) directly to the claimants or may make such payments or credit
such amounts to a company other than a covered financial company or a bridge
financial company established with respect thereto in order to induce such
other company to accept liability for such claims.</text>
</subparagraph></paragraph></subsection><subsection id="IDab53f770da7f445393dc9052ed5e0360"><enum>(e)</enum><header>Limitation on court
action</header><text>Except as provided in this title, no court may take any
action to restrain or affect the exercise of powers or functions of the
receiver hereunder, and any remedy against the Corporation or receiver shall be
limited to money damages determined in accordance with this title.</text>
</subsection><subsection id="IDfd592a6009bf42eea15f0dc74a9265c4"><enum>(f)</enum><header>Liability of directors
and officers</header>
<paragraph id="IDb54df78da988464196ebfac38d3bf325"><enum>(1)</enum><header>In
general</header><text>A director or officer of a covered financial company may
be held personally liable for monetary damages in any civil action described in
paragraph (2) by, on behalf of, or at the request or direction of the
Corporation, which action is prosecuted wholly or partially for the benefit of
the Corporation—</text>
<subparagraph id="ID2147e6ce999d4342a380bd25e122cb93"><enum>(A)</enum><text>acting as receiver for
such covered financial company;</text>
</subparagraph><subparagraph id="IDcfde917340b64617a7b0a1f0d844f087"><enum>(B)</enum><text>acting based upon a suit,
claim, or cause of action purchased from, assigned by, or otherwise conveyed by
the Corporation as receiver; or</text>
</subparagraph><subparagraph id="ID383055574123464fa879b3c48eaa56b9"><enum>(C)</enum><text>acting based upon a suit,
claim, or cause of action purchased from, assigned by, or otherwise conveyed in
whole or in part by a covered financial company or its affiliate in connection
with assistance provided under this title.</text>
</subparagraph></paragraph><paragraph id="ID02783569ad2345268ee029c85ecaa5a0"><enum>(2)</enum><header>Actions
covered</header><text>Paragraph (1) shall apply with respect to actions for
gross negligence, including any similar conduct or conduct that demonstrates a
greater disregard of a duty of care (than gross negligence) including
intentional tortious conduct, as such terms are defined and determined under
applicable State law.</text>
</paragraph><paragraph id="ID4d86f7f2e420425e9c86df40bab4832c"><enum>(3)</enum><header>Savings
clause</header><text>Nothing in this subsection shall impair or affect any
right of the Corporation under other applicable law.</text>
</paragraph></subsection><subsection id="ID4d8953d2f4f34bc5950329a7a8da95ae"><enum>(g)</enum><header>Damages</header><text>In
any proceeding related to any claim against a director, officer, employee,
agent, attorney, accountant, or appraiser of a covered financial company, or
any other party employed by or providing services to a covered financial
company, recoverable damages determined to result from the improvident or
otherwise improper use or investment of any assets of the covered financial
company shall include principal losses and appropriate interest.</text>
</subsection><subsection id="ID6822cd1c94e44fed967e6426b941602e"><enum>(h)</enum><header>Bridge financial
companies</header>
<paragraph id="IDc4c95150411e424c99a08129a82b8240"><enum>(1)</enum><header>Organization</header>
<subparagraph id="IDa5f6431ee6684eb08b459fa620f50332"><enum>(A)</enum><header>Purpose</header><text>The
Corporation, as receiver for one or more covered financial companies or in
anticipation of being appointed receiver for one or more covered financial
companies, may organize one or more bridge financial companies in accordance
with this subsection.</text>
</subparagraph><subparagraph id="IDcde6a5201b4c438eaa01b788f6ae86d0"><enum>(B)</enum><header>Authorities</header><text>Upon
the creation of a bridge financial company under subparagraph (A) with respect
to a covered financial company, such bridge financial company may—</text>
<clause id="ID139bf8ce4030424b8e593b45df088aff"><enum>(i)</enum><text>assume such liabilities
(including liabilities associated with any trust or custody business, but
excluding any liabilities that count as regulatory capital) of such covered
financial company as the Corporation may, in its discretion, determine to be
appropriate;</text>
</clause><clause id="IDf800f557167349609e2a3a4dcf75073e"><enum>(ii)</enum><text>purchase such assets
(including assets associated with any trust or custody business) of such
covered financial company as the Corporation may, in its discretion, determine
to be appropriate; and</text>
</clause><clause id="ID0b4cf5c031834dbba507ce6dd88cf111"><enum>(iii)</enum><text>perform any other
temporary function which the Corporation may, in its discretion, prescribe in
accordance with this section.</text>
</clause></subparagraph></paragraph><paragraph id="ID8d92dfa7785641eea29ae6517b2d0c12"><enum>(2)</enum><header>Charter and
establishment</header>
<subparagraph id="ID2824e72609834c2680cf3f27c6b008a9"><enum>(A)</enum><header>Establishment</header><text>Except
as provided in subparagraph (H), where the covered financial company is a
covered broker or dealer, the Corporation, as receiver for a covered financial
company, may grant a Federal charter to and approve articles of association for
one or more bridge financial company or companies, with respect to such covered
financial company which shall, by operation of law and immediately upon
issuance of its charter and approval of its articles of association, be
established and operate in accordance with, and subject to, such charter,
articles, and this section.</text>
</subparagraph><subparagraph id="ID9bc1164d17074b21b5c8b924b345e171"><enum>(B)</enum><header>Management</header><text>Upon
its establishment, a bridge financial company shall be under the management of
a board of directors appointed by the Corporation.</text>
</subparagraph><subparagraph id="IDd2a75922a19441158633b1d934169700"><enum>(C)</enum><header>Articles of
association</header><text>The articles of association and organization
certificate of a bridge financial company shall have such terms as the
Corporation may provide, and shall be executed by such representatives as the
Corporation may designate.</text>
</subparagraph><subparagraph id="IDf6fa8eadfac14e099cd71691002ed872"><enum>(D)</enum><header>Terms of charter;
rights and privileges</header><text>Subject to and in accordance with the
provisions of this subsection, the Corporation shall—</text>
<clause id="ID3bcbecca58124d7fb13ffd4f1a4e2eb9"><enum>(i)</enum><text>establish the terms of
the charter of a bridge financial company and the rights, powers, authorities,
and privileges of a bridge financial company granted by the charter or as an
incident thereto; and</text>
</clause><clause id="ID3c326516c26f4510abbf5a8b4594b5d6"><enum>(ii)</enum><text>provide for, and
establish the terms and conditions governing, the management (including the
bylaws and the number of directors of the board of directors) and operations of
the bridge financial company.</text>
</clause></subparagraph><subparagraph id="ID11722becbc834f3685a5eca5bff88dc3"><enum>(E)</enum><header>Transfer of rights and
privileges of covered financial company</header>
<clause id="IDa9c4bfd2c97541408198ef8d9acb4340"><enum>(i)</enum><header>In
general</header><text>Notwithstanding any other provision of Federal or State
law, the Corporation may provide for a bridge financial company to succeed to
and assume any rights, powers, authorities, or privileges of the covered
financial company with respect to which the bridge financial company was
established and, upon such determination by the Corporation, the bridge
financial company shall immediately and by operation of law succeed to and
assume such rights, powers, authorities, and privileges.</text>
</clause><clause id="IDe84e59f32bd94db88b25264bb1b90165"><enum>(ii)</enum><header>Effective without
approval</header><text>Any succession to or assumption by a bridge financial
company of rights, powers, authorities, or privileges of a covered financial
company under clause (i) or otherwise shall be effective without any further
approval under Federal or State law, assignment, or consent with respect
thereto.</text>
</clause></subparagraph><subparagraph id="ID9f8bd9f9ab604cd8a5c0b5c0cd8c2369"><enum>(F)</enum><header>Corporate governance
and election and designation of body of law</header><text>To the extent
permitted by the Corporation and consistent with this section and any rules,
regulations, or directives issued by the Corporation under this section, a
bridge financial company may elect to follow the corporate governance practices
and procedures that are applicable to a corporation incorporated under the
general corporation law of the State of Delaware, or the State of incorporation
or organization of the covered financial company with respect to which the
bridge financial company was established, as such law may be amended from time
to time.</text>
</subparagraph><subparagraph id="ID7aa020ed9a9943ca82579a8c1814db46"><enum>(G)</enum><header>Capital</header>
<clause id="ID8c7d3b0bd376491695f6743ba66f9ab9"><enum>(i)</enum><header>Capital not
required</header><text>Notwithstanding any other provision of Federal or State
law, a bridge financial company may, if permitted by the Corporation, operate
without any capital or surplus, or with such capital or surplus as the
Corporation may in its discretion determine to be appropriate.</text>
</clause><clause id="IDc21af21f0ebc4962ac7c6a7eed80af53"><enum>(ii)</enum><header>No contribution by the
corporation required</header><text>The Corporation is not required to pay
capital into a bridge financial company or to issue any capital stock on behalf
of a bridge financial company established under this subsection.</text>
</clause><clause id="IDa2451199b7014611a0a3ff1a3e8fd32f"><enum>(iii)</enum><header>Authority</header><text>If
the Corporation determines that such action is advisable, the Corporation may
cause capital stock or other securities of a bridge financial company
established with respect to a covered financial company to be issued and
offered for sale in such amounts and on such terms and conditions as the
Corporation may, in its discretion, determine.</text>
</clause><clause id="IDddb53250f5644eb2b660fddd3bae71b9"><enum>(iv)</enum><header>Operating funds in
lieu of capital and implementation plan</header><text>Upon the organization of
a bridge financial company, and thereafter as the Corporation may, in its
discretion, determine to be necessary or advisable, the Corporation may make
available to the bridge financial company, subject to the plan described in
subsection (n)(11), funds for the operation of the bridge financial company in
lieu of capital.</text>
</clause></subparagraph><subparagraph id="ID62abc4072c8d4497965dbb74c3de2ab2"><enum>(H)</enum><header>Bridge brokers or
dealers</header>
<clause id="id303B68D708AA4B5EB6D094AE4AB7EF87"><enum>(i)</enum><header>In
general</header><text>The Corporation, as receiver for a covered broker or
dealer, may approve articles of association for one or more bridge financial
companies with respect to such covered broker or dealer, which bridge financial
company or companies shall, by operation of law and immediately upon approval
of its articles of association—</text>
<subclause id="id57B56A7C27624BCD8006F1064763473B"><enum>(I)</enum><text>be established and deemed
registered with the Commission under the Securities Exchange Act of 1934 and a
member of SIPC;</text>
</subclause><subclause id="id735032398C554DB0BB6C0CB274A9F312"><enum>(II)</enum><text>operate in accordance
with such articles and this section; and</text>
</subclause><subclause id="id996627B795A246F08DF4556E0093AA27"><enum>(III)</enum><text>succeed to any and all
registrations and memberships of the covered financial company with or in any
self-regulatory organizations.</text>
</subclause></clause><clause id="id41B166C299C8408ABBEBF3036D899817"><enum>(ii)</enum><header>Other
requirements</header><text>Except as provided in clause (i), and
notwithstanding any other provision of this section, the bridge financial
company shall be subject to the Federal securities laws and all requirements
with respect to being a member of a self-regulatory organization, unless
exempted from any such requirements by the Commission, as is necessary or
appropriate in the public interest or for the protection of investors.</text>
</clause><clause id="id035298CF2C914A778168A24060371C21"><enum>(iii)</enum><header>Treatment of
customers</header><text>Except as otherwise provided by this title, any
customer of the covered broker or dealer whose account is transferred to a
bridge financial company shall have all the rights, privileges, and protections
under section 205(f) and under the Securities Investor Protection Act of 1970
(15 U.S.C. 78aaa et seq.), that such customer would have had if the account
were not transferred from the covered financial company under this
subparagraph.</text>
</clause><clause id="IDd794a9a5c9814db7906500834b91f70b"><enum>(iv)</enum><header>Operation of bridge
brokers or dealers</header><text>Notwithstanding any other provision of this
title, the Corporation shall not operate any bridge financial company created
by the Corporation under this title with respect to a covered broker or dealer
in such a manner as to adversely affect the ability of customers to promptly
access their customer property in accordance with applicable law.</text>
</clause></subparagraph></paragraph><paragraph id="ID9c90a2a736144d0c85672d563d5d0d9f"><enum>(3)</enum><header>Interests in and assets
and obligations of covered financial company</header><text>Notwithstanding
paragraph (1) or (2) or any other provision of law—</text>
<subparagraph id="id0E9C68F2E37D4C4286EB2C3A22E1D227"><enum>(A)</enum><text>a bridge financial
company shall assume, acquire, or succeed to the assets or liabilities of a
covered financial company (including the assets or liabilities associated with
any trust or custody business) only to the extent that such assets or
liabilities are transferred by the Corporation to the bridge financial company
in accordance with, and subject to the restrictions set forth in, paragraph
(1)(B); and</text>
</subparagraph><subparagraph id="IDeb49e4ec9f5b440e875234ede5abecfe"><enum>(B)</enum><text>a bridge financial
company shall not assume, acquire, or succeed to any obligation that a covered
financial company for which the Corporation has been appointed receiver may
have to any shareholder, member, general partner, limited partner, or other
person with an interest in the equity of the covered financial company that
arises as a result of the status of that person having an equity claim in the
covered financial company.</text>
</subparagraph></paragraph><paragraph id="ID1c787608bce443b1901c48eba65ec240"><enum>(4)</enum><header>Bridge financial
company treated as being in default for certain purposes</header><text>A bridge
financial company shall be treated as a covered financial company in default at
such times and for such purposes as the Corporation may, in its discretion,
determine.</text>
</paragraph><paragraph id="IDbbd6a41c017944f0a16d2fd181e517e9"><enum>(5)</enum><header>Transfer of assets and
liabilities</header>
<subparagraph id="IDabf0958bc18847199bf8415f4537d7fe"><enum>(A)</enum><header>Authority of
corporation</header><text>The Corporation, as receiver for a covered financial
company, may transfer any assets and liabilities of a covered financial company
(including any assets or liabilities associated with any trust or custody
business) to one or more bridge financial companies, in accordance with and
subject to the restrictions of paragraph (1).</text>
</subparagraph><subparagraph id="ID318df351c5a7433b936dbb13151c65fb"><enum>(B)</enum><header>Subsequent
transfers</header><text>At any time after the establishment of a bridge
financial company with respect to a covered financial company, the Corporation,
as receiver, may transfer any assets and liabilities of such covered financial
company as the Corporation may, in its discretion, determine to be appropriate
in accordance with and subject to the restrictions of paragraph (1).</text>
</subparagraph><subparagraph id="ID22afa8caab0546fe89a55e12e5fe879d"><enum>(C)</enum><header>Treatment of trust or
custody business</header><text>For purposes of this paragraph, the trust or
custody business, including fiduciary appointments, held by any covered
financial company is included among its assets and liabilities.</text>
</subparagraph><subparagraph id="IDee8e34213c4e49779a507f67518883f6"><enum>(D)</enum><header>Effective without
approval</header><text>The transfer of any assets or liabilities, including
those associated with any trust or custody business of a covered financial
company, to a bridge financial company shall be effective without any further
approval under Federal or State law, assignment, or consent with respect
thereto.</text>
</subparagraph><subparagraph id="ID4f83946be72a4197b26e60e455838aaf"><enum>(E)</enum><header>Equitable treatment of
similarly situated creditors</header><text>The Corporation shall treat all
creditors of a covered financial company that are similarly situated under
subsection (b)(1), in a similar manner in exercising the authority of the
Corporation under this subsection to transfer any assets or liabilities of the
covered financial company to one or more bridge financial companies established
with respect to such covered financial company, except that the Corporation may
take any action (including making payments, subject to subsection
(o)(1)(D)(ii)) that does not comply with this subparagraph, if—</text>
<clause id="ID4d77e5c65aca49b198e079b9710d0821"><enum>(i)</enum><text>the Corporation
determines that such action is necessary—</text>
<subclause id="IDfc87919503944da8907ec96ffbdeb9c0"><enum>(I)</enum><text>to maximize the value of
the assets of the covered financial company;</text>
</subclause><subclause id="ID4197da60b8ed4f81920c0765462e9e9f"><enum>(II)</enum><text>to maximize the present
value return from the sale or other disposition of the assets of the covered
financial company; or</text>
</subclause><subclause id="IDa825c4e761a74c958d3793100a29250f"><enum>(III)</enum><text>to minimize the amount
of any loss realized upon the sale or other disposition of the assets of the
covered financial company; and</text>
</subclause></clause><clause id="ID80be9a6cdbd345b0852313179a2fb032"><enum>(ii)</enum><text>all creditors that are
similarly situated under subsection (b)(1) receive not less than the amount
provided under paragraphs (2) and (3) of subsection (d).</text>
</clause></subparagraph><subparagraph id="idC2D170E5D4FB414CBE4CA60946AD90B3"><enum>(F)</enum><header>Limitation on transfer
of liabilities</header><text>Notwithstanding any other provision of law, the
aggregate amount of liabilities of a covered financial company that are
transferred to, or assumed by, a bridge financial company from a covered
financial company may not exceed the aggregate amount of the assets of the
covered financial company that are transferred to, or purchased by, the bridge
financial company from the covered financial company.</text>
</subparagraph></paragraph><paragraph id="ID99252dc0dd93449cba3771d8d48fd433"><enum>(6)</enum><header>Stay of judicial
action</header><text>Any judicial action to which a bridge financial company
becomes a party by virtue of its acquisition of any assets or assumption of any
liabilities of a covered financial company shall be stayed from further
proceedings for a period of not longer than 45 days (or such longer period as
may be agreed to upon the consent of all parties) at the request of the bridge
financial company.</text>
</paragraph><paragraph id="ID92f01d7a50d14e58abfd1c23c411bd60"><enum>(7)</enum><header>Agreements against
interest of the bridge financial company</header><text>No agreement that tends
to diminish or defeat the interest of the bridge financial company in any asset
of a covered financial company acquired by the bridge financial company shall
be valid against the bridge financial company, unless such agreement—</text>
<subparagraph id="id38A79ED8E8594EA1B3BE9329182B2AAF"><enum>(A)</enum><text>is in writing;</text>
</subparagraph><subparagraph id="idF126A159ED564E94A752EE162C15DAA2"><enum>(B)</enum><text>was executed by an
authorized officer or representative of the covered financial company or
confirmed in the ordinary course of business by the covered financial company;
and</text>
</subparagraph><subparagraph id="id4D7005C0B7B945CDA31A19A4D6A18C86"><enum>(C)</enum><text>has been on the official
record of the company, since the time of its execution, or with which, the
party claiming under the agreement provides documentation of such agreement and
its authorized execution or confirmation by the covered financial company that
is acceptable to the receiver.</text>
</subparagraph></paragraph><paragraph id="ID6a35862a61d248f8b6e5a1a45cd9d3a2"><enum>(8)</enum><header>No Federal
status</header>
<subparagraph id="ID32a7c37af4234c998473fe72d68af47e"><enum>(A)</enum><header>Agency
status</header><text>A bridge financial company is not an agency,
establishment, or instrumentality of the United States.</text>
</subparagraph><subparagraph id="IDf948298a180745eeab4e6f19dc2c2627"><enum>(B)</enum><header>Employee
status</header><text>Representatives for purposes of paragraph (1)(B),
directors, officers, employees, or agents of a bridge financial company are
not, solely by virtue of service in any such capacity, officers or employees of
the United States. Any employee of the Corporation or of any Federal
instrumentality who serves at the request of the Corporation as a
representative for purposes of paragraph (1)(B), director, officer, employee,
or agent of a bridge financial company shall not—</text>
<clause id="ID1f50141190334b3492f1e3816fa7d516"><enum>(i)</enum><text>solely by virtue of
service in any such capacity lose any existing status as an officer or employee
of the United States for purposes of title 5, United States Code, or any other
provision of law; or</text>
</clause><clause id="ID6aaedcb25347464c848bb879b9f637d8"><enum>(ii)</enum><text>receive any salary or
benefits for service in any such capacity with respect to a bridge financial
company in addition to such salary or benefits as are obtained through
employment with the Corporation or such Federal instrumentality.</text>
</clause></subparagraph></paragraph><paragraph id="ID5b98d257fbad4af8b82f50d3b80da97f"><enum>(9)</enum><header>Funding
authorized</header><text>The Corporation may, subject to the plan described in
subsection (n)(11), provide funding to facilitate any transaction described in
subparagraph (A), (B), (C), or (D) of paragraph (13) with respect to any bridge
financial company, or facilitate the acquisition by a bridge financial company
of any assets, or the assumption of any liabilities, of a covered financial
company for which the Corporation has been appointed receiver.</text>
</paragraph><paragraph id="ID4f5e39678338478680ee206d993f0984"><enum>(10)</enum><header>Exempt tax
status</header><text>Notwithstanding any other provision of Federal or State
law, a bridge financial company, its franchise, property, and income shall be
exempt from all taxation now or hereafter imposed by the United States, by any
territory, dependency, or possession thereof, or by any State, county,
municipality, or local taxing authority.</text>
</paragraph><paragraph id="IDdb212be8059b444cb121dc56f6781152"><enum>(11)</enum><header>Federal agency
approval; antitrust review</header><text>If a transaction involving the merger
or sale of a bridge financial company requires approval by a Federal agency,
the transaction may not be consummated before the 5th calendar day after the
date of approval by the Federal agency responsible for such approval with
respect thereto. If, in connection with any such approval a report on
competitive factors from the Attorney General is required, the Federal agency
responsible for such approval shall promptly notify the Attorney General of the
proposed transaction and the Attorney General shall provide the required report
within 10 days of the request. If a notification is required under section 7A
of the Clayton Act with respect to such transaction, the required waiting
period shall end on the 15th day after the date on which the Attorney General
and the Federal Trade Commission receive such notification, unless the waiting
period is terminated earlier under section 7A(b)(2) of the Clayton Act, or
extended under section 7A(e)(2) of that Act.</text>
</paragraph><paragraph id="ID3308002d7ed54c37ab56ddbefc569b25"><enum>(12)</enum><header>Duration of bridge
financial company</header><text>Subject to paragraphs (13) and (14), the status
of a bridge financial company as such shall terminate at the end of the 2-year
period following the date on which it was granted a charter. The Corporation
may, in its discretion, extend the status of the bridge financial company as
such for no more than 3 additional 1-year periods.</text>
</paragraph><paragraph id="IDe89b7175249242eeaeca70ebe5987f90"><enum>(13)</enum><header>Termination of bridge
financial company status</header><text>The status of any bridge financial
company as such shall terminate upon the earliest of—</text>
<subparagraph id="ID5dee8c88189b4ba5b3f1c11d5f2e46c2"><enum>(A)</enum><text>the date of the merger or
consolidation of the bridge financial company with a company that is not a
bridge financial company;</text>
</subparagraph><subparagraph id="IDca0cd4b7313d455cb4684808545858df"><enum>(B)</enum><text>at the election of the
Corporation, the sale of a majority of the capital stock of the bridge
financial company to a company other than the Corporation and other than
another bridge financial company;</text>
</subparagraph><subparagraph id="ID148005ac82ed41e9bae148232f9afa47"><enum>(C)</enum><text>the sale of 80 percent,
or more, of the capital stock of the bridge financial company to a person other
than the Corporation and other than another bridge financial company;</text>
</subparagraph><subparagraph id="ID4d152b02686045fc8ee8aca6548848f1"><enum>(D)</enum><text>at the election of the
Corporation, either the assumption of all or substantially all of the
liabilities of the bridge financial company by a company that is not a bridge
financial company, or the acquisition of all or substantially all of the assets
of the bridge financial company by a company that is not a bridge financial
company, or other entity as permitted under applicable law; and</text>
</subparagraph><subparagraph id="ID97e06517670a42548ba117ad5c909f82"><enum>(E)</enum><text>the expiration of the
period provided in paragraph (12), or the earlier dissolution of the bridge
financial company, as provided in paragraph (15).</text>
</subparagraph></paragraph><paragraph id="IDb2abf5d906854ee5af7fd73d9c99e6f6"><enum>(14)</enum><header>Effect of termination
events</header>
<subparagraph id="IDf74688645c6b4d038e9c6f9790011779"><enum>(A)</enum><header>Merger or
consolidation</header><text>A merger or consolidation, described in paragraph
(12)(A) shall be conducted in accordance with, and shall have the effect
provided in, the provisions of applicable law. For the purpose of effecting
such a merger or consolidation, the bridge financial company shall be treated
as a corporation organized under the laws of the State of Delaware (unless the
law of another State has been selected by the bridge financial company in
accordance with paragraph (2)(F)), and the Corporation shall be treated as the
sole shareholder thereof, notwithstanding any other provision of State or
Federal law.</text>
</subparagraph><subparagraph id="IDe8b9ecadadfa4107b125452931afdef3"><enum>(B)</enum><header>Charter
conversion</header><text>Following the sale of a majority of the capital stock
of the bridge financial company, as provided in paragraph (13)(B), the
Corporation may amend the charter of the bridge financial company to reflect
the termination of the status of the bridge financial company as such,
whereupon the company shall have all of the rights, powers, and privileges
under its constituent documents and applicable Federal or State law. In
connection therewith, the Corporation may take such steps as may be necessary
or convenient to reincorporate the bridge financial company under the laws of a
State and, notwithstanding any provisions of Federal or State law, such
State-chartered corporation shall be deemed to succeed by operation of law to
such rights, titles, powers, and interests of the bridge financial company as
the Corporation may provide, with the same effect as if the bridge financial
company had merged with the State-chartered corporation under provisions of the
corporate laws of such State.</text>
</subparagraph><subparagraph id="ID5b4f1186a5e44f0597245164b0fe0a05"><enum>(C)</enum><header>Sale of
stock</header><text>Following the sale of 80 percent or more of the capital
stock of a bridge financial company, as provided in paragraph (13)(C), the
company shall have all of the rights, powers, and privileges under its
constituent documents and applicable Federal or State law. In connection
therewith, the Corporation may take such steps as may be necessary or
convenient to reincorporate the bridge financial company under the laws of a
State and, notwithstanding any provisions of Federal or State law, the
State-chartered corporation shall be deemed to succeed by operation of law to
such rights, titles, powers and interests of the bridge financial company as
the Corporation may provide, with the same effect as if the bridge financial
company had merged with the State-chartered corporation under provisions of the
corporate laws of such State.</text>
</subparagraph><subparagraph id="ID08399ef357874506801cfdde112a1dc1"><enum>(D)</enum><header>Assumption of
liabilities and sale of assets</header><text>Following the assumption of all or
substantially all of the liabilities of the bridge financial company, or the
sale of all or substantially all of the assets of the bridge financial company,
as provided in paragraph (13)(D), at the election of the Corporation, the
bridge financial company may retain its status as such for the period provided
in paragraph (12) or may be dissolved at the election of the
Corporation.</text>
</subparagraph><subparagraph id="ID5389d2f7ec384d43ac9bfe778dd30daf"><enum>(E)</enum><header>Amendments to
charter</header><text>Following the consummation of a transaction described in
subparagraph (A), (B), (C), or (D) of paragraph (13), the charter of the
resulting company shall be amended to reflect the termination of bridge
financial company status, if appropriate.</text>
</subparagraph></paragraph><paragraph id="ID4bb43f37d7cb4cf6a9407899a463bf9f"><enum>(15)</enum><header>Dissolution of bridge
financial company</header>
<subparagraph id="IDa918929564a34e9da0c9ed5a2da03999"><enum>(A)</enum><header>In
general</header><text>Notwithstanding any other provision of Federal or State
law, if the status of a bridge financial company as such has not previously
been terminated by the occurrence of an event specified in subparagraph (A),
(B), (C), or (D) of paragraph (13)—</text>
<clause id="ID90515dc356644fd38ba975840ad392a2"><enum>(i)</enum><text>the Corporation may, in
its discretion, dissolve the bridge financial company in accordance with this
paragraph at any time; and</text>
</clause><clause id="IDb66607ec95194cc79db9c5ea851cdc20"><enum>(ii)</enum><text>the Corporation shall
promptly commence dissolution proceedings in accordance with this paragraph
upon the expiration of the 2-year period following the date on which the bridge
financial company was chartered, or any extension thereof, as provided in
paragraph (12).</text>
</clause></subparagraph><subparagraph id="IDe3f1dfc087a4415a87445ba778e3e4f0"><enum>(B)</enum><header>Procedures</header><text>The
Corporation shall remain the receiver for a bridge financial company for the
purpose of dissolving the bridge financial company. The Corporation as receiver
for a bridge financial company shall wind up the affairs of the bridge
financial company in conformity with the provisions of law relating to the
liquidation of covered financial companies under this title. With respect to
any such bridge financial company, the Corporation as receiver shall have all
the rights, powers, and privileges and shall perform the duties related to the
exercise of such rights, powers, or privileges granted by law to the
Corporation as receiver for a covered financial company under this title and,
notwithstanding any other provision of law, in the exercise of such rights,
powers, and privileges, the Corporation shall not be subject to the direction
or supervision of any State agency or other Federal agency.</text>
</subparagraph></paragraph><paragraph id="ID4069b5cd2d30415e93df59a4fcbb60af"><enum>(16)</enum><header>Authority to obtain
credit</header>
<subparagraph id="ID75ecfc4fd1da4a5c98671e0cc399f67f"><enum>(A)</enum><header>In
general</header><text>A bridge financial company may obtain unsecured credit
and issue unsecured debt.</text>
</subparagraph><subparagraph id="IDf6aa5b72536f4bc6ba040214bc6d9837"><enum>(B)</enum><header>Inability to obtain
credit</header><text>If a bridge financial company is unable to obtain
unsecured credit or issue unsecured debt, the Corporation may authorize the
obtaining of credit or the issuance of debt by the bridge financial
company—</text>
<clause id="IDf60caaee43a8448fac89662cc31f07ef"><enum>(i)</enum><text>with priority over any or
all of the obligations of the bridge financial company;</text>
</clause><clause id="ID7446d4d228a24c4c9d9ccae0cb3a7bf3"><enum>(ii)</enum><text>secured by a lien on
property of the bridge financial company that is not otherwise subject to a
lien; or</text>
</clause><clause id="IDd4dcdd5b6529451292caecf23994919c"><enum>(iii)</enum><text>secured by a junior
lien on property of the bridge financial company that is subject to a
lien.</text>
</clause></subparagraph><subparagraph id="IDc68e8d4349cf4be8bf53f23a08d279b8"><enum>(C)</enum><header>Limitations</header>
<clause id="ID2a637f93f1be457594a1b8e0b03bc1a1"><enum>(i)</enum><header>In
general</header><text>The Corporation, after notice and a hearing, may
authorize the obtaining of credit or the issuance of debt by a bridge financial
company that is secured by a senior or equal lien on property of the bridge
financial company that is subject to a lien, only if—</text>
<subclause id="IDdbd80cbfb83544888d5425e32c182020"><enum>(I)</enum><text>the bridge financial
company is unable to otherwise obtain such credit or issue such debt;
and</text>
</subclause><subclause id="ID7742874e5c9d427d871e5e67ac504eef"><enum>(II)</enum><text>there is adequate
protection of the interest of the holder of the lien on the property with
respect to which such senior or equal lien is proposed to be granted.</text>
</subclause></clause><clause id="ID358adb23322b499f947d99ae252e90bf"><enum>(ii)</enum><header>Hearing</header><text>The
hearing required pursuant to this subparagraph shall be before a court of the
United States, which shall have jurisdiction to conduct such hearing.</text>
</clause></subparagraph><subparagraph id="ID75f2bc777c63498ba05edb1d0a12aa3c"><enum>(D)</enum><header>Burden of
proof</header><text>In any hearing under this paragraph, the Corporation has
the burden of proof on the issue of adequate protection.</text>
</subparagraph><subparagraph id="IDd2f5419fbfa54606a896bad8093735e2"><enum>(E)</enum><header>Qualified financial
contracts</header><text>No credit or debt obtained or issued by a bridge
financial company may contain terms that impair the rights of a counterparty to
a qualified financial contract upon a default by the bridge financial company,
other than the priority of such counterparty’s unsecured claim (after the
exercise of rights) relative to the priority of the bridge financial company’s
obligations in respect of such credit or debt, unless such counterparty
consents in writing to any such impairment.</text>
</subparagraph></paragraph><paragraph id="ID8470a2ffbd1943fba4ddbd31bb3e996a"><enum>(17)</enum><header>Effect on debts and
liens</header><text>The reversal or modification on appeal of an authorization
under this subsection to obtain credit or issue debt, or of a grant under this
section of a priority or a lien, does not affect the validity of any debt so
issued, or any priority or lien so granted, to an entity that extended such
credit in good faith, whether or not such entity knew of the pendency of the
appeal, unless such authorization and the issuance of such debt, or the
granting of such priority or lien, were stayed pending appeal.</text>
</paragraph></subsection><subsection id="IDe415d825b1a84f4b861dfc5607427c17"><enum>(i)</enum><header>Sharing
records</header><text>If the Corporation has been appointed as receiver for a
covered financial company, other Federal regulators shall make all records
relating to the covered financial company available to the Corporation, which
may be used by the Corporation in any manner that the Corporation determines to
be appropriate.</text>
</subsection><subsection id="ID9c80bb9869d4419d93278aaf605a38fc"><enum>(j)</enum><header>Expedited procedures
for certain claims</header>
<paragraph id="ID9721920218174b1f8d72f1a678876b29"><enum>(1)</enum><header>Time for filing notice
of appeal</header><text>The notice of appeal of any order, whether
interlocutory or final, entered in any case brought by the Corporation against
a director, officer, employee, agent, attorney, accountant, or appraiser of the
covered financial company, or any other person employed by or providing
services to a covered financial company, shall be filed not later than 30 days
after the date of entry of the order. The hearing of the appeal shall be held
not later than 120 days after the date of the notice of appeal. The appeal
shall be decided not later than 180 days after the date of the notice of
appeal.</text>
</paragraph><paragraph id="IDcfe16b58d1254dc6a7151daed1d8031e"><enum>(2)</enum><header>Scheduling</header><text>The
court shall expedite the consideration of any case brought by the Corporation
against a director, officer, employee, agent, attorney, accountant, or
appraiser of a covered financial company or any other person employed by or
providing services to a covered financial company. As far as practicable, the
court shall give such case priority on its docket.</text>
</paragraph><paragraph id="ID1381878d2f86451abf7c769a4bf5962a"><enum>(3)</enum><header>Judicial
discretion</header><text>The court may modify the schedule and limitations
stated in paragraphs (1) and (2) in a particular case, based on a specific
finding that the ends of justice that would be served by making such a
modification would outweigh the best interest of the public in having the case
resolved expeditiously.</text>
</paragraph></subsection><subsection id="ID1838575598ea491d855ed5c2bcd68e32"><enum>(k)</enum><header>Foreign
investigations</header><text>The Corporation, as receiver for any covered
financial company, and for purposes of carrying out any power, authority, or
duty with respect to a covered financial company—</text>
<paragraph id="ID86c0a42057874a6598dd6810cce8237b"><enum>(1)</enum><text>may request the
assistance of any foreign financial authority and provide assistance to any
foreign financial authority in accordance with section 8(v) of the Federal
Deposit Insurance Act, as if the covered financial company were an insured
depository institution, the Corporation were the appropriate Federal banking
agency for the company, and any foreign financial authority were the foreign
banking authority; and</text>
</paragraph><paragraph id="IDb00d62f7b3df4acc921dc158a53d18df"><enum>(2)</enum><text>may maintain an office to
coordinate foreign investigations or investigations on behalf of foreign
financial authorities.</text>
</paragraph></subsection><subsection id="ID7a178f397bc1407a942b94cf6ac92116"><enum>(l)</enum><header>Prohibition on entering
secrecy agreements and protective orders</header><text>The Corporation may not
enter into any agreement or approve any protective order which prohibits the
Corporation from disclosing the terms of any settlement of an administrative or
other action for damages or restitution brought by the Corporation in its
capacity as receiver for a covered financial company.</text>
</subsection><subsection id="ID65865397e610480aa14bb3beb44e486f"><enum>(m)</enum><header>Liquidation of certain
covered financial companies or bridge financial companies</header>
<paragraph id="ID1539fe3e2073401b9660927759deeb4f"><enum>(1)</enum><header>In
general</header><text>Except as specifically provided in this section, and
notwithstanding any other provision of law, the Corporation, in connection with
the liquidation of any covered financial company or bridge financial company
with respect to which the Corporation has been appointed as receiver,
shall—</text>
<subparagraph id="ID53f0f1696dbf443a9028e445e25d3435"><enum>(A)</enum><text>in the case of any
covered financial company or bridge financial company that is or has a
subsidiary that is a stockbroker, but is not a member of the Securities
Investor Protection Corporation, apply the provisions of subchapter III of
chapter 7 of the Bankruptcy Code, in respect of the distribution to any
customer of all customer name securities and customer property, as if such
covered financial company or bridge financial company were a debtor for
purposes of such subchapter; or</text>
</subparagraph><subparagraph id="IDd488c5d1949f4f37b36c1938ccf1d905"><enum>(B)</enum><text>in the case of any
covered financial company or bridge financial company that is a commodity
broker, apply the provisions of subchapter IV of chapter 7 the Bankruptcy Code,
in respect of the distribution to any customer of all customer property, as if
such covered financial company or bridge financial company were a debtor for
purposes of such subchapter.</text>
</subparagraph></paragraph><paragraph id="ID0c0810e93d04478facfbfd9399094336"><enum>(2)</enum><header>Definitions</header><text>For
purposes of this subsection—</text>
<subparagraph id="IDd37671f681274dc58ec3e378c6ba7388"><enum>(A)</enum><text>the terms
<term>customer</term>, <term>customer name securities</term>, and
<term>customer property</term> have the same meanings as in section 741 of
title 11, United States Code; and</text>
</subparagraph><subparagraph id="IDd55eeb79cc3d42b585dcddf5ebfc1bef"><enum>(B)</enum><text>the terms <term>commodity
broker</term> and <term>stockbroker</term> have the same meanings as in section
101 of the Bankruptcy Code.</text>
</subparagraph></paragraph></subsection><subsection id="ID9a21812056274efc954fe29fb057cde8"><enum>(n)</enum><header>Orderly liquidation
fund</header>
<paragraph id="ID8e00d2bb0c0c421b97a80ea6e880ce03"><enum>(1)</enum><header>Establishment</header><text>There
is established in the Treasury of the United States a separate fund to be known
as the <quote>Orderly Liquidation Fund</quote>, which shall be available to the
Corporation to carry out the authorities contained in this title, for the cost
of actions authorized by this title, including the orderly liquidation of
covered financial companies, payment of administrative expenses, the payment of
principal and interest by the Corporation on obligations issued under paragraph
(6), and the exercise of the authorities of the Corporation under this
title.</text>
</paragraph><paragraph id="ID8f3bb4764c81475ead0b7f6824f1cbd1"><enum>(2)</enum><header>Proceeds</header><text>Amounts
received by the Corporation, including assessments received under subsection
(o), proceeds of obligations issued under paragraph (6), interest and other
earnings from investments, and repayments to the Corporation by covered
financial companies, shall be deposited into the Fund.</text>
</paragraph><paragraph id="IDcc3c7aca1ef74ad3a847ad285280c737"><enum>(3)</enum><header>Management</header><text>The
Corporation shall manage the Fund in accordance with this subsection and the
policies and procedures established under section 203(d).</text>
</paragraph><paragraph id="ID922dcad3c8f448e19253a20c437f6d8e"><enum>(4)</enum><header>Investments</header><text>At
the request of the Corporation, the Secretary may invest such portion of
amounts held in the Fund that are not, in the judgment of the Corporation,
required to meet the current needs of the Corporation, in obligations of the
United States having suitable maturities, as determined by the Corporation. The
interest on and the proceeds from the sale or redemption of such obligations
shall be credited to the Fund.</text>
</paragraph><paragraph id="ID40d2ec1bfbe54107aa190a7149838abc"><enum>(5)</enum><header>Authority to issue
obligations</header>
<subparagraph id="ID93358dcf2c41487ebc4e0283fce0a9b5"><enum>(A)</enum><header>Corporation authorized
to issue obligations</header><text>Upon appointment by the Secretary of the
Corporation as receiver for a covered financial company, the Corporation is
authorized to issue obligations to the Secretary.</text>
</subparagraph><subparagraph id="IDd5fdceb7b839402fa92b26b119e1fab6"><enum>(B)</enum><header>Secretary authorized to
purchase obligations</header><text>The Secretary may, under such terms and
conditions as the Secretary may require, purchase or agree to purchase any
obligations issued under subparagraph (A), and for such purpose, the Secretary
is authorized to use as a public debt transaction the proceeds of the sale of
any securities issued under chapter 31 of title 31, United States Code, and the
purposes for which securities may be issued under chapter 31 of title 31,
United States Code, are extended to include such purchases.</text>
</subparagraph><subparagraph id="IDc9c32f3a9c1247c0bd9db297e6bc7f99"><enum>(C)</enum><header>Interest
rate</header><text>Each purchase of obligations by the Secretary under this
paragraph shall be upon such terms and conditions as to yield a return at a
rate determined by the Secretary, taking into consideration the current average
yield on outstanding marketable obligations of the United States of comparable
maturity, plus an interest rate surcharge to be determined by the Secretary,
which shall be greater than the difference between—</text>
<clause id="id2369BD94FD314526A48DCEE954D4B3B3"><enum>(i)</enum><text>the current average rate
on an index of corporate obligations of comparable maturity; and</text>
</clause><clause id="id1B165DB8DBC64E50A266197C79EC4A75"><enum>(ii)</enum><text>the current average rate
on outstanding marketable obligations of the United States of comparable
maturity.</text>
</clause></subparagraph><subparagraph id="ID46fed932e6c345a8a7b747680c4d0194"><enum>(D)</enum><header>Secretary authorized to
sell obligations</header><text>The Secretary may sell, upon such terms and
conditions as the Secretary shall determine, any of the obligations acquired
under this paragraph.</text>
</subparagraph><subparagraph id="ID4ff340a8a20e465b81b9ac7fd6157cfb"><enum>(E)</enum><header>Public debt
transactions</header><text>All purchases and sales by the Secretary of such
obligations under this paragraph shall be treated as public debt transactions
of the United States, and the proceeds from the sale of any obligations
acquired by the Secretary under this paragraph shall be deposited into the
Treasury of the United States as miscellaneous receipts.</text>
</subparagraph></paragraph><paragraph id="IDc0f19c585da44c7e9ada03669531306f"><enum>(6)</enum><header>Maximum obligation
limitation</header><text>The Corporation may not, in connection with the
orderly liquidation of a covered financial company, issue or incur any
obligation, if, after issuing or incurring the obligation, the aggregate amount
of such obligations outstanding under this subsection for each covered
financial company would exceed—</text>
<subparagraph id="ID906a117fdcf94b87905169827207f740"><enum>(A)</enum><text>an amount that is equal
to 10 percent of the total consolidated assets of the covered financial
company, based on the most recent financial statement available, during the
30-day period immediately following the date of appointment of the Corporation
as receiver (or a shorter time period if the Corporation has calculated the
amount described under subparagraph (B)); and</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="IDdf30c93e1b004b408431d8a2bd58ae8f"><enum>(B)</enum><text>the amount that is equal
to 90 percent of the fair value of the total consolidated assets of each
covered financial company that are available for repayment, after the time
period described in subparagraph (A).</text>
</subparagraph></paragraph><paragraph id="ID7dd4a21211864959bbba095926685aed"><enum>(7)</enum><header>Rulemaking</header><text>The
Corporation and the Secretary shall jointly, in consultation with the Council,
prescribe regulations governing the calculation of the maximum obligation
limitation defined in this paragraph.</text>
</paragraph><paragraph id="ID44f1ac88b8c442c1af2365b6403551a9"><enum>(8)</enum><header>Rule of
construction</header>
<subparagraph id="ID7a3f0c3dccd04dd2b924ace8a13fc2a3"><enum>(A)</enum><header>In
general</header><text>Nothing in this section shall be construed to affect the
authority of the Corporation under subsection (a) or (b) of section 14 or
section 15(c)(5) of the Federal Deposit Insurance Act (12 U.S.C. 1824,
1825(c)(5)), the management of the Deposit Insurance Fund by the Corporation,
or the resolution of insured depository institutions, provided that—</text>
<clause id="idAAE2D0A8CBE84095A21CEDFB36B6F489"><enum>(i)</enum><text>the authorities of the
Corporation contained in this title shall not be used to assist the Deposit
Insurance Fund or to assist any financial company under applicable law other
than this Act;</text>
</clause><clause id="IDb606919cf1de439fb367184189824061"><enum>(ii)</enum><text>the authorities of the
Corporation relating to the Deposit Insurance Fund, or any other
responsibilities of the Corporation under applicable law other than this title,
shall not be used to assist a covered financial company pursuant to this title;
and</text>
</clause><clause commented="no" display-inline="no-display-inline" id="ID703ef172a5154fdd98e9c5811087f7f6"><enum>(iii)</enum><text>the Deposit Insurance
Fund may not be used in any manner to otherwise circumvent the purposes of this
title.</text>
</clause></subparagraph><subparagraph id="IDd33805f235bc4d6584108a8eecfa4c1e"><enum>(B)</enum><header>Valuation</header><text>For
purposes of determining the amount of obligations under this subsection—</text>
<clause id="ID1a6f748f2db4469eaa0640b145a0a7c2"><enum>(i)</enum><text>the Corporation shall
include as an obligation any contingent liability of the Corporation pursuant
to this title; and</text>
</clause><clause id="ID6a47bea7e7db419ea64e1589571a9682"><enum>(ii)</enum><text>the Corporation shall
value any contingent liability at its expected cost to the Corporation.</text>
</clause></subparagraph></paragraph><paragraph id="IDa309ae1cb30b44beaab7cb68bee7522a"><enum>(9)</enum><header>Orderly liquidation
plan</header><text>Amounts in the Fund shall be available to the Corporation
with regard to a covered financial company for which the Corporation is
appointed receiver after the Corporation has developed an orderly liquidation
plan that is acceptable to the Secretary with regard to such covered financial
company, including the provision and use of funds, including taking any actions
specified under section 204(d) and subsection (h)(2)(G)(iv) and (h)(9) of this
section, and payments to third parties. The Corporation may, at any time, amend
any orderly liquidation plan approved by the Secretary with the concurrence of
the Secretary.</text>
</paragraph><paragraph id="IDaabde579858f48cf80c27234a19213fd"><enum>(10)</enum><header>Implementation
expenses</header>
<subparagraph id="idED56AA51367F491AB86E16226387FDD6"><enum>(A)</enum><header>In
general</header><text>Reasonable implementation expenses of the Corporation
incurred after the date of enactment of this Act shall be treated as expenses
of the Council.</text>
</subparagraph><subparagraph id="id342B8299D34C471992BAAE30BA77D889"><enum>(B)</enum><header>Requests for
reimbursement</header><text>The Corporation shall periodically submit a request
for reimbursement for implementation expenses to the Chairperson of the
Council, who shall arrange for prompt reimbursement to the Corporation of
reasonable implementation expenses.</text>
</subparagraph><subparagraph id="id7CFA3B1D3EA440D59B1A9E48DB4274A3"><enum>(C)</enum><header>Definition</header><text>As
used in this paragraph, the term <term>implementation expenses</term>—</text>
<clause id="id73CC17E144914F98B8F28E102E194AEC"><enum>(i)</enum><text>means costs incurred by
the Corporation beginning on the date of enactment of this Act, as part of its
efforts to implement this title that do not relate to a particular covered
financial company; and</text>
</clause><clause commented="no" display-inline="no-display-inline" id="idBF823ABF08EC4A39A4D6E8BC46976409"><enum>(ii)</enum><text>includes the costs
incurred in connection with the development of policies, procedures, rules, and
regulations and other planning activities of the Corporation consistent with
carrying out this title.</text>
</clause></subparagraph></paragraph></subsection><subsection id="ID0a4c05d1546e49b89b1069b13118ea24"><enum>(o)</enum><header>Assessments</header>
<paragraph id="ID0f045e653c954056aed38787ae772348"><enum>(1)</enum><header>Risk-based
assessments</header>
<subparagraph id="IDf8176a96022047b69ac78284700ea610"><enum>(A)</enum><header>Eligible financial
companies defined</header><text>For purposes of this subsection, the term
<term>eligible financial company</term> means any bank holding company with
total consolidated assets equal to or greater than $50,000,000,000 and any
nonbank financial company supervised by the Board of Governors.</text>
</subparagraph><subparagraph id="ID762c29939da6496388198e40affa4f4d"><enum>(B)</enum><header>Assessments</header><text>The
Corporation shall charge one or more risk-based assessments in accordance with
the provisions of subparagraph (D), if such assessments are necessary to pay in
full the obligations issued by the Corporation to the Secretary within 60
months of the date of issuance of such obligations.</text>
</subparagraph><subparagraph id="ID842611e3612a4b0db73ded4484f2df23"><enum>(C)</enum><header>Extensions
authorized</header><text>The Corporation may, with the approval of the
Secretary, extend the time period under subparagraph (C)(iii), if the
Corporation determines that an extension is necessary to avoid a serious
adverse effect on the financial system of the United States.</text>
</subparagraph><subparagraph id="ID4c3ac47ef6704b899d774cb5f970e536"><enum>(D)</enum><header>Application of
assessments</header><text>To meet the requirements of subparagraph (C), the
Corporation shall—</text>
<clause id="ID81dd0f7705f949a29a82c492924ada59"><enum>(i)</enum><text>impose assessments, as
soon as practicable, on any claimant that received additional payments or
amounts from the Corporation pursuant to subsection (b)(4), (d)(4), or
(h)(5)(E), except for payments or amounts necessary to initiate and continue
operations essential to implementation of the receivership or any bridge
financial company, to recover on a cumulative basis, the entire difference
between—</text>
<subclause id="IDad650939f6794bb886623ff8d7e62e27"><enum>(I)</enum><text>the aggregate value the
claimant received from the Corporation on a claim pursuant to this title
(including pursuant to subsection (b)(4), (d)(4), and (h)(5)(E)), as of the
date on which such value was received; and</text>
</subclause><subclause id="IDe6b02979c4f546e5b2af8cc25c216adc"><enum>(II)</enum><text>the value the claimant
was entitled to receive from the Corporation on such claim solely from the
proceeds of the liquidation of the covered financial company under this title;
and</text>
</subclause></clause><clause id="ID51f152d8437d48ca969e136094973e4e"><enum>(ii)</enum><text>if the amounts to be
recovered on a cumulative basis under clause (i) are insufficient to meet the
requirements of subparagraph (C), after taking into account the considerations
set forth in paragraph (4), impose assessments on—</text>
<subclause id="ID6da91fe07aa64dbf9b8b1fb5b6d2f0c2"><enum>(I)</enum><text>eligible financial
companies; and</text>
</subclause><subclause id="IDe4f96812a6834c04a88826fcf222260f"><enum>(II)</enum><text>financial companies with
total consolidated assets equal to or greater than $50,000,000,000 that are not
eligible financial companies.</text>
</subclause></clause></subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="ID84eab75e7c87418794338c153925bb91"><enum>(E)</enum><header>Provision of
financing</header><text>Payments or amounts necessary to initiate and continue
operations essential to implementation of the receivership or any bridge
financial company described in subparagraph (E)(i) shall not include the
provision of financing, as defined by rule of the Corporation, to third
parties.</text>
</subparagraph></paragraph><paragraph id="ID698a428d9da244b5bc9f56f2fd3d7f02"><enum>(2)</enum><header>Graduated assessment
rate</header><text>The Corporation shall impose assessments on a graduated
basis, with financial companies having greater assets being assessed at a
higher rate.</text>
</paragraph><paragraph id="IDc4555e527f35421db3ee0d42432861e0"><enum>(3)</enum><header>Notification and
payment</header><text>The Corporation shall notify each financial company of
that company's assessment under this subsection. Any financial company subject
to assessment under this subsection shall pay such assessment in accordance
with the regulations prescribed pursuant to paragraph (6).</text>
</paragraph><paragraph id="IDfe36440b182a4ec7894437597c88ee72"><enum>(4)</enum><header>Risk-based assessment
considerations</header><text>In imposing assessments under this subsection, the
Corporation shall—</text>
<subparagraph id="IDa3b11d6e3c2444aaa1d299e2fb237683"><enum>(A)</enum><text>take into account
economic conditions generally affecting financial companies, so as to allow
assessments to be lower during less favorable economic conditions;</text>
</subparagraph><subparagraph id="IDd7fe152c0468401688e1dff84740c9f9"><enum>(B)</enum><text>take into account any
assessments imposed on—</text>
<clause id="ID640fc6951cf94b05b1d96e18e18138d1"><enum>(i)</enum><text>an insured depository
institution subsidiary of a financial company pursuant to section 7 or section
13(c)(4)(G) of the Federal Deposit Insurance Act (12 U.S.C. 1817,
1823(c)(4)(G));</text>
</clause><clause id="IDeeadb4e400c04270b2096aeaee61d642"><enum>(ii)</enum><text>a financial company or
subsidiary of such company that is a member of SIPC pursuant to section 4 of
the Securities Investor Protection Act of 1970 (15 U.S.C. 78ddd); and</text>
</clause><clause id="IDb814098cddfa4559997605ceb2398a19"><enum>(iii)</enum><text>a financial company or
subsidiary of such company that is an insurance company pursuant to applicable
State law to cover (or reimburse payments made to cover) the costs of
rehabilitation, liquidation, or other State insolvency proceeding with respect
to one or more insurance companies;</text>
</clause></subparagraph><subparagraph id="IDe69d2fa3814c4996bd7d3fc249474f14"><enum>(C)</enum><text>take into account the
financial condition of the financial company, including the extent and type of
off-balance-sheet exposures of the financial company;</text>
</subparagraph><subparagraph id="IDff9f5fba63e9402c942a972b024a0fa5"><enum>(D)</enum><text>take into account the
risks presented by the financial company to the financial stability of the
United States economy;</text>
</subparagraph><subparagraph id="ID7cca37dd1bc64cfd8f80f260955ac413"><enum>(E)</enum><text>take into account the
extent to which the financial company or group of financial companies has
benefitted, or likely would benefit, from the orderly liquidation of a covered
financial company and the use of the Fund under this title;</text>
</subparagraph><subparagraph id="IDb174058e1e254dcfaca982ed8fb6245f"><enum>(F)</enum><text>distinguish among
different classes of assets or different types of financial companies
(including distinguishing among different types of financial companies, based
on their levels of capital and leverage) in order to establish comparable
assessment bases among financial companies subject to this subsection;</text>
</subparagraph><subparagraph id="ID25cef2903ab64b528ce3f9e2dd0ede63"><enum>(G)</enum><text>establish the parameters
for the graduated assessment requirement in paragraph (2); and</text>
</subparagraph><subparagraph id="ID60a97befe9e141628df6d3f02325b508"><enum>(H)</enum><text>take into account such
other factors as the Corporation, in consultation with the Secretary, deems
appropriate.</text>
</subparagraph></paragraph><paragraph id="IDd17136cdfa154e4987b292612d0e056c"><enum>(5)</enum><header>Collection of
information</header><text>The Corporation may impose on covered financial
companies such collection of information requirements as the Corporation deems
necessary to carry out this subsection after the appointment of the Corporation
as receiver under this title.</text>
</paragraph><paragraph id="IDeff8bfde690d47e08d72c94407b8e200"><enum>(6)</enum><header>Rulemaking</header>
<subparagraph id="IDaa0ee46ccbc3418abf5bc423b32b0ed4"><enum>(A)</enum><header>In
general</header><text>The Corporation shall prescribe regulations to carry out
this subsection. The Corporation shall consult with the Secretary in the
development and finalization of such regulations.</text>
</subparagraph><subparagraph id="ID422bd89cee8e48b1bcaac636ac47963e"><enum>(B)</enum><header>Equitable
treatment</header><text>The regulations prescribed under subparagraph (A) shall
take into account the differences in risks posed to the financial stability of
the United States by financial companies, the differences in the liability
structures of financial companies, and the different bases for other
assessments that such financial companies may be required to pay, to ensure
that assessed financial companies are treated equitably and that assessments
under this subsection reflect such differences.</text>
</subparagraph></paragraph></subsection><subsection id="IDce0d46cfdb894a42aa0ae9cdbfb7d980"><enum>(p)</enum><header>Unenforceability of
certain agreements</header>
<paragraph id="id01618B2D5DFD449F92DA55F27E1E2B50"><enum>(1)</enum><header>In
general</header><text>No provision described in paragraph (2) shall be
enforceable against or impose any liability on any person, as such enforcement
or liability shall be contrary to public policy.</text>
</paragraph><paragraph id="id08C3A050FCAE433F84E6F6905BA1A4A3"><enum>(2)</enum><header>Prohibited
provisions</header><text>A provision described in this paragraph is any term
contained in any existing or future standstill, confidentiality, or other
agreement that, directly or indirectly—</text>
<subparagraph id="ID7ed8d0e959574120b38494b73f7db8e8"><enum>(A)</enum><text>affects, restricts, or
limits the ability of any person to offer to acquire or acquire;</text>
</subparagraph><subparagraph id="ID5b9117f265f24612bf05ad9d91703ef7"><enum>(B)</enum><text>prohibits any person from
offering to acquire or acquiring; or</text>
</subparagraph><subparagraph id="IDcd2f600be5ec446ca3dd5d574b081513"><enum>(C)</enum><text>prohibits any person from
using any previously disclosed information in connection with any such offer to
acquire or acquisition of,</text>
</subparagraph><continuation-text continuation-text-level="paragraph">all or part of any covered financial
company, including any liabilities, assets, or interest therein, in connection
with any transaction in which the Corporation exercises its authority under
this title.</continuation-text></paragraph></subsection><subsection id="IDdcee4b2ca3bf4dfe801def344eda1f6b"><enum>(q)</enum><header>Other
exemptions</header>
<paragraph id="id726563E633834F39985567EA7FDFFD44"><enum>(1)</enum><header>In
general</header><text>When acting as a receiver under this title—</text>
<subparagraph id="IDc3a2b8d4078c4df79e5c45f6cc3a33c5"><enum>(A)</enum><text>the Corporation,
including its franchise, its capital, reserves and surplus, and its income,
shall be exempt from all taxation imposed by any State, county, municipality,
or local taxing authority, except that any real property of the Corporation
shall be subject to State, territorial, county, municipal, or local taxation to
the same extent according to its value as other real property is taxed, except
that, notwithstanding the failure of any person to challenge an assessment
under State law of the value of such property, such value, and the tax thereon,
shall be determined as of the period for which such tax is imposed;</text>
</subparagraph><subparagraph id="IDab409cc366bf4664bfef7acbc2ad62c6"><enum>(B)</enum><text>no property of the
Corporation shall be subject to levy, attachment, garnishment, foreclosure, or
sale without the consent of the Corporation, nor shall any involuntary lien
attach to the property of the Corporation; and</text>
</subparagraph><subparagraph id="ID4b3f7cfb04a243fd852116a83687fab0"><enum>(C)</enum><text>the Corporation shall not
be liable for any amounts in the nature of penalties or fines, including those
arising from the failure of any person to pay any real property, personal
property, probate, or recording tax or any recording or filing fees when due;
and</text>
</subparagraph><subparagraph commented="no" id="ID1369fc57c16c449689c588029ceba073"><enum>(D)</enum><text>the Corporation shall be
exempt from all prosecution by the United States or any State, county,
municipality, or local authority for any criminal offense arising under
Federal, State, county, municipal, or local law, which was allegedly committed
by the covered financial company, or persons acting on behalf of the covered
financial company, prior to the appointment of the Corporation as
receiver.</text>
</subparagraph></paragraph><paragraph id="id9B70241080524341A5E697543A497DBA"><enum>(2)</enum><header>Limitation</header><text>Paragraph
(1) shall not apply with respect to any tax imposed (or other amount arising)
under the Internal Revenue Code of 1986.</text>
</paragraph></subsection><subsection id="IDf85bf77265f34c6c88a12fd11cee05a8"><enum>(r)</enum><header>Certain sales of assets
prohibited</header>
<paragraph id="ID362f596c84c0460cb666fa14872e8bd1"><enum>(1)</enum><header>Persons who engaged in
improper conduct with, or caused losses to, covered financial
companies</header><text>The Corporation shall prescribe regulations which, at a
minimum, shall prohibit the sale of assets of a covered financial company by
the Corporation to—</text>
<subparagraph id="IDef271d4d9a524b238e6e5ea0601fc8b5"><enum>(A)</enum><text>any person who—</text>
<clause id="ID5b67cd1313984c3880987c39b18bf07b"><enum>(i)</enum><text>has defaulted, or was a
member of a partnership or an officer or director of a corporation that has
defaulted, on 1 or more obligations, the aggregate amount of which exceeds
$1,000,000, to such covered financial company;</text>
</clause><clause id="IDf2fc4a8e99c5427da1b051422d45ca05"><enum>(ii)</enum><text>has been found to have
engaged in fraudulent activity in connection with any obligation referred to in
clause (i); and</text>
</clause><clause id="ID38621da0af3a47d784781fe690637e39"><enum>(iii)</enum><text>proposes to purchase
any such asset in whole or in part through the use of the proceeds of a loan or
advance of credit from the Corporation or from any covered financial
company;</text>
</clause></subparagraph><subparagraph id="IDc6afa8a3e37142f3953c8a52e364fa20"><enum>(B)</enum><text>any person who
participated, as an officer or director of such covered financial company or of
any affiliate of such company, in a material way in any transaction that
resulted in a substantial loss to such covered financial company; or</text>
</subparagraph><subparagraph id="ID53adfb65cde94e4494cd3aad0ad7b983"><enum>(C)</enum><text>any person who has
demonstrated a pattern or practice of defalcation regarding obligations to such
covered financial company.</text>
</subparagraph></paragraph><paragraph id="ID91622119561d41eab70bac92efbcf5f8"><enum>(2)</enum><header>Convicted
debtors</header><text>Except as provided in paragraph (3), a person may not
purchase any asset of such institution from the receiver, if that
person—</text>
<subparagraph id="IDb1b983977d164ad0bca74114c28499f5"><enum>(A)</enum><text>has been convicted of an
offense under section 215, 656, 657, 1005, 1006, 1007, 1008, 1014, 1032, 1341,
1343, or 1344 of title 18, United States Code, or of conspiring to commit such
an offense, affecting any covered financial company; and</text>
</subparagraph><subparagraph id="ID6a1665c9942e4360b6bffc7fd3e4c82b"><enum>(B)</enum><text>is in default on any loan
or other extension of credit from such covered financial company which, if not
paid, will cause substantial loss to the Fund or the Corporation.</text>
</subparagraph></paragraph><paragraph id="IDab890f6bdf0a41e8b4a3dd89660d1826"><enum>(3)</enum><header>Settlement of
claims</header><text>Paragraphs (1) and (2) shall not apply to the sale or
transfer by the Corporation of any asset of any covered financial company to
any person, if the sale or transfer of the asset resolves or settles, or is
part of the resolution or settlement, of 1 or more claims that have been, or
could have been, asserted by the Corporation against the person.</text>
</paragraph><paragraph id="ID551879b7b9894703808159d06fbd5fee"><enum>(4)</enum><header>Definition of
default</header><text>For purposes of this subsection, the term
<term>default</term> means a failure to comply with the terms of a loan or
other obligation to such an extent that the property securing the obligation is
foreclosed upon.</text>
</paragraph></subsection><subsection id="ID45888ccec48f45feb87654dd069d15ac"><enum>(s)</enum><header>Recoupment of
compensation from senior executives and directors</header>
<paragraph id="IDbfd3a13953ce4b23a9f154a624fc197b"><enum>(1)</enum><header>In
general</header><text>The Corporation, as receiver of a covered financial
company, may recover from any current or former senior executive or director
substantially responsible for the failed condition of the covered financial
company any compensation received during the 2-year period preceding the date
on which the Corporation was appointed as the receiver of the covered financial
company, except that, in the case of fraud, no time limit shall apply.</text>
</paragraph><paragraph id="IDf864a1fb0f9b460595daa41f78751fc5"><enum>(2)</enum><header>Cost
considerations</header><text>In seeking to recover any such compensation, the
Corporation shall weigh the financial and deterrent benefits of such recovery
against the cost of executing the recovery.</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="ID3841e6b6766a4c9abe668721820e442e"><enum>(3)</enum><header>Rulemaking</header><text>The
Corporation shall promulgate regulations to implement the requirements of this
subsection, including defining the term <term>compensation</term> to mean any
financial remuneration, including salary, bonuses, incentives, benefits,
severance, deferred compensation, or golden parachute benefits, and any profits
realized from the sale of the securities of the covered financial
company.</text>
</paragraph></subsection></section><section id="IDfe324a1591ae4263988e78f6ce90d8f5"><enum>211.</enum><header>Miscellaneous
provisions</header>
<subsection id="ID972c4b71b095489198ed82dbec0803ee"><enum>(a)</enum><header>Clarification of
prohibition regarding concealment of assets from receiver or liquidating
agent</header><text>Section 1032(1) of title 18, United States Code, is amended
by inserting <quote>the Federal Deposit Insurance Corporation acting as
receiver for a covered financial company, in accordance with title II of the
Restoring American Financial Stability Act of 2010,</quote> before <quote>or
the National Credit</quote>.</text>
</subsection><subsection id="ID75181a53374643e5ad91a28402433da7"><enum>(b)</enum><header>Conforming
amendment</header><text>Section 1032 of title 18, United States Code, is
amended in the section heading, by striking <quote><header-in-text level="section" style="USC">of financial
institution</header-in-text></quote>.</text>
</subsection><subsection id="ID7fce21eba7f347148c66c80722d5729c"><enum>(c)</enum><header>Federal deposit
insurance corporation improvement Act of 1991</header><text>Section 403(a) of
the Federal Deposit Insurance Corporation Improvement Act of 1991 (12 U.S.C.
4403(a)) is amended by inserting <quote>section 210(c) of the Restoring
American Financial Stability Act of 2010, section 1367 of the Federal Housing
Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C.
4617(d)),</quote> after <quote>section 11(e) of the Federal Deposit Insurance
Act,</quote>.</text>
</subsection><subsection id="ID2aa9bb8c29b74fc5a4a14d93948d4489"><enum>(d)</enum><header>FDIC inspector general
reviews</header>
<paragraph id="IDd1f9d542c87a4579ac6164e7e253f310"><enum>(1)</enum><header>Scope</header><text>The
Inspector General of the Corporation shall conduct, supervise, and coordinate
audits and investigations of the liquidation of any covered financial company
by the Corporation as receiver under this title, including collecting and
summarizing—</text>
<subparagraph id="ID3744e73ad0254716b130fc1cff7943be"><enum>(A)</enum><text>a description of actions
taken by the Corporation as receiver;</text>
</subparagraph><subparagraph id="IDb617f98d322349ab9b6843211cb98e1b"><enum>(B)</enum><text>a description of any
material sales, transfers, mergers, obligations, purchases, and other material
transactions entered into by the Corporation;</text>
</subparagraph><subparagraph id="IDa940e2df1c58431c857a043cdac398a2"><enum>(C)</enum><text>an evaluation of the
adequacy of the policies and procedures of the Corporation under section 203(d)
and orderly liquidation plan under section 210(n)(14);</text>
</subparagraph><subparagraph id="ID0484a0a2868d4ed5890965d799094aab"><enum>(D)</enum><text>an evaluation of the
utilization by the Corporation of the private sector in carrying out its
functions, including the adequacy of any conflict-of-interest reviews;
and</text>
</subparagraph><subparagraph id="ID42958d79e8134e4d9358bd7e6fa6391b"><enum>(E)</enum><text>an evaluation of the
overall performance of the Corporation in liquidating the covered financial
company, including administrative costs, timeliness of liquidation process, and
impact on the financial system.</text>
</subparagraph></paragraph><paragraph id="ID44494e29627a4f5e9d614b3bdd9d690b"><enum>(2)</enum><header>Frequency</header><text>Not
later than 6 months after the date of appointment of the Corporation as
receiver under this title and every 6 months thereafter, the Inspector General
of the Corporation shall conduct the audit and investigation described in
paragraph (1).</text>
</paragraph><paragraph id="ID4d8f45da47654b34ae8d1b2856051274"><enum>(3)</enum><header>Reports and
testimony</header><text>The Inspector General of the Corporation shall include
in the semiannual reports required by section 5(a) of the Inspector General Act
of 1978 (5 U.S.C. App.), a summary of the findings and evaluations under
paragraph (1), and shall appear before the appropriate committees of Congress,
if requested, to present each such report.</text>
</paragraph><paragraph id="IDcada74a17a2c49c78ffde6ac1744fe04"><enum>(4)</enum><header>Funding</header>
<subparagraph id="ID6aef625ddcb84daeb23e2fb06007327c"><enum>(A)</enum><header>Initial
funding</header><text>The expenses of the Inspector General of the Corporation
in carrying out this subsection shall be considered administrative expenses of
the receivership.</text>
</subparagraph><subparagraph id="IDf2f298a6b9b2495cbccb42bc53eaa854"><enum>(B)</enum><header>Additional
funding</header><text>If the maximum amount available to the Corporation as
receiver under this title is insufficient to enable the Inspector General of
the Corporation to carry out the duties under this subsection, the Corporation
shall pay such additional amounts from assessments imposed under section
210.</text>
</subparagraph></paragraph><paragraph id="ID68490f57e9fa43918464028c632f800d"><enum>(5)</enum><header>Termination of
responsibilities</header><text>The duties and responsibilities of the Inspector
General of the Corporation under this subsection shall terminate 1 year after
the date of termination of the receivership under this title.</text>
</paragraph></subsection><subsection id="IDbafe6ce3eeaa4b9ea05047e048d39679"><enum>(e)</enum><header>Treasury inspector
general reviews</header>
<paragraph id="IDc9fead81acfe450496ce846c7cf0654d"><enum>(1)</enum><header>Scope</header><text>The
Inspector General of the Department of the Treasury shall conduct, supervise,
and coordinate audits and investigations of actions taken by the Secretary
related to the liquidation of any covered financial company under this title,
including collecting and summarizing—</text>
<subparagraph id="IDea17dbe9e3dd4b4e86c8cb429a328b0c"><enum>(A)</enum><text>a description of actions
taken by the Secretary under this title;</text>
</subparagraph><subparagraph id="ID343ae9cc285b491b87c956d2f968894e"><enum>(B)</enum><text>an analysis of the
approval by the Secretary of the policies and procedures of the Corporation
under section 203 and acceptance of the orderly liquidation plan of the
Corporation under section 210; and</text>
</subparagraph><subparagraph id="ID1e9617005da6469f9662155d5dd6beac"><enum>(C)</enum><text>an assessment of the
terms and conditions underlying the purchase by the Secretary of obligations of
the Corporation under section 210.</text>
</subparagraph></paragraph><paragraph id="IDe17c8e2a37af4d06a68795a9d9b37341"><enum>(2)</enum><header>Frequency</header><text>Not
later than 6 months after the date of appointment of the Corporation as
receiver under this title and every 6 months thereafter, the Inspector General
of the Department of the Treasury shall conduct the audit and investigation
described in paragraph (1).</text>
</paragraph><paragraph id="ID74ce08e54b6646c093cd9813ec521398"><enum>(3)</enum><header>Reports and
testimony</header><text>The Inspector General of the Department of the Treasury
shall include in the semiannual reports required by section 5(a) of the
Inspector General Act of 1978 (5 U.S.C. App.), a summary of the findings and
assessments under paragraph (1), and shall appear before the appropriate
committees of Congress, if requested, to present each such report.</text>
</paragraph><paragraph id="ID68421301f8834bdda9103a3192ea3efb"><enum>(4)</enum><header>Termination of
responsibilities</header><text>The duties and responsibilities of the Inspector
General of the Department of the Treasury under this subsection shall terminate
1 year after the date on which the obligations purchased by the Secretary from
the Corporation under section 210 are fully redeemed.</text>
</paragraph></subsection><subsection id="ID9732d922622d46b893f1ce8ac48d435e"><enum>(f)</enum><header>Primary financial
regulatory agency inspector general reviews</header>
<paragraph id="ID1df9511d6dff4cb1a1fe87744487b6ee"><enum>(1)</enum><header>Scope</header><text>Upon
the appointment of the Corporation as receiver for a covered financial company
supervised by a Federal primary financial regulatory agency or the Board of
Governors under section 165, the Inspector General of the agency or the Board
of Governors shall make a written report reviewing the supervision by the
agency or the Board of Governors of the covered financial company, which
shall—</text>
<subparagraph id="IDb041ef8c33214defa2b0bb188b172195"><enum>(A)</enum><text>evaluate the
effectiveness of the agency or the Board of Governors in carrying out its
supervisory responsibilities with respect to the covered financial
company;</text>
</subparagraph><subparagraph id="ID4d6e7ff963d44f9ca6d2732c76548c7b"><enum>(B)</enum><text>identify any acts or
omissions on the part of agency or Board of Governors officials that
contributed to the covered financial company being in default or in danger of
default;</text>
</subparagraph><subparagraph id="ID7f2753801851450eb48397ceea1ec3c7"><enum>(C)</enum><text>identify any actions that
could have been taken by the agency or the Board of Governors that would have
prevented the company from being in default or in danger of default; and</text>
</subparagraph><subparagraph id="ID8c1da04e4efb4b0594b743ebfb2c01ef"><enum>(D)</enum><text>recommend appropriate
administrative or legislative action.</text>
</subparagraph></paragraph><paragraph commented="no" display-inline="no-display-inline" id="IDab3dfe2230414035a581c55fb9a2c63c"><enum>(2)</enum><header>Reports and
testimony</header><text>Not later than 1 year after the date of appointment of
the Corporation as receiver under this title, the Inspector General of the
Federal primary financial regulatory agency or the Board of Governors shall
provide the report required by paragraph (1) to such agency or the Board of
Governors, and along with such agency or the Board of Governors, as applicable,
shall appear before the appropriate committees of Congress, if requested, to
present the report required by paragraph (1). Not later than 90 days after the
date of receipt of the report required by paragraph (1), such agency or the
Board of Governors, as applicable, shall provide a written report to Congress
describing any actions taken in response to the recommendations in the report,
and if no such actions were taken, describing the reasons why no actions were
taken.</text>
</paragraph></subsection></section><section id="ID389c3020b8dd42a9b164bf0f02cdb3cd"><enum>212.</enum><header>Prohibition of
circumvention and prevention of conflicts of interest</header>
<subsection id="IDe64a65d6706f452e900ff93ebac49a14"><enum>(a)</enum><header>No other
funding</header><text>Funds for the orderly liquidation of any covered
financial company under this title shall only be provided as specified under
this title.</text>
</subsection><subsection id="IDd28cbae9dd8948e79845ecc9f47f078f"><enum>(b)</enum><header>Limit on governmental
actions</header><text>No governmental entity may take any action to circumvent
the purposes of this title.</text>
</subsection><subsection id="ID5380dfbe27154b87840c53e1bc1596ed"><enum>(c)</enum><header>Conflict of
interest</header><text>In the event that the Corporation is appointed receiver
for more than 1 covered financial company or is appointed receiver for a
covered financial company and receiver for any insured depository institution
that is an affiliate of such covered financial company, the Corporation shall
take appropriate action, as necessary to avoid any conflicts of interest that
may arise in connection with multiple receiverships.</text>
</subsection></section><section id="ID6340da3b5a884b4aa9524f28458d0b38"><enum>213.</enum><header>Ban on senior
executives and directors</header>
<subsection id="ID41a37af1f897435b913a14d00d1f714f"><enum>(a)</enum><header>Prohibition
authority</header><text>The Board of Governors or, if the covered financial
company was not supervised by the Board of Governors, the Corporation, may
exercise the authority provided by this section.</text>
</subsection><subsection id="ID3e7b6e9f536546c598737f9e7f1c1c5d"><enum>(b)</enum><header>Authority To issue
order</header><text>The appropriate agency described in subsection (a) may take
any action authorized by subsection (c), if the agency determines that—</text>
<paragraph id="ID6e8c678c93974989947eb39bd8b9dd8c"><enum>(1)</enum><text>a senior executive or a
director of the covered financial company, prior to the appointment of the
Corporation as receiver, has, directly or indirectly—</text>
<subparagraph id="IDfb951ecab7d84d1f9c99b5ebdc05cb8b"><enum>(A)</enum><text>violated—</text>
<clause id="ID0cb0553457f840f6be8e24065136e263"><enum>(i)</enum><text>any law or
regulation;</text>
</clause><clause id="IDd0835cad90b14465953fd37cabb2a67f"><enum>(ii)</enum><text>any cease-and-desist
order which has become final;</text>
</clause><clause id="IDe49dad641bee48fb8fc4c3ab145570b0"><enum>(iii)</enum><text>any condition imposed
in writing by a Federal agency in connection with any action on any
application, notice, or request by such company or senior executive; or</text>
</clause><clause id="IDedee545c740f4e6c97ca58cbdd37adf9"><enum>(iv)</enum><text>any written agreement
between such company and such agency;</text>
</clause></subparagraph><subparagraph id="ID0a1097cf195c41ff91335e1649d2eb9b"><enum>(B)</enum><text>engaged or participated
in any unsafe or unsound practice in connection with any financial company;
or</text>
</subparagraph><subparagraph id="ID0f0b4d8cb5a742c1bf598730746fbf66"><enum>(C)</enum><text>committed or engaged in
any act, omission, or practice which constitutes a breach of the fiduciary duty
of such senior executive or director;</text>
</subparagraph></paragraph><paragraph id="ID271b9b98b532472ca97284ad50150bcd"><enum>(2)</enum><text>by reason of the
violation, practice, or breach described in any clause of paragraph (1), such
senior executive or director has received financial gain or other benefit by
reason of such violation, practice, or breach and such violation, practice, or
breach contributed to the failure of the company; and</text>
</paragraph><paragraph id="ID86274fffbecf4c35a325e230b69501b8"><enum>(3)</enum><text>such violation, practice,
or breach—</text>
<subparagraph id="IDc529c20557354d28b6ca550036a3b235"><enum>(A)</enum><text>involves personal
dishonesty on the part of such senior executive or director; or</text>
</subparagraph><subparagraph id="ID8639a7d91edc4c37b9713afe26351265"><enum>(B)</enum><text>demonstrates willful or
continuing disregard by such senior executive or director for the safety or
soundness of such company.</text>
</subparagraph></paragraph></subsection><subsection id="ID2b13b22a69c9407a9276692bae755fbe"><enum>(c)</enum><header>Authorized
actions</header>
<paragraph id="id2C84E7B96D1C4E0A9DDF3FA53F4A4066"><enum>(1)</enum><header>In
general</header><text>The appropriate agency for a financial company, as
described in subsection (a), may serve upon a senior executive or director
described in subsection (b) a written notice of the intention of the agency to
prohibit any further participation by such person, in any manner, in the
conduct of the affairs of any financial company for a period of time determined
by the appropriate agency to be commensurate with such violation, practice, or
breach, provided such period shall be not less than 2 years.</text>
</paragraph><paragraph id="IDda248a20dad64cc29becfb711c610670"><enum>(2)</enum><header>Procedures</header><text>The
due process requirements and other procedures under section 8(e) of the Federal
Deposit Insurance Act shall apply to actions under this section as if the
covered financial company were an insured depository institution and the senior
executive or director were an institution-affiliated party, as those terms are
defined in that Act.</text>
</paragraph></subsection><subsection commented="no" display-inline="no-display-inline" id="ID4674937007ae4ba6b89353ae27faf5b0"><enum>(d)</enum><header>Regulations</header><text>The
Corporation and the Board of Governors, in consultation with the Council, shall
jointly prescribe rules or regulations to administer and carry out this
section, including rules, regulations, or guidelines to further define the term
senior executive for the purposes of this section.</text>
</subsection></section><section id="ID24022edaa2b94db7b6fb893bb655b485"><enum>214.</enum><header>Prohibition on
taxpayer funding</header>
<subsection id="idA546FC3C668F4F4DADBD74B0DD8B378F"><enum>(a)</enum><header>Liquidation
required</header><text>All financial companies put into receivership under this
title shall be liquidated. No taxpayer funds shall be used to prevent the
liquidation of any financial company under this title.</text>
</subsection><subsection id="ID06ab900a08804981944c46158ad37fc8"><enum>(b)</enum><header>Recovery of
funds</header><text>All funds expended in the liquidation of a financial
company under this title shall be recovered from the disposition of assets of
such financial company, or shall be the responsibility of the financial sector,
through assessments.</text>
</subsection><subsection id="ID03d5d9441a724ed585a472d756b406f0"><enum>(c)</enum><header>No losses to
taxpayers</header><text>Taxpayers shall bear no losses from the exercise of any
authority under this title.</text>
</subsection></section><enum>III</enum><header>Transfer of powers to
the Comptroller of the Currency, the Corporation, and the Board of
Governors</header>
<section id="ID306c6d62aa5d4d1b92fdfa2d1c3a6e1a"><enum>300.</enum><header>Short
title</header><text display-inline="no-display-inline">This title may be cited
as the <quote>Enhancing Financial Institution Safety and Soundness Act of
2010</quote>.</text>
</section><section id="IDe07b45f018924d76b0c0cbf2c802042f"><enum>301.</enum><header>Purposes</header><text display-inline="no-display-inline">The purposes of this title are—</text>
<paragraph id="IDa629c93dc1a24ab882b4e2631b9f6beb"><enum>(1)</enum><text>to provide for the safe
and sound operation of the banking system of the United States;</text>
</paragraph><paragraph id="IDc0118fcfeb5e445a88972bc96271cdbb"><enum>(2)</enum><text>to preserve and protect
the dual system of Federal and State-chartered depository institutions;</text>
</paragraph><paragraph id="ID364896c61bab4ea2b85e150defcde3b0"><enum>(3)</enum><text>to ensure the fair and
appropriate supervision of each depository institution, regardless of the size
or type of charter of the depository institution; and</text>
</paragraph><paragraph id="ID09fadfe4a2164adea45b4914afb9e82f"><enum>(4)</enum><text>to streamline and
rationalize the supervision of depository institutions and the holding
companies of depository institutions.</text>
</paragraph></section><section id="IDd1b36fcb40b0403eb26d051f0e7833b5"><enum>302.</enum><header>Definition</header><text display-inline="no-display-inline">In this title, the term <term>transferred
employee</term> means, as the context requires, an employee transferred to the
Office of the Comptroller of the Currency or the Corporation under section
322.</text>
</section><subtitle id="idDB85B4D494D54FCD8623A61B7F5EED93"><enum>A</enum><header>Transfer of powers and
duties</header>
<section id="IDee8af4401b59426a9996b527a6208d3a"><enum>311.</enum><header>Transfer date</header>
<subsection id="ID1955b83423b947178ac39a7b7cc43169"><enum>(a)</enum><header>Transfer
date</header><text>Except as provided in subsection (b), the term
<term>transfer date</term> means the date that is 1 year after the date of
enactment of this Act.</text>
</subsection><subsection id="ID2f2ffaf3276e41babc060436cdabec34"><enum>(b)</enum><header>Extension
permitted</header>
<paragraph id="IDe9829974557f4824915e31acbe0b9fc7"><enum>(1)</enum><header>Notice
required</header><text>The Secretary, in consultation with the Comptroller of
the Currency, the Director of the Office of Thrift Supervision, the Chairman of
the Board of Governors, and the Chairperson of the Corporation, may extend the
period under subsection (a) and designate a transfer date that is not later
than 18 months after the date of enactment of this Act, if the Secretary
transmits to the Committee on Banking, Housing, and Urban Affairs of the Senate
and the Committee on Financial Services of the House of Representatives—</text>
<subparagraph id="ID5b0667c6ab5c4f0abc22c59c5ffd725d"><enum>(A)</enum><text>a written determination
that commencement of the orderly process to implement this title is not
feasible by the date that is 1 year after the date of enactment of this
Act;</text>
</subparagraph><subparagraph id="ID8b7095aa72b84fd7aeffa75a35257939"><enum>(B)</enum><text>an explanation of why an
extension is necessary to commence the process of orderly implementation of
this title;</text>
</subparagraph><subparagraph id="id8CCAC93D3ECA4D4AA640840EE92BAA05"><enum>(C)</enum><text>the transfer date
designated under this subsection; and</text>
</subparagraph><subparagraph id="ID483fca69e87a42918923ec892eb881ae"><enum>(D)</enum><text>a description of the
steps that will be taken to initiate the process of an orderly and timely
implementation of this title within the extended time period.</text>
</subparagraph></paragraph><paragraph id="ID0a5f0894f42a423e83992c4e9b706215"><enum>(2)</enum><header>Publication of
notice</header><text>Not later than 270 days after the date of enactment of
this Act, the Secretary shall publish in the Federal Register notice of any
transfer date designated under paragraph (1).</text>
</paragraph></subsection></section><section id="IDca90970d497544e6ad91f15d0fcaafad"><enum>312.</enum><header>Powers and duties
transferred</header>
<subsection id="ID9f65c5cdc1474fd5b475b83c7d7f945a"><enum>(a)</enum><header>Effective
date</header><text>This section, and the amendments made by this section, shall
take effect on the transfer date.</text>
</subsection><subsection id="IDfb40a3f24c904ec9857a51fc02179169"><enum>(b)</enum><header>Functions of the Office
of Thrift Supervision</header>
<paragraph id="ID268d425b61d7485bb7a2124143f2f892"><enum>(1)</enum><header>Savings and loan
holding company functions transferred</header><text>There are transferred to
the Board of Governors all functions of the Office of Thrift Supervision and
the Director of the Office of Thrift Supervision (including the authority to
issue orders) relating to—</text>
<subparagraph id="idDF675054356E45168163EE7FC18F75B7"><enum>(A)</enum><text>the supervision
of—</text>
<clause id="idB6F37035EF9D455DBB6332D39FDB51F9"><enum>(i)</enum><text>any savings and loan
holding company; and</text>
</clause><clause id="id721A6698F3254F3988C73CC0AE7AA756"><enum>(ii)</enum><text>any subsidiary (other
than a depository institution) of a savings and loan holding company;
and</text>
</clause></subparagraph><subparagraph id="ID2a3ba8ec637046cc82140b279171beda"><enum>(B)</enum><text>all rulemaking authority
of the Office of Thrift Supervision and the Director of the Office of Thrift
Supervision relating to savings and loan holding companies.</text>
</subparagraph></paragraph><paragraph id="IDc6f3f8c5fcf243f28af1cc4124f961fc"><enum>(2)</enum><header>All other functions
transferred</header>
<subparagraph id="idFB7325617DCD49728D8AEB4678E93E39"><enum>(A)</enum><header>Board of
Governors</header><text>All rulemaking authority of the Office of Thrift
Supervision and the Director of the Office of Thrift Supervision under section
11 of the Home Owners’ Loan Act (12 U.S.C. 1468) relating to transactions with
affiliates and extensions of credit to executive officers, directors, and
principal shareholders and under section 5(q) of such Act relating to tying
arrangements is transferred to the Board of Governors.</text>
</subparagraph><subparagraph id="ID13eb26fc5d3b49a2a961555a81c1b51c"><enum>(B)</enum><header>Comptroller of the
Currency</header><text>Except as provided in paragraph (1) and subparagraph
(A), there are transferred to the Comptroller of the Currency all functions of
the Office of Thrift Supervision and the Director of the Office of Thrift
Supervision relating to Federal savings associations.</text>
</subparagraph><subparagraph id="ID53139eee237444b3aeee83bbe1b49281"><enum>(C)</enum><header>Corporation</header><text>Except
as provided in paragraph (1) and subparagraph (A), all functions of the Office
of Thrift Supervision and the Director of the Office of Thrift Supervision
relating to State savings associations are transferred to the
Corporation.</text>
</subparagraph><subparagraph id="idDAEFDD7669E6441DA2C42653C6014B87"><enum>(D)</enum><header>Comptroller of the
Currency and the Corporation</header><text>Except as provided in paragraph (1)
and subparagraph (A), all rulemaking authority of the Office of Thrift
Supervision and the Director of the Office of Thrift Supervision relating to
savings associations is transferred to the Office of the Comptroller of the
Currency.</text>
</subparagraph></paragraph></subsection><subsection id="IDdce9a2a03e9c443c8b4f7abf39a0b710"><enum>(c)</enum><header>Conforming
amendments</header>
<paragraph id="ID807202b10fdd4a868c68f19251052451"><enum>(1)</enum><header>Federal deposit
insurance Act</header><text>Section 3(q) of the Federal Deposit Insurance Act
(12 U.S.C. 1813(q)) is amended by striking paragraphs (1) through (4) and
inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idEEE6480ADAFA4D7ABDC67FB1B7840968" reported-display-style="italic" style="OLC">
<paragraph id="ID572101448f6b4e1bb563dce78bf4cf5f"><enum>(1)</enum><text>the Office of the
Comptroller of the Currency, in the case of—</text>
<subparagraph id="IDd7803ef8341949f48ca988bc815bebab"><enum>(A)</enum><text>any national banking
association;</text>
</subparagraph><subparagraph id="ID026754656f2d49b9b00857b262c69ac4"><enum>(B)</enum><text>any Federal branch or
agency of a foreign bank; and</text>
</subparagraph><subparagraph id="IDcb40cc7aa4564bb7a28a61c60da0450f"><enum>(C)</enum><text>any Federal savings
association;</text>
</subparagraph></paragraph><paragraph id="IDe4d7ae0bb4054ad99b0292edbbf4a95e"><enum>(2)</enum><text>the Federal Deposit
Insurance Corporation, in the case of—</text>
<subparagraph id="ID21710f4b0e82429da75117a12243e815"><enum>(A)</enum><text>any insured State
nonmember bank;</text>
</subparagraph><subparagraph id="IDb2033c2ff6684284b7b9d21015b3ebeb"><enum>(B)</enum><text>any foreign bank having
an insured branch; and</text>
</subparagraph><subparagraph id="IDd4f5890c548443488086530af46be843"><enum>(C)</enum><text>any State savings
association;</text>
</subparagraph></paragraph><paragraph id="ID6675646517e04bbf898e7c53313f9b1c"><enum>(3)</enum><text>the Board of Governors of
the Federal Reserve System, in the case of—</text>
<subparagraph id="id253AD494ABC94A0C9D6EFC4E11D3682B"><enum>(A)</enum><text>any State member
bank;</text>
</subparagraph><subparagraph id="ID98aaa7c1f6664d27af55a26e03b12daf"><enum>(B)</enum><text>any branch or agency of a
foreign bank with respect to any provision of the Federal Reserve Act which is
made applicable under the International Banking Act of 1978;</text>
</subparagraph><subparagraph id="ID8df38c8a1f224bb98261609c1d461560"><enum>(C)</enum><text>any foreign bank which
does not operate an insured branch;</text>
</subparagraph><subparagraph id="IDe5885ca8d5da492083e3d0c74ee48bd0"><enum>(D)</enum><text>any agency or commercial
lending company other than a Federal agency;</text>
</subparagraph><subparagraph id="ID1ed350e56206457e81b2b5357795754c"><enum>(E)</enum><text>supervisory or regulatory
proceedings arising from the authority given to the Board of Governors under
section 7(c)(1) of the International Banking Act of 1978, including such
proceedings under the Financial Institutions Supervisory Act of 1966;</text>
</subparagraph><subparagraph id="ID16f9acd52cd94d2487cc2f57fcabbd9c"><enum>(F)</enum><text>any bank holding company
and any subsidiary (other than a depository institution) of a bank holding
company; and</text>
</subparagraph><subparagraph id="IDd86c4dbd73964482bb7b80817290b3dd"><enum>(G)</enum><text>any savings and loan
holding company and any subsidiary (other than a depository institution) of a
savings and loan holding
company.</text>
</subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph><paragraph id="id131FADBD974B45179107D0926DC8C665"><enum>(2)</enum><header>Federal Deposit
Insurance Act</header>
<subparagraph id="idFB8555A92894476E8A94E8E247FAEEBB"><enum>(A)</enum><header>Application</header><text>Section
8(b)(3) of the Federal Deposit Insurance Act (12 U.S.C. 1818(b)(3)) is amended
to read as follows:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id285695D4E67F4625B2E2CC2D7B0CD956" reported-display-style="italic" style="OLC">
<paragraph id="idF066D70F15384330BBCEF32CF313AEF1" indent="up1"><enum>(3)</enum><header>Application to bank
holding companies, savings and loan holding companies, and edge and agreement
corporations</header>
<subparagraph id="id646282E9B56E40AABA749703F4A139AF"><enum>(A)</enum><header>Application</header><text>This
subsection, subsections (c) through (s) and subsection (u) of this section, and
section 50 shall apply to—</text>
<clause id="idC2D867E971E3494DA14538563DB353F3"><enum>(i)</enum><text>any
bank holding company, and any subsidiary (other than a bank) of a bank holding
company, as those terms are defined in section 2 of the Bank Holding Company
Act of 1956 (12 U.S.C. 1841), as if such company or subsidiary was an insured
depository institution for which the appropriate Federal banking agency for the
bank holding company was the appropriate Federal banking agency;</text>
</clause><clause id="idD62064587B0240D093C4EE97CBF06E44"><enum>(ii)</enum><text>any savings and loan
holding company, and any subsidiary (other than a depository institution) of a
savings and loan holding company, as those terms are defined in section 10 of
the Home Owners’ Loan Act (12 U.S.C. 1467a), as if such company or subsidiary
was an insured depository institution for which the appropriate Federal banking
agency for the savings and loan holding company was the appropriate Federal
banking agency; and</text>
</clause><clause id="id7A57D0E2DC7242909EA5143CEAB3A6FD"><enum>(iii)</enum><text>any organization
organized and operated under section 25A of the Federal Reserve Act (12 U.S.C.
611 et seq.) or operating under section 25 of the Federal Reserve Act (12
U.S.C. 601 et seq.) and any noninsured State member bank, as if such
organization or bank was a bank holding company.</text>
</clause></subparagraph><subparagraph id="idD21CD1DEDF6343069ABAB1210C790D33"><enum>(B)</enum><header>Rules of
construction</header>
<clause id="idBC093F9FCE2F4515BFBD4BBE1F6E1B8C"><enum>(i)</enum><header>Effect on other
authority</header><text>Nothing in this paragraph may be construed to alter or
affect the authority of an appropriate Federal banking agency to initiate
enforcement proceedings, issue directives, or take other remedial action under
any other provision of law.</text>
</clause><clause id="id94472D8A8744440AB9107EC6E3282999"><enum>(ii)</enum><header>Holding
companies</header><text>Nothing in this paragraph or subsection (c) may be
construed as authorizing any Federal banking agency other than the appropriate
Federal banking agency for a bank holding company or a savings and loan holding
company to initiate enforcement proceedings, issue directives, or take other
remedial action against a bank holding company, a savings and loan holding
company, or any subsidiary thereof (other than a depository
institution).</text>
</clause></subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subparagraph><subparagraph id="idA5C735F56E724CAABF4A2FF597E58CD4"><enum>(B)</enum><header>Conforming
amendment</header><text>Section 8(b)(9) of the Federal Deposit Insurance Act
(12 U.S.C. 1818(b)(9)) is amended to read as follows:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id2AF21CD56E9F4B95BCBC59F525289C80" reported-display-style="italic" style="OLC">
<paragraph id="idADF0C5D221FA4503BB29B8EE76C65A5F"><enum>(9)</enum><text>[Reserved].</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subparagraph></paragraph></subsection><subsection id="id06C94B3FD68A4D5D8C33AAA9E866419C"><enum>(d)</enum><header>Consumer
protection</header><text>Nothing in this section may be construed to limit or
otherwise affect the transfer of powers under title X.</text>
</subsection></section><section id="ID888624a73ae242b1bb99104a1408a4e1"><enum>313.</enum><header>Abolishment</header><text display-inline="no-display-inline">Effective 90 days after the transfer date,
the Office of Thrift Supervision and the position of Director of the Office of
Thrift Supervision are abolished.</text>
</section><section id="ID7fd900200a704b7a916083cb2eeac59f"><enum>314.</enum><header>Amendments to the
revised statutes</header>
<subsection id="ID8ae1884ca9644bc1935bdef9639dddfe"><enum>(a)</enum><header>Amendment to section
324</header><text>Section 324 of the Revised Statutes of the United States (12
U.S.C. 1) is amended to read as follows:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idD5C1449353434926A3E373C9CAB697C8" reported-display-style="italic" style="OLC">
<section id="ID8de2b58d371a439282f232e8b3e1fd7e"><enum>324.</enum><header>Comptroller of the
Currency</header>
<subsection id="id0D41E17ACDCD455A8EE8B4E1B79D655C"><enum>(a)</enum><header>Office of the
Comptroller of the Currency established</header><text display-inline="yes-display-inline">There is established in the Department of
the Treasury a bureau to be known as the <quote>Office of the Comptroller of
the Currency</quote> which is charged with assuring the safety and soundness
of, and compliance with laws and regulations, fair access to financial
services, and fair treatment of customers by, the institutions and other
persons subject to its jurisdiction.</text>
</subsection><subsection id="idD2922BA29F584C878F1BC68C73A5591F"><enum>(b)</enum><header>Comptroller of the
Currency</header>
<paragraph id="idC3400072DDA14734A98D561E1B36FCC0"><enum>(1)</enum><header>In
general</header><text display-inline="yes-display-inline">The chief officer of
the Office of the Comptroller of the Currency shall be known as the Comptroller
of the Currency. The Comptroller of the Currency shall perform the duties of
the Comptroller of the Currency under the general direction of the Secretary of
the Treasury. The Secretary of the Treasury may not delay or prevent the
issuance of any rule or the promulgation of any regulation by the Comptroller
of the Currency, and may not intervene in any matter or proceeding before the
Comptroller of the Currency (including agency enforcement actions), unless
otherwise specifically provided by law.</text>
</paragraph><paragraph id="id3B5CFDEDB13E47F19F8F2D14F3A9568D"><enum>(2)</enum><header>Additional
authority</header><text display-inline="yes-display-inline">The Comptroller of
the Currency shall have the same authority with respect to functions
transferred to the Comptroller of the Currency under the Enhancing Financial
Institution Safety and Soundness Act of 2010 (including matters that were
within the jurisdiction of the Director of the Office of Thrift Supervision or
the Office of Thrift Supervision on the day before the transfer date under that
Act) as was vested in the Director of the Office of Thrift Supervision on the
transfer date under that
Act.</text>
</paragraph></subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="ID833df1bfe9d945ffad68eff382e6071b"><enum>(b)</enum><header>Amendment to section
329</header><text>Section 329 of the Revised Statutes of the United States (12
U.S.C. 11) is amended by inserting before the period at the end the following:
<quote>or any Federal savings association</quote>.</text>
</subsection><subsection id="IDa9b81a5294ff4df9835ba39ecc6b4370"><enum>(c)</enum><header>Effective
date</header><text>This section, and the amendments made by this section, shall
take effect on the transfer date.</text>
</subsection></section><section id="ID7cc6af50a4314435b4ea218643c1401e"><enum>315.</enum><header>Federal information
policy</header><text display-inline="no-display-inline">Section 3502(5) of
title 44, United States Code, is amended by inserting <quote>Office of the
Comptroller of the Currency,</quote> after <quote>the Securities and Exchange
Commission,</quote>.</text>
</section><section id="IDa30074590c7a432e8579d89f9bf87b5a"><enum>316.</enum><header>Savings
provisions</header>
<subsection id="IDd5903a203959405bbb1dcf58a42fc201"><enum>(a)</enum><header>Office of Thrift
Supervision</header>
<paragraph id="IDdbdda63bd0de4dcda6c7fa95de4630bc"><enum>(1)</enum><header>Existing rights,
duties, and obligations not affected</header><text>Sections 312(b) and 313
shall not affect the validity of any right, duty, or obligation of the United
States, the Director of the Office of Thrift Supervision, the Office of Thrift
Supervision, or any other person, that existed on the day before the transfer
date.</text>
</paragraph><paragraph id="IDa27bfec8dd354f3fa0ea3ac51a325fb9"><enum>(2)</enum><header>Continuation of
suits</header><text>This title shall not abate any action or proceeding
commenced by or against the Director of the Office of Thrift Supervision or the
Office of Thrift Supervision before the transfer date, except that, for any
action or proceeding arising out of a function of the Director of the Office of
Thrift Supervision or the Office of Thrift Supervision that is transferred to
the Comptroller of the Currency, the Office of the Comptroller of the Currency,
the Chairperson of the Corporation, the Corporation, the Chairman of the Board
of Governors, or the Board of Governors by this subtitle, the Comptroller of
the Currency, the Office of the Comptroller of the Currency, the Chairperson of
the Corporation, the Corporation, the Chairman of the Board of Governors, or
the Board of Governors shall be substituted for the Director of the Office of
Thrift Supervision or the Office of Thrift Supervision, as appropriate, as a
party to the action or proceeding as of the transfer date.</text>
</paragraph></subsection><subsection id="ID55bebda43d1449fb9d54f87fe1018067"><enum>(b)</enum><header>Continuation of
existing orders, resolutions, determinations, agreements, regulations, and
other materials</header><text>All orders, resolutions, determinations,
agreements, regulations, interpretative rules, other interpretations,
guidelines, procedures, and other advisory materials that have been issued,
made, prescribed, or allowed to become effective by the Office of Thrift
Supervision, or by a court of competent jurisdiction, in the performance of
functions of the Office of Thrift Supervision that are transferred by this
subtitle and that are in effect on the day before the transfer date, shall
continue in effect according to the terms of those materials, and shall be
enforceable by or against the Office of the Comptroller of the Currency, the
Corporation, or the Board of Governors, as appropriate, until modified,
terminated, set aside, or superseded in accordance with applicable law by the
Office of the Comptroller of the Currency, the Corporation, or the Board of
Governors, as appropriate, by any court of competent jurisdiction, or by
operation of law.</text>
</subsection><subsection id="IDc097e35a7e3f4e16bec6bcba90a0d79b"><enum>(c)</enum><header>Identification of
regulations continued</header>
<paragraph id="ID3d9b516aeb84496198cf708467257d3d"><enum>(1)</enum><header>By the office of the
comptroller of the currency</header><text>Not later than the transfer date, the
Office of the Comptroller of the Currency shall—</text>
<subparagraph id="ID186a278685ae42338d2949c936546314"><enum>(A)</enum><text>in consultation with the
Corporation, identify the regulations continued under subsection (b) that will
be enforced by the Office of the Comptroller of the Currency; and</text>
</subparagraph><subparagraph id="ID1e0e249744354564a8f0fb8fe97ffb07"><enum>(B)</enum><text>publish a list of such
regulations in the Federal Register.</text>
</subparagraph></paragraph><paragraph id="id96C41CEF778F4842BFED5521217596DB"><enum>(2)</enum><header>By the
corporation</header><text>Not later than the transfer date, the Corporation
shall—</text>
<subparagraph id="id0DEF453B87D64B80A97FECB44B6864C5"><enum>(A)</enum><text>in consultation with the
Office of the Comptroller of the Currency, identify the regulations continued
under subsection (b) that will be enforced by the Corporation; and</text>
</subparagraph><subparagraph id="idDC0758DAEE5548BA9A93AEABBF3F556B"><enum>(B)</enum><text>publish a list of such
regulations in the Federal Register.</text>
</subparagraph></paragraph><paragraph id="IDeec96e5ca5904e858fe4a68dd135d39c"><enum>(3)</enum><header>By the Board of
Governors</header><text>Not later than the transfer date, the Board of
Governors shall—</text>
<subparagraph id="IDd50397d022e64e5eb0676b42949a25f1"><enum>(A)</enum><text>in consultation with the
Office of the Comptroller of the Currency and the Corporation, identify the
regulations continued under subsection (b) that will be enforced by the Board
of Governors; and</text>
</subparagraph><subparagraph id="ID98a1e1e442bc4223ad372ce7b2fa43ef"><enum>(B)</enum><text>publish a list of such
regulations in the Federal Register.</text>
</subparagraph></paragraph></subsection><subsection id="IDcfb58611d90f4f48bb96fe2b168ce635"><enum>(d)</enum><header>Status of regulations
proposed or not yet effective</header>
<paragraph id="ID32ed3e0e9e5d490b92d33a713ef02156"><enum>(1)</enum><header>Proposed
regulations</header><text>Any proposed regulation of the Office of Thrift
Supervision that the Office of Thrift Supervision, in performing functions
transferred by this subtitle, has proposed before the transfer date, but has
not published as a final regulation before that date, shall be deemed to be a
proposed regulation of the Office of the Comptroller of the Currency or the
Board of Governors, as appropriate, according to its terms.</text>
</paragraph><paragraph id="IDfd0b12ea55264f0abca74173fb98e3b6"><enum>(2)</enum><header>Regulations not yet
effective</header><text>Any interim or final regulation of the Office of Thrift
Supervision that the Office of Thrift Supervision, in performing functions
transferred by this subtitle, has published before the transfer date, but which
has not become effective before that date, shall become effective as a
regulation of the Office of the Comptroller of the Currency or the Board of
Governors, as appropriate, according to its terms.</text>
</paragraph></subsection></section><section id="ID49e336407758479990953b8a86560c63"><enum>317.</enum><header>References in Federal
law to Federal banking agencies</header><text display-inline="no-display-inline">Except as provided in section 312(d)(2), on
and after the transfer date, any reference in Federal law to the Director of
the Office of Thrift Supervision or the Office of Thrift Supervision, in
connection with any function of the Director of the Office of Thrift
Supervision or the Office of Thrift Supervision transferred under section
312(b) or any other provision of this subtitle, shall be deemed to be a
reference to the Comptroller of the Currency, the Office of the Comptroller of
the Currency, the Chairperson of the Corporation, the Corporation, the Chairman
of the Board of Governors, or the Board of Governors, as appropriate.</text>
</section><section id="id11B3A87DBDF0491F9221D7347496B1E2"><enum>318.</enum><header>Funding</header>
<subsection id="id888EB114080B4005A154EB7838B5FB78"><enum>(a)</enum><header>Funding of Office of
the Comptroller of the Currency</header><text>Chapter 4 of title LXII of the
Revised Statutes is amended by inserting after section 5240 (12 U.S.C. 481,
482) the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id8647F46B43BF48D1AFDF23FCBCE4EFC7" reported-display-style="italic" style="traditional">
<section id="id7575C57D332741B4BEBE038742799059"><enum>5240A.</enum><text>The Comptroller of the
Currency may collect an assessment, fee, or other charge from any entity
described in section 3(q)(1) of the Federal Deposit Insurance Act (12 U.S.C.
1813(q)(1)), as the Comptroller determines is necessary or appropriate to carry
out the responsibilities of the Office of the Comptroller of the Currency. In
establishing the amount of an assessment, fee, or charge collected from an
entity under this section, the Comptroller of the Currency may take into
account the funds transferred to the Office of the Comptroller of the Currency
under this section, the nature and scope of the activities of the entity, the
amount and type of assets that the entity holds, the financial and managerial
condition of the entity, and any other factor, as the Comptroller of the
Currency determines is appropriate. Funds derived from any assessment, fee, or
charge collected or payment made pursuant to this section may be deposited by
the Comptroller of the Currency in accordance with the provisions of section
5234. Such funds shall not be construed to be Government funds or appropriated
monies, and shall not be subject to apportionment for purposes of chapter 15 of
title 31, United States Code, or any other provision of law. The authority of
the Comptroller of the Currency under this section shall be in addition to the
authority under section 5240.</text>
<subsection id="idF89BCA202ED9423EADA123269DCFA107"><enum></enum><text>The Comptroller of the Currency shall
have sole authority to determine the manner in which the obligations of the
Office of the Comptroller of the Currency shall be incurred and its
disbursements and expenses allowed and paid, in accordance with this
section.</text>
</subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="idAE07A0CF297C4AFB9BE0B7CAA3549CA5"><enum>(b)</enum><header>Funding of Board of
Governors</header><text display-inline="yes-display-inline">Section 11 of the
Federal Reserve Act (12 U.S.C. 248) is amended by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idAFD0031096AE415786B0BAB893CEF10B" reported-display-style="italic" style="OLC">
<subsection id="id2FCDC62A5CE34206A9B9D745E4983F77"><enum>(s)</enum><header>Assessments, fees, and
other charges for certain companies</header>
<paragraph id="id725365BED15F42E4B65EEE38E0C67CA7"><enum>(1)</enum><header>In
general</header><text>The Board shall collect a total amount of assessments,
fees, or other charges from the companies described in paragraph (2) that is
equal to the total expenses the Board estimates are necessary or appropriate to
carry out the responsibilities of the Board with respect to such
companies.</text>
</paragraph><paragraph id="id67C0A033A74C438AAFB89B17D3F78681"><enum>(2)</enum><header>Companies</header><text>The
companies described in this paragraph are—</text>
<subparagraph id="id88BE303B848A4A5786A41E865ACC73A6"><enum>(A)</enum><text>all bank holding
companies having total consolidated assets of $50,000,000,000 or more;</text>
</subparagraph><subparagraph id="id5FC9F24462BA4CB1B893759637252BAD"><enum>(B)</enum><text>all savings and loan
holding companies having total consolidated assets of $50,000,000,000 or more;
and</text>
</subparagraph><subparagraph id="id26EEFADE4B1446168242F6BE53BAAA2C"><enum>(C)</enum><text>all nonbank financial
companies supervised by the Board under section 113 of the Restoring American
Financial Stability Act of
2010.</text>
</subparagraph></paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="idA176254A838D4BF9987689CCBAFD9BCA"><enum>(c)</enum><header>Corporation examination
fees</header><text>Section 10(e) of the Federal Deposit Insurance Act (12
U.S.C. 1820(e)) is amended by striking paragraph (1) and inserting the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id7129D03BB2BA4AFAA31F995A5AD746E7" reported-display-style="italic" style="OLC">
<paragraph id="idB9DCE78CB6AA40A0BD32E42D89253430"><enum>(1)</enum><header>Regular and special
examinations of depository institutions</header><text>The cost of conducting
any regular examination or special examination of any depository institution
under subsection (b)(2), (b)(3), or (d) or of any entity described in section
3(q)(2) may be assessed by the Corporation against the institution or entity to
meet the expenses of the Corporation in carrying out such examinations, or as
the Corporation determines is necessary or appropriate to carry out the
responsibilities of the
Corporation.</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="idCAF4C88DDA2C440791D197B2510EEE14"><enum>(d)</enum><header>Effective
date</header><text>This section, and the amendments made by this section, shall
take effect on the transfer date.</text>
</subsection></section><section id="IDee3f54b9ce7f4b5c97684f61f4bd4b01"><enum>319.</enum><header>Contracting and
leasing authority</header><text display-inline="no-display-inline">Notwithstanding the Federal Property and
Administrative Services Act of 1949 (41 U.S.C. 251 et seq.) or any other
provision of law, the Office of the Comptroller of the Currency may—</text>
<paragraph id="IDea46d203b11c443e929906dd67df588d"><enum>(1)</enum><text>enter into and perform
contracts, execute instruments, and acquire, in any lawful manner, such goods
and services, or personal or real property (or property interest) as the
Comptroller deems necessary to carry out the duties and responsibilities of the
Office of the Comptroller of the Currency; and</text>
</paragraph><paragraph id="IDba0c9c3c5c174f679f7d82d93d1a0622"><enum>(2)</enum><text>hold, maintain, sell,
lease, or otherwise dispose of the property (or property interest) acquired
under paragraph (1).</text>
</paragraph></section></subtitle><subtitle id="idC85851C856ED4D4598B394A24A0787CB"><enum>B</enum><header>Transitional
provisions</header>
<section id="ID9f29d1f2d5fe4add8e09580c9061daa0"><enum>321.</enum><header>Interim use of funds,
personnel, and property of the Office of Thrift Supervision</header>
<subsection id="id8D244FE480B241F290544A36AEA07BEC"><enum>(a)</enum><header>In
general</header><text>Before the transfer date, the Office of the Comptroller
of the Currency, the Corporation, and the Board of Governors shall—</text>
<paragraph id="id563530F60C9B4F9287E86BF9CA17AB7D"><enum>(1)</enum><text>consult and cooperate
with the Office of Thrift Supervision to facilitate the orderly transfer of
functions to the Office of the Comptroller of the Currency, the Corporation,
and the Board of Governors in accordance with this title;</text>
</paragraph><paragraph id="id153F299B1E614069B86ABA32BC7C2D5B"><enum>(2)</enum><text>determine jointly, from
time to time—</text>
<subparagraph id="idCAEF3C197AF54CE292794967480FCFE3"><enum>(A)</enum><text>the amount of funds
necessary to pay any expenses associated with the transfer of functions
(including expenses for personnel, property, and administrative services)
during the period beginning on the date of enactment of this Act and ending on
the transfer date;</text>
</subparagraph><subparagraph id="id960E028E8BFF4230B47D481EF1BD91AF"><enum>(B)</enum><text>which personnel are
appropriate to facilitate the orderly transfer of functions by this title;
and</text>
</subparagraph><subparagraph id="idCB3A0C8E88E442FE9BABC2ECAA9D07B3"><enum>(C)</enum><text>what property and
administrative services are necessary to support the Office of the Comptroller
of the Currency, the Corporation, and the Board of Governors during the period
beginning on the date of enactment of this Act and ending on the transfer date;
and</text>
</subparagraph></paragraph><paragraph id="idCF627CA94BCC41C294647E5A6D4B53BD"><enum>(3)</enum><text>take such actions as may
be necessary to provide for the orderly implementation of this title.</text>
</paragraph></subsection><subsection id="id1B1B8831250A472FAB8C61B9BF6085EC"><enum>(b)</enum><header>Agency
consultation</header><text>When requested jointly by the Office of the
Comptroller of the Currency, the Corporation, and the Board of Governors to do
so before the transfer date, the Office of Thrift Supervision shall—</text>
<paragraph id="idD5841E2A663D4B9A890012605EDB7CDD"><enum>(1)</enum><text>pay to the Office of the
Comptroller of the Currency, the Corporation, or the Board of Governors, as
applicable, from funds obtained by the Office of Thrift Supervision through
assessments, fees, or other charges that the Office of Thrift Supervision is
authorized by law to impose, such amounts as the Office of the Comptroller of
the Currency, the Corporation, and the Board of Governors jointly determine to
be necessary under subsection (a);</text>
</paragraph><paragraph id="id6C0A07491B48438096A6F2C5E05AC1FF"><enum>(2)</enum><text>detail to the Office of
the Comptroller of the Currency, the Corporation, or the Board of Governors, as
applicable, such personnel as the Office of the Comptroller of the Currency,
the Corporation, and the Board of Governors jointly determine to be appropriate
under subsection (a); and</text>
</paragraph><paragraph id="idD654ABE9CD834C2A80674461DC3E5A04"><enum>(3)</enum><text>make available to the
Office of the Comptroller of the Currency, the Corporation, or the Board of
Governors, as applicable, such property and provide to the Office of the
Comptroller of the Currency, the Corporation, or the Board of Governors, as
applicable, such administrative services as the Office of the Comptroller of
the Currency, the Corporation, and the Board of Governors jointly determine to
be necessary under subsection (a).</text>
</paragraph></subsection><subsection id="id374C9316EBF24EA7AF57677EE7B163C9"><enum>(c)</enum><header>Notice
required</header><text>The Office of the Comptroller of the Currency, the
Corporation, and the Board of Governors shall jointly give the Office of Thrift
Supervision reasonable prior notice of any request that the Office of the
Comptroller of the Currency, the Corporation, and the Board of Governors
jointly intend to make under subsection (b).</text>
</subsection></section><section id="ID052925dd106f4df397ce8a6c3f53ace6"><enum>322.</enum><header>Transfer of
employees</header>
<subsection id="IDfcc930ea303b436f86b44ca5f9fcaa5f"><enum>(a)</enum><header>In general</header>
<paragraph id="ID1c66944fb2394655a1c43d499f375507"><enum>(1)</enum><header>Office of thrift
supervision employees</header>
<subparagraph id="IDbcca61e1ab424044adc343b7125a3bb6"><enum>(A)</enum><header>In
general</header><text>All employees of the Office of Thrift Supervision shall
be transferred to the Office of the Comptroller of the Currency or the
Corporation for employment in accordance with this section.</text>
</subparagraph><subparagraph id="IDf40c6e3b79ce4d129eccbc571c894472"><enum>(B)</enum><header>Allocating employees
for transfer to receiving agencies</header><text>The Director of the Office of
Thrift Supervision, the Comptroller of the Currency, and the Chairperson of the
Corporation shall—</text>
<clause id="ID8a0b14a4c0754797b85d509160928e45"><enum>(i)</enum><text>jointly determine the
number of employees of the Office of Thrift Supervision necessary to perform or
support the functions that are transferred to the Office of the Comptroller of
the Currency or the Corporation by this title; and</text>
</clause><clause id="ID4cfd317eb0ac4496ab6bec53c5504c2b"><enum>(ii)</enum><text>consistent with the
determination under clause (i), jointly identify employees of the Office of
Thrift Supervision for transfer to the Office of the Comptroller of the
Currency or the Corporation.</text>
</clause></subparagraph></paragraph><paragraph id="ID49ee829aabaf4d4e9df76beea5fff638"><enum>(2)</enum><header>Employees transferred;
service periods credited</header><text>For purposes of this section, periods of
service with a Federal home loan bank, a joint office of Federal home loan
banks, or a Federal reserve bank shall be credited as periods of service with a
Federal agency.</text>
</paragraph><paragraph id="IDd3b362f4c15b4110aff493c120fefa57"><enum>(3)</enum><header>Appointment authority
for excepted service transferred</header>
<subparagraph id="ID8cd9632ab9984cf2837959238f513147"><enum>(A)</enum><header>In
general</header><text>Except as provided in subparagraph (B), any appointment
authority of the Office of Thrift Supervision under Federal law that relates to
the functions transferred under section 312, including the regulations of the
Office of Personnel Management, for filling the positions of employees in the
excepted service shall be transferred to the Comptroller of the Currency or the
Chairperson of the Corporation, as appropriate.</text>
</subparagraph><subparagraph id="ID937eeb5967674b88aa281ffb76c0eb99"><enum>(B)</enum><header>Declining transfers
allowed</header><text>The Office of the Comptroller of the Currency or the
Chairperson of the Corporation may decline to accept a transfer of authority
under subparagraph (A) (and the employees appointed under that authority) to
the extent that such authority relates to positions excepted from the
competitive service because of their confidential, policy-making,
policy-determining, or policy-advocating character.</text>
</subparagraph></paragraph><paragraph id="id99075CDC4A29410F9C9B96E117EAD7E7"><enum>(4)</enum><header>Additional appointment
authority</header><text>Notwithstanding any other provision of law, the Office
of the Comptroller of the Currency and the Corporation may appoint transferred
employees to positions in the Office of the Comptroller of the Currency or the
Corporation, respectively.</text>
</paragraph></subsection><subsection id="IDc23b03d0363341d9acb2feed4fa47ac6"><enum>(b)</enum><header>Timing of transfers and
position assignments</header><text>Each employee to be transferred under
subsection (a)(1) shall—</text>
<paragraph id="ID995594751b03476ca90e3ab07a610b96"><enum>(1)</enum><text>be transferred not later
than 90 days after the transfer date; and</text>
</paragraph><paragraph id="ID10891666a4e046ed98d5ee52845e3996"><enum>(2)</enum><text>receive notice of the
position assignment of the employee not later than 120 days after the effective
date of the transfer of the employee.</text>
</paragraph></subsection><subsection id="IDc092ee94a1774009b8655eb9d37f0540"><enum>(c)</enum><header>Transfer of
functions</header>
<paragraph id="ID4fadd07de3bf4e928666176605ebeb20"><enum>(1)</enum><header>In
general</header><text>Notwithstanding any other provision of law, the transfer
of employees under this subtitle shall be deemed a transfer of functions for
the purpose of section 3503 of title 5, United States Code.</text>
</paragraph><paragraph id="IDd312bb68c6254c76978c44e27f3cd1e1"><enum>(2)</enum><header>Priority</header><text>If
any provision of this subtitle conflicts with any protection provided to a
transferred employee under section 3503 of title 5, United States Code, the
provisions of this subtitle shall control.</text>
</paragraph></subsection><subsection id="IDc03520f76a134249b75d2f6fb79f7896"><enum>(d)</enum><header>Employee status and
eligibility</header><text>The transfer of functions and employees under this
subtitle, and the abolishment of the Office of Thrift Supervision under section
313, shall not affect the status of the transferred employees as employees of
an agency of the United States under any provision of law.</text>
</subsection><subsection id="ID962468a65d6846918dfae6df0d7cf962"><enum>(e)</enum><header>Equal status and tenure
positions</header>
<paragraph id="IDc4103fd75dc74aac8e4024e14ef8c554"><enum>(1)</enum><header>Status and
tenure</header><text>Each transferred employee from the Office of Thrift
Supervision shall be placed in a position at the Office of the Comptroller of
the Currency or the Corporation with the same status and tenure as the
transferred employee held on the day before the date on which the employee was
transferred.</text>
</paragraph><paragraph id="ID32faf73ff40948b2b06db9412f1da3eb"><enum>(2)</enum><header>Functions</header><text>To
the extent practicable, each transferred employee shall be placed in a position
at the Office of the Comptroller of the Currency or the Corporation, as
applicable, responsible for the same functions and duties as the transferred
employee had on the day before the date on which the employee was transferred,
in accordance with the expertise and preferences of the transferred
employee.</text>
</paragraph></subsection><subsection id="IDd4dba9b860c84f378d13352077b7f64d"><enum>(f)</enum><header>No additional
certification requirements</header><text>An examiner who is a transferred
employee shall not be subject to any additional certification requirements
before being placed in a comparable position at the Office of the Comptroller
of the Currency or the Corporation, if the examiner carries out examinations of
the same type of institutions as an employee of the Office of the Comptroller
of the Currency or the Corporation as the employee was responsible for carrying
out before the date on which the employee was transferred.</text>
</subsection><subsection id="IDfd226a9401bc4858b9ba1fb0e149015e"><enum>(g)</enum><header>Personnel actions
limited</header>
<paragraph id="ID1e4a7ea0c6f94685ac5ce51512eace11"><enum>(1)</enum><header>2-Year
protection</header><text>Except as provided in paragraph (2), during the 2-year
period beginning on the transfer date, an employee holding a permanent position
on the day before the date on which the employee was transferred shall not be
involuntarily separated or involuntarily reassigned outside the locality pay
area (as defined by the Office of Personnel Management) of the employee.</text>
</paragraph><paragraph id="IDef5d3678dbd34f74a00020dad4ee4adf"><enum>(2)</enum><header>Exceptions</header><text>The
Comptroller of the Currency and the Chairperson of the Corporation, as
applicable, may—</text>
<subparagraph id="IDea88702706fa40478f459c4337e6f611"><enum>(A)</enum><text>separate a transferred
employee for cause, including for unacceptable performance; or</text>
</subparagraph><subparagraph id="ID3ed1f2a6779f444fa15fa3d996c6f350"><enum>(B)</enum><text>terminate an appointment
to a position excepted from the competitive service because of its confidential
policy-making, policy-determining, or policy-advocating character.</text>
</subparagraph></paragraph></subsection><subsection id="ID354f2ad52ecc45c1a337ee2c6f04bdfa"><enum>(h)</enum><header>Pay</header>
<paragraph id="ID44aebe65126a4ba89d63e337edc7663f"><enum>(1)</enum><header>2-Year
protection</header><text>Except as provided in paragraph (2), during the 2-year
period beginning on the date on which the employee was transferred under this
subtitle, a transferred employee shall be paid at a rate that is not less than
the basic rate of pay, including any geographic differential, that the
transferred employee received during the pay period immediately preceding the
date on which the employee was transferred.</text>
</paragraph><paragraph id="ID1bd8ae02d85f4f34a3586fc54f017cdd"><enum>(2)</enum><header>Exceptions</header><text>The
Comptroller of the Currency or the Chairman of the Board of Governors may
reduce the rate of basic pay of a transferred employee—</text>
<subparagraph id="IDa732db47a724432298dd8fb27c197b92"><enum>(A)</enum><text>for cause, including for
unacceptable performance; or</text>
</subparagraph><subparagraph id="IDea1731c3305c4ccea9cb95b23692eb65"><enum>(B)</enum><text>with the consent of the
transferred employee.</text>
</subparagraph></paragraph><paragraph id="ID18c5c54987c04e8d85c3f93123c710f4"><enum>(3)</enum><header>Protection only while
employed</header><text>This subsection shall apply to a transferred employee
only during the period that the transferred employee remains employed by Office
of the Comptroller of the Currency or the Corporation.</text>
</paragraph><paragraph id="IDdd9393ca162f46f7aaec23954f0dc2bb"><enum>(4)</enum><header>Pay increases
permitted</header><text>Nothing in this subsection shall limit the authority of
the Comptroller of the Currency or the Chairperson of the Corporation to
increase the pay of a transferred employee.</text>
</paragraph></subsection><subsection id="ID29cad8559008451cbc445e2540d5e179"><enum>(i)</enum><header>Benefits</header>
<paragraph id="ID20b43aa207fb44f2879624362de7f10b"><enum>(1)</enum><header>Retirement benefits for
transferred employees</header>
<subparagraph id="IDfaf40deb11e649e6ba2e72aa93cd06ac"><enum>(A)</enum><header>In general</header>
<clause id="IDa77b605ef48b42659868d084d6182b08"><enum>(i)</enum><header>Continuation of
existing retirement plan</header><text>Each transferred employee shall remain
enrolled in the retirement plan of the transferred employee, for as long as the
transferred employee is employed by the Office of the Comptroller of the
Currency or the Corporation.</text>
</clause><clause id="ID03a8228640b947ada51594bcc6b084e5"><enum>(ii)</enum><header>Employer’s
contribution</header><text>The Comptroller of the Currency or the Chairperson
of the Corporation, as appropriate, shall pay any employer contributions to the
existing retirement plan of each transferred employee, as required under each
such existing retirement plan.</text>
</clause></subparagraph><subparagraph id="IDebb240e329d64abba4c75e9c30086934"><enum>(B)</enum><header>Definition</header><text>In
this paragraph, the term <term>existing retirement plan</term> means, with
respect to a transferred employee, the retirement plan (including the Financial
Institutions Retirement Fund), and any associated thrift savings plan, of the
agency from which the employee was transferred in which the employee was
enrolled on the day before the date on which the employee was
transferred.</text>
</subparagraph></paragraph><paragraph id="ID71df631f26444b5a93b7ba9daad73d70"><enum>(2)</enum><header>Benefits other than
retirement benefits</header>
<subparagraph id="IDe2cfb8b1299d418fa2b90d65986149f8"><enum>(A)</enum><header>During first
year</header>
<clause id="ID2de7dc0bdacd4df888990a56f358e8fb"><enum>(i)</enum><header>Existing plans
continue</header><text>During the 1-year period following the transfer date,
each transferred employee may retain membership in any employee benefit program
(other than a retirement benefit program) of the agency from which the employee
was transferred under this title, including any dental, vision, long term care,
or life insurance program to which the employee belonged on the day before the
transfer date.</text>
</clause><clause id="ID2885f8dced5341379410091de0f0649b"><enum>(ii)</enum><header>Employer’s
contribution</header><text>The Office of the Comptroller of the Currency or the
Corporation, as appropriate, shall pay any employer cost required to extend
coverage in the benefit program to the transferred employee as required under
that program or negotiated agreements.</text>
</clause></subparagraph><subparagraph id="IDc82d94e50eb549399c519f1e77df56ec"><enum>(B)</enum><header>Dental, vision, or life
insurance after first year</header><text>If, after the 1-year period beginning
on the transfer date, the Office of the Comptroller of the Currency or the
Corporation determines that the Office of the Comptroller of the Currency or
the Corporation, as the case may be, will not continue to participate in any
dental, vision, or life insurance program of an agency from which an employee
was transferred, a transferred employee who is a member of the program may,
before the decision takes effect and without regard to any regularly scheduled
open season, elect to enroll in—</text>
<clause id="ID8bf4fa7f38214cb89dde0f08a21a5864"><enum>(i)</enum><text>the enhanced dental
benefits program established under chapter 89A of title 5, United States
Code;</text>
</clause><clause id="ID0e3b5edaf43c4569a3bd3da0ab3e2c3a"><enum>(ii)</enum><text>the enhanced vision
benefits established under chapter 89B of title 5, United States Code;
and</text>
</clause><clause id="ID190f34ad30cd4abda57d529d404d32d3"><enum>(iii)</enum><text>the Federal Employees’
Group Life Insurance Program established under chapter 87 of title 5, United
States Code, without regard to any requirement of insurability.</text>
</clause></subparagraph><subparagraph id="IDc26d74421b96411b8e6d97b9816beda5"><enum>(C)</enum><header>Long term care
insurance after 1st year</header><text>If, after the 1-year period beginning on
the transfer date, the Office of the Comptroller of the Currency or the
Corporation determines that the Office of the Comptroller of the Currency or
the Corporation, as appropriate, will not continue to participate in any long
term care insurance program of an agency from which an employee transferred, a
transferred employee who is a member of such a program may, before the decision
takes effect, elect to apply for coverage under the Federal Long Term Care
Insurance Program established under chapter 90 of title 5, United States Code,
under the underwriting requirements applicable to a new active workforce
member, as described in part 875 of title 5, Code of Federal Regulations (or
any successor thereto).</text>
</subparagraph><subparagraph id="ID6c4ef7519a674ee4bbae6bd659d65198"><enum>(D)</enum><header>Contribution of
transferred employee</header>
<clause id="IDe6e6ca226cf747258d631f6363258a5c"><enum>(i)</enum><header>In
general</header><text>Subject to clause (ii), a transferred employee who is
enrolled in a plan under the Federal Employees Health Benefits Program shall
pay any employee contribution required under the plan.</text>
</clause><clause id="ID4b7da6cd4dd442a39d33d28a38adb906"><enum>(ii)</enum><header>Cost
differential</header><text>The Office of the Comptroller of the Currency or the
Corporation, as applicable, shall pay any difference in cost between the
employee contribution required under the plan provided to transferred employees
by the agency from which the employee transferred on the date of enactment of
this Act and the plan provided by the Office of the Comptroller of the Currency
or the Corporation, as the case may be, under this section.</text>
</clause><clause id="IDc65ea0969be04f37b294048142f6dcca"><enum>(iii)</enum><header>Funds
transfer</header><text>The Office of the Comptroller of the Currency or the
Corporation, as the case may be, shall transfer to the Employees Health
Benefits Fund established under section 8909 of title 5, United States Code, an
amount determined by the Director of the Office of Personnel Management, after
consultation with the Comptroller of the Currency or the Chairperson of the
Corporation, as the case may be, and the Office of Management and Budget, to be
necessary to reimburse the Fund for the cost to the Fund of providing any
benefits under this subparagraph that are not otherwise paid for by a
transferred employee under clause (i).</text>
</clause></subparagraph><subparagraph id="ID8e84cfef576d436fabb4aa8234147110"><enum>(E)</enum><header>Special provisions to
ensure continuation of life insurance benefits</header>
<clause id="ID47c2febb3377436fbb7040a0882d3831"><enum>(i)</enum><header>In
general</header><text>An annuitant, as defined in section 8901 of title 5,
United States Code, who is enrolled in a life insurance plan administered by an
agency from which employees are transferred under this title on the day before
the transfer date shall be eligible for coverage by a life insurance plan under
sections 8706(b), 8714a, 8714b, or 8714c of title 5, United States Code, or by
a life insurance plan established by the Office of the Comptroller of the
Currency or the Corporation, as applicable, without regard to any regularly
scheduled open season or any requirement of insurability.</text>
</clause><clause id="ID30a1ddd9180a42b0ade642456760d3b8"><enum>(ii)</enum><header>Contribution of
transferred employee</header>
<subclause id="ID8ec67d3d9eba4fca8204755638c4f14f"><enum>(I)</enum><header>In
general</header><text>Subject to subclause (II), a transferred employee
enrolled in a life insurance plan under this subparagraph shall pay any
employee contribution required by the plan.</text>
</subclause><subclause id="IDc0cbb5685cee4a8386c9e14dc85f37da"><enum>(II)</enum><header>Cost
differential</header><text>The Office of the Comptroller of the Currency or the
Corporation, as the case may be, shall pay any difference in cost between the
benefits provided by the agency from which the employee transferred on the date
of enactment of this Act and the benefits provided under this section.</text>
</subclause><subclause id="IDf0f60163492346a3ac5d1d740ed66fb8"><enum>(III)</enum><header>Funds
transfer</header><text>The Office of the Comptroller of the Currency or the
Corporation, as the case may be, shall transfer to the Federal Employees’ Group
Life Insurance Fund established under section 8714 of title 5, United States
Code, an amount determined by the Director of the Office of Personnel
Management, after consultation with the Comptroller of the Currency or the
Chairperson of the Corporation, as the case may be, and the Office of
Management and Budget, to be necessary to reimburse the Federal Employees’
Group Life Insurance Fund for the cost to the Federal Employees’ Group Life
Insurance Fund of providing benefits under this subparagraph not otherwise paid
for by a transferred employee under subclause (I).</text>
</subclause><subclause id="ID46ca33cb79c94c7ab097d2dd100cfb81"><enum>(IV)</enum><header>Credit for time
enrolled in other plans</header><text>For any transferred employee, enrollment
in a life insurance plan administered by the agency from which the employee
transferred, immediately before enrollment in a life insurance plan under
chapter 87 of title 5, United States Code, shall be considered as enrollment in
a life insurance plan under that chapter for purposes of section 8706(b)(1)(A)
of title 5, United States Code.</text>
</subclause></clause></subparagraph></paragraph></subsection><subsection id="ID76ca14b796784bfba88ab138dffba3c9"><enum>(j)</enum><header>Incorporation into
agency pay system</header><text>Not later than 2 years after the transfer date,
the Comptroller of the Currency and the Chairperson of the Corporation shall
place each transferred employee into the established pay system and structure
of the appropriate employing agency.</text>
</subsection><subsection id="ID341b9b20a0fe40c78b950b9eaafd7bbf"><enum>(k)</enum><header>Equitable
treatment</header><text>In administering the provisions of this section, the
Comptroller of the Currency and the Chairperson of the Corporation—</text>
<paragraph id="IDb6e61e5d105d4a49bed8249bc4414428"><enum>(1)</enum><text>may not take any action
that would unfairly disadvantage a transferred employee relative to any other
employee of the Office of the Comptroller of the Currency or the Corporation on
the basis of prior employment by the Office of Thrift Supervision; and</text>
</paragraph><paragraph id="ID0bfc808ad0ee401b9d7b53e2152a64fc"><enum>(2)</enum><text>may take such action as
is appropriate in an individual case to ensure that a transferred employee
receives equitable treatment, with respect to the status, tenure, pay, benefits
(other than benefits under programs administered by the Office of Personnel
Management), and accrued leave or vacation time for prior periods of service
with any Federal agency of the transferred employee.</text>
</paragraph></subsection><subsection id="ID64eb9991bda24cafac9ab58f2f5f4b83"><enum>(l)</enum><header>Reorganization</header>
<paragraph id="ID1267aeb88fa64418b8a6423cceeed81b"><enum>(1)</enum><header>In
general</header><text>If the Comptroller of the Currency or the Chairperson of
the Corporation determines, during the 2-year period beginning 1 year after the
transfer date, that a reorganization of the staff of the Office of the
Comptroller of the Currency or the Corporation, respectively, is required, the
reorganization shall be deemed a <quote>major reorganization</quote> for
purposes of affording affected employees retirement under section 8336(d)(2) or
8414(b)(1)(B) of title 5, United States Code.</text>
</paragraph><paragraph id="IDae3c5e9d4378491788413f9985a22401"><enum>(2)</enum><header>Service
credit</header><text>For purposes of this subsection, periods of service with a
Federal home loan bank or a joint office of Federal home loan banks shall be
credited as periods of service with a Federal agency.</text>
</paragraph></subsection></section><section id="IDddeb9f14780347249decd22c9cd34ac7"><enum>323.</enum><header>Property
transferred</header>
<subsection id="IDb7a5f9114e814843aeba16292c9000f5"><enum>(a)</enum><header>Property
defined</header><text>For purposes of this section, the term
<term>property</term> includes all real property (including leaseholds) and all
personal property, including computers, furniture, fixtures, equipment, books,
accounts, records, reports, files, memoranda, paper, reports of examination,
work papers, and correspondence related to such reports, and any other
information or materials.</text>
</subsection><subsection id="ID8e170b3008a54897bdf6b8ce923526ab"><enum>(b)</enum><header>Property of the Office
of Thrift Supervision</header><text>Not later than 90 days after the transfer
date, all property of the Office of Thrift Supervision that the Comptroller of
the Currency and the Chairperson of the Corporation jointly determine is used,
on the day before the transfer date, to perform or support the functions of the
Office of Thrift Supervision transferred to the Office of the Comptroller of
the Currency or the Corporation under this title, shall be transferred to the
Office of the Comptroller of the Currency or the Corporation in a manner
consistent with the transfer of employees under this subtitle.</text>
</subsection><subsection id="IDbf3bcc08f57a42c8be708700758417a2"><enum>(c)</enum><header>Contracts related to
property transferred</header><text>Each contract, agreement, lease, license,
permit, and similar arrangement relating to property transferred to the Office
of the Comptroller of the Currency or the Corporation by this section shall be
transferred to the Office of the Comptroller of the Currency or the
Corporation, as appropriate, together with the property to which it
relates.</text>
</subsection><subsection id="IDf7495816d1f34226bcd52c2852df81cd"><enum>(d)</enum><header>Preservation of
property</header><text>Property identified for transfer under this section
shall not be altered, destroyed, or deleted before transfer under this
section.</text>
</subsection></section><section id="ID4bf83d0418794868bff61669f6ba0c1b"><enum>324.</enum><header>Funds
transferred</header><text display-inline="no-display-inline">The funds that, on
the day before the transfer date, the Director of the Office of Thrift
Supervision (in consultation with the Comptroller of the Currency, the
Chairperson of the Corporation, and the Chairman of the Board of Governors)
determines are not necessary to dispose of the affairs of the Office of Thrift
Supervision under section 325 and are available to the Office of Thrift
Supervision to pay the expenses of the Office of Thrift Supervision—</text>
<paragraph id="id2DBDA9A74DDF49DA9A1711F3C0E02600"><enum>(1)</enum><text display-inline="yes-display-inline">relating to the functions of the Office of
Thrift Supervision transferred under section 312(b)(1)(B), shall be transferred
to the Office of the Comptroller of the Currency on the transfer date;</text>
</paragraph><paragraph id="id2010B65A9CD2438DB2AD03D90F88A298"><enum>(2)</enum><text>relating to the functions
of the Office of Thrift Supervision transferred under section 312(b)(1)(C),
shall be transferred to the Corporation on the transfer date; and</text>
</paragraph><paragraph id="id079EDFFF432D449EA6C9F3140397CE1C"><enum>(3)</enum><text>relating to the functions
of the Office of Thrift Supervision transferred under section 312(b)(1)(A),
shall be transferred to the Board of Governors on the transfer date.</text>
</paragraph></section><section id="IDf4f51729c33b4995a502f24a956ba3c8"><enum>325.</enum><header>Disposition of
affairs</header>
<subsection id="ID755cd2d2358a40e7b568e160e2132961"><enum>(a)</enum><header>Authority of
Director</header><text>During the 90-day period beginning on the transfer date,
the Director of the Office of Thrift Supervision—</text>
<paragraph id="ID2f4fd72984bd4b2497aa1e249b522cd6"><enum>(1)</enum><text>shall, solely for the
purpose of winding up the affairs of the Office of Thrift Supervision relating
to any function transferred to the Office of the Comptroller of the Currency,
the Corporation, or the Board of Governors under this title—</text>
<subparagraph id="ID591eb6750aae495c9e9b006311b9f189"><enum>(A)</enum><text>manage the employees of
the Office of Thrift Supervision who have not yet been transferred and provide
for the payment of the compensation and benefits of the employees that accrue
before the date on which the employees are transferred under this title;
and</text>
</subparagraph><subparagraph id="ID0108111c67194b55af30f800f8be4f24"><enum>(B)</enum><text>manage any property of
the Office of Thrift Supervision, until the date on which the property is
transferred under section 323; and</text>
</subparagraph></paragraph><paragraph id="ID5bbcba34232044c3b5d58fcf7439c6fc"><enum>(2)</enum><text>may take any other action
necessary to wind up the affairs of the Office of Thrift Supervision.</text>
</paragraph></subsection><subsection id="IDde9b8e0f8dff4fa7be277d96afdd224b"><enum>(b)</enum><header>Status of
Director</header>
<paragraph id="ID8cb0529ba2414c1697e0d3a1ac8542a4"><enum>(1)</enum><header>In
general</header><text>Notwithstanding the transfer of functions under this
subtitle, during the 90-day period beginning on the transfer date, the Director
of the Office of Thrift Supervision shall retain and may exercise any authority
vested in the Director of the Office of Thrift Supervision on the day before
the transfer date, only to the extent necessary—</text>
<subparagraph id="ID921693eca2f945209cc2d042686cecd8"><enum>(A)</enum><text>to wind up the Office of
Thrift Supervision; and</text>
</subparagraph><subparagraph id="IDf3e2aaa962434b1e93dbaa4f3173e1fe"><enum>(B)</enum><text>to carry out the transfer
under this subtitle during such 90-day period.</text>
</subparagraph></paragraph><paragraph id="IDba462ede154f4ee48f76e4af39a1e20c"><enum>(2)</enum><header>Other
provisions</header><text>For purposes of paragraph (1), the Director of the
Office of Thrift Supervision shall, during the 90-day period beginning on the
transfer date, continue to be—</text>
<subparagraph id="ID0dc5bb4ae9db43a8a59078ab082cc647"><enum>(A)</enum><text>treated as an officer of
the United States; and</text>
</subparagraph><subparagraph id="ID2e35e7a4242d47eb877036c1c854e5ff"><enum>(B)</enum><text>entitled to receive
compensation at the same annual rate of basic pay that the Director of the
Office of Thrift Supervision received on the day before the transfer
date.</text>
</subparagraph></paragraph></subsection></section><section id="ID60a39b8f255941339bfdde2daee20aad"><enum>326.</enum><header>Continuation of
services</header><text display-inline="no-display-inline">Any agency,
department, or other instrumentality of the United States, and any successor to
any such agency, department, or instrumentality, that was, before the transfer
date, providing support services to the Office of Thrift Supervision in
connection with functions transferred to the Office of the Comptroller of the
Currency, the Corporation or the Board of Governors under this title,
shall—</text>
<paragraph id="ID4f8b9fc702074e45a15fd2c79fc11127"><enum>(1)</enum><text>continue to provide such
services, subject to reimbursement by the Office of the Comptroller of the
Currency, the Corporation, or the Board of Governors, until the transfer of
functions under this title is complete; and</text>
</paragraph><paragraph id="ID3fab4af86f6046caa0166ea3e1b59903"><enum>(2)</enum><text>consult with the
Comptroller of the Currency, the Chairperson of the Corporation, or the
Chairman of the Board of Governors, as appropriate, to coordinate and
facilitate a prompt and orderly transition.</text>
</paragraph></section></subtitle><subtitle id="id7A534EFB1D4C4D6EB92FDD972C02C167"><enum>C</enum><header>Federal Deposit Insurance
Corporation</header>
<section id="ID836b7d581f1248818d5cb1d12f2f3858"><enum>331.</enum><header>Deposit insurance
reforms</header>
<subsection id="ID504e9a94f7b8499d8460b6f17207d68e"><enum>(a)</enum><header>Size
distinctions</header><text>Section 7(b)(2) of the Federal Deposit Insurance Act
(12 U.S.C. 1817(b)(2)) is amended—</text>
<paragraph id="IDaeb8c8a3d8004d2182a78b9c93558eb9"><enum>(1)</enum><text>by striking subparagraph
(D); and</text>
</paragraph><paragraph id="IDb82ee91ff8bc456ebd6fec8ef6c2cf6c"><enum>(2)</enum><text>by redesignating
subparagraph (C) as subparagraph (D).</text>
</paragraph></subsection><subsection id="ID6cade22fa2174fdd81323271e0162e8b"><enum>(b)</enum><header>Assessment
base</header><text>The Corporation shall amend the regulations issued by the
Corporation under section 7(b)(2) of the Federal Deposit Insurance Act (12
U.S.C. 1817(b)(2)) to define the term <term>assessment base</term> with respect
to an insured depository institution for purposes of that section 7(b)(2), as
an amount equal to—</text>
<paragraph id="id5975563B6C414378AE52F37E7F66EF18"><enum>(1)</enum><text>the average consolidated
total assets of the insured depository institution during the assessment
period; minus</text>
</paragraph><paragraph id="id19689E08947F4A87BAFE3D6652F8A8DC"><enum>(2)</enum><text>the sum of—</text>
<subparagraph id="id4372754A5DA14E80B3D56F9B1F9CDB32"><enum>(A)</enum><text>the average tangible
equity of the insured depository institution during the assessment period;
and</text>
</subparagraph><subparagraph id="id996F8F3049984337953A5D969A826CA5"><enum>(B)</enum><text>in the case of an insured
depository institution that is a custodial bank (as defined by the Corporation,
based on factors including the percentage of total revenues generated by
custodial businesses and the level of assets under custody) or a banker's bank
(as that term is used in section 5136 of the Revised Statutes (12 U.S.C. 24)),
an amount that the Corporation determines is necessary to establish assessments
consistent with the definition under section 7(b)(1) of the Federal Deposit
Insurance Act (12 U.S.C. 1817(b)(1)) for a custodial bank or a banker's
bank.</text>
</subparagraph></paragraph></subsection></section><section id="IDe79413c1a8b546918d4aa0f77a13f2dc"><enum>332.</enum><header>Management of the
Federal Deposit Insurance Corporation</header>
<subsection id="idC314519B84444E1189C2BC7A2B22053D"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">Section 2 of the
Federal Deposit Insurance Act (12 U.S.C. 1812) is amended—</text>
<paragraph id="IDe36787b6398f43dd9165944d80af461e"><enum>(1)</enum><text>in subsection (a)(1)(B),
by striking <quote>Director of the Office of Thrift Supervision</quote> and
inserting <quote>Director of the Consumer Financial Protection
Bureau</quote>;</text>
</paragraph><paragraph id="ID724fa4a2dd444b6ba0da21683f439a27"><enum>(2)</enum><text>by amending subsection
(d)(2) to read as follows:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idF46F850D0C784A4CAE7E9CB60C535A9E" reported-display-style="italic" style="OLC">
<paragraph id="ID1874241f955943f0a6a56c64b0a746e5"><enum>(2)</enum><header>Acting officials may
serve</header><text>In the event of a vacancy in the Office of the Comptroller
of the Currency and pending the appointment of a successor, or during the
absence or disability of the Comptroller of the Currency, the acting
Comptroller of the Currency shall be a member of the Board of Directors in the
place of the Comptroller of the
Currency.</text>
</paragraph><after-quoted-block>;
and</after-quoted-block></quoted-block>
</paragraph><paragraph id="ID1a13e5818e154cc99a474451cff46a61"><enum>(3)</enum><text>in subsection (f)(2), by
striking <quote>or of the Office of Thrift Supervision</quote>.</text>
</paragraph></subsection><subsection commented="no" id="ID48bdc833f9e64c609e2d8ed459b96a95"><enum>(b)</enum><header>Effective
date</header><text>This section, and the amendments made by this section, shall
take effect on the transfer date.</text>
</subsection></section></subtitle><subtitle id="idAC1CA2D4FAD64DD0A3797508076E24A0"><enum>D</enum><header>Termination of Federal
Thrift Charter</header>
<section id="IDfc51b0732490489a974b8c54f9cc4fdc"><enum>341.</enum><header>Termination of Federal
savings associations</header>
<subsection id="ID3fd97b002cb449768943eb3e823b5a58"><enum>(a)</enum><header>In
general</header><text>Beginning on the date of enactment of this Act, the
Director of the Office of Thrift Supervision, or the Comptroller of the
Currency, may not issue a charter for a Federal savings association under
section 5 of the Home Owners’ Loan Act (12 U.S.C. 1464).</text>
</subsection><subsection id="ID1716afd2b9bc49ff9ee1cf3f69182bfc"><enum>(b)</enum><header>Conforming
amendment</header><text>Section 5(a) of the Home Owner’s Loan Act (12 U.S.C.
1464(a)) is amended to read as follows:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idB2F14F45C3CF47888AA1A5FDCB7AA5F4" reported-display-style="italic" style="OLC">
<subsection id="ID1afe848edc71408ba5554007dab9fe41"><enum>(a)</enum><header>In
general</header><text>In order to provide thrift institutions for the deposit
of funds and for the extension of credit for homes and other goods and
services, the Comptroller of the Currency is authorized, under such regulations
as the Comptroller of the Currency may prescribe, to provide for the
examination, operation, and regulation of associations to be known as
<quote>Federal savings associations</quote> (including Federal savings banks),
giving primary consideration to the best practices of thrift institutions in
the United States. The lending and investment powers conferred by this section
are intended to encourage such institutions to provide credit for housing
safely and
soundly.</text>
</subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="ID0e6de983e7e6443cb9618cf3da236349"><enum>(c)</enum><header>Prospective
repeal</header><text>Effective on the date on which the Comptroller of the
Currency determines that no Federal savings associations exist, section 5 of
the Home Owner’s Loan Act (12 U.S.C. 1464) is repealed.</text>
</subsection></section><section id="IDdc8c3bb066f54b1084efdf1563d797bb"><enum>342.</enum><header>Branching</header><text display-inline="no-display-inline">Notwithstanding the Federal Deposit
Insurance Act (12 U.S.C. 1811 et seq.), the Bank Holding Company Act of 1956
(12 U.S.C. 1841 et seq.), or any other provision of Federal or State law, a
savings association that becomes a bank may continue to operate any branch or
agency that the savings association operated immediately before the savings
association became a bank.</text>
</section></subtitle><enum>IV</enum><header>Regulation of advisers
to hedge funds and others</header>
<section id="id8A34EF1D92E74CEB9638561E9C1C8B27"><enum>401.</enum><header>Short
title</header><text display-inline="no-display-inline">This title may be cited
as the <quote>Private Fund Investment Advisers Registration Act of
2010</quote>.</text>
</section><section id="idDB2EC9BFFA594A4DA8B65778E2199714"><enum>402.</enum><header>Definitions</header>
<subsection id="idFABFBB04FC334C07A3DDBD945B1777F5"><enum>(a)</enum><header>Investment Advisers Act
of 1940 definitions</header><text display-inline="yes-display-inline">Section
202(a) of the Investment Advisers Act of 1940 (15 U.S.C. 80b–2(a)) is amended
by adding at the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id6C10F0A438A44558B4157B120D3D8566" reported-display-style="italic" style="OLC">
<paragraph id="id765D84F0B061484FAE4BDA06B5D11827"><enum>(29)</enum><text>The term <term>private
fund</term> means an issuer that would be an investment company, as defined in
section 3 of the Investment Company Act of 1940 (15 U.S.C. 80a–3), but for
section 3(c)(1) or 3(c)(7) of that Act.</text>
</paragraph><paragraph id="ID69e62c59a504498591c3ef67fcfa2ca8"><enum>(30)</enum><text>The term <term>foreign
private adviser</term> means any investment adviser who—</text>
<subparagraph id="ID8479469beaea41f6acfdb329ca925cba"><enum>(A)</enum><text>has no place of business
in the United States;</text>
</subparagraph><subparagraph id="ID930453d80892414cba65f391cc1ed443"><enum>(B)</enum><text>has, in total, fewer than
15 clients who are domiciled in or residents of the United States;</text>
</subparagraph><subparagraph id="IDd523ec6cd20246a392f1cc25a8e6d9b4"><enum>(C)</enum><text>has aggregate assets
under management attributable to clients in the United States and investors in
the United States in private funds advised by the investment adviser of less
than $25,000,000, or such higher amount as the Commission may, by rule, deem
appropriate in accordance with the purposes of this title; and</text>
</subparagraph><subparagraph id="ID4e25425cf3af4de186df12c1593a076d"><enum>(D)</enum><text>neither—</text>
<clause id="idB331B06123574B74B9E27B0017283D27"><enum>(i)</enum><text>holds itself out
generally to the public in the United States as an investment adviser;
nor</text>
</clause><clause id="id341FEBCD2E854F7B97BB1B2397C0FE05"><enum>(ii)</enum><text>acts as—</text>
<subclause id="idFC84BF3644E4429D8CD1C77427AE7063"><enum>(I)</enum><text>an investment adviser to
any investment company registered under the Investment Company Act of 1940;
or</text>
</subclause><subclause id="idF400BAC74A60453CB78BAE5AF74FC383"><enum>(II)</enum><text>a company that has
elected to be a business development company pursuant to section 54 of the
Investment Company Act of 1940 (15 U.S.C. 80a–53), and has not withdrawn its
election.</text>
</subclause></clause></subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="id16A1BB79FD3042C4AB6E48D7FC4FCC18"><enum>(b)</enum><header>Other
definitions</header><text>As used in this title, the terms <quote>investment
adviser</quote> and <quote>private fund</quote> have the same meanings as in
section 202 of the Investment Advisers Act of 1940, as amended by this
title.</text>
</subsection></section><section id="ID06372e5736074826b721edb52ace152a"><enum>403.</enum><header>Elimination of private
adviser exemption; limited exemption for foreign private advisers; limited
intrastate exemption</header><text display-inline="no-display-inline">Section
203(b) of the Investment Advisers Act of 1940 (15 U.S.C. 80b–3(b)) is
amended—</text>
<paragraph id="ID46e7f06b3ae741f4b01e573116e992da"><enum>(1)</enum><text>in paragraph (1), by
inserting <quote>, other than an investment adviser who acts as an investment
adviser to any private fund,</quote> before <quote>all of whose</quote>;</text>
</paragraph><paragraph id="IDa444229f4c2a426c92c7573c48f11d6a"><enum>(2)</enum><text>by striking paragraph (3)
and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id7358DDB69BE840A1BCCD37F8CD83DB2D" reported-display-style="italic" style="OLC">
<paragraph id="IDe3188220df6345a08e050c62767ee821"><enum>(3)</enum><text>any investment adviser
that is a foreign private adviser;</text>
</paragraph><after-quoted-block>;
and</after-quoted-block></quoted-block>
</paragraph><paragraph id="idAC8ED76F86EA4F1B82E7C2EC5E4EE1FE"><enum>(3)</enum><text>in paragraph (5), by
striking <quote>or</quote> at the end;</text>
</paragraph><paragraph id="ID61f3732a88a44fd6b2309dc3f8a1ff68"><enum>(4)</enum><text>in paragraph (6), by
striking the period at the end and inserting <quote>; or</quote>; and</text>
</paragraph><paragraph id="id65AAC2777AC0465DA23D21FA42C306BE"><enum>(5)</enum><text>by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idCC008315C1F649A9B848688CB8ABF529" reported-display-style="italic" style="OLC">
<paragraph commented="no" id="ID5948ea11b31f4946a98b6fc9ebe2803f"><enum>(7)</enum><text>any investment adviser,
other than any entity that has elected to be regulated or is regulated as a
business development company pursuant to section 54 of the Investment Company
Act of 1940 (15 U.S.C. 80a–54), who solely advises—</text>
<subparagraph commented="no" id="ID2f8f427830984c06949b7d5ad36ec902"><enum>(A)</enum><text>small business investment
companies that are licensees under the Small Business Investment Act of
1958;</text>
</subparagraph><subparagraph commented="no" id="ID771e1a9527a64100af12584c2617aaf5"><enum>(B)</enum><text>entities that have
received from the Small Business Administration notice to proceed to qualify
for a license as a small business investment company under the Small Business
Investment Act of 1958, which notice or license has not been revoked; or</text>
</subparagraph><subparagraph commented="no" id="ID78a2c836e3f5407b88be8cb173a50ed7"><enum>(C)</enum><text>applicants that are
affiliated with 1 or more licensed small business investment companies
described in subparagraph (A) and that have applied for another license under
the Small Business Investment Act of 1958, which application remains
pending.</text>
</subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></section><section id="IDfb3603b5fa1f4b3588e4f2db811eed7c"><enum>404.</enum><header>Collection of systemic
risk data; reports; examinations; disclosures</header><text display-inline="no-display-inline">Section 204 of the Investment Advisers Act
of 1940 (15 U.S.C. 80b–4) is amended—</text>
<paragraph id="IDfe60f9cfc09d4e42a06748d6168d72f7"><enum>(1)</enum><text>by redesignating
subsections (b) and (c) as subsections (c) and (d), respectively; and</text>
</paragraph><paragraph id="ID74ce68991bad41e7b1bddfa32485c4a2"><enum>(2)</enum><text>by inserting after
subsection (a) the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idA1FDC1CCFF604A6A96581D2219BCFD45" reported-display-style="italic" style="OLC">
<subsection id="ID4dcecf101ce64398b707d9275ed468be"><enum>(b)</enum><header>Records and reports of
private funds</header>
<paragraph id="ID0de6c8e04f2840ccb86d94ff8203c91b"><enum>(1)</enum><header>In
general</header><text>The Commission may require any investment adviser
registered under this title—</text>
<subparagraph id="id8A646F433CF94DFE8AB13DAD9805B47C"><enum>(A)</enum><text>to maintain such records
of, and file with the Commission such reports regarding, private funds advised
by the investment adviser, as necessary and appropriate in the public interest
and for the protection of investors, or for the assessment of systemic risk by
the Financial Stability Oversight Council (in this subsection referred to as
the <quote>Council</quote>); and</text>
</subparagraph><subparagraph id="id6B1C18A34475446CA80C33030D7E11E0"><enum>(B)</enum><text>to provide or make
available to the Council those reports or records or the information contained
therein.</text>
</subparagraph></paragraph><paragraph commented="no" id="idCD69DD948A0E42B7845E3CFF5789363F"><enum>(2)</enum><header>Treatment of
records</header><text>The records and reports of any private fund to which an
investment adviser registered under this title provides investment advice shall
be deemed to be the records and reports of the investment adviser.</text>
</paragraph><paragraph id="IDf2267c67d1574d39aa41c98113cce221"><enum>(3)</enum><header>Required
information</header><text>The records and reports required to be maintained by
a private fund and subject to inspection by the Commission under this
subsection shall include, for each private fund advised by the investment
adviser, a description of—</text>
<subparagraph id="IDc40447f6f37447879f42b421a741b3af"><enum>(A)</enum><text>the amount of assets
under management and use of leverage;</text>
</subparagraph><subparagraph id="idBD9CFE08EC944B5AB4665131B6481ACF"><enum>(B)</enum><text>counterparty credit risk
exposure;</text>
</subparagraph><subparagraph id="id777A9FBD8A5542BC93A9715AA874C923"><enum>(C)</enum><text>trading and investment
positions;</text>
</subparagraph><subparagraph id="id82733CAFC41442249C1434165442E63A"><enum>(D)</enum><text>valuation policies and
practices of the fund;</text>
</subparagraph><subparagraph id="idD5C723EB144F495281FBA51169C72A4E"><enum>(E)</enum><text>types of assets
held;</text>
</subparagraph><subparagraph id="idCF0DFF2CBBBF46448895AA79C8D3AE2F"><enum>(F)</enum><text>side arrangements or side
letters, whereby certain investors in a fund obtain more favorable rights or
entitlements than other investors;</text>
</subparagraph><subparagraph id="id0C93B10024B942B2B49C9D960B28871E"><enum>(G)</enum><text>trading practices;
and</text>
</subparagraph><subparagraph id="ID1034eaefc70b453ead26ec5646a004ae"><enum>(H)</enum><text>such other information as
the Commission, in consultation with the Council, determines is necessary and
appropriate in the public interest and for the protection of investors or for
the assessment of systemic risk, which may include the establishment of
different reporting requirements for different classes of fund advisers, based
on the type or size of private fund being advised.</text>
</subparagraph></paragraph><paragraph id="ID44a100fbe29f4eb39d3564657bdae5f3"><enum>(4)</enum><header>Maintenance of
records</header><text>An investment adviser registered under this title shall
maintain such records of private funds advised by the investment adviser for
such period or periods as the Commission, by rule, may prescribe as necessary
and appropriate in the public interest and for the protection of investors, or
for the assessment of systemic risk.</text>
</paragraph><paragraph id="id427D33FE36624F5A94687AA314A63DE3"><enum>(5)</enum><header>Filing of
records</header><text>The Commission shall issue rules requiring each
investment adviser to a private fund to file reports containing such
information as the Commission deems necessary and appropriate in the public
interest and for the protection of investors or for the assessment of systemic
risk.</text>
</paragraph><paragraph id="IDec54b16500384b8fa4455990d10d4fab"><enum>(6)</enum><header>Examination of
records</header>
<subparagraph id="ID16ec8cd97fa5433db2dcc07ce607f5a4"><enum>(A)</enum><header>Periodic and special
examinations</header><text>The Commission—</text>
<clause id="idBAFC5ABAE52C449E96D2022335F36EA0"><enum>(i)</enum><text>shall conduct periodic
inspections of all records of private funds maintained by an investment adviser
registered under this title in accordance with a schedule established by the
Commission; and</text>
</clause><clause id="idD138CCD37ACF4560854EFA0330091A5C"><enum>(ii)</enum><text>may conduct at any time
and from time to time such additional, special, and other examinations as the
Commission may prescribe as necessary and appropriate in the public interest
and for the protection of investors, or for the assessment of systemic
risk.</text>
</clause></subparagraph><subparagraph id="IDb257ee9aadbb49c98b66fa4b84d1df8b"><enum>(B)</enum><header>Availability of
records</header><text>An investment adviser registered under this title shall
make available to the Commission any copies or extracts from such records as
may be prepared without undue effort, expense, or delay, as the Commission or
its representatives may reasonably request.</text>
</subparagraph></paragraph><paragraph id="IDa97c83ab25604e2ca54aaadf7b3ce1c5"><enum>(7)</enum><header>Information
sharing</header>
<subparagraph id="id95EEFB3843424DC0AF33903B4FB043F8"><enum>(A)</enum><header>In
general</header><text>The Commission shall make available to the Council copies
of all reports, documents, records, and information filed with or provided to
the Commission by an investment adviser under this subsection as the Council
may consider necessary for the purpose of assessing the systemic risk posed by
a private fund.</text>
</subparagraph><subparagraph id="ID3d5e15308ab742af9e16f837d195a10b"><enum>(B)</enum><header>Confidentiality</header><text>The
Council shall maintain the confidentiality of information received under this
paragraph in all such reports, documents, records, and information, in a manner
consistent with the level of confidentiality established by the Commission
pursuant to paragraph (8). The Council shall be exempt from section 552 of
title 5, United States Code, with respect to any information in any report,
document, record, or information made available, to the Council under this
subsection.”.</text>
</subparagraph></paragraph><paragraph id="ID8c07bf96e8304408a0b7b779a5a7e37e"><enum>(8)</enum><header>Commission
confidentiality of reports</header><text>Notwithstanding any other provision of
law, the Commission may not be compelled to disclose any report or information
contained therein required to be filed with the Commission under this
subsection, except that nothing in this subsection authorizes the
Commission—</text>
<subparagraph id="id87A4760DAD384456B4EAC21F4CB3D4C8"><enum>(A)</enum><text>to withhold information
from Congress, upon an agreement of confidentiality; or</text>
</subparagraph><subparagraph id="idB91FC1B6DF7644168DDB6EE941EDDCF5"><enum>(B)</enum><text>prevent the Commission
from complying with—</text>
<clause id="id4A15B14837514443920E2ED5A2FBB471"><enum>(i)</enum><text>a request for information
from any other Federal department or agency or any self-regulatory organization
requesting the report or information for purposes within the scope of its
jurisdiction; or</text>
</clause><clause id="id62B2254929C941E4A7C611540CC87CA2"><enum>(ii)</enum><text>an order of a court of
the United States in an action brought by the United States or the
Commission.</text>
</clause></subparagraph></paragraph><paragraph id="idBB4F5609AD7A4CC9A1D375D8DAACBE7B"><enum>(9)</enum><header>Other recipients
confidentiality</header><text>Any department, agency, or self-regulatory
organization that receives reports or information from the Commission under
this subsection shall maintain the confidentiality of such reports, documents,
records, and information in a manner consistent with the level of
confidentiality established for the Commission under paragraph (8).</text>
</paragraph><paragraph commented="no" id="id7EE2052A62404728A20C65266DF54C1A"><enum>(10)</enum><header>Public information
exception</header>
<subparagraph commented="no" id="idFFD9C756DD394ABEB4167610A974B0FA"><enum>(A)</enum><header>In
general</header><text>The Commission, the Council, and any other department,
agency, or self-regulatory organization that receives information, reports,
documents, records, or information from the Commission under this subsection,
shall be exempt from the provisions of section 552 of title 5, United States
Code, with respect to any such report, document, record, or information. Any
proprietary information of an investment adviser ascertained by the Commission
from any report required to be filed with the Commission pursuant to this
subsection shall be subject to the same limitations on public disclosure as any
facts ascertained during an examination, as provided by section 210(b) of this
title.</text>
</subparagraph><subparagraph commented="no" id="idCBEDD1ADC8404ADBB0F2D56C84F18225"><enum>(B)</enum><header>Proprietary
information</header><text>For purposes of this paragraph, proprietary
information includes—</text>
<clause commented="no" id="idBB9FB56D7B684A0DA7AD029863026CAD"><enum>(i)</enum><text>sensitive, non-public
information regarding the investment or trading strategies of the investment
adviser;</text>
</clause><clause commented="no" id="idACC7F3B0F17D4FE7A5F4F32B8937089B"><enum>(ii)</enum><text>analytical or research
methodologies;</text>
</clause><clause commented="no" id="id373FFFB904584686921A17661D365247"><enum>(iii)</enum><text>trading data;</text>
</clause><clause commented="no" id="id4EDEB905E877436C8B3521AB096647A1"><enum>(iv)</enum><text>computer hardware or
software containing intellectual property; and</text>
</clause><clause commented="no" id="id4A3F6545F8334EE291D9D0F37BBB67C4"><enum>(v)</enum><text>any additional
information that the Commission determines to be proprietary.</text>
</clause></subparagraph></paragraph><paragraph id="idBF3A8B57D7334CA49F0E5C23DC1E90EC"><enum>(11)</enum><header>Annual report to
Congress</header><text>The Commission shall report annually to Congress on how
the Commission has used the data collected pursuant to this subsection to
monitor the markets for the protection of investors and the integrity of the
markets.</text>
</paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></section><section id="IDde02c7b5a96445c4873c7ed4a4f620b6"><enum>405.</enum><header>Disclosure provision
eliminated</header><text display-inline="no-display-inline">Section 210(c) of
the Investment Advisers Act of 1940 (15 U.S.C. 80b–10(c)) is amended by
inserting before the period at the end the following: <quote>or for purposes of
assessment of potential systemic risk</quote>.</text>
</section><section id="ID69b2cdd6686849e3b81a7617406eda92"><enum>406.</enum><header>Clarification of
rulemaking authority</header><text display-inline="no-display-inline">Section
211 of the Investment Advisers Act of 1940 (15 U.S.C. 80b–11) is
amended—</text>
<paragraph id="IDccec6a3a676c419c9b64bd1c46cc8849"><enum>(1)</enum><text>in subsection (a), by
inserting before the period at the end of the first sentence the following:
<quote>, including rules and regulations defining technical, trade, and other
terms used in this title, except that the Commission may not define the term
<term>client</term> for purposes of paragraphs (1) and (2) of section 206 to
include an investor in a private fund managed by an investment adviser, if such
private fund has entered into an advisory contract with such adviser</quote>;
and</text>
</paragraph><paragraph id="IDd4020a6b8a2348749ff7cb657a461755"><enum>(2)</enum><text>by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idF13589DB14C44E55BA31225030330660" reported-display-style="italic" style="OLC">
<subsection id="IDdc911da3171445598460cd4c1e1834dd"><enum>(e)</enum><header>Disclosure rules on
private funds</header><text>The Commission and the Commodity Futures Trading
Commission shall, after consultation with the Council but not later than 12
months after the date of enactment of the Private Fund Investment Advisers
Registration Act of 2010, jointly promulgate rules to establish the form and
content of the reports required to be filed with the Commission under
subsection 204(b) and with the Commodity Futures Trading Commission by
investment advisers that are registered both under this title and the Commodity
Exchange Act (7 U.S.C. 1a et
seq.).</text>
</subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></section><section commented="no" id="idD144121A4EBB417AA83C4B7DBF36E5C3"><enum>407.</enum><header>Exemption of venture
capital fund advisers</header><text display-inline="no-display-inline">Section
203 of the Investment Advisers Act of 1940 (15 U.S.C. 80b–3) is amended by
adding at the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id32CC702C05B649859F266AA05493F5DC" reported-display-style="italic" style="OLC">
<subsection commented="no" id="id1C926B3CEB5742CC834733A1A3AA39A6"><enum>(l)</enum><header>Exemption of venture
capital fund advisers</header><text>No investment adviser shall be subject to
the registration requirements of this title with respect to the provision of
investment advice relating to a venture capital fund. Not later than 6 months
after the date of enactment of this subsection, the Commission shall issue
final rules to define the term <term>venture capital fund</term> for purposes
of this
subsection.</text>
</subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</section><section commented="no" id="idB033392FD7B64C2CAC51E4D8E399BEF9"><enum>408.</enum><header>Exemption of and
record keeping by private equity fund advisers</header><text display-inline="no-display-inline">Section 203 of the Investment Advisers Act
of 1940 (15 U.S.C. 80b–3) is amended by adding at the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id9959DC3439F44AA7A825B4FA6DBF3C03" reported-display-style="italic" style="OLC">
<subsection commented="no" id="idB2C6F4152FBD4DE78ADD225F069BC390"><enum>(m)</enum><header>Exemption of and
reporting by private equity fund advisers</header>
<paragraph commented="no" id="id51D1EC9730824DF3AE63905F03109E80"><enum>(1)</enum><header>In
general</header><text>Except as provided in this subsection, no investment
adviser shall be subject to the registration or reporting requirements of this
title with respect to the provision of investment advice relating to a private
equity fund or funds.</text>
</paragraph><paragraph commented="no" id="id52B71640B1D6421BA74FFC3DB19026E0"><enum>(2)</enum><header>Maintenance of records
and access by Commission</header><text>Not later than 6 months after the date
of enactment of this subsection, the Commission shall issue final rules—</text>
<subparagraph commented="no" id="id1977756F515341928A5F48F950823563"><enum>(A)</enum><text>to require investment
advisers described in paragraph (1) to maintain such records and provide to the
Commission such annual or other reports as the Commission taking into account
fund size, governance, investment strategy, risk, and other factors, as the
Commission determines necessary and appropriate in the public interest and for
the protection of investors; and</text>
</subparagraph><subparagraph commented="no" id="id656B7CC0CC8E4E2AA99CECCD86D9E44B"><enum>(B)</enum><text>to define the term
<term>private equity fund</term> for purposes of this
subsection.</text>
</subparagraph></paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</section><section commented="no" id="id57E96EF9D8904FA1B511544771C3745C"><enum>409.</enum><header>Family
offices</header>
<subsection commented="no" id="idE2478FC8A3624FFE9CFE0FE3D515F91B"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">Section 202(a)(11) of
the Investment Advisers Act of 1940 (15 U.S.C. 80b–2(a)(11)) is amended by
striking <quote>or (G)</quote> and inserting the following: <quote>; (G) any
family office, as defined by rule, regulation, or order of the Commission, in
accordance with the purposes of this title; or (H)</quote>.</text>
</subsection><subsection id="IDa8cc63b9d5194a1c9a7e7bc6cf953dbd"><enum>(b)</enum><header>Rulemaking</header><text>The
rules, regulations, or orders issued by the Commission pursuant to section
202(a)(11)(G) of the Investment Advisers Act of 1940, as added by this section,
regarding the definition of the term <quote>family office</quote> shall provide
for an exemption that—</text>
<paragraph id="idB917B18991EB4296A0803EB48ED7DBAB"><enum>(1)</enum><text>is consistent with the
previous exemptive policy of the Commission, as reflected in exemptive orders
for family offices in effect on the date of enactment of this Act; and</text>
</paragraph><paragraph id="id863473642238486D98C0211398919064"><enum>(2)</enum><text>recognizes the range of
organizational, management, and employment structures and arrangements employed
by family offices.</text>
</paragraph></subsection></section><section id="ID1f967db558af4aafac73cc58ab8ddb41"><enum>410.</enum><header>State and Federal
responsibilities; asset threshold for Federal registration of investment
advisers</header><text display-inline="no-display-inline">Section 203A(a)(1) of
the Investment Advisers Act of 1940 (15 U.S.C. 80b–3a(a)(1)) is amended—</text>
<paragraph id="id1E3082ED4EE64570989C985959962DC6"><enum>(1)</enum><text display-inline="yes-display-inline">in subparagraph (A)—</text>
<subparagraph id="idB5F89770AB5E4D3C94B946E958853031"><enum>(A)</enum><text display-inline="yes-display-inline">by striking <quote>$25,000,000</quote> and
inserting <quote>$100,000,000</quote>; and</text>
</subparagraph><subparagraph id="id0DE725A42C314812B6CF02ACA2938BA3"><enum>(B)</enum><text display-inline="yes-display-inline">by striking <quote>or</quote> at the
end;</text>
</subparagraph></paragraph><paragraph id="idAD83659AD9D741A9A04862D5183F90C5"><enum>(2)</enum><text>in subparagraph (B), by
striking the period at the end and inserting <quote>; or</quote>; and</text>
</paragraph><paragraph id="id72E028536007492E8BB5C43CAB723DD8"><enum>(3)</enum><text>by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id486C54AF85CE452AB686814C2BA7E8F5" reported-display-style="italic" style="OLC">
<subparagraph commented="no" id="id4CDC41E369F148E7ACE8E45E24A8E1C7"><enum>(C)</enum><text>is an adviser to a
company that has elected to be a business development company pursuant to
section 54 of the Investment Company Act of 1940, and has not withdrawn its
election.</text>
</subparagraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></section><section id="id98D0B788D91C4E5EA1AA66F4CCA46690"><enum>411.</enum><header>Custody of client
assets</header><text display-inline="no-display-inline">The Investment Advisers
Act of 1940 (15 U.S.C. 80b–1 et seq.) is amended by adding at the end the
following new section:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id54B8104B1DE44E08B885C79AF117211F" reported-display-style="italic" style="OLC">
<section id="ID03151a696b344711a5f8f69776cd0edc"><enum>223.</enum><header>Custody of client
accounts</header><text display-inline="no-display-inline">An investment adviser
registered under this title shall take such steps to safeguard client assets
over which such adviser has custody, including, without limitation,
verification of such assets by an independent public accountant, as the
Commission may, by rule,
prescribe.</text>
</section><after-quoted-block>.</after-quoted-block></quoted-block>
</section><section id="ID8e214f29f1374d18937c3306c2adef2f"><enum>412.</enum><header>Adjusting the
accredited investor standard</header>
<subsection id="id4999D9ED47E649AB8E611332B526E21B"><enum>(a)</enum><header>In
general</header><text>The Commission shall adjust any net worth standard for an
accredited investor, as set forth in the rules of the Commission under the
Securities Act of 1933, so that the individual net worth of any natural person,
or joint net worth with the spouse of that person, at the time of purchase, is
more than $1,000,000 (as such amount is adjusted periodically by rule of the
Commission), excluding the value of the primary residence of such natural
person, except that during the 4-year period that begins on the date of
enactment of this Act, any net worth standard shall be $1,000,000, excluding
the value of the primary residence of such natural person.</text>
</subsection><subsection id="idFB3760F9BFE64D3494477B8020F4417F"><enum>(b)</enum><header>Review and
adjustment</header>
<paragraph id="id552F56BBF78F413BB9570614CE8487C4"><enum>(1)</enum><header>Initial review and
adjustment</header>
<subparagraph id="idABB92518B66E4EC3895FAE95FA7485D7"><enum>(A)</enum><header>Initial
review</header><text>The Commission may undertake a review of the definition of
the term <term>accredited investor</term>, as such term applies to natural
persons, to determine whether the requirements of the definition, excluding the
requirement relating to the net worth standard described in subsection (a),
should be adjusted or modified for the protection of investors, in the public
interest, and in light of the economy.</text>
</subparagraph><subparagraph id="id4B9E8B47C3B04F07AF8E2FB43E7223C5"><enum>(B)</enum><header>Adjustment or
modification</header><text>Upon completion of a review under subparagraph (A),
the Commission may, by notice and comment rulemaking, make such adjustments to
the definition of the term <term>accredited investor</term>, excluding
adjusting or modifying the requirement relating to the net worth standard
described in subsection (a), as such term applies to natural persons, as the
Commission may deem appropriate for the protection of investors, in the public
interest, and in light of the economy.</text>
</subparagraph></paragraph><paragraph id="id4D36C5B88A644347B3F00FE3939A4138"><enum>(2)</enum><header>Subsequent reviews and
adjustment</header>
<subparagraph id="idE2F631DB361D4EF385555F3FA7AE0B40"><enum>(A)</enum><header>Subsequent
reviews</header><text>Not earlier than 4 years after the date of enactment of
this Act, and not less frequently than once every 4 years thereafter, the
Commission shall undertake a review of the definition, in its entirety, of the
term <term>accredited investor</term>, as defined in section 230.215 of title
17, Code of Federal Regulations, or any successor thereto, as such term applies
to natural persons, to determine whether the requirements of the definition
should be adjusted or modified for the protection of investors, in the public
interest, and in light of the economy.</text>
</subparagraph><subparagraph id="id1992A0B881D94C12B7E9650D008E0516"><enum>(B)</enum><header>Adjustment or
modification</header><text>Upon completion of a review under subparagraph (A),
the Commission may, by notice and comment rulemaking, make such adjustments to
the definition of the term <term>accredited investor</term>, as defined in
section 230.215 of title 17, Code of Federal Regulations, or any successor
thereto, as such term applies to natural persons, as the Commission may deem
appropriate for the protection of investors, in the public interest, and in
light of the economy.</text>
</subparagraph></paragraph></subsection></section><section id="IDd448405dbc454b88814b9b54f17e1771"><enum>413.</enum><header>GAO study and report
on accredited investors</header><text display-inline="no-display-inline">The
Comptroller General of the United States shall conduct a study on the
appropriate criteria for determining the financial thresholds or other criteria
needed to qualify for accredited investor status and eligibility to invest in
private funds, and shall submit a report to the Committee on Banking, Housing,
and Urban Affairs of the Senate and the Committee on Financial Services of the
House of Representatives on the results of such study not later than 3 years
after the date of enactment of this Act.</text>
</section><section id="idA7C468E2F3424901B28B18DE4BDE0893"><enum>414.</enum><header>GAO study on
self-regulatory organization for private funds</header><text display-inline="no-display-inline">The Comptroller General of the United States
shall—</text>
<paragraph id="id9A9097EF17BE4E209002AE9D79E28CAC"><enum>(1)</enum><text display-inline="yes-display-inline">conduct a study of the feasibility of
forming a self-regulatory organization to oversee private funds; and</text>
</paragraph><paragraph id="id2C32CF01880041A495243EB74F96D4A9"><enum>(2)</enum><text display-inline="yes-display-inline">submit a report to the Committee on
Banking, Housing, and Urban Affairs of the Senate and the Committee on
Financial Services of the House of Representatives on the results of such
study, not later than 1 year after the date of enactment of this Act.</text>
</paragraph></section><section id="id565AF578BFC04B2589B2C744AFE950FB"><enum>415.</enum><header>Commission study and
report on short selling</header>
<subsection id="id5D0DB0E35E3B405E9BDC16703459F03B"><enum>(a)</enum><header>Study</header><text display-inline="yes-display-inline">The Division of Risk, Strategy, and
Financial Innovation of the Commission shall conduct a study, taking into
account current scholarship, on the state of short selling on national
securities exchanges and in the over-the-counter markets, with particular
attention to the impact of recent rule changes and the incidence of—</text>
<paragraph id="id984926467E1748D9B7A26EEB505CDE83"><enum>(1)</enum><text display-inline="yes-display-inline">the failure to deliver shares sold short;
or</text>
</paragraph><paragraph id="id6A4D5BBF6E60414CB711A68E5D01BAAD"><enum>(2)</enum><text display-inline="yes-display-inline">delivery of shares on the fourth day
following the short sale transaction.</text>
</paragraph></subsection><subsection id="id3126ED43699C4B01BAA80E969F39B7D8"><enum>(b)</enum><header>Report</header><text display-inline="yes-display-inline">The Division of Risk, Strategy, and
Financial Innovation shall submit a report, together with any recommendations
for market improvements, including consideration of real time reporting of
short sale positions, to the Committee on Banking, Housing, and Urban Affairs
of the Senate and the Committee on Financial Services of the House of
Representatives on the results of the study conducted under subsection (a), not
later than 2 years after the date of enactment of this Act.</text>
</subsection></section><section id="idD721D7A7496B4DB8A9EB6145EF152496"><enum>416.</enum><header>Transition
period</header><text display-inline="no-display-inline">Except as otherwise
provided in this title, this title and the amendments made by this title shall
become effective 1 year after the date of enactment of this Act, except that
any investment adviser may, at the discretion of the investment adviser,
register with the Commission under the Investment Advisers Act of 1940 during
that 1-year period, subject to the rules of the Commission.</text>
</section><enum>V</enum><header>Insurance</header>
<subtitle id="idA4E74F5AAE6C42A0BDFFAB6E8543F485"><enum>A</enum><header>Office of National
Insurance</header>
<section id="ID2cf2dc958021489b9ae085d7a2e0d35b"><enum>501.</enum><header>Short
title</header><text display-inline="no-display-inline">This subtitle may be
cited as the <quote>Office of National Insurance Act of 2010</quote>.</text>
</section><section id="IDbbad6775feb843298a125c9f1b151dea"><enum>502.</enum><header>Establishment of
Office of National Insurance</header>
<subsection id="ID4bbfb96d550b4fcdaa1f30984d93eb53"><enum>(a)</enum><header>Establishment of
office</header><text>Subchapter I of chapter 3 of subtitle I of title 31,
United States Code, is amended—</text>
<paragraph id="ID5b55e8edc78845b19cc436b94d844263"><enum>(1)</enum><text>by redesignating section
312 as section 315;</text>
</paragraph><paragraph id="id379622552CD5453B92DD4306C2AE853D"><enum>(2)</enum><text>by redesignating section
313 as section 312; and</text>
</paragraph><paragraph id="IDaabe98117ec146df85ee19f03b4b5c05"><enum>(3)</enum><text>by inserting after
section 312 (as so redesignated) the following new sections:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id51C74B4709BC485B93C55E66BC541670" reported-display-style="italic" style="OLC">
<section id="ID3b5905c46f054e778e64e2c2c814be34"><enum>313.</enum><header>Office of National
Insurance</header>
<subsection id="ID8cdf3cb5b2cb4131acc8f52976a5300c"><enum>(a)</enum><header>Establishment</header><text>There
is established within the Department of the Treasury the Office of National
Insurance.</text>
</subsection><subsection id="IDee5d16a8a40d4a02a3135bcead3962b6"><enum>(b)</enum><header>Leadership</header><text>The
Office shall be headed by a Director, who shall be appointed by the Secretary
of the Treasury. The position of Director shall be a career reserved position
in the Senior Executive Service, as that position is defined under section 3132
of title 5, United States Code.</text>
</subsection><subsection id="IDe6fb86c29ec64d8f929740902a2a3a36"><enum>(c)</enum><header>Functions</header>
<paragraph id="IDad885673bf414148a9ee862b439cf1fc"><enum>(1)</enum><header>Authority pursuant to
direction of Secretary</header><text>The Office, pursuant to the direction of
the Secretary, shall have the authority—</text>
<subparagraph id="IDe9cc4d30a3b746469b36e8c902ae71ad"><enum>(A)</enum><text>to monitor all aspects of
the insurance industry, including identifying issues or gaps in the regulation
of insurers that could contribute to a systemic crisis in the insurance
industry or the United States financial system;</text>
</subparagraph><subparagraph id="ID7192b03abe3442b6af45fb90ef9df46b"><enum>(B)</enum><text>to recommend to the
Financial Stability Oversight Council that it designate an insurer, including
the affiliates of such insurer, as an entity subject to regulation as a nonbank
financial company supervised by the Board of Governors pursuant to title I of
the Restoring American Financial Stability Act of 2010;</text>
</subparagraph><subparagraph id="ID14ca26dadb35444e803b40642cc85ce0"><enum>(C)</enum><text>to assist the Secretary
in administering the Terrorism Insurance Program established in the Department
of the Treasury under the Terrorism Risk Insurance Act of 2002 (15 U.S.C. 6701
note);</text>
</subparagraph><subparagraph id="ID9ea764eed7b743c89b25af0372e4fbdf"><enum>(D)</enum><text>to coordinate Federal
efforts and develop Federal policy on prudential aspects of international
insurance matters, including representing the United States, as appropriate, in
the International Association of Insurance Supervisors (or a successor entity)
and assisting the Secretary in negotiating International Insurance Agreements
on Prudential Measures;</text>
</subparagraph><subparagraph id="ID212038f0586c425c990cfb4d0c320c47"><enum>(E)</enum><text>to determine, in
accordance with subsection (f), whether State insurance measures are preempted
by International Insurance Agreements on Prudential Measures;</text>
</subparagraph><subparagraph id="ID7c8a065257204591a1a7db84648b2604"><enum>(F)</enum><text>to consult with the
States (including State insurance regulators) regarding insurance matters of
national importance and prudential insurance matters of international
importance; and</text>
</subparagraph><subparagraph id="ID77fb542d990143d0ba29625d4610dbef"><enum>(G)</enum><text>to perform such other
related duties and authorities as may be assigned to the Office by the
Secretary.</text>
</subparagraph></paragraph><paragraph id="ID508f76d571b043f088f5eb0652cd38cb"><enum>(2)</enum><header>Advisory
functions</header><text>The Office shall advise the Secretary on major domestic
and prudential international insurance policy issues.</text>
</paragraph></subsection><subsection id="ID6c307f7e4ef84731b9a813b0abd90386"><enum>(d)</enum><header>Scope</header><text>The
authority of the Office shall extend to all lines of insurance except health
insurance, as such insurance is determined by the Secretary based on section
2791 of the Public Health Service Act (42 U.S.C. 300gg–91), and crop insurance,
as established by the Federal Crop Insurance Act (7 U.S.C. 1501 et
seq.).</text>
</subsection><subsection id="IDed921a1c7a0046838229d2aca1dd57ea"><enum>(e)</enum><header>Gathering of
information</header>
<paragraph id="IDae3cc351e7b34cceb37e94dedf5e4a67"><enum>(1)</enum><header>In
general</header><text>In carrying out the functions required under subsection
(c), the Office may—</text>
<subparagraph id="id189FA225643B4457A03729B6469456FA"><enum>(A)</enum><text>receive and collect data
and information on and from the insurance industry and insurers;</text>
</subparagraph><subparagraph id="id9E6C0787D2E843F3A108BE9E42FECF7F"><enum>(B)</enum><text>enter into
information-sharing agreements;</text>
</subparagraph><subparagraph id="id8D836C15A3714AB7BB02F2513C61CF40"><enum>(C)</enum><text>analyze and disseminate
data and information; and</text>
</subparagraph><subparagraph id="id20C99197979C48E2ADB944FE5EC1FDA6"><enum>(D)</enum><text>issue reports regarding
all lines of insurance except health insurance.</text>
</subparagraph></paragraph><paragraph id="ID33c98b1b6761404ab045858f76920687"><enum>(2)</enum><header>Collection of
information from insurers and affiliates</header>
<subparagraph id="idC55F03ED22234C5DAB44F098742575B4"><enum>(A)</enum><header>In
general</header><text>Except as provided in paragraph (3), the Office may
require an insurer, or any affiliate of an insurer, to submit such data or
information as the Office may reasonably require in carrying out the functions
described under subsection (c).</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="id7B4D64BFE5FA479B856FC476E6939BC2"><enum>(B)</enum><header>Rule of
construction</header><text>Notwithstanding any other provision of this section,
for purposes of subparagraph (A), the term ‘insurer’ means any person that is
authorized to write insurance or reinsure risks and issue contracts or policies
in 1 or more States.</text>
</subparagraph></paragraph><paragraph id="IDdde6fa0214dd4d6280a0229ba50f9478"><enum>(3)</enum><header>Exception for small
insurers</header><text>Paragraph (2) shall not apply with respect to any
insurer or affiliate thereof that meets a minimum size threshold that the
Office may establish, whether by order or rule.</text>
</paragraph><paragraph id="ID1ef871332036467f906ee7d24a81db63"><enum>(4)</enum><header>Advance
coordination</header><text>Before collecting any data or information under
paragraph (2) from an insurer, or any affiliate of an insurer, the Office shall
coordinate with each relevant State insurance regulator (or other relevant
Federal or State regulatory agency, if any, in the case of an affiliate of an
insurer) to determine if the information to be collected is available from, or
may be obtained in a timely manner by, such State insurance regulator,
individually or collectively, another regulatory agency, or publicly available
sources. Notwithstanding any other provision of law, each such relevant State
insurance regulator or other Federal or State regulatory agency is authorized
to provide to the Office such data or information.</text>
</paragraph><paragraph id="ID953b8c201e194e078d7264cebd095a0f"><enum>(5)</enum><header>Confidentiality</header>
<subparagraph id="ID75fed9adae1f4a5292ba6d0f761e0d08"><enum>(A)</enum><header>Retention of
privilege</header><text>The submission of any nonpublicly available data and
information to the Office under this subsection shall not constitute a waiver
of, or otherwise affect, any privilege arising under Federal or State law
(including the rules of any Federal or State court) to which the data or
information is otherwise subject.</text>
</subparagraph><subparagraph id="ID31d2b2e0a8db4f23b490a21c338f421a"><enum>(B)</enum><header>Continued application
of prior confidentiality agreements</header><text>Any requirement under Federal
or State law to the extent otherwise applicable, or any requirement pursuant to
a written agreement in effect between the original source of any nonpublicly
available data or information and the source of such data or information to the
Office, regarding the privacy or confidentiality of any data or information in
the possession of the source to the Office, shall continue to apply to such
data or information after the data or information has been provided pursuant to
this subsection to the Office.</text>
</subparagraph><subparagraph id="id456244ED23ED4AB1942A6D86FF07DFFE"><enum>(C)</enum><header>Information sharing
agreement</header><text>Any data or information obtained by the Office may be
made available to State insurance regulators, individually or collectively,
through an information sharing agreement that—</text>
<clause id="id9C7F53585A474796B4EF8EF66EFDD53F"><enum>(i)</enum><text>shall comply with
applicable Federal law; and</text>
</clause><clause id="id11E999E17D424C05B6B53975A3EAF522"><enum>(ii)</enum><text>shall not constitute a
waiver of, or otherwise affect, any privilege under Federal or State law
(including the rules of any Federal or State Court) to which the data or
information is otherwise subject.</text>
</clause></subparagraph><subparagraph id="IDce6086df3d664bf6a81440c9ecef4cc5"><enum>(D)</enum><header>Agency disclosure
requirements</header><text>Section 552 of title 5, United States Code, shall
apply to any data or information submitted to the Office by an insurer or an
affiliate of an insurer.</text>
</subparagraph></paragraph><paragraph id="IDa12c2cba5fb14f00b0a9b38cb8d75c04"><enum>(6)</enum><header>Subpoenas and
enforcement</header><text>The Director shall have the power to require by
subpoena the production of the data or information requested under paragraph
(2), but only upon a written finding by the Director that such data or
information is required to carry out the functions described under subsection
(c) and that the Office has coordinated with such regulator or agency as
required under paragraph (4). Subpoenas shall bear the signature of the
Director and shall be served by any person or class of persons designated by
the Director for that purpose. In the case of contumacy or failure to obey a
subpoena, the subpoena shall be enforceable by order of any appropriate
district court of the United States. Any failure to obey the order of the court
may be punished by the court as a contempt of court.</text>
</paragraph></subsection><subsection id="ID9c0561b7fa9146fcb71bbec234807986"><enum>(f)</enum><header>Preemption of State
insurance measures</header>
<paragraph id="ID27b0f84dfb1944be98d1e485eef4bbc7"><enum>(1)</enum><header>Standard</header><text>A
State insurance measure shall be preempted if, and only to the extent that the
Director determines, in accordance with this subsection, that the
measure—</text>
<subparagraph id="ID53376ce1daea4f5988753c48366cc2f2"><enum>(A)</enum><text>results in less favorable
treatment of a non-United States insurer domiciled in a foreign jurisdiction
that is subject to an international insurance agreement on prudential measures
than a United States insurer domiciled, licensed, or otherwise admitted in that
State; and</text>
</subparagraph><subparagraph id="IDc2eacba6f8c24d9a90418b6c88c10b85"><enum>(B)</enum><text>is inconsistent with an
International Insurance Agreement on Prudential Measures.</text>
</subparagraph></paragraph><paragraph id="IDbf8580f37fd247599903f01abd7900d6"><enum>(2)</enum><header>Determination</header>
<subparagraph id="ID50b8869f2a2c4c34937833cf19349cf3"><enum>(A)</enum><header>Notice of potential
inconsistency</header><text>Before making any determination under paragraph
(1), the Director shall—</text>
<clause id="IDe6f90f2fc8924461be08dd38390c9a6f"><enum>(i)</enum><text>notify and consult with
the appropriate State regarding any potential inconsistency or
preemption;</text>
</clause><clause id="ID6a2238d7c4ad47c0a7daf6c20fb39314"><enum>(ii)</enum><text>cause to be published in
the Federal Register notice of the issue regarding the potential inconsistency
or preemption, including a description of each State insurance measure at issue
and any applicable International Insurance Agreement on Prudential
Measures;</text>
</clause><clause id="ID4497cbd133964f2f8243ac9edb2bc3b7"><enum>(iii)</enum><text>provide interested
parties a reasonable opportunity to submit written comments to the Office;
and</text>
</clause><clause id="ID3860d0df438c438295049f4e9cccdaa2"><enum>(iv)</enum><text>consider any comments
received.</text>
</clause></subparagraph><subparagraph id="id1E8BC2AE2D4B41BCAB6DF954250E231B"><enum>(B)</enum><header>Scope of
review</header><text>For purposes of this subsection, the determination of the
Director regarding State insurance measures shall be limited to the subject
matter contained within the international insurance agreement on prudential
measure involved.</text>
</subparagraph><subparagraph id="IDf1df1ccdfb2140cc9d0bec0c7373bba7"><enum>(C)</enum><header>Notice of determination
of inconsistency</header><text>Upon making any determination under paragraph
(1), the Director shall—</text>
<clause id="ID3cd640b26b17443cb589c274292b1d1f"><enum>(i)</enum><text>notify the appropriate
State of the determination and the extent of the inconsistency;</text>
</clause><clause id="ID046950f9b1f24f888bd93ae632647a29"><enum>(ii)</enum><text>establish a reasonable
period of time, which shall not be less than 30 days, before the determination
shall become effective; and</text>
</clause><clause id="idEF3B1B5A1E1A45EDB179BC3D848A6293"><enum>(iii)</enum><text>notify the Committee on
Banking, Housing, and Urban Affairs of the Senate and the Committee on
Financial Services of the House of Representatives of the inconsistency.</text>
</clause></subparagraph></paragraph><paragraph id="IDa50df9860ed74ca4bff6d163cd58e46f"><enum>(3)</enum><header>Notice of
effectiveness</header><text>Upon the conclusion of the period referred to in
paragraph (2)(C)(ii), if the basis for such determination still exists, the
determination shall become effective and the Director shall—</text>
<subparagraph id="ID434e7cd563154c33a9c9f31498f5d493"><enum>(A)</enum><text>cause to be published a
notice in the Federal Register that the preemption has become effective, as
well as the effective date; and</text>
</subparagraph><subparagraph id="IDc050806617c6490e9ab9062df7b6969e"><enum>(B)</enum><text>notify the appropriate
State.</text>
</subparagraph></paragraph><paragraph id="IDe01492393f5a4d409a256641b3c79460"><enum>(4)</enum><header>Limitation</header><text>No
State may enforce a State insurance measure to the extent that such measure has
been preempted under this subsection.</text>
</paragraph></subsection><subsection id="id17264FBD9E344CC691B89B226172163F"><enum>(g)</enum><header>Applicability of
Administrative Procedures Act</header><text>Determinations of inconsistency
made pursuant to subsection (f)(2) shall be subject to the applicable
provisions of subchapter II of chapter 5 of title 5, United States Code
(relating to administrative procedure), and chapter 7 of such title (relating
to judicial review).</text>
</subsection><subsection id="IDbf726cf7b832467c8896cde64563d3e8"><enum>(h)</enum><header>Regulations, policies,
and procedures</header><text>The Secretary may issue orders, regulations,
policies, and procedures to implement this section.</text>
</subsection><subsection id="ID7ebf001cab584e99a8628b407b8355d3"><enum>(i)</enum><header>Consultation</header><text>The
Director shall consult with State insurance regulators, individually or
collectively, to the extent the Director determines appropriate, in carrying
out the functions of the Office.</text>
</subsection><subsection id="ID7c49739a007342829e89e87f1815ce45"><enum>(j)</enum><header>Savings
provisions</header><text>Nothing in this section shall—</text>
<paragraph id="IDb405b9bf7f4f45039936fe291450d200"><enum>(1)</enum><text>preempt—</text>
<subparagraph id="id2D120036D0E6479998DE82EED0F305A2"><enum>(A)</enum><text>any State insurance
measure that governs any insurer’s rates, premiums, underwriting, or sales
practices;</text>
</subparagraph><subparagraph id="idF70ED469F37E48F6B312F169DF1ECBC3"><enum>(B)</enum><text>any State coverage
requirements for insurance;</text>
</subparagraph><subparagraph id="id56C520F3901A476E89D95D1512B7795B"><enum>(C)</enum><text>the application of the
antitrust laws of any State to the business of insurance; or</text>
</subparagraph><subparagraph id="id6FADE8B46F014C309D8A8DABE8376E7A"><enum>(D)</enum><text>any State insurance
measure governing the capital or solvency of an insurer, except to the extent
that such State insurance measure results in less favorable treatment of a
non-United State insurer than a United States insurer;</text>
</subparagraph></paragraph><paragraph id="IDb8113132bf334a88978eb9e6c6615aca"><enum>(2)</enum><text>be construed to alter,
amend, or limit any provision of the Consumer Financial Protection Agency Act
of 2010; or</text>
</paragraph><paragraph id="IDd571cb5c3d974e198df0f0f7e9b497a3"><enum>(3)</enum><text>affect the preemption of
any State insurance measure otherwise inconsistent with and preempted by
Federal law.</text>
</paragraph></subsection><subsection id="id92D70741C11648C497DF14671C06A972"><enum>(k)</enum><header>Retention of existing
State regulatory authority</header><text>Nothing in this section or section 314
shall be construed to establish or provide the Office or the Department of the
Treasury with general supervisory or regulatory authority over the business of
insurance.</text>
</subsection><subsection id="IDca99c314e8644aca9b5b03290cf2f72e"><enum>(l)</enum><header>Annual report to
congress</header><text>Beginning September 30, 2011, the Director shall submit
a report on or before September 30 of each calendar year to the President and
to the Committee on Banking, Housing, and Urban Affairs of the Senate and the
Committee on Financial Services of the House of Representatives on the
insurance industry, any actions taken by the Office pursuant to subsection (f)
(regarding preemption of inconsistent State insurance measures), and any other
information as deemed relevant by the Director or as requested by such
Committees.</text>
</subsection><subsection id="idE034D88579274D80B42907EB122FED8A"><enum>(m)</enum><header>Study and report on
regulation of insurance</header>
<paragraph id="id6C49DD34260C4533951F1C13A5FAF2B6"><enum>(1)</enum><header>In
general</header><text>Not later than 18 months after the date of enactment of
this section, the Director shall conduct a study and submit a report to
Congress on how to modernize and improve the system of insurance regulation in
the United States.</text>
</paragraph><paragraph id="id17965A08C5F64C87BEDAEB0A5DA810F0"><enum>(2)</enum><header>Considerations</header><text>The
study and report required under paragraph (1) shall be based on and guided by
the following considerations:</text>
<subparagraph id="id048096B8279D40E38917C72F4257CBC5"><enum>(A)</enum><text>Systemic risk regulation
with respect to insurance.</text>
</subparagraph><subparagraph id="idE893454AE2E7452E869553DA2AEAF678"><enum>(B)</enum><text>Capital standards and the
relationship between capital allocation and liabilities, including standards
relating to liquidity and duration risk.</text>
</subparagraph><subparagraph id="id2D1FB45251364671B28A3B064456A1FA"><enum>(C)</enum><text>Consumer protection for
insurance products and practices, including gaps in state regulation.</text>
</subparagraph><subparagraph id="idA30C4B10EC6147658777E6FF17646AC1"><enum>(D)</enum><text>The degree of national
uniformity of state insurance regulation.</text>
</subparagraph><subparagraph id="idA49BEB27A66A44B89BC6307C79C091A5"><enum>(E)</enum><text>The regulation of
insurance companies and affiliates on a consolidated basis.</text>
</subparagraph><subparagraph id="id3AB3E5BAF3424071885C5A3E3E7FC68B"><enum>(F)</enum><text>International
coordination of insurance regulation.</text>
</subparagraph></paragraph><paragraph id="id08186E6E8DBA443992E2B723C061AAEC"><enum>(3)</enum><header>Additional
factors</header><text>The study and report required under paragraph (1) shall
also examine the following factors:</text>
<subparagraph id="ID95c37eab94984458ae944dfff6a29702"><enum>(A)</enum><text>The costs and benefits of
potential Federal regulation of insurance across various lines of insurance
(except health insurance).</text>
</subparagraph><subparagraph id="ID7ffe492f3b2444cea2dfe1fcb7109ef3"><enum>(B)</enum><text>The feasibility of
regulating only certain lines of insurance at the Federal level, while leaving
other lines of insurance to be regulated at the State level.</text>
</subparagraph><subparagraph id="ID00d8618f0d4e4084abedc0ebadc5d4ca"><enum>(C)</enum><text>The ability of any
potential Federal regulation or Federal regulators to eliminate or minimize
regulatory arbitrage.</text>
</subparagraph><subparagraph id="IDe4e08a3c6e494aaca423470dae380902"><enum>(D)</enum><text>The impact that
developments in the regulation of insurance in foreign jurisdictions might have
on the potential Federal regulation of insurance.</text>
</subparagraph><subparagraph id="IDaa26549387574d7fae580b47c2300362"><enum>(E)</enum><text>The ability of any
potential Federal regulation or Federal regulator to provide robust consumer
protection for policyholders.</text>
</subparagraph><subparagraph id="IDbd4bdbf2664840e5a1f2a7d20d5f2faa"><enum>(F)</enum><text>The potential
consequences of subjecting insurance companies to a Federal resolution
authority, including the effects of any Federal resolution authority—</text>
<clause id="ID12512261e6b14c7d88030e3dc25aa689"><enum>(i)</enum><text>on the operation of State
insurance guaranty fund systems, including the loss of guaranty fund coverage
if an insurance company is subject to a Federal resolution authority;</text>
</clause><clause id="ID7945bc049820465f8838de751aace6f7"><enum>(ii)</enum><text>on policyholder
protection, including the loss of the priority status of policyholder claims
over other unsecured general creditor claims;</text>
</clause><clause id="ID505a91d9a8d7405784ee909e13c94881"><enum>(iii)</enum><text>in the case of life
insurance companies, the loss of the special status of separate account assets
and separate account liabilities; and</text>
</clause><clause id="IDd3ec45dbdacd4f73b22d316a9c11f9ba"><enum>(iv)</enum><text>on the international
competitiveness of insurance companies.</text>
</clause></subparagraph><subparagraph id="IDff27da51f76a4a57878e04b034359734"><enum>(G)</enum><text>Such other factors as the
Director determines necessary or appropriate, consistent with the principles
set forth in paragraph (2).</text>
</subparagraph></paragraph><paragraph id="id5D1AC3EC9609414A910B9E569A37625F"><enum>(4)</enum><header>Required
recommendations</header><text>The study and report required under paragraph (1)
shall also contain any legislative, administrative, or regulatory
recommendations, as the Director determines appropriate, to carry out or
effectuate the findings set forth in such report.</text>
</paragraph><paragraph id="ID2605465666ee4e269ad235f3a8c01c40"><enum>(5)</enum><header>Consultation</header><text>With
respect to the study and report required under paragraph (1), the Director
shall consult with the National Association of Insurance Commissioners,
consumer organizations, representatives of the insurance industry and
policyholders, and other organizations and experts, as appropriate.</text>
</paragraph></subsection><subsection id="IDf55137d420e64db3bbbbf4f58215ee25"><enum>(n)</enum><header>Use of existing
resources</header><text>To carry out this section, the Office may employ
personnel, facilities, and any other resource of the Department of the Treasury
available to the Secretary.</text>
</subsection><subsection id="IDc4c7682b776249658ac26655fce65613"><enum>(o)</enum><header>Definitions</header><text>In
this section and section 314, the following definitions shall apply:</text>
<paragraph id="ID6fcf05cc970146b783773cbb3c3c21d3"><enum>(1)</enum><header>Affiliate</header><text>The
term <term>affiliate</term> means, with respect to an insurer, any person who
controls, is controlled by, or is under common control with the insurer.</text>
</paragraph><paragraph id="IDd3e0c6ee1b6b4369a0f95d1319e6a7da"><enum>(2)</enum><header>Insurer</header><text>The
term <term>insurer</term> means any person engaged in the business of
insurance, including reinsurance.</text>
</paragraph><paragraph id="ID6e2eee753ae744379cad05f48398523d"><enum>(3)</enum><header>International insurance
agreement on prudential measures</header><text>The term <term>International
Insurance Agreement on Prudential Measures</term> means a written bilateral or
multilateral agreement entered into between the United States and a foreign
government, authority, or regulatory entity regarding prudential measures
applicable to the business of insurance or reinsurance.</text>
</paragraph><paragraph id="ID53a7a5493db2478d9a7838de4eeec346"><enum>(4)</enum><header>Non-United States
insurer</header><text>The term <term>non-United States insurer</term> means an
insurer that is organized under the laws of a jurisdiction other than a State,
but does not include any United States branch of such an insurer.</text>
</paragraph><paragraph id="IDba6b6522485a412c9eb43bc60367fe72"><enum>(5)</enum><header>Office</header><text>The
term <term>Office</term> means the Office of National Insurance established by
this section.</text>
</paragraph><paragraph id="ID10875942028649e5b81006d7cd11d13d"><enum>(6)</enum><header>State insurance
measure</header><text>The term <term>State insurance measure</term> means any
State law, regulation, administrative ruling, bulletin, guideline, or practice
relating to or affecting prudential measures applicable to insurance or
reinsurance.</text>
</paragraph><paragraph id="IDb9deef40bbff455ca24c35cbc59cdb23"><enum>(7)</enum><header>State insurance
regulator</header><text>The term <term>State insurance regulator</term> means
any State regulatory authority responsible for the supervision of
insurers.</text>
</paragraph><paragraph id="IDacc0c650e07d4d5d98664f1f385a04c1"><enum>(8)</enum><header>United States
insurer</header><text>The term <term>United States insurer</term> means—</text>
<subparagraph id="IDfcd8cb6f33af4b70aa01658bf1f8bab9"><enum>(A)</enum><text>an insurer that is
organized under the laws of a State; or</text>
</subparagraph><subparagraph id="ID02e4cb1c42fa453aa972740606df7634"><enum>(B)</enum><text>a United States branch of
a non-United States insurer.</text>
</subparagraph></paragraph></subsection><subsection id="IDe5e5206bd42c48fbbd479e6be40794d5"><enum>(p)</enum><header>Authorization of
appropriations</header><text>There are authorized to be appropriated for the
Office for each fiscal year such sums as may be necessary.</text>
</subsection></section><section id="ID8afd014e5a7b498cbe6a0b0b5061e36d"><enum>314.</enum><header>International
insurance agreements on prudential measures</header>
<subsection id="idC03F38A22EEB4E1198F56610AB9ACE11"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">The Secretary of the
Treasury is authorized to negotiate and enter into International Insurance
Agreements on Prudential Measures on behalf of the United States.</text>
</subsection><subsection id="ID69d8c4ca1ebc4b118d90fb0c10d1a1ca"><enum>(b)</enum><header>Savings
provision</header><text>Nothing in this section or section 313 shall be
construed to affect the development and coordination of United States
international trade policy or the administration of the United States trade
agreements program. It is to be understood that the negotiation of
International Insurance Agreements on Prudential Measures under such sections
is consistent with the requirement of this subsection.</text>
</subsection><subsection id="IDc78e2b68851c45cf92c088eae315c0d0"><enum>(c)</enum><header>Consultation</header><text>The
Secretary shall consult with the United States Trade Representative on the
negotiation of International Insurance Agreements on Prudential Measures,
including prior to initiating and concluding any such
agreements.</text>
</subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="IDc913e54d22f349d48bc8e9a5c7173e68"><enum>(b)</enum><header>Duties of
Secretary</header><text>Section 321(a) of title 31, United States Code, is
amended—</text>
<paragraph id="IDcf5b750aa08c4be7902748e5091c3824"><enum>(1)</enum><text>in paragraph (7), by
striking <quote>; and</quote> and inserting a semicolon;</text>
</paragraph><paragraph id="ID2d7f2648dcb144a1b7f3e6c11c9403ab"><enum>(2)</enum><text>in paragraph (8)(C), by
striking the period at the end and inserting <quote>; and</quote>; and</text>
</paragraph><paragraph id="ID2cba2572a5c24999b07bdc451140a28c"><enum>(3)</enum><text>by adding at the end the
following new paragraph:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id1098B2EBBF53490BB33A309EAADEE8D2" reported-display-style="italic" style="OLC">
<paragraph id="ID60f2185d4a16451eb7faf7fc80e81c61"><enum>(9)</enum><text>advise the President on
major domestic and international prudential policy issues in connection with
all lines of insurance except health
insurance.</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="ID2d407e886fe14eccb532701bfc6aa7cd"><enum>(c)</enum><header>Clerical
amendment</header><text>The table of sections for subchapter I of chapter 3 of
title 31, United States Code, is amended by striking the item relating to
section 312 and inserting the following new items:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id7561BC5C23B1430BAD4F09BD3B4D3E1A" reported-display-style="italic" style="OLC">
<toc changed="added" reported-display-style="italic">
<toc-entry idref="ID3b5905c46f054e778e64e2c2c814be34" level="section">Sec. 312. Terrorism and
financial intelligence.</toc-entry>
<toc-entry bold="off" level="section">Sec. 313. Office of National
Insurance.</toc-entry>
<toc-entry idref="ID8afd014e5a7b498cbe6a0b0b5061e36d" level="section">Sec. 314. International
insurance agreements on prudential measures.</toc-entry>
<toc-entry bold="off" level="section">Sec. 315. Continuing in
office.</toc-entry>
</toc>
<after-quoted-block>.</after-quoted-block></quoted-block>
</subsection></section></subtitle><subtitle id="idCB65149C7A264122B7C09EDEFF5932DA"><enum>B</enum><header>State-based Insurance
Reform</header>
<section id="idA326A944851344EB94114CEEAEFB413B"><enum>511.</enum><header>Short
title</header><text display-inline="no-display-inline">This subtitle may be
cited as the <quote>Nonadmitted and Reinsurance Reform Act of
2010</quote>.</text>
</section><section id="H3CB7FF3F6B7B4C71912116ECFD3562F"><enum>512.</enum><header>Effective
date</header><text display-inline="no-display-inline">Except as otherwise
specifically provided in this subtitle, this subtitle shall take effect upon
the expiration of the 12-month period beginning on the date of the enactment of
this subtitle.</text>
</section><part id="HE2ECDF15D27045B5BD28B4F3AEA08F03"><enum>I</enum><header>Nonadmitted
insurance</header>
<section id="H544FACBFA0454217006068F1A29578EB"><enum>521.</enum><header>Reporting, payment,
and allocation of premium taxes</header>
<subsection id="HF75F7056D921411988D507BB90E99C93"><enum>(a)</enum><header>Home State’s exclusive
authority</header><text>No State other than the home State of an insured may
require any premium tax payment for nonadmitted insurance.</text>
</subsection><subsection id="HC33631E6C7BA4BAC98A17DD6D172F75D"><enum>(b)</enum><header>Allocation of
nonadmitted premium taxes</header>
<paragraph id="H7F152306AFCE487C84286EF853F4114"><enum>(1)</enum><header>In
general</header><text>The States may enter into a compact or otherwise
establish procedures to allocate among the States the premium taxes paid to an
insured’s home State described in subsection (a).</text>
</paragraph><paragraph display-inline="no-display-inline" id="H4AFA5BF27C624470A7B958C6CA494589"><enum>(2)</enum><header>Effective
date</header><text display-inline="yes-display-inline">Except as expressly
otherwise provided in such compact or other procedures, any such compact or
other procedures—</text>
<subparagraph id="H399BEF58712B4BBE9FF600F59398606D"><enum>(A)</enum><text display-inline="yes-display-inline">if adopted on or before the expiration of
the 330-day period that begins on the date of the enactment of this subtitle,
shall apply to any premium taxes that, on or after such date of enactment, are
required to be paid to any State that is subject to such compact or procedures;
and</text>
</subparagraph><subparagraph id="H1DB6C1365E57410B8BDBB41C424F7DA1"><enum>(B)</enum><text display-inline="yes-display-inline">if adopted after the expiration of such
330-day period, shall apply to any premium taxes that, on or after January 1 of
the first calendar year that begins after the expiration of such 330-day
period, are required to be paid to any State that is subject to such compact or
procedures.</text>
</subparagraph></paragraph><paragraph id="HD958124944244E18AB00FBB8D3BAE2B4"><enum>(3)</enum><header>Report</header><text display-inline="yes-display-inline">Upon the expiration of the 330-day period
referred to in paragraph (2), the NAIC may submit a report to the Committee on
Financial Services and Committee on the Judiciary of the House of
Representatives and the Committee on Banking, Housing, and Urban Affairs of the
Senate identifying and describing any compact or other procedures for
allocation among the States of premium taxes that have been adopted during such
period by any States.</text>
</paragraph><paragraph id="HA66CAD1655DD469D9F0046624D639113"><enum>(4)</enum><header>Nationwide
system</header><text>The Congress intends that each State adopt nationwide
uniform requirements, forms, and procedures, such as an interstate compact,
that provides for the reporting, payment, collection, and allocation of premium
taxes for nonadmitted insurance consistent with this section.</text>
</paragraph></subsection><subsection id="H048DC5D23BC14DF4A1457E748D470003"><enum>(c)</enum><header>Allocation based on tax
allocation report</header><text>To facilitate the payment of premium taxes
among the States, an insured’s home State may require surplus lines brokers and
insureds who have independently procured insurance to annually file tax
allocation reports with the insured’s home State detailing the portion of the
nonadmitted insurance policy premium or premiums attributable to properties,
risks, or exposures located in each State. The filing of a nonadmitted
insurance tax allocation report and the payment of tax may be made by a person
authorized by the insured to act as its agent.</text>
</subsection></section><section id="HC357845F013642FCA84496E1F39CF027"><enum>522.</enum><header>Regulation of
nonadmitted insurance by insured’s home State</header>
<subsection id="H065C8FEEB1FE46C4AC15FD20F43BD082"><enum>(a)</enum><header>Home State
authority</header><text display-inline="yes-display-inline">Except as otherwise
provided in this section, the placement of nonadmitted insurance shall be
subject to the statutory and regulatory requirements solely of the insured’s
home State.</text>
</subsection><subsection id="HCA40CC47AC3F41F38CE1F4173C9949DE"><enum>(b)</enum><header>Broker
licensing</header><text>No State other than an insured’s home State may require
a surplus lines broker to be licensed in order to sell, solicit, or negotiate
nonadmitted insurance with respect to such insured.</text>
</subsection><subsection id="H7BB8ED67ADBE49FAAB6B4798CC2FA31"><enum>(c)</enum><header>Enforcement
provision</header><text>With respect to section 521 and subsections (a) and (b)
of this section, any law, regulation, provision, or action of any State that
applies or purports to apply to nonadmitted insurance sold to, solicited by, or
negotiated with an insured whose home State is another State shall be preempted
with respect to such application.</text>
</subsection><subsection id="H30432579BDC0408FA905003706243700"><enum>(d)</enum><header>Workers’ compensation
exception</header><text display-inline="yes-display-inline">This section may
not be construed to preempt any State law, rule, or regulation that restricts
the placement of workers’ compensation insurance or excess insurance for
self-funded workers’ compensation plans with a nonadmitted insurer.</text>
</subsection></section><section id="HCC4B0AD7E1994B6BB9ACAAFEEC6581"><enum>523.</enum><header>Participation in
national producer database</header><text display-inline="no-display-inline">After the expiration of the 2-year period
beginning on the date of the enactment of this subtitle, a State may not
collect any fees relating to licensing of an individual or entity as a surplus
lines broker in the State unless the State has in effect at such time laws or
regulations that provide for participation by the State in the national
insurance producer database of the NAIC, or any other equivalent uniform
national database, for the licensure of surplus lines brokers and the renewal
of such licenses.</text>
</section><section id="H237CFA1325BA4BA1A7A93F75A4144F7D"><enum>524.</enum><header>Uniform standards for
surplus lines eligibility</header><text display-inline="no-display-inline">A
State may not—</text>
<paragraph id="HCB52519D194948AB8186C66FC6D91F28"><enum>(1)</enum><text display-inline="yes-display-inline">impose eligibility requirements on, or
otherwise establish eligibility criteria for, nonadmitted insurers domiciled in
a United States jurisdiction, except in conformance with such requirements and
criteria in sections 5A(2) and 5C(2)(a) of the Non-Admitted Insurance Model
Act, unless the State has adopted nationwide uniform requirements, forms, and
procedures developed in accordance with section 521(b) of this subtitle that
include alternative nationwide uniform eligibility requirements; or</text>
</paragraph><paragraph id="HB37085102BF5447E87E1EA92191EF814"><enum>(2)</enum><text display-inline="yes-display-inline">prohibit a surplus lines broker from
placing nonadmitted insurance with, or procuring nonadmitted insurance from, a
nonadmitted insurer domiciled outside the United States that is listed on the
Quarterly Listing of Alien Insurers maintained by the International Insurers
Department of the NAIC.</text>
</paragraph></section><section id="HA6A99371C424427C945E3F8B35FDF0DC"><enum>525.</enum><header>Streamlined
application for commercial purchasers</header><text display-inline="no-display-inline">A surplus lines broker seeking to procure or
place nonadmitted insurance in a State for an exempt commercial purchaser shall
not be required to satisfy any State requirement to make a due diligence search
to determine whether the full amount or type of insurance sought by such exempt
commercial purchaser can be obtained from admitted insurers if—</text>
<paragraph id="HC3CF49EAC35E4651A3D5F6F286C0351"><enum>(1)</enum><text>the broker procuring or
placing the surplus lines insurance has disclosed to the exempt commercial
purchaser that such insurance may or may not be available from the admitted
market that may provide greater protection with more regulatory oversight;
and</text>
</paragraph><paragraph id="H0EC635461757411BA39BEA1DCFCB888D"><enum>(2)</enum><text>the exempt commercial
purchaser has subsequently requested in writing the broker to procure or place
such insurance from a nonadmitted insurer.</text>
</paragraph></section><section display-inline="no-display-inline" id="H7EE1B1BDB3FE4A50A9B152063F939C4" section-type="subsequent-section"><enum>526.</enum><header>GAO study of
nonadmitted insurance market</header>
<subsection id="HA6DC9D48B27E4512A1E4C0A9FAFA1831"><enum>(a)</enum><header>In
general</header><text>The Comptroller General of the United States shall
conduct a study of the nonadmitted insurance market to determine the effect of
the enactment of this part on the size and market share of the nonadmitted
insurance market for providing coverage typically provided by the admitted
insurance market.</text>
</subsection><subsection id="HFC031601AB424C8BA3BEF1B780B01298"><enum>(b)</enum><header>Contents</header><text>The
study shall determine and analyze—</text>
<paragraph id="HF1ECF38BF3FD4809976CEDC63200CC5D"><enum>(1)</enum><text>the change in the size
and market share of the nonadmitted insurance market and in the number of
insurance companies and insurance holding companies providing such business in
the 18-month period that begins upon the effective date of this
subtitle;</text>
</paragraph><paragraph id="H5AD3029C184E42BBB12000E1C21772A"><enum>(2)</enum><text>the extent to which
insurance coverage typically provided by the admitted insurance market has
shifted to the nonadmitted insurance market;</text>
</paragraph><paragraph id="H3A50D4D5AB444B74ADC305A881D98D93"><enum>(3)</enum><text>the consequences of any
change in the size and market share of the nonadmitted insurance market,
including differences in the price and availability of coverage available in
both the admitted and nonadmitted insurance markets;</text>
</paragraph><paragraph id="H1A21B0EEF6414CD3ABCE32DA25D7349F"><enum>(4)</enum><text>the extent to which
insurance companies and insurance holding companies that provide both admitted
and nonadmitted insurance have experienced shifts in the volume of business
between admitted and nonadmitted insurance; and</text>
</paragraph><paragraph id="H8EFE4BF414C242C39B6F715579C77627"><enum>(5)</enum><text>the extent to which there
has been a change in the number of individuals who have nonadmitted insurance
policies, the type of coverage provided under such policies, and whether such
coverage is available in the admitted insurance market.</text>
</paragraph></subsection><subsection id="H628F232198394606BA296CCD00655646"><enum>(c)</enum><header>Consultation with
NAIC</header><text>In conducting the study under this section, the Comptroller
General shall consult with the NAIC.</text>
</subsection><subsection id="HF001F4FA33DA481AB6647CE540AE51AE"><enum>(d)</enum><header>Report</header><text>The
Comptroller General shall complete the study under this section and submit a
report to the Committee on Banking, Housing, and Urban Affairs of the Senate
and the Committee on Financial Services of the House of Representatives
regarding the findings of the study not later than 30 months after the
effective date of this subtitle.</text>
</subsection></section><section id="HCC42C17E3E6A4D04A000C8B8B5B878BA"><enum>527.</enum><header>Definitions</header><text display-inline="no-display-inline">For purposes of this part, the following
definitions shall apply:</text>
<paragraph id="H80B981919F6D4D509279811D9322DB69"><enum>(1)</enum><header>Admitted
insurer</header><text>The term <term>admitted insurer</term> means, with
respect to a State, an insurer licensed to engage in the business of insurance
in such State.</text>
</paragraph><paragraph id="HCD0565D3FA0545318F3886D1A06D8DFB"><enum>(2)</enum><header>Affiliate</header><text display-inline="yes-display-inline">The term <term>affiliate</term> means, with
respect to an insured, any entity that controls, is controlled by, or is under
common control with the insured.</text>
</paragraph><paragraph id="HC1FDCA572C2043EEAE50F2AA69546CCB"><enum>(3)</enum><header>Affiliated
group</header><text>The term <term>affiliated group</term> means any group of
entities that are all affiliated.</text>
</paragraph><paragraph id="HA9908D9F01B04D04B9D444E4038BD408"><enum>(4)</enum><header>Control</header><text>An
entity has <term>control</term> over another entity if—</text>
<subparagraph id="HF1B8352A5A10429D8558B839609AF93C"><enum>(A)</enum><text>the entity directly or
indirectly or acting through 1 or more other persons owns, controls, or has the
power to vote 25 percent or more of any class of voting securities of the other
entity; or</text>
</subparagraph><subparagraph id="HEC78D376024E463CA6D8EC33D5DD7947"><enum>(B)</enum><text>the entity controls in
any manner the election of a majority of the directors or trustees of the other
entity.</text>
</subparagraph></paragraph><paragraph id="H7C8B84067F7049899426D127EE00DA12"><enum>(5)</enum><header>Exempt commercial
purchaser</header><text display-inline="yes-display-inline">The term
<term>exempt commercial purchaser</term> means any person purchasing commercial
insurance that, at the time of placement, meets the following
requirements:</text>
<subparagraph id="H00B4883F663F4504BD8011FEDC9134BB"><enum>(A)</enum><text>The person employs or
retains a qualified risk manager to negotiate insurance coverage.</text>
</subparagraph><subparagraph display-inline="no-display-inline" id="H462312FB725343D58FBE97F3BC582AA"><enum>(B)</enum><text>The person has paid
aggregate nationwide commercial property and casualty insurance premiums in
excess of $100,000 in the immediately preceding 12 months.</text>
</subparagraph><subparagraph id="HB9F92952184144699F7C72E9CCAA093C"><enum>(C)</enum><clause commented="no" display-inline="yes-display-inline" id="HAEE0BC3279B34845B9939E00D2AA3E77"><enum>(i)</enum><text>The person meets at
least 1 of the following criteria:</text>
<subclause changed="added" id="HDA6D0394104B41A49D96AE76EBFC7322" indent="up1" reported-display-style="italic"><enum>(I)</enum><text>The
person possesses a net worth in excess of $20,000,000, as such amount is
adjusted pursuant to clause (ii).</text>
</subclause><subclause changed="added" id="H0531FB2D20934B779E4F6F52C831FA34" indent="up1" reported-display-style="italic"><enum>(II)</enum><text>The
person generates annual revenues in excess of $50,000,000, as such amount is
adjusted pursuant to clause (ii).</text>
</subclause><subclause changed="added" id="H1FD2FB4B85F147E38227D1D500C5BD16" indent="up1" reported-display-style="italic"><enum>(III)</enum><text>The
person employs more than 500 full-time or full-time equivalent employees per
individual insured or is a member of an affiliated group employing more than
1,000 employees in the aggregate.</text>
</subclause><subclause changed="added" id="H98CACB32F93F46BDBB54135D7FA183B7" indent="up1" reported-display-style="italic"><enum>(IV)</enum><text>The
person is a not-for-profit organization or public entity generating annual
budgeted expenditures of at least $30,000,000, as such amount is adjusted
pursuant to clause (ii).</text>
</subclause><subclause changed="added" id="HB017F3AB598D48E49F3DAFBFAC78B400" indent="up1" reported-display-style="italic"><enum>(V)</enum><text>The
person is a municipality with a population in excess of 50,000 persons.</text>
</subclause></clause><clause changed="added" id="HF4C85A857E0746840054BFA9FD6B2751" indent="up1" reported-display-style="italic"><enum>(ii)</enum><text>Effective on the fifth
January 1 occurring after the date of the enactment of this subtitle and each
fifth January 1 occurring thereafter, the amounts in subclauses (I), (II), and
(IV) of clause (i) shall be adjusted to reflect the percentage change for such
5-year period in the Consumer Price Index for All Urban Consumers published by
the Bureau of Labor Statistics of the Department of Labor.</text>
</clause></subparagraph></paragraph><paragraph commented="no" id="H9F995421EA1546C4AC8B05E9B9BA3E03"><enum>(6)</enum><header>Home State</header>
<subparagraph id="H9E337BE99BE44B3CB98F29725C628513"><enum>(A)</enum><header>In
general</header><text display-inline="yes-display-inline">Except as provided in
subparagraph (B), the term <term>home State</term> means, with respect to an
insured—</text>
<clause id="H7499ABD85D31419B8B565FEFABCD7C3E"><enum>(i)</enum><text>the State in which an
insured maintains its principal place of business or, in the case of an
individual, the individual’s principal residence; or</text>
</clause><clause id="H023EC5C6B3184204A1D509194EDFBA4C"><enum>(ii)</enum><text display-inline="yes-display-inline">if 100 percent of the insured risk is
located out of the State referred to in subparagraph (A), the State to which
the greatest percentage of the insured’s taxable premium for that insurance
contract is allocated.</text>
</clause></subparagraph><subparagraph id="H0369195A41414049A12865C2245D844A"><enum>(B)</enum><header>Affiliated
groups</header><text>If more than 1 insured from an affiliated group are named
insureds on a single nonadmitted insurance contract, the term <term>home
State</term> means the home State, as determined pursuant to subparagraph (A),
of the member of the affiliated group that has the largest percentage of
premium attributed to it under such insurance contract.</text>
</subparagraph></paragraph><paragraph id="H5C937E0E495D412D001BADECFAAD3667"><enum>(7)</enum><header>Independently procured
insurance</header><text>The term <term>independently procured insurance</term>
means insurance procured directly by an insured from a nonadmitted
insurer.</text>
</paragraph><paragraph display-inline="no-display-inline" id="H9F85DB1EDCC645688C55CF954704028E"><enum>(8)</enum><header>NAIC</header><text>The
term <term>NAIC</term> means the National Association of Insurance
Commissioners or any successor entity.</text>
</paragraph><paragraph id="HBBB308DE8AF1456DB0FDF175324952D4"><enum>(9)</enum><header>Nonadmitted
insurance</header><text>The term <term>nonadmitted insurance</term> means any
property and casualty insurance permitted to be placed directly or through a
surplus lines broker with a nonadmitted insurer eligible to accept such
insurance.</text>
</paragraph><paragraph id="H1520AC690D5F4C5DA08502853E5E3485"><enum>(10)</enum><header>Non-admitted insurance
model act</header><text>The term <term>Non-Admitted Insurance Model Act</term>
means the provisions of the Non-Admitted Insurance Model Act, as adopted by the
NAIC on August 3, 1994, and amended on September 30, 1996, December 6, 1997,
October 2, 1999, and June 8, 2002.</text>
</paragraph><paragraph id="H3C059FC047A047369256C98BA212A3F1"><enum>(11)</enum><header>Nonadmitted
insurer</header><text>The term <term>nonadmitted insurer</term>—</text>
<subparagraph id="id9C40ECAEC0864411B994A3E018B12835"><enum>(A)</enum><text>means, with respect to a
State, an insurer not licensed to engage in the business of insurance in such
State; but</text>
</subparagraph><subparagraph id="id378C718083384F8482AC1CCE403FC7E9"><enum>(B)</enum><text>does not include a risk
retention group, as that term is defined in section 2(a)(4) of the Liability
Risk Retention Act of 1986 (15 U.S.C. 3901(a)(4)).</text>
</subparagraph></paragraph><paragraph id="H19098761C7B04964A93733878FFA10C9"><enum>(12)</enum><header>Qualified risk
manager</header><text display-inline="yes-display-inline">The term
<term>qualified risk manager</term> means, with respect to a policyholder of
commercial insurance, a person who meets all of the following
requirements:</text>
<subparagraph id="H416009772CEA4EE3B693E5A767B66F18"><enum>(A)</enum><text>The person is an employee
of, or third party consultant retained by, the commercial policyholder.</text>
</subparagraph><subparagraph id="HF3167E278C254EDEB7AA9F94155C6F"><enum>(B)</enum><text>The person provides
skilled services in loss prevention, loss reduction, or risk and insurance
coverage analysis, and purchase of insurance.</text>
</subparagraph><subparagraph id="H55F6C04CBB9446F782C04127FBDD0D8"><enum>(C)</enum><text display-inline="yes-display-inline">The person—</text>
<clause id="H18585334351B4B79919111A170F3EC9C"><enum>(i)</enum><subclause commented="no" display-inline="yes-display-inline" id="H86D41D66ADC74459006DCCCBC507DDD9"><enum>(I)</enum><text>has a bachelor’s degree
or higher from an accredited college or university in risk management, business
administration, finance, economics, or any other field determined by a State
insurance commissioner or other State regulatory official or entity to
demonstrate minimum competence in risk management; and</text>
</subclause><subclause changed="added" id="HFF0AC53DBF1C40E2921118CCEDB2EB27" indent="up1" reported-display-style="italic"><enum>(II)</enum><item commented="no" display-inline="yes-display-inline" id="H62FFDE9314DE4E4E83AFC327D2CB781C"><enum>(aa)</enum><text display-inline="yes-display-inline">has 3 years of experience in risk
financing, claims administration, loss prevention, risk and insurance analysis,
or purchasing commercial lines of insurance; or</text>
</item><item changed="added" id="H6971D83F101F4FEC95BA4C141801C58D" indent="up1" reported-display-style="italic"><enum>(bb)</enum><text>has 1 of
the following designations:</text>
<subitem id="HCCCC40FBA3F64494AB37D05698790412"><enum>(AA)</enum><text>a
designation as a Chartered Property and Casualty Underwriter (in this
subparagraph referred to as <quote>CPCU</quote>) issued by the American
Institute for CPCU/Insurance Institute of America;</text>
</subitem><subitem id="H3DEAD5FBDAFB4B3089F62B95D09D1659"><enum>(BB)</enum><text>a
designation as an Associate in Risk Management (ARM) issued by the American
Institute for CPCU/Insurance Institute of America;</text>
</subitem><subitem id="HCD124C1B47FC4E5DA6CF86E24D8AD2D"><enum>(CC)</enum><text>a
designation as Certified Risk Manager (CRM) issued by the National Alliance for
Insurance Education & Research;</text>
</subitem><subitem id="H8C1552AB92554F00A1589814B084A6FA"><enum>(DD)</enum><text>a
designation as a RIMS Fellow (RF) issued by the Global Risk Management
Institute; or</text>
</subitem><subitem id="H5A89B572288946F1B4AE13FCC3796704"><enum>(EE)</enum><text>any
other designation, certification, or license determined by a State insurance
commissioner or other State insurance regulatory official or entity to
demonstrate minimum competency in risk management;</text>
</subitem></item></subclause></clause><clause id="H525A8EA3C1CA47F693704D5F4CD5EB5E"><enum>(ii)</enum><subclause commented="no" display-inline="yes-display-inline" id="H67007C6A50B149BCB900F3E6DF7E700"><enum>(I)</enum><text>has at least 7 years of
experience in risk financing, claims administration, loss prevention, risk and
insurance coverage analysis, or purchasing commercial lines of insurance;
and</text>
</subclause><subclause changed="added" id="H2055FC0AC039415E87000000BACCA22B" indent="up1" reported-display-style="italic"><enum>(II)</enum><text>has any
1 of the designations specified in subitems (AA) through (EE) of clause
(i)(II)(bb);</text>
</subclause></clause><clause id="HAEB5E0C053FD4B8580C17B6760F35B83"><enum>(iii)</enum><text>has at least 10 years
of experience in risk financing, claims administration, loss prevention, risk
and insurance coverage analysis, or purchasing commercial lines of insurance;
or</text>
</clause><clause id="HC216C648AA8249EFB0685C1CD670BBFE"><enum>(iv)</enum><text display-inline="yes-display-inline">has a graduate degree from an accredited
college or university in risk management, business administration, finance,
economics, or any other field determined by a State insurance commissioner or
other State regulatory official or entity to demonstrate minimum competence in
risk management.</text>
</clause></subparagraph></paragraph><paragraph id="HC078466FD3D24B7FBD26DAD7A7D1B3C"><enum>(13)</enum><header>Premium
tax</header><text>The term <term>premium tax</term> means, with respect to
surplus lines or independently procured insurance coverage, any tax, fee,
assessment, or other charge imposed by a government entity directly or
indirectly based on any payment made as consideration for an insurance contract
for such insurance, including premium deposits, assessments, registration fees,
and any other compensation given in consideration for a contract of
insurance.</text>
</paragraph><paragraph id="H2BDC33EAE5A34125B68208BB4BF2E64"><enum>(14)</enum><header>Surplus lines
broker</header><text>The term <term>surplus lines broker</term> means an
individual, firm, or corporation which is licensed in a State to sell, solicit,
or negotiate insurance on properties, risks, or exposures located or to be
performed in a State with nonadmitted insurers.</text>
</paragraph></section></part><part id="HEA658BBD9F634D41B6F4F2D88DB06369"><enum>II</enum><header>Reinsurance</header>
<section id="HC6107BB5A4694190987727A9CE044D66" section-type="subsequent-section"><enum>531.</enum><header>Regulation of credit
for reinsurance and reinsurance agreements</header>
<subsection id="H11ADC702A222436698AE61B6FDBA8E83"><enum>(a)</enum><header>Credit for
reinsurance</header><text>If the State of domicile of a ceding insurer is an
NAIC-accredited State, or has financial solvency requirements substantially
similar to the requirements necessary for NAIC accreditation, and recognizes
credit for reinsurance for the insurer’s ceded risk, then no other State may
deny such credit for reinsurance.</text>
</subsection><subsection display-inline="no-display-inline" id="HED111F8F6CF7481A935EE6F3845BF2C"><enum>(b)</enum><header>Additional preemption
of extraterritorial application of State law</header><text display-inline="yes-display-inline">In addition to the application of
subsection (a), all laws, regulations, provisions, or other actions of a State
that is not the domiciliary State of the ceding insurer, except those with
respect to taxes and assessments on insurance companies or insurance income,
are preempted to the extent that they—</text>
<paragraph id="H10744FD3FECC4CCCA6FD79EAC9E2008B"><enum>(1)</enum><text display-inline="yes-display-inline">restrict or eliminate the rights of the
ceding insurer or the assuming insurer to resolve disputes pursuant to
contractual arbitration to the extent such contractual provision is not
inconsistent with the provisions of title 9, United States Code;</text>
</paragraph><paragraph id="H1F71FB57710045D79C8FEC665ED02297"><enum>(2)</enum><text>require that a certain
State’s law shall govern the reinsurance contract, disputes arising from the
reinsurance contract, or requirements of the reinsurance contract;</text>
</paragraph><paragraph id="H7121B62DF406477AA57F4B771CF16009"><enum>(3)</enum><text>attempt to enforce a
reinsurance contract on terms different than those set forth in the reinsurance
contract, to the extent that the terms are not inconsistent with this part;
or</text>
</paragraph><paragraph id="HDC678C492E9C4A2EBA49C3D1EF8951"><enum>(4)</enum><text>otherwise apply the laws
of the State to reinsurance agreements of ceding insurers not domiciled in that
State.</text>
</paragraph></subsection></section><section display-inline="no-display-inline" id="H2FCC20AABC1148FEB2EEF97CD9F6639" section-type="subsequent-section"><enum>532.</enum><header>Regulation of
reinsurer solvency</header>
<subsection id="HBAF204F837B84C24842156C2002EB536"><enum>(a)</enum><header>Domiciliary state
regulation</header><text display-inline="yes-display-inline">If the State of
domicile of a reinsurer is an NAIC-accredited State or has financial solvency
requirements substantially similar to the requirements necessary for NAIC
accreditation, such State shall be solely responsible for regulating the
financial solvency of the reinsurer.</text>
</subsection><subsection display-inline="no-display-inline" id="HB9ACA73758054E9CB29B58B93B605700"><enum>(b)</enum><header>Nondomiciliary
states</header>
<paragraph id="H7B8EB0C9A146423291D1D449E648855F"><enum>(1)</enum><header>Limitation on financial
information requirements</header><text display-inline="yes-display-inline">If
the State of domicile of a reinsurer is an NAIC-accredited State or has
financial solvency requirements substantially similar to the requirements
necessary for NAIC accreditation, no other State may require the reinsurer to
provide any additional financial information other than the information the
reinsurer is required to file with its domiciliary State.</text>
</paragraph><paragraph id="H841D2D82104041ABB80177D60714BFB4"><enum>(2)</enum><header>Receipt of
information</header><text display-inline="yes-display-inline">No provision of
this section shall be construed as preventing or prohibiting a State that is
not the State of domicile of a reinsurer from receiving a copy of any financial
statement filed with its domiciliary State.</text>
</paragraph></subsection></section><section display-inline="no-display-inline" id="H81BF9E7426E54C3AB9E26006FC29D304" section-type="subsequent-section"><enum>533.</enum><header>Definitions</header><text display-inline="no-display-inline">For purposes of this part, the following
definitions shall apply:</text>
<paragraph id="H0AE0570ADC804571A326AFFD56FFC4C5"><enum>(1)</enum><header>Ceding
insurer</header><text>The term <term>ceding insurer</term> means an insurer
that purchases reinsurance.</text>
</paragraph><paragraph id="H6C3B3A441C0D4B88ABCB734CAAC93DF8"><enum>(2)</enum><header>Domiciliary
State</header><text>The terms <term>State of domicile</term> and
<term>domiciliary State</term> mean, with respect to an insurer or reinsurer,
the State in which the insurer or reinsurer is incorporated or entered through,
and licensed.</text>
</paragraph><paragraph id="H625D76CB94BA459F9F5D64D431C51310"><enum>(3)</enum><header>Reinsurance</header><text>The
term <term>reinsurance</term> means the assumption by an insurer of all or part
of a risk undertaken originally by another insurer.</text>
</paragraph><paragraph id="H98367A9FF1CB4DB98ED95FF7E82CE8E1"><enum>(4)</enum><header>Reinsurer</header>
<subparagraph id="H5A5FAF13486944A4A676A600A8EA91AE"><enum>(A)</enum><header>In
general</header><text>The term <term>reinsurer</term> means an insurer to the
extent that the insurer—</text>
<clause id="H758534DC90DE4CF7962378E1CDC8E1C"><enum>(i)</enum><text>is principally engaged in
the business of reinsurance;</text>
</clause><clause id="H2C2ED325F9944EF789C5F127C8EB6C6B"><enum>(ii)</enum><text>does not conduct
significant amounts of direct insurance as a percentage of its net premiums;
and</text>
</clause><clause id="H3D6F3E3CA2E346E4B671BEC1F4FF167B"><enum>(iii)</enum><text>is not engaged in an
ongoing basis in the business of soliciting direct insurance.</text>
</clause></subparagraph><subparagraph id="H3B591A27087F4B50A8A8EC16A0124E18"><enum>(B)</enum><header>Determination</header><text>A
determination of whether an insurer is a reinsurer shall be made under the laws
of the State of domicile in accordance with this paragraph.</text>
</subparagraph></paragraph></section></part><part id="H396223634FA04E9C87E7E5EAAD99E0C1"><enum>III</enum><header>Rule of
construction</header>
<section id="H4C29A6153F16475CA6FF8DFB00F7D0BA"><enum>541.</enum><header>Rule of
construction</header><text display-inline="no-display-inline">Nothing in this
subtitle or the amendments made by this subtitle shall be construed to modify,
impair, or supersede the application of the antitrust laws. Any implied or
actual conflict between this subtitle and any amendments to this subtitle and
the antitrust laws shall be resolved in favor of the operation of the antitrust
laws.</text>
</section><section commented="no" display-inline="no-display-inline" id="H3622A237E17548839A4523659B19827E" section-type="subsequent-section"><enum>542.</enum><header>Severability</header><text display-inline="no-display-inline">If any section or subsection of this
subtitle, or any application of such provision to any person or circumstance,
is held to be unconstitutional, the remainder of this subtitle, and the
application of the provision to any other person or circumstance, shall not be
affected.</text>
</section></part></subtitle><enum>VI</enum><header>Improvements to
regulation of bank and savings association holding companies and depository
institutions</header>
<section id="IDd7433542a470478d98358a80c1a84224"><enum>601.</enum><header>Short
title</header><text display-inline="no-display-inline">This title may be cited
as the <quote>Bank and Savings Association Holding Company and Depository
Institution Regulatory Improvements Act of 2010</quote>.</text>
</section><section id="idADA6D157FC484AA09729AD519674AC67"><enum>602.</enum><header>Definition</header><text display-inline="no-display-inline">In this title, the term <term>commercial
firm</term> means any entity that derives not less than 15 percent of the
consolidated annual gross revenues of the entity, including all affiliates of
the entity, from engaging in activities that are not financial in nature or
incidental to activities that are financial in nature, as provided in section
4(k) of the Bank Holding Company Act of 1956 (12 U.S.C. 1843(k)).</text>
</section><section id="idF2A36304D4C640E98EAE517A8FB0FA2A"><enum>603.</enum><header>Moratorium and study
on treatment of credit card banks, industrial loan companies, and certain other
companies under the Bank Holding Company Act of 1956</header>
<subsection id="ID4579da5c8c59429ea0a898cfc807067e"><enum>(a)</enum><header>Moratorium</header>
<paragraph id="IDccbe364463a44030b2f4ba4af35b52a4"><enum>(1)</enum><header>Definitions</header><text>In
this subsection—</text>
<subparagraph id="ID9244db980a694138b40ae2539e455fc1"><enum>(A)</enum><text>the term <term>credit
card bank</term> means an institution described in section 2(c)(2)(F) of the
Bank Holding Company Act of 1956 (12 U.S.C. 1841(c)(2)(F));</text>
</subparagraph><subparagraph id="IDfc1e6d0b561d4471a81285357e7e8b08"><enum>(B)</enum><text>the term <term>industrial
bank</term> means an institution described in section 2(c)(2)(H) of the Bank
Holding Company Act of 1956 (12 U.S.C. 1841(c)(2)(H)); and</text>
</subparagraph><subparagraph id="ID7ce1b0fcb958477e8bf7eaed8114fc9b"><enum>(C)</enum><text>the term <term>trust
bank</term> means an institution described in section 2(c)(2)(D) of the Bank
Holding Company Act of 1956 (12 U.S.C. 1841(c)(2)(D)).</text>
</subparagraph></paragraph><paragraph id="IDdbbc84cf1cf44272b375546eba3955fc"><enum>(2)</enum><header>Moratorium on provision
of deposit insurance</header><text>The Corporation may not approve an
application for deposit insurance under section 5 of the Federal Deposit
Insurance Act (12 U.S.C. 1815) that is received after November 10, 2009, for an
industrial bank, a credit card bank, or a trust bank that is directly or
indirectly owned or controlled by a commercial firm.</text>
</paragraph><paragraph id="IDc1e85b1daf814810b298dd966dc560b8"><enum>(3)</enum><header>Change in
control</header>
<subparagraph id="idD19F36BCA16146E4B3EF4D82A7831282"><enum>(A)</enum><header>In
general</header><text>Except as provided in subparagraph (B), the appropriate
Federal banking agency shall disapprove a change in control, as provided in
section 7(j) of the Federal Deposit Insurance Act (12 U.S.C. 1817(j)), of an
industrial bank, a credit card bank, or a trust bank if the change in control
would result in direct or indirect control of the industrial bank, credit card
bank, or trust bank by a commercial firm.</text>
</subparagraph><subparagraph id="IDe4316321d16a4b4390f2f893a06079ed"><enum>(B)</enum><header>Exceptions</header><text>Subparagraph
(A) shall not apply to a change in control of an industrial bank, credit card
bank, or trust bank that—</text>
<clause id="ID6aa60c2d30554de189eb95fd919c895f"><enum>(i)</enum><text>is in danger of default,
as determined by the appropriate Federal banking agency; or</text>
</clause><clause id="ID5b0b9d986e7847b093d7d3f0e4d5a7f7"><enum>(ii)</enum><text>results from the merger
or whole acquisition of a commercial firm that directly or indirectly controls
the industrial bank, credit card bank, or trust bank in a bona fide merger with
or acquisition by another commercial firm, as determined by the appropriate
Federal banking agency.</text>
</clause></subparagraph></paragraph><paragraph id="IDbf37cda40e324efbb89780982847b53a"><enum>(4)</enum><header>Sunset</header><text>This
subsection shall cease to have effect 3 years after the date of enactment of
this Act.</text>
</paragraph></subsection><subsection id="ID79beb4aef39f4e309f28e3b99c70cc10"><enum>(b)</enum><header>Government
Accountability Office study of exceptions under the Bank Holding Company Act of
1956</header>
<paragraph id="ID907df5beddf9433291e847b83692112a"><enum>(1)</enum><header>Study
required</header><text>The Comptroller General of the United States shall carry
out a study to determine whether it is necessary, in order to strengthen the
safety and soundness of institutions or the stability of the financial system,
to eliminate the exceptions under section 2 of the Bank Holding Company Act of
1956 (12 U.S.C. 1841) for institutions described in—</text>
<subparagraph id="id11BBB45B04D04EAC9C453A90A8233662"><enum>(A)</enum><text>section 2(a)(5)(E) of the
Bank Holding Company Act of 1956 (12 U.S.C. 1841(a)(5)(E));</text>
</subparagraph><subparagraph id="id52893B5A1B7640E98CA05FC19FAE39FA"><enum>(B)</enum><text>section 2(a)(5)(F) of the
Bank Holding Company Act of 1956 (12 U.S.C. 1841(a)(5)(F));</text>
</subparagraph><subparagraph id="id9EB2CF025D084711AD17E62BAB94EC79"><enum>(C)</enum><text>section 2(c)(2)(D) of the
Bank Holding Company Act of 1956 (12 U.S.C. 1841(c)(2)(D));</text>
</subparagraph><subparagraph id="id26AFA1FC927444EB8BF86A6841ACFE31"><enum>(D)</enum><text>section 2(c)(2)(F) of the
Bank Holding Company Act of 1956 (12 U.S.C. 1841(c)(2)(F));</text>
</subparagraph><subparagraph id="id67D9BAA28D0740ED80BF4423DAAE7506"><enum>(E)</enum><text>section 2(c)(2)(H) of the
Bank Holding Company Act of 1956 (12 U.S.C. 1841(c)(2)(H)); and</text>
</subparagraph><subparagraph id="ID2bf4cc9d25c642e3add0cf417f4264b3"><enum>(F)</enum><text>section 2(c)(2)(B) of the
Bank Holding Company Act of 1956 (12 U.S.C. 1841(c)(2)(B)).</text>
</subparagraph></paragraph><paragraph id="ID87c2d1166aee4e95ad0e35bcb592cbb2"><enum>(2)</enum><header>Content of
study</header>
<subparagraph id="id7F18CE6CCE934D18883CA3E7D4F9E830"><enum>(A)</enum><header>In
general</header><text>The study required under paragraph (1), with respect to
the institutions referenced in each of subparagraphs (A) through (E) of
paragraph (1), shall, to the extent feasible be based on information provided
to the Comptroller General by the appropriate Federal or State regulator, and
shall—</text>
<clause id="ID589fcf1e6c714cedabe0d1c06960c1c2"><enum>(i)</enum><text>identify the types and
number of institutions excepted from section 2 of the Bank Holding Company Act
of 1956 (12 U.S.C. 1841) under each of the subparagraphs described in
subparagraphs (A) through (E) of paragraph (1);</text>
</clause><clause id="IDb684c882326442b981186554eb4ea00a"><enum>(ii)</enum><text>generally describe the
size and geographic locations of the institutions described in clause
(i);</text>
</clause><clause id="ID83f2e5209cd44e07a9891991482ae0f9"><enum>(iii)</enum><text>determine the extent to
which the institutions described in clause (i) are held by holding companies
that are commercial firms;</text>
</clause><clause id="ID5c4a014a1d084e46ac74e71934b714c8"><enum>(iv)</enum><text>determine whether the
institutions described in clause (i) have any affiliates that are commercial
firms;</text>
</clause><clause id="ID2232df33ad6c49869aa955d86d500be4"><enum>(v)</enum><text>identify the Federal
banking agency responsible for the supervision of the institutions described in
clause (i) on and after the transfer date;</text>
</clause><clause id="ID4b0e1044e0e64c1ca3d3e3fab64aa7ff"><enum>(vi)</enum><text>determine the adequacy
of the Federal bank regulatory framework applicable to each category of
institution described in clause (i), including any restrictions (including
limitations on affiliate transactions or cross-marketing) that apply to
transactions between an institution, the holding company of the institution,
and any other affiliate of the institution; and</text>
</clause><clause id="IDeb73627e82b44e23bfc6462e7b62fb20"><enum>(vii)</enum><text>evaluate the potential
consequences of subjecting the institutions described in clause (i) to the
requirements of the Bank Holding Company Act of 1956, including with respect to
the availability and allocation of credit, the stability of the financial
system and the economy, the safe and sound operation of each category of
institution, and the impact on the types of activities in which such
institutions, and the holding companies of such institutions, may
engage.</text>
</clause></subparagraph><subparagraph id="idD1D7EF8780C147718D6CFF45AFF8A04A"><enum>(B)</enum><header>Savings
associations</header><text>With respect to institutions described in paragraph
(1)(F), the study required under paragraph (1) shall—</text>
<clause id="idBD9B562816D4461F914DD492540528C0"><enum>(i)</enum><text>determine the adequacy of
the Federal bank regulatory framework applicable to such institutions,
including any restrictions (including limitations on affiliate transactions or
cross-marketing) that apply to transactions between an institution, the holding
company of the institution, and any other affiliate of the institution;
and</text>
</clause><clause id="id99F87A2C5E9243C6B1B02FE4357380C6"><enum>(ii)</enum><text>evaluate the potential
consequences of subjecting the institutions described in paragraph (1)(F) to
the requirements of the Bank Holding Company Act of 1956, including with
respect to the availability and allocation of credit, the stability of the
financial system and the economy, the safe and sound operation of such
institutions, and the impact on the types of activities in which such
institutions, and the holding companies of such institutions, may
engage.</text>
</clause></subparagraph></paragraph><paragraph id="IDe2c09ca13efb4b24aa4edc62bb304ffe"><enum>(3)</enum><header>Report</header><text>Not
later than 18 months after the date of enactment of this Act, the Comptroller
General shall submit to the Committee on Banking, Housing, and Urban Affairs of
the Senate and the Committee on Financial Services of the House of
Representatives a report on the study required under paragraph (1).</text>
</paragraph></subsection></section><section id="IDcc1d05ce437c4547a4fcb669a6c92d6d"><enum>604.</enum><header>Reports and
examinations of holding companies; regulation of functionally regulated
subsidiaries</header>
<subsection id="idC01835C4309E48B4B73B681DCE0C3AFD"><enum>(a)</enum><header>Reports by bank holding
companies</header><text>Sections 5(c)(1) of the Bank Holding Company Act of
1956 (12 U.S.C. 1844(c)(1)) is amended—</text>
<paragraph id="idF9039FBB114A440B96C9786FB7E9DC46"><enum>(1)</enum><text>by striking subparagraph
(B) and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id16767FAF99904BC9B868CA59AAD17D94" reported-display-style="italic" style="OLC">
<subparagraph id="ID3535f1c009bf4cfc979df7d88369e604"><enum>(B)</enum><header>Use of existing reports
and other supervisory information</header><text>The appropriate Federal banking
agency for a bank holding company shall, to the fullest extent possible,
use—</text>
<clause id="IDf37c4a82145146068ee09916d56108a2"><enum>(i)</enum><text>reports and other
supervisory information that the bank holding company or any subsidiary thereof
has been required to provide to other Federal or State regulatory
agencies;</text>
</clause><clause id="idB24EDA0586DB49A49340ECDBFA2F0BC6"><enum>(ii)</enum><text>externally audited
financial statements of the bank holding company or subsidiary;</text>
</clause><clause id="ID35ae36b23ad44c8698b3ea05f4c7f523"><enum>(iii)</enum><text>information otherwise
available from Federal or State regulatory agencies; and</text>
</clause><clause id="idE1B2A79161E14855826CCD9A8AA6DA39"><enum>(iv)</enum><text>information that is
otherwise required to be reported
publicly.</text>
</clause></subparagraph><after-quoted-block>;
and</after-quoted-block></quoted-block>
</paragraph><paragraph id="idD25F7E2DD9B747E284A435A29FF72C15"><enum>(2)</enum><text>by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id2B0AC155CDDB482D8A406F8F98033F5C" reported-display-style="italic" style="OLC">
<subparagraph id="idD7B993FF5EA244C7894F491DD4969822"><enum>(C)</enum><header>Availability</header><text>Upon
the request of the appropriate Federal banking agency for a bank holding
company, the bank holding company or a subsidiary of the bank holding company
shall promptly provide to the appropriate Federal banking agency any
information described in clauses (i) through (iii) of subparagraph
(B).</text>
</subparagraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="id97A050A3F6F7427DB973A942215C2DED"><enum>(b)</enum><header>Examinations of bank
holding companies</header><text>Section 5(c)(2) of the Bank Holding Company Act
of 1956 (12 U.S.C. 1844(c)(2)) is amended to read as follows:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id1F3AC5247C0B47A6BD37C1FC29F7E101" reported-display-style="italic" style="OLC">
<paragraph id="id8A14C9DFD33A409CAD7159A40F03B93E"><enum>(2)</enum><header>Examinations</header>
<subparagraph id="id64376CC4C6AB45B99C88D5B8A02C8F10"><enum>(A)</enum><header>In
general</header><text>The appropriate Federal banking agency for a bank holding
company may make examinations of the bank holding company and each subsidiary
of the bank holding company in order to—</text>
<clause id="id5DEEE61F5A254C5B9D239A409DCD9A46"><enum>(i)</enum><text>inform such appropriate
Federal banking agency of—</text>
<subclause id="id1F0370C04C314FF89E23C7B9FA4311A2"><enum>(I)</enum><text>the nature of the
operations and financial condition of the bank holding company and the
subsidiary;</text>
</subclause><subclause id="idB9855B2A85AD42009D92F2CE821572E2"><enum>(II)</enum><text>the financial,
operational, and other risks within the bank holding company system that may
pose a threat to—</text>
<item id="id747CCC0A2F794DF79DABC05793926D59"><enum>(aa)</enum><text>the safety and soundness
of the bank holding company or of any depository institution subsidiary of the
bank holding company; or</text>
</item><item id="idF162E33946624A9FA695DD75805DBA26"><enum>(bb)</enum><text>the stability of the
financial system of the United States; and</text>
</item></subclause><subclause id="id7B989CC125EE49459FCDBF640F41D18B"><enum>(III)</enum><text>the systems of the bank
holding company for monitoring and controlling the risks described in subclause
(II); and</text>
</subclause></clause><clause id="id84B51EDA7DD149A688B431BECA8423E8"><enum>(ii)</enum><text>enforce the compliance
of the bank holding company and the subsidiary with this Act and any other
Federal law that such appropriate Federal banking agency has specific
jurisdiction to enforce against the bank holding company or subsidiary.</text>
</clause></subparagraph><subparagraph id="id7C400538204F492EBBC18FC093B83CBB"><enum>(B)</enum><header>Use of reports to
reduce examinations</header><text>For purposes of this paragraph, the
appropriate Federal banking agency for a bank holding company shall, to the
fullest extent possible, rely on—</text>
<clause id="idD0E3D7180CCE4946B723F21416CDA67E"><enum>(i)</enum><text>examination reports made
by other Federal or State regulatory agencies relating to the bank holding
company and any subsidiary of the bank holding company; and</text>
</clause><clause id="id851348E044AB4587AA73207C5421B350"><enum>(ii)</enum><text>the reports and other
information required under paragraph (1).</text>
</clause></subparagraph><subparagraph id="idC5D3AD5160D345D78179546B23D3B162"><enum>(C)</enum><header>Coordination with other
regulators</header><text>The appropriate Federal banking agency for a bank
holding company shall—</text>
<clause id="id60808059ECEF4E30A064CFDBD4D314A4"><enum>(i)</enum><text>provide reasonable notice
to, and consult with, the appropriate Federal banking agency or State
regulatory agency of a subsidiary that is a depository institution or a
functionally regulated subsidiary before commencing an examination of the
subsidiary under this section; and</text>
</clause><clause id="id75554568DB694C04B316E3B47578B2A1"><enum>(ii)</enum><text>to the fullest extent
possible, avoid duplication of examination activities, reporting requirements,
and requests for
information.</text>
</clause></subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="ID9e4e3c41ad604f1f94ac9dde15ad084b"><enum>(c)</enum><header>Authority To regulate
functionally regulated subsidiaries of bank holding companies</header><text>The
Bank Holding Company Act of 1956 (12 U.S.C. 1841 et seq.) is amended—</text>
<paragraph id="idAE919302AA89433AAB57F685D709E2D9"><enum>(1)</enum><text>in section 5(c) (12
U.S.C. 1844(c)), by striking paragraphs (3) and (4) and inserting the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id3BFAE52FE3FB4CD593B1CB6551AC5703" reported-display-style="italic" style="OLC">
<paragraph id="idC429921DFF0C440DBBA2649B9563A3C9"><enum>(3)</enum><text>[Reserved]</text>
</paragraph><paragraph id="id03E0D57DC4964700ABB5CBA96AE8DFA4"><enum>(4)</enum><text>[Reserved]</text>
</paragraph><after-quoted-block>;
and</after-quoted-block></quoted-block>
</paragraph><paragraph id="idE490B1405F684A19905B08AAB2FAA062"><enum>(2)</enum><text>by striking section 10A
(12 U.S.C. 1848a).</text>
</paragraph></subsection><subsection id="IDc8843b9745524707aa9ebffa3065739b"><enum>(d)</enum><header>Acquisitions of
banks</header><text>Section 3(c) of the Bank Holding Company Act of 1956 (12
U.S.C. 1842(c)) is amended by adding at the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idD139EEA3B116429BB55B11D9F9B93437" reported-display-style="italic" style="OLC">
<paragraph id="IDeabf8ea70711408eaed44969896815c7"><enum>(7)</enum><header>Financial
stability</header><text>In every case, the appropriate Federal banking agency
of a bank holding company shall take into consideration the extent to which a
proposed acquisition, merger, or consolidation would result in greater or more
concentrated risks to the stability of the United States banking or financial
system.</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="IDd31bf648ca76445ba0590f252c1777ba"><enum>(e)</enum><header>Acquisitions of
nonbanks</header>
<paragraph id="ID0b898e1d9a0f4cfdbe2cfea67eac561d"><enum>(1)</enum><header>Notice
procedures</header><text>Section 4(j)(2)(A) of the Bank Holding Company Act of
1956 (12 U.S.C. 1843(j)(2)(A)) is amended by striking <quote>or unsound banking
practices</quote> and inserting <quote>unsound banking practices, or risk to
the stability of the United States banking or financial system</quote>.</text>
</paragraph><paragraph id="ID30b179bf76c44a8dac99e76b164efd0c"><enum>(2)</enum><header>Activities that are
financial in nature</header><text>Section 4(k)(6)(B) of the Bank Holding
Company Act of 1956 (12 U.S.C. 1843(k)(6)(B)) is amended to read as
follows:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id28839815BCD643C2A4B31B3A4D73BB89" reported-display-style="italic" style="OLC">
<subparagraph id="ID06314c7d40e843e5b5ac51f36f4a7ab9"><enum>(B)</enum><header>Approval not required
for certain financial activities</header>
<clause id="id999ACDD7FF464CEF902C73D86A07B9F3"><enum>(i)</enum><header>In
general</header><text>Except as provided in clause (ii), a financial holding
company may commence any activity or acquire any company, pursuant to paragraph
(4) or any regulation prescribed or order issued under paragraph (5), without
prior approval of the appropriate Federal banking agency for the financial
holding company.</text>
</clause><clause id="IDe1294cd1be304d0fbb0f2dad16b0bac0"><enum>(ii)</enum><header>Exception</header><text>A
financial holding company may not acquire a company, without the prior approval
of the appropriate Federal banking agency for the financial holding company, in
a transaction in which the total consolidated assets to be acquired by the
financial holding company exceed
$25,000,000,000.</text>
</clause></subparagraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="ID668044eccc434c9bb6f001483577383e"><enum>(f)</enum><header>Bank merger act
transactions</header><text>Section 18(c)(5) of the Federal Deposit Insurance
Act (12 U.S.C. 1828(c)(5)) is amended, in the matter immediately following
subparagraph (B), by striking <quote>and the convenience and needs of the
community to be served</quote> and inserting <quote>the convenience and needs
of the community to be served, and the risk to the stability of the United
States banking or financial system</quote>.</text>
</subsection><subsection id="id5D6CD0442C71403E8D34A54B3816AE70"><enum>(g)</enum><header>Reports by savings and
loan holding companies</header><text>Section 10(b)(2) of the Home Owners' Loan
Act (12 U.S.C. 1467a(b)(2) is amended—</text>
<paragraph id="ID306774fd41134d15bb3a39be9bce7aaa"><enum>(1)</enum><text>by striking <quote>Each
savings</quote> and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id1D48D5CD9BBF448AA9E3E40263251FF1" reported-display-style="italic" style="OLC">
<subparagraph id="id9C16C85176F34579A73FB75A8FFA3C6E"><enum>(A)</enum><header>In
general</header><text>Each savings</text>
</subparagraph><after-quoted-block>;
and</after-quoted-block></quoted-block>
</paragraph><paragraph id="id92BDFFC965A34574BAB1262DD97B2159"><enum>(2)</enum><text>by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idAF5EC31F76CE41519E18EF99C4063E3D" reported-display-style="italic" style="OLC">
<subparagraph id="IDd2b061cec8f64219a548eb9f34f9fe23"><enum>(B)</enum><header>Use of existing reports
and other supervisory information</header><text>The appropriate Federal banking
agency for a savings and loan holding company shall, to the fullest extent
possible, use—</text>
<clause id="ID393ee24f02bc4cbb8f659d65c80dd959"><enum>(i)</enum><text>reports and other
supervisory information that the savings and loan holding company or any
subsidiary thereof has been required to provide to other Federal or State
regulatory agencies;</text>
</clause><clause id="ID5ae3ac41930e463fa690ac949184ecab"><enum>(ii)</enum><text>externally audited
financial statements of the savings and loan holding company or
subsidiary;</text>
</clause><clause id="ID3a8327ad01ba4ee7917bd4ff03c4e826"><enum>(iii)</enum><text>information that is
otherwise available from Federal or State regulatory agencies; and</text>
</clause><clause id="ID10d8051c864c4ff5b693430c2e4cf6d7"><enum>(iv)</enum><text>information that is
otherwise required to be reported publicly.</text>
</clause></subparagraph><subparagraph id="ID32bf208bfa3a4aff840116c5c9c07262"><enum>(C)</enum><header>Availability</header><text>Upon
the request of the appropriate Federal banking agency for a savings and loan
holding company, the savings and loan holding company or a subsidiary of the
savings and loan holding company shall promptly provide to the appropriate
Federal banking agency any information described in clauses (i) through (iii)
of subparagraph
(B).</text>
</subparagraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="id136772E4E91446D482DEEA86E4CAB625"><enum>(h)</enum><header>Examination of savings
and loan holding companies</header>
<paragraph id="id624D42A3F2FE41618203966C4F3124B4"><enum>(1)</enum><header>Definitions</header><text>Section
2 of the Home Owners' Loan Act (12 U.S.C. 1462) is amended by adding at the end
the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idAC4D6679E8784E2F80D36DEA33AB8331" reported-display-style="italic" style="OLC">
<paragraph id="id344FD3CA53364C9BBB31B687BC3573D4"><enum>(10)</enum><header>Appropriate Federal
banking agency</header><text>The term <term>appropriate Federal banking
agency</term> has the same meaning as in section 3(q) of the Federal Deposit
Insurance Act (12 U.S.C. 1813(q)).</text>
</paragraph><paragraph id="idE43A8614A8644009B3BD9101D67C50A4"><enum>(11)</enum><header>Functionally regulated
subsidiary</header><text>The term <term>functionally regulated
subsidiary</term> has the same meaning as in section 5(c)(5) of the Bank
Holding Company Act of 1956 (12 U.S.C.
1844(c)(5)).</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph><paragraph id="id26C30BB6C1894908B3E81559B69545E8"><enum>(2)</enum><header>Examination</header><text>Section
10(b) of the Home Owners' Loan Act (12 U.S.C. 1467a(b)) is amended by striking
paragraph (4) and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id8557BC0B95574195910EC45513DDC888" reported-display-style="italic" style="OLC">
<paragraph id="id27D5D906E08C4B82BAEB5711F598E7EE"><enum>(4)</enum><header>Examinations</header>
<subparagraph id="id662883059EC94D4B85AF7B534D9578F4"><enum>(A)</enum><header>In
general</header><text>The appropriate Federal banking agency for a savings and
loan holding company may make examinations of the savings and loan holding
company and each subsidiary of the savings and loan holding company system, in
order to—</text>
<clause id="id89D1C98934AA42BBACB0F8B7CDAD7026"><enum>(i)</enum><text>inform such appropriate
Federal banking agency of—</text>
<subclause id="idB52649B07BAB4FB092395BC7CF76817F"><enum>(I)</enum><text>the nature of the
operations and financial condition of the savings and loan holding company and
the subsidiary;</text>
</subclause><subclause id="idFEDDE6467C7A4E8393EF9FE155A5EA2F"><enum>(II)</enum><text>the financial,
operational, and other risks within the savings and loan holding company that
may pose a threat to—</text>
<item id="idE4D92A77A5D74D6C8C1AEE98F0CA4332"><enum>(aa)</enum><text>the safety and soundness
of the savings and loan holding company or of any depository institution
subsidiary of the savings and loan holding company; or</text>
</item><item id="id78E7D4B3F6474063B93F5FE073BC20A9"><enum>(bb)</enum><text>the stability of the
financial system of the United States; and</text>
</item></subclause><subclause id="id1F033820CD3347BF82269A60D1FC3AF3"><enum>(III)</enum><text>the systems of the
savings and loan holding company for monitoring and controlling the risks
described in subclause (II); and</text>
</subclause></clause><clause id="id674352175F4E4020A607C682F0F4779D"><enum>(ii)</enum><text>enforce the compliance
of the savings and loan holding company and the subsidiary with this Act and
any other Federal law that such appropriate Federal banking agency has specific
jurisdiction to enforce against the savings and loan holding company or
subsidiary.</text>
</clause></subparagraph><subparagraph id="ID62b2b7c66ed94ab6bc6d16897d83fc7c"><enum>(B)</enum><header>Use of reports to
reduce examinations</header><text>For purposes of this subsection, the
appropriate Federal banking agency for a savings and loan holding company
shall, to the fullest extent possible, rely on—</text>
<clause id="id02D6BD986FF5420FB39CBC5524DB279E"><enum>(i)</enum><text>the examination reports
made by other Federal or State regulatory agencies relating to the savings and
loan holding company and any subsidiary; and</text>
</clause><clause id="id327E1F0253D04C219BD7A4DBC2E63111"><enum>(ii)</enum><text>the reports and other
information required under paragraph (2).</text>
</clause></subparagraph><subparagraph id="id1B57C592D85C4FAD84DB9F3D8D0E2268"><enum>(C)</enum><header>Coordination with other
regulators</header><text>The appropriate Federal banking agency for a savings
and loan holding company shall—</text>
<clause id="id8EBA7A86861D4F0FB240AA4A5E21C4FE"><enum>(i)</enum><text>provide reasonable notice
to, and consult with, the appropriate Federal banking agency or State
regulatory agency of a subsidiary that is a depository institution or a
functionally regulated subsidiary before commencing an examination of the
subsidiary under this section; and</text>
</clause><clause id="id9053075291D34E81AE5911C2ADDA9E46"><enum>(ii)</enum><text>to the fullest extent
possible, avoid duplication of examination activities, reporting requirements,
and requests for
information.</text>
</clause></subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="idC98E92BA6F0E44A29D49B2FAAC9ADC41"><enum>(i)</enum><header>Effective
date</header><text>The amendments made by this section shall take effect on the
transfer date.</text>
</subsection></section><section id="ID8935f5b89e704325b13e1184dd1d66da"><enum>605.</enum><header>Assuring consistent
oversight of permissible activities of depository institution subsidiaries of
holding companies</header><text display-inline="no-display-inline">Section 6 of
the Bank Holding Company Act of 1956 (12 U.S.C. 1845) is amended to read as
follows:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id9EC1ACF434954A23A5B1F833FFEB4C5B" reported-display-style="italic" style="OLC">
<section id="id9198E578894D481E9C5CD3678BC5806E"><enum>6.</enum><header>Assuring consistent
oversight of permissible activities of depository institution subsidiaries of
holding companies</header>
<subsection id="id314F057FF8C94676917CB5F0084674AD"><enum>(a)</enum><header>Definitions</header>
<paragraph id="id1161E1B5B2FB4CE3B054111393B4F70D"><enum>(1)</enum><header>Definitions</header><text>In
this section—</text>
<subparagraph id="IDd9e4070ec8f24715a4d0e245a9b00058"><enum>(A)</enum><text>the term <term>depository
institution holding company</term> has the same meaning as in section 3(w) of
the Federal Deposit Insurance Act (12 U.S.C. 1813(w));</text>
</subparagraph><subparagraph commented="no" id="id878460D3A86746E69B4550F7498ACB82"><enum>(B)</enum><text>the term
<term>functionally regulated subsidiary</term> has the same meaning as in
section 5(c)(5); and</text>
</subparagraph><subparagraph id="id6EED5739CCA943038215D7A522DD4D93"><enum>(C)</enum><text>the term <term>lead
Federal banking agency</term> means—</text>
<clause id="IDcfc61d37239f4b19bee84e6b4da09f9c"><enum>(i)</enum><text>the Office of the
Comptroller of the Currency, in the case of any depository institution holding
company having—</text>
<subclause id="ID825c0e0b12b4484b9ae0f6ebad81ee4f"><enum>(I)</enum><text>a subsidiary that is an
insured depository institution, if all such insured depository institutions are
Federal depository institutions; or</text>
</subclause><subclause id="ID13689e31abaa4fdcb1ee8f5e3b271ae3"><enum>(II)</enum><text>a subsidiary that is a
Federal depository institution and a subsidiary that is a State depository
institution, if the total consolidated assets of all subsidiaries that are
Federal depository institutions exceed the total consolidated assets of all
subsidiaries that are State depository institutions; and</text>
</subclause></clause><clause id="ID76b961cb67164b62af9c60bc448fcfe3"><enum>(ii)</enum><text>the Federal Deposit
Insurance Corporation, in the case of any depository institution holding
company having—</text>
<subclause id="IDfd4dde210200436182999bf1afaec22a"><enum>(I)</enum><text>a subsidiary that is an
insured depository institution, if all such insured depository institutions are
State depository institutions; or</text>
</subclause><subclause id="ID70a9c04c393649a98913e65d343ec819"><enum>(II)</enum><text>a subsidiary that is a
Federal depository institution and a subsidiary that is a State depository
institution, if the total consolidated assets of all subsidiaries that are
State depository institutions exceed the total consolidated assets of all
subsidiaries that are Federal depository institutions.</text>
</subclause></clause></subparagraph></paragraph><paragraph id="IDbe081e9b4fb04875abedc743c01c8c22"><enum>(2)</enum><header>Determination of total
consolidated assets</header><text>For purposes of paragraph (1)(A), the total
consolidated assets of a depository institution shall be determined in the same
manner that total consolidated assets of depository institutions are determined
for purposes of section 3(q) of the Federal Deposit Insurance Act (12 U.S.C.
1813(q)).</text>
</paragraph></subsection><subsection id="id515BB7D1A2BA403D9D3BF1C2CC17B405"><enum>(b)</enum><header>Lead agency
supervision</header>
<paragraph id="idCE7817B42E4A45B38BAF8AE6903686F7"><enum>(1)</enum><header>In
general</header><text>The lead Federal banking agency for each depository
institution holding company shall make examinations of the activities of each
nondepository institution subsidiary (other than a functionally regulated
subsidiary) of the depository institution holding company that are permissible
for depository institution subsidiaries of the depository institution holding
company, to determine whether the activities—</text>
<subparagraph id="IDe397959a466e4c1f9913ee7761a54ddf"><enum>(A)</enum><text>present safety and
soundness risks to any depository institution subsidiary of the depository
institution holding company;</text>
</subparagraph><subparagraph id="IDadb560623d4445888c8f935dd4f641ed"><enum>(B)</enum><text>are conducted in
accordance with applicable law; and</text>
</subparagraph><subparagraph id="ID898454772f8448cd8f9b9cb6417622ed"><enum>(C)</enum><text>are subject to
appropriate systems for monitoring and controlling the financial, operating,
and other risks of the activity and protecting the depository institution
subsidiaries of the holding company.</text>
</subparagraph></paragraph><paragraph id="id92765A92D3ED4708B2FB8C6B0DA5BE24"><enum>(2)</enum><header>Process for
examination</header><text>An examination under paragraph (1) shall be carried
out under the authority of the lead Federal banking agency, as if the
nondepository institution subsidiary were an insured depository institution for
which the lead Federal banking agency is the appropriate Federal banking
agency.</text>
</paragraph></subsection><subsection id="idB86390DDA4014F02A9B6CF413EBFF795"><enum>(c)</enum><header>Coordination</header><text>For
each depository institution holding company for which the Board of Governors is
the appropriate Federal banking agency, the lead Federal banking agency of the
depository institution holding company shall coordinate the supervision of the
activities of subsidiaries described in subsection (b) with the Board of
Governors, in a manner that—</text>
<paragraph id="ID337b2c97dd334145a2f1b10c775f2723"><enum>(1)</enum><text>avoids
duplication;</text>
</paragraph><paragraph id="ID43684da557a1445db986709b42fc386b"><enum>(2)</enum><text>shares information
relevant to the supervision of the depository institution holding company by
each agency;</text>
</paragraph><paragraph id="ID6c024b4900e0495dad411fd068a00d16"><enum>(3)</enum><text>achieves the objectives
of subsection (b); and</text>
</paragraph><paragraph id="ID6fc4b61ed08847bf88aa2ee604b67b43"><enum>(4)</enum><text>ensures that the
depository institution holding company and the subsidiaries of the depository
institution holding company are not subject to conflicting supervisory demands
by the 2 agencies.</text>
</paragraph></subsection><subsection id="idDA9F4BA9CE5F4D9DBFF032B98DF1A121"><enum>(d)</enum><header>Referrals for
enforcement</header>
<paragraph id="idBCB38CD25BD64B94A854633FBF9A2B1E"><enum>(1)</enum><header>Recommendation of
action by Board of Governors</header><text>The lead Federal banking agency for
a depository institution holding company, based on information obtained
pursuant to the responsibilities of the agency under subsection (b), may submit
to the Board of Governors, in writing, a recommendation that the Board of
Governors take enforcement action against a nondepository institution
subsidiary (other than a functionally regulated subsidiary) of the depository
institution holding company, together with an explanation of the concerns
giving rise to the recommendation.</text>
</paragraph><paragraph id="idA477700EC2EE4880A6494FE6DCC18C59"><enum>(2)</enum><header>Back-up authority of
the lead Federal banking agency</header><text>If, within the 60-day period
beginning on the date on which the Board of Governors receives a recommendation
under paragraph (1), the Board of Governors does not take enforcement action
against a nondepository institution subsidiary or provide a plan for
enforcement action that is acceptable to the lead Federal banking agency, the
lead Federal banking agency (upon the authorization of the Comptroller, or the
Federal Deposit Insurance Corporation, upon a vote of its members, as
applicable) may take the recommended enforcement action, in the same manner as
if the subsidiary were an insured depository institution for which the lead
Federal banking agency is the appropriate Federal banking
agency.</text>
</paragraph></subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</section><section id="id9E8A6B940D964213B64D12858FB371C9"><enum>606.</enum><header>Requirements for
financial holding companies to remain well capitalized and well
managed</header>
<subsection id="idD0B57E049F4F482DAB7EB117FCCD8F2C"><enum>(a)</enum><header>Amendment</header><text display-inline="yes-display-inline">Section 4(l)(1) of the Bank Holding Company
Act of 1956 (12 U.S.C. 1843(l)(1)) is amended—</text>
<paragraph id="IDc43722238eda4a3c9b27550ad5106311"><enum>(1)</enum><text>in subparagraph (B), by
striking <quote>and</quote> at the end;</text>
</paragraph><paragraph id="idF21BB86CCD1A44DEA80F9CB7935A1F5B"><enum>(2)</enum><text>by redesignating
subparagraph (C) as subparagraph (D);</text>
</paragraph><paragraph id="ID1e631e73e168465783739eba13b54894"><enum>(3)</enum><text>by inserting after
subparagraph (B) the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idD281340CC95D4E71B99A9BFD2EC1F36A" reported-display-style="italic" style="OLC">
<subparagraph id="ID8d488186d32f4f2286d086fd20a3b2b6"><enum>(C)</enum><text>the bank holding company
is well capitalized and well managed;
and</text>
</subparagraph><after-quoted-block>;
and</after-quoted-block></quoted-block>
</paragraph><paragraph id="ID3509c136bdd646bd8e3101b373884c6b"><enum>(4)</enum><text>in subparagraph (D)(ii),
as so redesignated, by striking <quote>subparagraphs (A) and (B)</quote> and
inserting <quote>subparagraphs (A), (B), and (C)</quote>.</text>
</paragraph></subsection><subsection id="idA16CA06D500545148A7C412496BD4825"><enum>(b)</enum><header>Effective
date</header><text>The amendments made by this section shall take effect on the
transfer date.</text>
</subsection></section><section id="ID819b8e086fb94273b3e87fd286a6ee39"><enum>607.</enum><header>Standards for
interstate acquisitions</header>
<subsection id="id0299AA185E66451AAEA0115C37C44F93"><enum>(a)</enum><header>Acquisition of
banks</header><text display-inline="yes-display-inline">Section 3(d)(1)(A) of
the Bank Holding Company Act of 1956 (12 U.S.C. 1842(d)(1)(A)) is amended by
striking <quote>adequately capitalized and adequately managed</quote> and
inserting <quote>well capitalized and well managed</quote>.</text>
</subsection><subsection id="ID85351e9759d84445ad22414c0bea8530"><enum>(b)</enum><header>Interstate bank
mergers</header><text>Section 44(b)(4)(B) of the Federal Deposit Insurance Act
(12 U.S.C. 1831u(b)(4)(B)) is amended by striking <quote>will continue to be
adequately capitalized and adequately managed</quote> and inserting <quote>will
be well capitalized and well managed</quote>.</text>
</subsection><subsection id="idAABCAACD152E4471B16ED1BE4F577026"><enum>(c)</enum><header>Effective
date</header><text>The amendments made by this section shall take effect on the
transfer date.</text>
</subsection></section><section id="ID8f8aa1896da64019aed34bbd0466e8df"><enum>608.</enum><header>Enhancing existing
restrictions on bank transactions with affiliates</header>
<subsection id="ID924cb09a0e83445e961eb4de00dfb2d7"><enum>(a)</enum><header>Affiliate
transactions</header><text>Section 23A of the Federal Reserve Act (12 U.S.C.
371c) is amended—</text>
<paragraph id="IDe41c9563bc4a42029d67b76a41b5205d"><enum>(1)</enum><text>in subsection (b)—</text>
<subparagraph id="id7A031BA44865461EA5AA43EF9F6D28B6"><enum>(A)</enum><text>in paragraph (1), by
striking subparagraph (D) and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idDCD0A243189E47D3B46B8381B22E8DD4" reported-display-style="italic" style="OLC">
<subparagraph id="ID7ce1416857b543b8a465652f2f9dfa71"><enum>(D)</enum><text>any investment fund with
respect to which a member bank or affiliate thereof is an investment adviser;
and</text>
</subparagraph><after-quoted-block>;
and</after-quoted-block></quoted-block>
</subparagraph><subparagraph id="ID1788cb78ad184d03ac6eefb08552ad07"><enum>(B)</enum><text>in paragraph (7)—</text>
<clause id="id5F3F0B876BEF4A75A775B74F1D3935DC"><enum>(i)</enum><text>in subparagraph (A), by
inserting before the semicolon at the end the following: <quote>, including a
purchase of assets subject to an agreement to repurchase</quote>;</text>
</clause><clause commented="no" id="ID7d84d331471a4aba8c36a91dad998926"><enum>(ii)</enum><text>in subparagraph (C), by
striking <quote>, including assets subject to an agreement to
repurchase,</quote>;</text>
</clause><clause id="ID70a1cbbe3e864bfca4261609515c667d"><enum>(iii)</enum><text>in subparagraph
(D)—</text>
<subclause id="id7204F5687AE642208F1AF88B8387AEDE"><enum>(I)</enum><text>by inserting <quote>or
other debt obligations</quote> after <quote>acceptance of securities</quote>;
and</text>
</subclause><subclause id="id0CFBCBF4D56D44CFA1977E9557153992"><enum>(II)</enum><text>by striking
<quote>or</quote> at the end; and</text>
</subclause></clause><clause id="IDde800c305bfe47f29bcd64fef166a37f"><enum>(iv)</enum><text>by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idED623BAC84CB458199BC6BCF2D1D9E72" reported-display-style="italic" style="OLC">
<subparagraph id="ID3d1479badbf04b8ea04b9d6ea35a5bea"><enum>(F)</enum><text>a transaction with an
affiliate that involves the borrowing or lending of securities, to the extent
that the transaction causes a member bank or a subsidiary to have credit
exposure to the affiliate; or</text>
</subparagraph><subparagraph id="ID091b1b95655f43baa4cc9b5d7ebb0b6e"><enum>(G)</enum><text>a derivative transaction,
as defined in paragraph (3) of section 5200(b) of the Revised Statutes of the
United States (12 U.S.C. 84(b)), with an affiliate, to the extent that the
transaction causes a member bank or a subsidiary to have credit exposure to the
affiliate;</text>
</subparagraph><after-quoted-block>;</after-quoted-block></quoted-block>
</clause></subparagraph></paragraph><paragraph id="ID9eb7486aebea4ed39f9e650e3c0df47b"><enum>(2)</enum><text>in subsection (c)—</text>
<subparagraph id="idA56DDB83C36B4A908C53CD53E14DDB2E"><enum>(A)</enum><text>in paragraph (1)—</text>
<clause id="idDFDE8F9B085D4B3CA22424821A2DD3F6"><enum>(i)</enum><text>in the matter preceding
subparagraph (A), by striking <quote>subsidiary</quote> and all that follows
through <quote>time of the transaction</quote> and inserting <quote>subsidiary,
and any credit exposure of a member bank or a subsidiary to an affiliate
resulting from a securities borrowing or lending transaction, or a derivative
transaction, shall be secured at all times</quote>; and</text>
</clause><clause id="id0EB7D8CCB1CD4C0785019A595322FC7D"><enum>(ii)</enum><text>in each of subparagraphs
(A) through (D), by striking <quote>or letter of credit</quote> and inserting
<quote>letter of credit, or credit exposure</quote>;</text>
</clause></subparagraph><subparagraph id="IDeb21bf08ce604a85a1da2940baab248d"><enum>(B)</enum><text>by striking paragraph
(2);</text>
</subparagraph><subparagraph id="idB6A1FEB5BC8146F7B7745BCE7500B964"><enum>(C)</enum><text>by redesignating
paragraphs (3) through (5) as paragraphs (2) through (4), respectively;</text>
</subparagraph><subparagraph id="id3491D0BF8C1F4FEC916EA9F8EC849AE0"><enum>(D)</enum><text>in paragraph (2), as so
redesignated, by inserting before the period at the end <quote>, or credit
exposure to an affiliate resulting from a securities borrowing or lending
transaction, or derivative transaction</quote>; and</text>
</subparagraph><subparagraph id="IDe2d0c186353d4d2b8217077aa8d50510"><enum>(E)</enum><text>in paragraph (3), as so
redesignated—</text>
<clause id="id72F86376ACC544748B80272EC795B5B1"><enum>(i)</enum><text>by inserting <quote>or
other debt obligations</quote> after <quote>securities</quote>; and</text>
</clause><clause id="idFBC736077BA9460A9A84C236CE78445D"><enum>(ii)</enum><text>by striking <quote>or
guarantee</quote> and all that follows through <quote>behalf of,</quote> and
inserting <quote>guarantee, acceptance, or letter of credit issued on behalf
of, or credit exposure from a securities borrowing or lending transaction, or
derivative transaction to,</quote>;</text>
</clause></subparagraph></paragraph><paragraph id="id8F7E38E32D4242ABB2046E744F34E9E8"><enum>(3)</enum><text>in subsection (d)(4), in
the matter preceding subparagraph (A), by striking <quote>or issuing</quote>
and all that follows through <quote>behalf of,</quote> and inserting
<quote>issuing a guarantee, acceptance, or letter of credit on behalf of, or
having credit exposure resulting from a securities borrowing or lending
transaction, or derivative transaction to,</quote>; and</text>
</paragraph><paragraph id="ID20927db1c7bb4342a955f565c5492602"><enum>(4)</enum><text>in subsection (f)—</text>
<subparagraph id="idA6C7233BFB6E42E1B3E152999CC8D761"><enum>(A)</enum><text>in paragraph (2)—</text>
<clause id="id049FBFC9BC8B4B8CA3646C682C367C53"><enum>(i)</enum><text>by striking <quote>or
order</quote>;</text>
</clause><clause id="id04B866F6C8834E52BF5FB6FAAC0C2FA0"><enum>(ii)</enum><text>by striking <quote>if it
finds</quote> and all that follows through the end of the paragraph and
inserting the following: “if—</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id901B89E729AB4E5ABDE391ED4235A6B0" reported-display-style="italic" style="OLC">
<clause id="id26BE62C152A14BEAB5A00C5A3DE4BC46"><enum>(i)</enum><text>the Board finds the
exemption to be in the public interest and consistent with the purposes of this
section, and notifies the Federal Deposit Insurance Corporation of such
finding; and</text>
</clause><clause id="id33F3CEF7A3E9481D9924BC6BA57DAD6D"><enum>(ii)</enum><text>before the end of the
60-day period beginning on the date on which the Federal Deposit Insurance
Corporation receives notice of the finding under clause (i), the Federal
Deposit Insurance Corporation does not object, in writing, to the finding,
based on a determination that the exemption presents an unacceptable risk to
the Deposit Insurance
Fund.</text>
</clause><after-quoted-block>;</after-quoted-block></quoted-block>
</clause><clause id="id65D2563DA1E142C482C58627A6157478"><enum>(iii)</enum><text>by striking the Board
and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id8D48EF029C66486483B74EB95A4514F5" reported-display-style="italic" style="OLC">
<subparagraph id="idE8E0404C542141B3A5E9DAE7479C9FB9"><enum>(A)</enum><header>In
general</header><text>The Board</text>
</subparagraph><after-quoted-block>;
and</after-quoted-block></quoted-block>
</clause><clause id="idD082ACE821EB478B8D80AEF5A05272AF"><enum>(iv)</enum><text>by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idC166FA8BF1E747539C726F7142B016D7" reported-display-style="italic" style="OLC">
<subparagraph id="id65BB898679DF4D6E8137A4EDD5F77D9D"><enum>(B)</enum><header>Additional
exemptions</header>
<clause id="idC4C0BD9ABF3F4672BAD2FE04AE12C31C"><enum>(i)</enum><header>National
banks</header><text>The Comptroller of the Currency may, by order, exempt a
transaction of a national bank from the requirements of this section if—</text>
<subclause id="id5E7166B8EE6A450BB565C0024CFB0FAC"><enum>(I)</enum><text>the Board and the Office
of the Comptroller of the Currency jointly find the exemption to be in the
public interest and consistent with the purposes of this section and notify the
Federal Deposit Insurance Corporation of such finding; and</text>
</subclause><subclause id="idE541D11AC7334453B3BA701E675FD39F"><enum>(II)</enum><text>before the end of the
60-day period beginning on the date on which the Federal Deposit Insurance
Corporation receives notice of the finding under subclause (I), the Federal
Deposit Insurance Corporation does not object, in writing, to the finding,
based on a determination that the exemption presents an unacceptable risk to
the Deposit Insurance Fund.</text>
</subclause></clause><clause id="id87AB872CC7CC41818C59E70046B561C5"><enum>(ii)</enum><header>State
banks</header><text>The Federal Deposit Insurance Corporation may, by order,
exempt a transaction of a State nonmember bank, and the Board may, by order,
exempt a transaction of a State member bank, from the requirements of this
section if—</text>
<subclause id="id6D528D598CAE4FB38B8D2B112F542067"><enum>(I)</enum><text>the Board and the Federal
Deposit Insurance Corporation jointly find that the exemption is in the public
interest and consistent with the purposes of this section; and</text>
</subclause><subclause id="id326636977CAC4E6C8F6F894829D66D37"><enum>(II)</enum><text>the Federal Deposit
Insurance Corporation finds that the exemption does not present an unacceptable
risk to the Deposit Insurance Fund.</text>
</subclause></clause></subparagraph><after-quoted-block>;
and</after-quoted-block></quoted-block>
</clause></subparagraph><subparagraph id="id1E788714E6C345DAB9E5AABDCEA6E4B0"><enum>(B)</enum><text>by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id4322FF1E2C0A4183BC1A4922BC3F379E" reported-display-style="italic" style="OLC">
<paragraph id="id9F66E136E056452B9D8756878E2A4817"><enum>(4)</enum><header>Amounts of covered
transactions</header><text>The Board may issue such regulations or
interpretations as the Board determines are necessary or appropriate with
respect to the manner in which a netting agreement may be taken into account in
determining the amount of a covered transaction between a member bank or a
subsidiary and an affiliate, including the extent to which netting agreements
between a member bank or a subsidiary and an affiliate may be taken into
account in determining whether a covered transaction is fully secured for
purposes of subsection (d)(4). An interpretation under this paragraph with
respect to a specific member bank, subsidiary, or affiliate shall be issued
jointly with the appropriate Federal banking agency for such member bank,
subsidiary, or
affiliate.</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subparagraph></paragraph></subsection><subsection id="ID6210e3263c294b87ab0f79327a544b82"><enum>(b)</enum><header>Transactions with
affiliates</header><text>Section 23B(e) of the Federal Reserve Act (12 U.S.C.
371c–1(e)) is amended—</text>
<paragraph id="idCC618C8898224D1F93A5FEC37CA840E3"><enum>(1)</enum><text>by striking the
undesignated matter following subparagraph (B);</text>
</paragraph><paragraph id="id6347831A52194E698F84EE9D62369DFF"><enum>(2)</enum><text>by redesignating
subparagraphs (A) and (B) as clauses (i) and (ii), respectively, and adjusting
the clause margins accordingly;</text>
</paragraph><paragraph id="idEC7F3AD9D37145578FD38D349D36F67F"><enum>(3)</enum><text>by redesignating
paragraphs (1) and (2) as subparagraphs (A) and (B), respectively, and
adjusting the subparagraph margins accordingly;</text>
</paragraph><paragraph id="idBA53D89C33D04FD596E6E6CC8DFBAE8C"><enum>(4)</enum><text>by striking <quote>The
Board</quote> and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id894D1F22D1D843548ED17831A3319DA6" reported-display-style="italic" style="OLC">
<paragraph id="idA9EF90F3966C41D6A23E0D78BCE02132"><enum>(1)</enum><header>In
general</header><text>The
Board</text>
</paragraph><after-quoted-block>;</after-quoted-block></quoted-block>
</paragraph><paragraph id="id354AA4324A3F4C10AC79EC036B76AC6D"><enum>(5)</enum><text>in paragraph (1)(B), as
so redesignated—</text>
<subparagraph id="id2552E7D05623465DACA7FFA267874EE3"><enum>(A)</enum><text>in the matter preceding
clause (i), by inserting before <quote>regulations</quote> the following:
<quote>subject to paragraph (2), if the Board finds that an exemption or
exclusion is in the public interest and is consistent with the purposes of this
section, and notifies the Federal Deposit Insurance Corporation of such
finding,</quote>; and</text>
</subparagraph><subparagraph id="id04A79B41E7B34A5E9C9D104F8564B541"><enum>(B)</enum><text>in clause (ii), by
striking the comma at the end and inserting a period; and</text>
</subparagraph></paragraph><paragraph id="idE4A5947C89B041AAB584AC650DD9FECA"><enum>(6)</enum><text>by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idA229F658A296472AA2FB014A9AB0076E" reported-display-style="italic" style="OLC">
<paragraph id="IDb92894eb9643403aa61d3b9305081ef4"><enum>(2)</enum><header>Exception</header><text>The
Board may grant an exemption or exclusion under this subsection only if, during
the 60-day period beginning on the date of receipt of notice of the finding
from the Board under paragraph (1)(B), the Federal Deposit Insurance
Corporation does not object, in writing, to such exemption or exclusion, based
on a determination that the exemption presents an unacceptable risk to the
Deposit Insurance
Fund.</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="id2987824BE9C6440786D51D9A91B83E25"><enum>(c)</enum><header>Home Owners' Loan
Act</header><text>Section 11 of the Home Owners' Loan Act (12 U.S.C. 1468) is
amended by adding at the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idFC270CE4FAEF4D3FAFCEB50215361AE7" reported-display-style="italic" style="OLC">
<subsection id="id79D1AF1CAE3545B69B154EDC797B9A63"><enum>(d)</enum><header>Exemptions</header>
<paragraph id="idBE81D5B79473426DA81AA2BB32922678"><enum>(1)</enum><header>Federal savings
associations</header><text>The Comptroller of the Currency may, by order,
exempt a transaction of a Federal savings association from the requirements of
this section if—</text>
<subparagraph id="id01E59945E39E4B62B7AB2637BDAB31AE"><enum>(A)</enum><text>the Board and the Office
of the Comptroller of the Currency jointly find the exemption to be in the
public interest and consistent with the purposes of this section and notify the
Federal Deposit Insurance Corporation of such finding; and</text>
</subparagraph><subparagraph id="id65D2BBE304D847C89B4666F2901F1DD0"><enum>(B)</enum><text>before the end of the
60-day period beginning on the date on which the Federal Deposit Insurance
Corporation receives notice of the finding under subparagraph (A), the Federal
Deposit Insurance Corporation does not object, in writing, to the finding,
based on a determination that the exemption presents an unacceptable risk to
the Deposit Insurance Fund.</text>
</subparagraph></paragraph><paragraph id="id320E54FD5DBF421A95477EB61F887DC0"><enum>(2)</enum><header>State savings
association</header><text>The Federal Deposit Insurance Corporation may, by
order, exempt a transaction of a State savings association from the
requirements of this section if the Board and the Federal Deposit Insurance
Corporation jointly find that—</text>
<subparagraph id="idDC51902B16BA41E9A8E3C3A258D0F573"><enum>(A)</enum><text>the exemption is in the
public interest and consistent with the purposes of this section; and</text>
</subparagraph><subparagraph id="id89FBE5CE5B5E4C4FBA075B081C07634B"><enum>(B)</enum><text>the exemption does not
present an unacceptable risk to the Deposit Insurance
Fund.</text>
</subparagraph></paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="ID0780b560a1194338a711bf80adae32f4"><enum>(d)</enum><header>Effective
date</header><text>The amendments made by this section shall take effect 1 year
after the transfer date.</text>
</subsection></section><section commented="no" id="ID57897761c7ea46a3aa56e6331dd40a1a"><enum>609.</enum><header>Eliminating exceptions
for transactions with financial subsidiaries</header>
<subsection commented="no" id="id00AB38F87A1545B49E450223FC889D86"><enum>(a)</enum><header>Amendment</header><text display-inline="yes-display-inline">Section 23A(e) of the Federal Reserve Act
(12 U.S.C. 371c(e)) is amended—</text>
<paragraph commented="no" id="id8F1087190F6E4D9D880C832F119C39D5"><enum>(1)</enum><text display-inline="yes-display-inline">by striking paragraph (3); and</text>
</paragraph><paragraph commented="no" id="id8964C5D106294E058BB46D9D54078EF5"><enum>(2)</enum><text display-inline="yes-display-inline">by redesignating paragraph (4) as paragraph
(3).</text>
</paragraph></subsection><subsection commented="no" id="idE94D90314F8C44478EF4DACD150791BC"><enum>(b)</enum><header>Prospective application
of amendment</header><text>The amendments made by this section shall apply with
respect to any covered transaction between a bank and a subsidiary of the bank,
as those terms are defined in section 23A of the Federal Reserve Act (12 U.S.C.
371c), that is entered into on or after the date of enactment of this
Act.</text>
</subsection><subsection commented="no" id="ID5366d53cb1304bb088e9489d9fd94602"><enum>(c)</enum><header>Effective
date</header><text>The amendments made by this section shall take effect 1 year
after the transfer date.</text>
</subsection></section><section id="ID7cd083fe909e44e6bc8d8db068f334f0"><enum>610.</enum><header>Lending limits
applicable to credit exposure on derivative transactions, repurchase
agreements, reverse repurchase agreements, and securities lending and borrowing
transactions</header>
<subsection id="idD0834A04319F4219AAB9DCF0839490F1"><enum>(a)</enum><header>National
banks</header><text display-inline="yes-display-inline">Section 5200(b) of the
Revised Statutes of the United States (12 U.S.C. 84(b)) is amended—</text>
<paragraph id="idDFA37C14524D4D12B5E50BFCB760559C"><enum>(1)</enum><text>in paragraph (1), by
striking <quote>shall include</quote> and all that follows through the end of
the paragraph and inserting the following: “shall include—</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id46A4B7ADACA04741B114E97CA29B9887" reported-display-style="italic" style="OLC">
<subparagraph id="ID469f3a0acaf94780a12010adf7419450"><enum>(A)</enum><text>all direct or indirect
advances of funds to a person made on the basis of any obligation of that
person to repay the funds or repayable from specific property pledged by or on
behalf of the person;</text>
</subparagraph><subparagraph id="ID2798fdda4b9041d6b88d0a4f58275e61"><enum>(B)</enum><text>to the extent specified
by the Comptroller of the Currency, any liability of a national banking
association to advance funds to or on behalf of a person pursuant to a
contractual commitment; and</text>
</subparagraph><subparagraph id="ID6d8a727870974050a159f996d3a79225"><enum>(C)</enum><text>any credit exposure to a
person arising from a derivative transaction, repurchase agreement, reverse
repurchase agreement, securities lending transaction, or securities borrowing
transaction between the national banking association and the
person;</text>
</subparagraph><after-quoted-block>;</after-quoted-block></quoted-block>
</paragraph><paragraph id="idDCC98A617781443E9C8B3B038C05BA34"><enum>(2)</enum><text>in paragraph (2), by
striking the period at the end and inserting <quote>; and</quote>; and</text>
</paragraph><paragraph id="IDa1f0f1a613834a6f9959d9d0f1398a35"><enum>(3)</enum><text>by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idA0AD0EC690C14F7DA4D413149243A3AB" reported-display-style="italic" style="OLC">
<paragraph id="IDab813d289eda4ce4b59db08a7fde5872"><enum>(3)</enum><text>the term <term>derivative
transaction</term> includes any transaction that is a contract, agreement,
swap, warrant, note, or option that is based, in whole or in part, on the value
of, any interest in, or any quantitative measure or the occurrence of any event
relating to, one or more commodities, securities, currencies, interest or other
rates, indices, or other
assets.</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="id9B958326A55D49AD8EA249F1BE780124"><enum>(b)</enum><header>Savings
associations</header><text>Section 5(u)(3) of the Home Owners' Loan Act (12
U.S.C. 1464(u)(3)) is amended by striking <quote>Director</quote> each place
that term appears and inserting <quote>Comptroller of the
Currency</quote>.</text>
</subsection><subsection id="id23CC0819B7B04AC99D63D474CE59C4CD"><enum>(c)</enum><header>Effective
date</header><text>The amendments made by this section shall take effect 1 year
after the transfer date.</text>
</subsection></section><section id="ID1545dbb7f50b4506b69185db119276bc"><enum>611.</enum><header>Application of
national bank lending limits to insured State banks</header>
<subsection id="id49091B49382645CB8A7BC729F7F61867"><enum>(a)</enum><header>Amendment</header><text display-inline="yes-display-inline">Section 18 of the Federal Deposit Insurance
Act (12 U.S.C. 1828) is amended by adding at the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id7548ABBCCAB74837BA7662318543559D" reported-display-style="italic" style="OLC">
<subsection id="ID2f65bce44dc64bd087dbe96a11eb92fe"><enum>(y)</enum><header>Application of lending
limits to insured State banks</header><text>Section 5200 of the Revised
Statutes of the United States (12 U.S.C. 84) shall apply to each insured State
bank, in the same manner and to the same extent as if the insured State bank
were a national banking
association.</text>
</subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection commented="no" id="id6EC9D52C08D3438084B361A851498343"><enum>(b)</enum><header>Effective
date</header><text>The amendment made by this section shall take effect 1 year
after the transfer date.</text>
</subsection></section><section id="ID7ec19f86875a4cdf87277080cfba4dc5"><enum>612.</enum><header>Restriction on
conversions of troubled banks</header>
<subsection id="ID307e97f4d1294fcf916d15be171aaf45"><enum>(a)</enum><header>Conversion of a
national banking association to a State bank</header><text>The Act entitled
<quote>An Act to provide for the conversion of national banking associations
into and their merger or consolidation with State banks, and for other
purposes.</quote> (12 U.S.C. 214 et seq.) is amended by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id14630D49B2BA474E8FA9F599111B09AF" reported-display-style="italic" style="OLC">
<section id="ID99a1ee59d03142848e1062a415187991"><enum>10.</enum><header>Prohibition on
conversion</header><text display-inline="no-display-inline">A national banking
association may not convert to a State bank or State savings association during
any period in which the national banking association is subject to a cease and
desist order (or other formal enforcement order) issued by, or a memorandum of
understanding entered into with, the Comptroller of the Currency with respect
to a significant supervisory
matter.</text>
</section><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="ID1bc03defc3cf4eec96323ae9325aa6ef"><enum>(b)</enum><header>Conversion of a State
bank to a national bank</header><text>Section 5154 of the Revised Statutes of
the United States (12 U.S.C. 35) is amended by adding at the end the following:
<quote>The Comptroller of the Currency may not approve the conversion of a
State bank or State savings association to a national banking association
during any period in which the State bank or State savings association is
subject to a cease and desist order (or other formal enforcement order) issued
by, or a memorandum of understanding entered into with, a State bank supervisor
or the appropriate Federal banking agency with respect to a significant
supervisory matter.</quote>.</text>
</subsection><subsection id="ID9b02d500c4374f1e87ab93c0d1e699ee"><enum>(c)</enum><header>Conversion of a Federal
savings association to a National or State Bank or State Savings
Association</header><text>Section 5(i) of the Home Owners' Loan Act (12 U.S.C.
1464(i)) is amended by adding at the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idCC889AC0EA5142C4B42FBF953602DE67" reported-display-style="italic" style="OLC">
<paragraph id="IDf57eaa2784ef43e99e02e8933fd5cc15"><enum>(6)</enum><header>Limitation on certain
conversions by Federal savings associations</header><text>A Federal savings
association may not convert to a national bank or State bank or State savings
association during any period in which the Federal savings association is
subject to a cease and desist order (or other formal enforcement order) issued
by, or a memorandum of understanding entered into with, the Office of Thrift
Supervision or the Comptroller of the Currency with respect to a significant
supervisory
matter.</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection></section><section id="ID480f27df56944578933ed4f9a3a98b98"><enum>613.</enum><header>De novo branching into
States</header>
<subsection id="ID2ebfae1c25524a23af98d2fa0fef14c9"><enum>(a)</enum><header>National
banks</header><text>Section 5155(g)(1)(A) of the Revised Statutes of the United
States (12 U.S.C. 36(g)(1)(A)) is amended to read as follows:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idC6B54D32072B4975BFBC5B01EB112C4E" reported-display-style="italic" style="OLC">
<subparagraph id="IDb94624b2ecd04f2ba7bc07e553ac6791"><enum>(A)</enum><text>the law of the State in
which the branch is located, or is to be located, would permit establishment of
the branch, if the national bank were a State bank chartered by such State;
and</text>
</subparagraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="ID2561d94e463745f1a2d7e538972c37b3"><enum>(b)</enum><header>State insured
banks</header><text>Section 18(d)(4)(A)(i) of the Federal Deposit Insurance Act
(12 U.S.C. 1828(d)(4)(A)(i)) is amended to read as follows:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idDCA87204878B4533840BC498F06F153D" reported-display-style="italic" style="OLC">
<clause id="ID324e0648c2db49c1af4b4d0de2698f14"><enum>(i)</enum><text>the law of the State in
which the branch is located, or is to be located, would permit establishment of
the branch, if the bank were a State bank chartered by such State;
and</text>
</clause><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection></section><section id="ID4a94a5879de44d9d9724e62fae6bcce6"><enum>614.</enum><header>Lending limits to
insiders</header>
<subsection id="idF350E7F1D91248C7B10C3B7EA4C2D8CE"><enum>(a)</enum><header>Extensions of
credit</header><text display-inline="yes-display-inline">Section 22(h)(9)(D)(i)
of the Federal Reserve Act (12 U.S.C. 375b(9)(D)(i)) is amended—</text>
<paragraph id="idC20FF0ACA98F4D3D9E2DBEFE3401CE25"><enum>(1)</enum><text display-inline="yes-display-inline">by striking the period at the end and
inserting <quote>; or</quote>;</text>
</paragraph><paragraph id="idC16A5EE2A8B246B49A38BD6EC5D72B59"><enum>(2)</enum><text>by striking <quote>a
person</quote> and inserting <quote>the person</quote>;</text>
</paragraph><paragraph id="idC576158E9539494BA4B2D35117920472"><enum>(3)</enum><text display-inline="yes-display-inline">by striking <quote>extends credit by
making</quote> and inserting the following: “extends credit to a person
by—</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idADD677E01EB146E68B7D901280133145" reported-display-style="italic" style="OLC">
<subclause id="id3F57AD93016A4BF786D082E930D76BFC"><enum>(I)</enum><text display-inline="yes-display-inline">making</text>
</subclause><after-quoted-block>;
and</after-quoted-block></quoted-block>
</paragraph><paragraph id="id0E5998FDD52848269F77849358F981A1"><enum>(4)</enum><text display-inline="yes-display-inline">by adding at the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id9EA28D15B09144C4B934578D5EE409CD" reported-display-style="italic" style="OLC">
<subclause id="id9FF828EEF443476482F26D75420E100A"><enum>(II)</enum><text display-inline="yes-display-inline">having credit exposure to the person
arising from a derivative transaction (as defined in section 5200(b) of the
Revised Statutes of the United States (12 U.S.C. 84(b))), repurchase agreement,
reverse repurchase agreement, securities lending transaction, or securities
borrowing transaction between the member bank and the
person.</text>
</subclause><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection commented="no" id="ID7fe96e241a69414e8af732083f25c638"><enum>(b)</enum><header>Effective
date</header><text>The amendments made by this section shall take effect 1 year
after the transfer date.</text>
</subsection></section><section id="IDd17f843bd3e942d8811cd31828177ad4"><enum>615.</enum><header>Limitations on
purchases of assets from insiders</header>
<subsection id="ID4f460decf5b54de1984ba12e7ce7f18b"><enum>(a)</enum><header>Amendment to the
Federal Deposit Insurance Act</header><text>Section 18 of the Federal Deposit
Insurance Act (12 U.S.C. 1828) is amended by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id3E292494A91F41D691912C8FA4005FC8" reported-display-style="italic" style="OLC">
<subsection id="ID5fc481f0548c426a8ddda7cc56145cbd"><enum>(z)</enum><header>General prohibition on
sale of assets</header>
<paragraph id="id415BF126440745B2B2C73393F7601C8B"><enum>(1)</enum><header>In
general</header><text>An insured depository institution may not purchase an
asset from, or sell an asset to, an executive officer, director, or principal
shareholder of the insured depository institution, or any related interest of
such person (as such terms are defined in section 22(h) of Federal Reserve
Act), unless—</text>
<subparagraph id="id67F72350F9A246E6942017D2F1AD873F"><enum>(A)</enum><text>the transaction is on
market terms; and</text>
</subparagraph><subparagraph id="idD7C3587A07924FC4B91B03D96835D168"><enum>(B)</enum><text>if the transaction
represents more than 10 percent of the capital stock and surplus of the insured
depository institution, the transaction has been approved in advance by a
majority of the members of the board of directors of the insured depository
institution who do not have an interest in the transaction.</text>
</subparagraph></paragraph><paragraph id="id5FE8F9E3D7154C2A8F1BD9714C0FC01B"><enum>(2)</enum><header>Rulemaking</header><text>The
Board of Governors of the Federal Reserve System may issue such rules as may be
necessary to define terms and to carry out the purposes this subsection. Before
proposing or adopting a rule under this paragraph, the Board of Governors of
the Federal Reserve System shall consult with the Comptroller of the Currency
and the Corporation as to the terms of the
rule.</text>
</paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="ID2a2365a68c494f3da8c86535399f965a"><enum>(b)</enum><header>Amendments to the
Federal reserve Act</header><text>Section 22(d) of the Federal Reserve Act (12
U.S.C. 375) is amended to read as follows:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idEDE36046504048C190A67E75F94D2345" reported-display-style="italic" style="OLC">
<subsection id="id990E55B75AE0436CBA1ADC32E0604EE5"><enum>(d)</enum><text>[Reserved]</text>
</subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="id38D7328E832D436EB7288D8A1F2618B6"><enum>(c)</enum><header>Effective
date</header><text>The amendments made by this section shall take effect on the
transfer date.</text>
</subsection></section><section id="IDddc0ed396cd34861900cfa4d6c81adff"><enum>616.</enum><header>Regulations regarding
capital levels of holding companies</header>
<subsection id="idCAB8DFA6ECBC4B50872705DDB2853425"><enum>(a)</enum><header>Capital levels of bank
holding companies</header><text display-inline="yes-display-inline">Section
5(b) of the Bank Holding Company Act of 1956 (12 U.S.C. 1844(b)) is amended by
inserting after <quote>regulations</quote> the following: <quote>(including
regulations relating to the capital requirements of bank holding
companies)</quote>.</text>
</subsection><subsection id="id799DE2DB3E3B44A4AFF28A0EFF2E8743"><enum>(b)</enum><header>Capital levels of
savings and loan holding companies</header><text>Section 10(g)(1) of the Home
Owners’ Loan Act (12 U.S.C. 1467a(g)(1)) is amended by inserting after
<quote>orders</quote> the following: <quote>(including regulations relating to
capital requirements for savings and loan holding companies)</quote>.</text>
</subsection><subsection id="id2D695588891B4AC99DE21F7E3A1E4EB9"><enum>(c)</enum><header>Source of
strength</header><text>The Federal Deposit Insurance Act (12 U.S.C. 1811 et
seq.) is amended by inserting after section 38 (12 U.S.C. 1831o) the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id03C0D25D7D434F328D8FA0450AB48BA9" reported-display-style="italic" style="OLC">
<section id="id8E7E73F89E8544C088A768CB126DA8DD"><enum>38A.</enum><header>Source of
strength</header>
<subsection id="IDdbbcead27c744ce5a8d82a2b7c9b4f1b"><enum>(a)</enum><header>Holding
companies</header><text>The appropriate Federal banking agency for a bank
holding company or savings and loan holding company shall require the bank
holding company or savings and loan holding company to serve as a source of
financial strength for any subsidiary of the bank holding company or savings
and loan holding company that is a depository institution.</text>
</subsection><subsection id="idAA0016A3F9A740D9A8B8CE74B5900128"><enum>(b)</enum><header>Other
companies</header><text>If an insured depository institution is not the
subsidiary of a bank holding company or savings and loan holding company, the
appropriate Federal banking agency for the insured depository institution shall
require any company that directly or indirectly controls the insured depository
institution to serve as a source of financial strength for such
institution.</text>
</subsection><subsection id="ID349b3d59208441c0ab1952fa78ccd337"><enum>(c)</enum><header>Reports</header><text>The
appropriate Federal banking agency for an insured depository institution
described in subsection (b) may, from time to time, require the company, or a
company that directly or indirectly controls the insured depository institution
to submit a report, under oath, for the purposes of—</text>
<paragraph id="id7952AB640B804F5EA7F6DA451BF9DB07"><enum>(1)</enum><text>assessing the ability of
such company to comply with the requirement under subsection (b); and</text>
</paragraph><paragraph id="id61B271D204014A35832DB9064C291408"><enum>(2)</enum><text>enforcing the compliance
of such company with the requirement under subsection (b).</text>
</paragraph></subsection><subsection id="idA5F373C34D98471D8DDC4641685C8026"><enum>(d)</enum><header>Rules</header><text>Not
later than 1 year after the transfer date, as defined in section 311 of the
Enhancing Financial Institution Safety and Soundness Act of 2010, the
appropriate Federal banking agencies shall jointly issue final rules to carry
out this section.</text>
</subsection><subsection id="id8CC071DA6F1F4028ADF71414D1BE602A"><enum>(e)</enum><header>Definition</header><text>In
this section, the term <term>source of financial strength</term> means the
ability of a company that directly or indirectly owns or controls an insured
depository institution to provide financial assistance to such insured
depository institution in the event of the financial distress of the insured
depository
institution.</text>
</subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="id7A0E253F31A04085B62E8B78A5180899"><enum>(d)</enum><header>Effective
date</header><text>The amendments made by this section shall take effect on the
transfer date.</text>
</subsection></section><section id="id09A3F04F80144D16AFFA442FEE9EF0E9"><enum>617.</enum><header>Elimination of
elective investment bank holding company framework</header>
<subsection id="idBE08EC7AA1CF4B67B2091E2832898FD3"><enum>(a)</enum><header>Amendment</header><text display-inline="yes-display-inline">Section 17 of the Securities Exchange Act
of 1934 (15 U.S.C. 78q) is amended—</text>
<paragraph id="id83011AEC6E0B44F6AAB00BE8054E883C"><enum>(1)</enum><text display-inline="yes-display-inline">by striking subsection (i); and</text>
</paragraph><paragraph id="id4D0021F36EBF4D26A5E4CBE06975B214"><enum>(2)</enum><text>by redesignating
subsections (j) and (k) as subsections (i) and (j), respectively.</text>
</paragraph></subsection><subsection id="id776CA4D5CEA749978C9BA74E1048C6C2"><enum>(b)</enum><header>Effective
date</header><text>The amendments made by this section shall take effect on the
transfer date.</text>
</subsection></section><section id="idE4CA779A6A6B42418655E95F76629880"><enum>618.</enum><header>Securities holding
companies</header>
<subsection id="id268CFA1922D74459894C26B5345DF654"><enum>(a)</enum><header>Definitions</header><text>In
this section—</text>
<paragraph id="id4CB4D793CD34479092838204847AB9DB"><enum>(1)</enum><text>the term <term>associated
person of a securities holding company </term> means a person directly or
indirectly controlling, controlled by, or under common control with, a
securities holding company;</text>
</paragraph><paragraph id="id020E57517A2B41729217AE27163070D2"><enum>(2)</enum><text>the term <term>foreign
bank</term> has the same meaning as in section 1(b)(7) of the International
Banking Act of 1978 (12 U.S.C. 3101(b)(7));</text>
</paragraph><paragraph id="id1BBCCF081CA147B5908079CE9445B1B7"><enum>(3)</enum><text>the term <term>insured
bank</term> has the same meaning as in section 3 of the Federal Deposit
Insurance Act (12 U.S.C. 1813);</text>
</paragraph><paragraph id="id8E313E3C1BAB41F6A81E65513B816551"><enum>(4)</enum><text>the term <term>securities
holding company</term>—</text>
<subparagraph id="idBAC62FA8FEE84C09A5B9DA740CC399DE"><enum>(A)</enum><text>means—</text>
<clause id="id2A2A6133D4E740BD8D110D9F4F97E832"><enum>(i)</enum><text>a person (other than a
natural person) that owns or controls 1 or more brokers or dealers registered
with the Commission; and</text>
</clause><clause id="idF05F1A80312F4F4EA6B0E4153976F03D"><enum>(ii)</enum><text>the associated persons
of a person described in clause (i); and</text>
</clause></subparagraph><subparagraph id="id6F0E8915B82D40BDBE416BB391F0D0BD"><enum>(B)</enum><text>does not include a person
that is—</text>
<clause commented="no" id="id5C83B0746EBD42DF908AB8ABC168CD36"><enum>(i)</enum><text>a nonbank financial
company supervised by the Board under title I;</text>
</clause><clause id="id65562B645C0444969E6D1E79CF3D7BA3"><enum>(ii)</enum><text>an affiliate of an
insured bank (other than an institution described in subparagraphs (D), (F), or
(H) of section 2(c)(2) of the Bank Holding Company Act of 1956 (12 U.S.C.
1841(c)(2)) or an affiliate of a savings association;</text>
</clause><clause id="idE4978568EDA44233B79026E8E01F1E92"><enum>(iii)</enum><text>a foreign bank, foreign
company, or company that is described in section 8(a) of the International
Banking Act of 1978 (12 U.S.C. 3106(a));</text>
</clause><clause id="idBD37055353A04B1BBAC95ED52A5BC62F"><enum>(iv)</enum><text>a foreign bank that
controls, directly or indirectly, a corporation chartered under section 25A of
the Federal Reserve Act (12 U.S.C. 611 et seq.); or</text>
</clause><clause id="id2B41FBA07CB1403EA467CA836F3EEEDF"><enum>(v)</enum><text>subject to comprehensive
consolidated supervision by a foreign regulator;</text>
</clause></subparagraph></paragraph><paragraph id="id7D901B1380614F708E7D637734101CE4"><enum>(5)</enum><text>the term <term>supervised
securities holding company</term> means a securities holding company that is
supervised by the Board of Governors under this section; and</text>
</paragraph><paragraph id="id23A3345FE32347839D02974FA2C01A3B"><enum>(6)</enum><text>the terms
<term>affiliate</term>, <term>bank</term>, <term>bank holding company</term>,
<term>company</term>, <term>control</term>, <term>savings association</term>,
and <term>subsidiary</term> have the same meanings as in section 2 of the Bank
Holding Company Act of 1956.</text>
</paragraph></subsection><subsection id="id8750A9E10F234697AB919233FFF032A9"><enum>(b)</enum><header>Supervision of a
Securities Holding Company Not Having a Bank or Savings Association
Affiliate</header>
<paragraph id="id01ADE998FC7B4183AC9F38B8705CAD78"><enum>(1)</enum><header>In
general</header><text>A securities holding company that is required by a
foreign regulator or provision of foreign law to be subject to comprehensive
consolidated supervision may register with the Board of Governors under
paragraph (2) to become a supervised securities holding company. Any securities
holding company filing such a registration shall be supervised in accordance
with this section, and shall comply with the rules and orders prescribed by the
Board of Governors applicable to supervised securities holding
companies.</text>
</paragraph><paragraph id="id365A05F7312F404E9E44FEAFF7BB3103"><enum>(2)</enum><header>Registration as a
supervised securities holding company</header>
<subparagraph id="idE79ED2A6967E40B9ADD1D5C627DEA3CE"><enum>(A)</enum><header>Registration</header><text>A
securities holding company that elects to be subject to comprehensive
consolidated supervision shall register by filing with the Board of Governors
such information and documents as the Board of Governors, by regulation, may
prescribe as necessary or appropriate in furtherance of the purposes of this
section.</text>
</subparagraph><subparagraph id="id2EA89F833E1F46A3A86E727FF55E29E8"><enum>(B)</enum><header>Effective
date</header><text>A securities holding company that registers under
subparagraph (A) shall be deemed to be a supervised securities holding company,
effective on the date that is 45 days after the date of receipt of the
registration information and documents under subparagraph (A) by the Board of
Governors, or within such shorter period as the Board of Governors, by rule or
order, may determine.</text>
</subparagraph></paragraph></subsection><subsection id="id14297259DCFD417F8163C6F46AB33CB6"><enum>(c)</enum><header>Supervision of
securities holding companies</header>
<paragraph id="idB0AECE64DBBC4758898423F8455237C3"><enum>(1)</enum><header>Recordkeeping and
reporting</header>
<subparagraph id="id3B8338F0FEE84343B5E5C495F9BD3C85"><enum>(A)</enum><header>Recordkeeping and
reporting required</header><text>Each supervised securities holding company and
each affiliate of a supervised securities holding company shall make and keep
for periods determined by the Board of Governors such records, furnish copies
of such records, and make such reports, as the Board of Governors determines to
be necessary or appropriate to carry out this section, to prevent evasions
thereof, and to monitor compliance by the supervised securities holding company
or affiliate with applicable provisions of law.</text>
</subparagraph><subparagraph id="idCF7A3E2D289D4FB19FB1EF622B3A8143"><enum>(B)</enum><header>Form and
contents</header>
<clause id="idF3F2CE807E1B41B4A26EA3988313CA4A"><enum>(i)</enum><header>In
general</header><text>Any record or report required to be made, furnished, or
kept under this paragraph shall—</text>
<subclause id="idB1A3C4466E654CED932B4E9AEE636CB2"><enum>(I)</enum><text>be prepared in such form
and according to such specifications (including certification by a registered
public accounting firm), as the Board of Governors may require; and</text>
</subclause><subclause id="id9FEFE1089EC341C09C0D094C1BFCFFB5"><enum>(II)</enum><text>be provided promptly to
the Board of Governors at any time, upon request by the Board of
Governors.</text>
</subclause></clause><clause id="id416263F50D5940AA9372C409056A68F3"><enum>(ii)</enum><header>Contents</header><text>Records
and reports required to be made, furnished, or kept under this paragraph may
include—</text>
<subclause id="id9CC16AB71CB24610AECA652D4EFCF392"><enum>(I)</enum><text>a balance sheet or income
statement of the supervised securities holding company or an affiliate of a
supervised securities holding company;</text>
</subclause><subclause id="id1C02BBD04522496BB9FE4DBDC9B52E37"><enum>(II)</enum><text>an assessment of the
consolidated capital and liquidity of the supervised securities holding
company;</text>
</subclause><subclause id="idD497402ECBB3435DA2654CD83BB21E33"><enum>(III)</enum><text>a report by an
independent auditor attesting to the compliance of the supervised securities
holding company with the internal risk management and internal control
objectives of the supervised securities holding company; and</text>
</subclause><subclause id="idBBF7EE477AEE46DEA126B337673C0878"><enum>(IV)</enum><text>a report concerning the
extent to which the supervised securities holding company or affiliate has
complied with the provisions of this section and any regulations prescribed and
orders issued under this section.</text>
</subclause></clause></subparagraph></paragraph><paragraph id="id82C23FE869C749AF9A6432D5687FEC91"><enum>(2)</enum><header>Use of existing
reports</header>
<subparagraph id="idBCFFFC2C43784407BADC6B48B0631A97"><enum>(A)</enum><header>In
general</header><text>The Board of Governors shall, to the fullest extent
possible, accept reports in fulfillment of the requirements of this paragraph
that a supervised securities holding company or an affiliate of a supervised
securities holding company has been required to provide to another regulatory
agency or a self-regulatory organization.</text>
</subparagraph><subparagraph id="idB88AB498C60F45E584C57818FFD84A36"><enum>(B)</enum><header>Availability</header><text>A
supervised securities holding company or an affiliate of a supervised
securities holding company shall promptly provide to the Board of Governors, at
the request of the Board of Governors, any report described in subparagraph
(A), as permitted by law.</text>
</subparagraph></paragraph><paragraph id="id662C4636BC5C4F7782AD6C6313B3CB87"><enum>(3)</enum><header>Examination
authority</header>
<subparagraph id="idD24163DF6B724BFD85EFD7A42ABF4B77"><enum>(A)</enum><header>Focus of examination
authority</header><text>The Board of Governors may make examinations of any
supervised securities holding company and any affiliate of a supervised
securities holding company to carry out this subsection, to prevent evasions
thereof, and to monitor compliance by the supervised securities holding company
or affiliate with applicable provisions of law.</text>
</subparagraph><subparagraph id="id7DE61430E4594C789AA82BF0B998D5BA"><enum>(B)</enum><header>Deference to other
examinations</header><text>For purposes of this subparagraph, the Board of
Governors shall, to the fullest extent possible, use the reports of examination
made by other appropriate Federal or State regulatory authorities with respect
to any functionally regulated subsidiary or any institution described in
subparagraph (D), (F), or (H) of section 2(c)(2) of the Bank Holding Company
Act of 1956 (12 U.S.C. 1841(c)(2)).</text>
</subparagraph></paragraph></subsection><subsection id="idE406023F4F324954B35BE89E1FFCF202"><enum>(d)</enum><header>Capital and risk
management</header>
<paragraph id="id3174942C7B16406A938285A993D3E121"><enum>(1)</enum><header>In
general</header><text>The Board of Governors shall, by regulation or order,
prescribe capital adequacy and other risk management standards for supervised
securities holding companies that are appropriate to protect the safety and
soundness of the supervised securities holding companies and address the risks
posed to financial stability by supervised securities holding companies.</text>
</paragraph><paragraph id="id286FA00D3C8B497C897AB84B9BCB5E1E"><enum>(2)</enum><header>Differentiation</header><text>In
imposing standards under this subsection, the Board of Governors may
differentiate among supervised securities holding companies on an individual
basis, or by category, taking into consideration the requirements under
paragraph (3).</text>
</paragraph><paragraph id="idD2DB222D8C0946F1B0161CA79914EAE3"><enum>(3)</enum><header>Content</header><text>Any
standards imposed on a supervised securities holding company under this
subsection shall take into account—</text>
<subparagraph id="id4E5C21D036DA41BF9DF34A0975B300EB"><enum>(A)</enum><text>the differences among
types of business activities carried out by the supervised securities holding
company;</text>
</subparagraph><subparagraph id="idB2F18C4CF88148DD80272DB77C5C9FE6"><enum>(B)</enum><text>the amount and nature of
the financial assets of the supervised securities holding company;</text>
</subparagraph><subparagraph id="idD0D815C4CE874960A05E4BF74993BB28"><enum>(C)</enum><text>the amount and nature of
the liabilities of the supervised securities holding company, including the
degree of reliance on short-term funding;</text>
</subparagraph><subparagraph id="idCEE81CB666F645989F7ECD7FF3C31EAC"><enum>(D)</enum><text>the extent and nature of
the off-balance sheet exposures of the supervised securities holding
company;</text>
</subparagraph><subparagraph id="id653FF5445000412C9F386BF76DAE7773"><enum>(E)</enum><text>the extent and nature of
the transactions and relationships of the supervised securities holding company
with other financial companies;</text>
</subparagraph><subparagraph id="idDF7A105A7A414BB3972C587CABB6C9AE"><enum>(F)</enum><text>the importance of the
supervised securities holding company as a source of credit for households,
businesses, and State and local governments, and as a source of liquidity for
the financial system; and</text>
</subparagraph><subparagraph id="idDE7FDA47FBE1443589BF343AC045CD00"><enum>(G)</enum><text>the nature, scope, and
mix of the activities of the supervised securities holding company.</text>
</subparagraph></paragraph><paragraph id="id313E62A72F2A4E5EBDED833E4FA88D94"><enum>(4)</enum><header>Notice</header><text>A
capital requirement imposed under this subsection may not take effect earlier
than 180 days after the date on which a supervised securities holding company
is provided notice of the capital requirement.</text>
</paragraph></subsection><subsection id="idDD7F6C958751493AB4F2C8C5BF2E16B1"><enum>(e)</enum><header>Exception for
banks</header><text>No bank shall be subject to any of the requirements set
forth in subsections (c) and (d).</text>
</subsection><subsection id="id45AF2BB5F6E643A294368A337459535E"><enum>(f)</enum><header>Other provisions of law
applicable to supervised securities holding companies</header>
<paragraph id="idF0E2707099D743C08BAF644FBDDAA65C"><enum>(1)</enum><header>Federal Deposit
Insurance Act</header><text>Subsections (b), (c) through (s), and (u) of
section 8 of the Federal Deposit Insurance Act (12 U.S.C. 1818) shall apply to
any supervised securities holding company, and to any subsidiary (other than a
bank or an institution described in subparagraph (D), (F), or (H) of section
2(c)(2) of the Bank Holding Company Act of 1956 (12 U.S.C. 1841(c)(2))) of a
supervised securities holding company, in the same manner as such subsections
apply to a bank holding company for which the Board of Governors is the
appropriate Federal banking agency. For purposes of applying such subsections
to a supervised securities holding company or a subsidiary (other than a bank
or an institution described in subparagraph (D), (F), or (H) of section 2(c)(2)
of the Bank Holding Company Act of 1956 (12 U.S.C. 1841(c)(2))) of a supervised
securities holding company, the Board of Governors shall be deemed the
appropriate Federal banking agency for the supervised securities holding
company or subsidiary.</text>
</paragraph><paragraph id="idDD248E85EB9C487996CEF209B827863D"><enum>(2)</enum><header>Bank Holding Company
Act of 1956</header><text>Except as the Board of Governors may otherwise
provide by regulation or order, a supervised securities holding company shall
be subject to the provisions of the Bank Holding Company Act of 1956 (12 U.S.C.
1841 et seq.) in the same manner and to the same extent a bank holding company
is subject to such provisions, except that a supervised securities holding
company may not, by reason of this paragraph, be deemed to be a bank holding
company for purposes of section 4 of the Bank Holding Company Act of 1956 (12
U.S.C. 1843).</text>
</paragraph></subsection></section><section id="idE45A7B6C52ED4718868D1192C52BE5CA"><enum>619.</enum><header>Restrictions on
capital market activity by banks and bank holding companies</header>
<subsection id="id2B09675E45D44276B7A30E4E8A69E9D3"><enum>(a)</enum><header>Definitions</header><text>In
this section—</text>
<paragraph id="idA259E62F81134045B8E03540668C04A6"><enum>(1)</enum><text>the terms <term>hedge
fund</term> and <term>private equity fund</term> mean a company or other entity
that is exempt from registration as an investment company pursuant to section
3(c)(1) or 3(c)(7) of the Investment Company Act of 1940 (15 U.S.C. 80a–3(c)(1)
or 80a–3(c)(7)), or a similar fund, as jointly determined by the appropriate
Federal banking agencies;</text>
</paragraph><paragraph id="idF184EF5A27224DA7B3F6D4EC6F8539CD"><enum>(2)</enum><text>the term
<term>proprietary trading</term>—</text>
<subparagraph id="idBB1B7553D385445FAFBCC9EB5661FF07"><enum>(A)</enum><text>means purchasing or
selling, or otherwise acquiring or disposing of, stocks, bonds, options,
commodities, derivatives, or other financial instruments by an insured
depository institution, a company that controls, directly or indirectly, an
insured depository institution or is treated as a bank holding company for
purposes of the Bank Holding Company Act of 1956 (12 U.S.C. 1841 et seq.), and
any subsidiary of such institution or company, for the trading book (or such
other portfolio as the Federal banking agencies may determine) of such
institution, company, or subsidiary; and</text>
</subparagraph><subparagraph id="idCECD9A1831CE481285271317616898E8"><enum>(B)</enum><text>subject to such
restrictions as the Federal banking agencies may determine, does not include
purchasing or selling, or otherwise acquiring or disposing of, stocks, bonds,
options, commodities, derivatives, or other financial instruments on behalf of
a customer, as part of market making activities, or otherwise in connection
with or in facilitation of customer relationships, including risk-mitigating
hedging activities related to such a purchase, sale, acquisition, or disposal;
and</text>
</subparagraph></paragraph><paragraph id="id588F002305324EC3B7DF3976529CE666"><enum>(3)</enum><text>the term
<term>sponsoring</term>, when used with respect to a hedge fund or private
equity fund, means—</text>
<subparagraph id="id18F88618D319455DBB3EBA8E9E44A178"><enum>(A)</enum><text>serving as a general
partner, managing member, or trustee of the fund;</text>
</subparagraph><subparagraph id="idE6F9EFA9AB67444FB7F02E1171304941"><enum>(B)</enum><text>in any manner selecting
or controlling (or having employees, officers, directors, or agents who
constitute) a majority of the directors, trustees, or management of the fund;
or</text>
</subparagraph><subparagraph id="id06C307EC72EB4E8A8C86CE571C13269B"><enum>(C)</enum><text>sharing with the fund,
for corporate, marketing, promotional, or other purposes, the same name or a
variation of the same name.</text>
</subparagraph></paragraph></subsection><subsection id="idB5E3A3D497D2466B8697B6A5CBBD059D"><enum>(b)</enum><header>Prohibition on
proprietary trading</header>
<paragraph id="id61AFE861F47B4F7094ABFBBAEF0A5304"><enum>(1)</enum><header>In
general</header><text>Subject to the recommendations and modifications of the
Council under subsection (g), and except as provided in paragraph (2) or (3),
the appropriate Federal banking agencies shall, through a rulemaking under
subsection (g), jointly prohibit proprietary trading by an insured depository
institution, a company that controls, directly or indirectly, an insured
depository institution or is treated as a bank holding company for purposes of
the Bank Holding Company Act of 1956 (12 U.S.C. 1841 et seq.), and any
subsidiary of such institution or company.</text>
</paragraph><paragraph id="id9CBC12C364A143929B6871F22D8851D1"><enum>(2)</enum><header>Excepted
obligations</header>
<subparagraph id="id96A6AFFE520F4624820B983CF2159D79"><enum>(A)</enum><header>In
general</header><text>The prohibition under this subsection shall not apply
with respect to an investment that is otherwise authorized by Federal law
in—</text>
<clause id="id59A299BBFEFF48DAA4D75266E9DAED64"><enum>(i)</enum><text>obligations of the United
States or any agency of the United States, including obligations fully
guaranteed as to principal and interest by the United States or an agency of
the United States;</text>
</clause><clause id="id6B6C61FEEE8D4DE8B29BBC300D5F6E08"><enum>(ii)</enum><text>obligations,
participations, or other instruments of, or issued by, the Government National
Mortgage Association, the Federal National Mortgage Association, or the Federal
Home Loan Mortgage Corporation, including obligations fully guaranteed as to
principal and interest by such entities; and</text>
</clause><clause id="idD92452F53C5C4E1F906D5C0C046240C6"><enum>(iii)</enum><text>obligations of any
State or any political subdivision of a State.</text>
</clause></subparagraph><subparagraph id="idFA90934835C44C8F92A8CC0EC6138885"><enum>(B)</enum><header>Conditions</header><text>The
appropriate Federal banking agencies may impose conditions on the conduct of
investments described in subparagraph (A).</text>
</subparagraph><subparagraph id="id0A8871993EA94B708FACCD0E74ADD30B"><enum>(C)</enum><header>Rule of
construction</header><text>Nothing in subparagraph (A) may be construed to
grant any authority to any person that is not otherwise provided in Federal
law.</text>
</subparagraph></paragraph><paragraph id="id00E8797CB5B24CD08D8117F93B3554B9"><enum>(3)</enum><header>Foreign
activities</header><text>An investment or activity conducted by a company
pursuant to paragraph (9) or (13) of section 4(c) of the Bank Holding Company
Act of 1956 (12 U.S.C. 1843(c)) solely outside of the United States shall not
be subject to the prohibition under paragraph (1), provided that the company is
not directly or indirectly controlled by a company that is organized under the
laws of the United States or of a State.</text>
</paragraph></subsection><subsection id="idBF6CEAE70FF345B4A90AA221878C06E2"><enum>(c)</enum><header>Prohibition on
sponsoring and investing in hedge funds and private equity funds</header>
<paragraph id="idA01F3B6CEDAD4F16BE24B441C4854E56"><enum>(1)</enum><header>In
general</header><text>Except as provided in paragraph (2), and subject to the
recommendations and modifications of the Council under subsection (g), the
appropriate Federal banking agencies shall, through a rulemaking under
subsection (g), jointly prohibit an insured depository institution, a company
that controls, directly or indirectly, an insured depository institution or is
treated as a bank holding company for purposes of the Bank Holding Company Act
of 1956 (12 U.S.C. 1841 et seq.), or any subsidiary of such institution or
company, from sponsoring or investing in a hedge fund or a private equity
fund.</text>
</paragraph><paragraph id="id54306F7C370A40B9A51EA5CF2CCC2A2E"><enum>(2)</enum><header>Application to foreign
activities of foreign firms</header><text>An investment or activity conducted
by a company pursuant to paragraph (9) or (13) of section 4(c) of the Bank
Holding Company Act of 1956 (12 U.S.C. 1843(c)) solely outside of the United
States shall not be subject to the prohibitions and restrictions under
paragraph (1), provided that the company is not directly or indirectly
controlled by a company that is organized under the laws of the United States
or of a State.</text>
</paragraph></subsection><subsection id="idAB4296EAE06E43F0A220E1F73D948C61"><enum>(d)</enum><header>Investments in small
business investment companies and investments designed To promote the public
welfare</header>
<paragraph id="id2BD28188AE9345DE934FC4B4A57118A8"><enum>(1)</enum><header>In
general</header><text>A prohibition imposed by the appropriate Federal banking
agencies under subsection (c) shall not apply with respect an investment
otherwise authorized under Federal law that is—</text>
<subparagraph id="id06A027755F974767A29C9D91E6E6A9B7"><enum>(A)</enum><text>an investment in a small
business investment company, as that term is defined in section 103 of the
Small Business Investment Act of 1958 (15 U.S.C. 662); or</text>
</subparagraph><subparagraph id="idF9984AA6482440BEAAF4A43DB2C68169"><enum>(B)</enum><text>designed primarily to
promote the public welfare, as provided in the 11th paragraph of section 5136
of the Revised Statutes (12 U.S.C. 24).</text>
</subparagraph></paragraph><paragraph id="id79C19EC1049840EDB4A4E4256C99FF3A"><enum>(2)</enum><header>Rule of
construction</header><text>Nothing in paragraph (1) may be construed to grant
any authority to any person that is not otherwise provided in Federal
law.</text>
</paragraph></subsection><subsection id="idFDA1F9A94B2E4F619D0988D192318EF8"><enum>(e)</enum><header>Limitations on
relationships with hedge funds and private equity funds</header>
<paragraph id="id65AC16BAD21A40DD84A58EA640825950"><enum>(1)</enum><header>Covered
transactions</header><text>An insured depository institution, a company that
controls, directly or indirectly, an insured depository institution or is
treated as a bank holding company for purposes of the Bank Holding Company Act
of 1956 (12 U.S.C. 1841 et seq.), and any subsidiary of such institution or
company that serves, directly or indirectly, as the investment manager or
investment adviser to a hedge fund or private equity fund may not enter into a
covered transaction, as defined in section 23A of the Federal Reserve Act (12
U.S.C. 371c) with such hedge fund or private equity fund.</text>
</paragraph><paragraph id="id23506AFFC0BE4872A7DFB00021EDB4B9"><enum>(2)</enum><header>Affiliation</header><text>An
insured depository institution, a company that controls, directly or
indirectly, an insured depository institution or is treated as a bank holding
company for purposes of the Bank Holding Company Act of 1956 (12 U.S.C. 1841 et
seq.), and any subsidiary of such institution or company that serves, directly
or indirectly, as the investment manager or investment adviser to a hedge fund
or private equity fund shall be subject to section 23B of the Federal Reserve
Act (12 U.S.C. 371c–1) as if such institution, company, or subsidiary were a
member bank and such hedge fund or private equity fund were an
affiliate.</text>
</paragraph></subsection><subsection id="id22FF06CA74F345BA884DDB0D1B2EF387"><enum>(f)</enum><header>Capital and
quantitative limitations for certain nonbank financial companies</header>
<paragraph id="id9C4247137CE94248930EBA768F673ADD"><enum>(1)</enum><header>In
general</header><text>Except as provided in paragraph (2), and subject to the
recommendations and modifications of the Council under subsection (g), the
Board of Governors shall adopt rules imposing additional capital requirements
and specifying additional quantitative limits for nonbank financial companies
supervised by the Board of Governors under section 113 that engage in
proprietary trading or sponsoring and investing in hedge funds and private
equity funds.</text>
</paragraph><paragraph id="idC8467D11AC52456CB293D2A870C64A72"><enum>(2)</enum><header>Exceptions</header><text>The
rules under this subsection shall not apply with respect to the trading of an
investment that is otherwise authorized by Federal law—</text>
<subparagraph id="ID0dd6dd30e12d46789fabe7aa1e45d0de"><enum>(A)</enum><text>in obligations of the
United States or any agency of the United States, including obligations fully
guaranteed as to principal and interest by the United States or an agency of
the United States;</text>
</subparagraph><subparagraph id="ID0c00dcbf887743f4a5408641755c9ee6"><enum>(B)</enum><text>in obligations,
participations, or other instruments of, or issued by, the Government National
Mortgage Association, the Federal National Mortgage Association, or the Federal
Home Loan Mortgage Corporation, including obligations fully guaranteed as to
principal and interest by such entities;</text>
</subparagraph><subparagraph id="IDc3ac0cf227404bff8dd48b1a92ab083e"><enum>(C)</enum><text>in obligations of any
State or any political subdivision of a State;</text>
</subparagraph><subparagraph id="idE38B89E960C64A81B6A6A6CD79CCB953"><enum>(D)</enum><text>in a small business
investment company, as that term is defined in section 103 of the Small
Business Investment Act of 1958 (15 U.S.C. 662); or</text>
</subparagraph><subparagraph id="idED5B3F84EA734DE098D2746765C9C45A"><enum>(E)</enum><text>that is designed
primarily to promote the public welfare, as provided in the 11th paragraph of
section 5136 of the Revised Statutes (12 U.S.C. 24).</text>
</subparagraph></paragraph></subsection><subsection id="id06A24EB7A2AD45C3B5F762DBC5134CF2"><enum>(g)</enum><header>Council study and
rulemaking</header>
<paragraph id="idC95ED362B0D74BD6A985ACFB9E930C7C"><enum>(1)</enum><header>Study and
recommendations</header><text>Not later than 6 months after the date of
enactment of this Act, the Council—</text>
<subparagraph id="id2A1BE0D0397E4D94BCBCF923C72EF7AD"><enum>(A)</enum><text>shall complete a study of
the definitions under subsection (a) and the other provisions under subsections
(b) through (f), to assess the extent to which the definitions under subsection
(a) and the implementation of subsections (a) through (f) would—</text>
<clause id="IDc809f218097d41edae59aa2435af501b"><enum>(i)</enum><text>promote and enhance the
safety and soundness of depository institutions and the affiliates of
depository institutions;</text>
</clause><clause id="ID54995cbdf3f140da86b2b1e3830263a8"><enum>(ii)</enum><text>protect taxpayers and
enhance financial stability by minimizing the risk that depository institutions
and the affiliates of depository institutions will engage in unsafe and unsound
activities;</text>
</clause><clause id="ID5e53c9ac9b76446f83dbd911c8cc9eb0"><enum>(iii)</enum><text>limit the inappropriate
transfer of Federal subsidies from institutions that benefit from deposit
insurance and liquidity facilities of the Federal Government to unregulated
entities;</text>
</clause><clause id="ID1b4c6ba3d9b64166bccde9e2fd734e48"><enum>(iv)</enum><text>reduce inappropriate
conflicts of interest between the self-interest of depository institutions,
affiliates of depository institutions, and financial companies supervised by
the Board, and the interests of the customers of such institutions and
companies;</text>
</clause><clause id="id606DADF278694D1E8522571450F3BA5D"><enum>(v)</enum><text>raise the cost of credit
or other financial services, reduce the availability of credit or other
financial services, or impose other costs on households and businesses in the
United States;</text>
</clause><clause id="id623B3BE7498849E2AA58AA3FEB9E5FC0"><enum>(vi)</enum><text>limit activities that
have caused undue risk or loss in depository institutions, affiliates of
depository institutions, and financial companies supervised by the Board of
Governors, or that might reasonably be expected to create undue risk or loss in
such institutions, affiliates, and companies; and</text>
</clause><clause id="idD32E9A3812404EBAB471A5C8D8F8E37E"><enum>(vii)</enum><text>appropriately
accommodates the business of insurance within an insurance company subject to
regulation in accordance with State insurance company investment laws;</text>
</clause></subparagraph><subparagraph id="idAF1368751D0142E4A1B8FDF9691F97E3"><enum>(B)</enum><text>shall make
recommendations regarding the definitions under subsection (a) and the
implementation of other provisions under subsections (b) through (f), including
any modifications to the definitions, prohibitions, requirements, and
limitations contained therein that the Council determines would more
effectively implement the purposes of this section; and</text>
</subparagraph><subparagraph id="id0C74FDEDABE140BF8829774CE706A10C"><enum>(C)</enum><text>may make recommendations
for prohibiting the conduct of the activities described in subsections (b) and
(c) above a specific threshold amount and imposing additional capital
requirements on activities conducted below such threshold amount.</text>
</subparagraph></paragraph><paragraph id="idEE8A237BA95448B7AC9D5C8D2FC387E3"><enum>(2)</enum><header>Rulemaking</header><text>Not
earlier than the date of completion of the study required under paragraph (1),
and not later than 9 months after the date of completion of such study—</text>
<subparagraph id="id7CEDA350428545778F99383223467837"><enum>(A)</enum><text>the appropriate Federal
banking agencies shall jointly issue final regulations implementing subsections
(b) through (e), which shall reflect any recommendations or modifications made
by the Council pursuant to paragraph (1)(B); and</text>
</subparagraph><subparagraph id="id7E52CDFB025A4D988EDCF64BB1191A41"><enum>(B)</enum><text>the Board of Governors
shall issue final regulations implementing subsection (f), which shall reflect
any recommendations or modifications made by the Council pursuant to paragraph
(1)(B).</text>
</subparagraph></paragraph></subsection><subsection id="id6AA516A707BA40CCA25AACCA10F9A5F9"><enum>(h)</enum><header>Transition</header>
<paragraph id="id1A28207659F34BD59CB2441BF90D9202"><enum>(1)</enum><header>In
general</header><text>The final regulations issued by the appropriate Federal
banking agencies and the Board of Governors under subsection (g)(2) shall
provide that, effective 2 years after the date on which such final regulations
are issued, no insured depository institution, company that controls, directly
or indirectly, an insured depository institution, company that is treated as a
bank holding company for purposes of the Bank Holding Company Act of 1956 (12
U.S.C. 1841 et seq.), or subsidiary of such institution or company, may retain
any investment or relationship prohibited under such regulations.</text>
</paragraph><paragraph id="id0976B840DCD148A5A704B0BAD236914A"><enum>(2)</enum><header>Extension</header>
<subparagraph id="id00EB19654556464A99F6CA9E52619DC1"><enum>(A)</enum><header>In
general</header><text>The appropriate Federal banking agency for an insured
depository institution or a company described in paragraph (1) may, upon the
application of any such company, extend the 2-year period under paragraph (1)
with respect to such company, if the appropriate Federal banking agency
determines that an extension would not be detrimental to the public
interest.</text>
</subparagraph><subparagraph id="id2F7BAC0890404B2497998DCCE5AAB3E1"><enum>(B)</enum><header>Time period for
extension</header><text>An extension granted under subparagraph (A) may not
exceed—</text>
<clause id="id815A67449E75456F86CE418764A63E05"><enum>(i)</enum><text>1 year for each
determination made by the appropriate Federal banking agency under subparagraph
(A); and</text>
</clause><clause id="id161FA999F4A44C95B6AF72293B3744DA"><enum>(ii)</enum><text>a total of 3 years with
respect to any 1 company.</text>
</clause></subparagraph></paragraph></subsection></section><section id="idFA28D08378A246BD9B7C68DFFA1B7000"><enum>620.</enum><header>Concentration limits
on large financial firms</header><text display-inline="no-display-inline">The
Bank Holding Company Act of 1956 (12 U.S.C. 1841 et seq.) is amended by adding
at the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id096352846D624DCFA4041946E4BC9B56" reported-display-style="italic" style="OLC">
<section id="id23DAFE480E6C4A7C95EB1E90F99055A3"><enum>13.</enum><header>Concentration limits on
large financial firms</header>
<subsection id="id04F2AAAB2FD7445AB8F2360881CCF8FB"><enum>(a)</enum><header>Definitions</header><text>In
this section—</text>
<paragraph id="id32D6AF37E3B0467180B445710CC4BB8F"><enum>(1)</enum><text>the term
<term>Council</term> means the Financial Stability Oversight Council;</text>
</paragraph><paragraph id="id5D7E26D39F8F47E79278EC4F68129AB5"><enum>(2)</enum><text>the term <term>financial
company</term> means—</text>
<subparagraph id="id14276EFE78E14F1EB12C33319A9021BA"><enum>(A)</enum><text>an insured depository
institution;</text>
</subparagraph><subparagraph id="id4C60E488785C4016BD6E113119B031CE"><enum>(B)</enum><text>a bank holding
company;</text>
</subparagraph><subparagraph id="idE46158466C47425BB6F1D75CA33A4EBC"><enum>(C)</enum><text>a savings and loan
holding company;</text>
</subparagraph><subparagraph id="id3ACE149416DA42C8AB50DFD549391361"><enum>(D)</enum><text>a company that controls
an insured depository institution;</text>
</subparagraph><subparagraph id="idCC53262789894EEB89813DE4DB5AA0EC"><enum>(E)</enum><text>a nonbank financial
company supervised by the Board under title I of the Restoring American
Financial Stability Act of 2010; and</text>
</subparagraph><subparagraph id="idEC47D1052641457AAB1DAE53D3C92EB7"><enum>(F)</enum><text>a foreign bank or company
that is treated as a bank holding company for purposes of this Act; and</text>
</subparagraph></paragraph><paragraph id="idE37E037A11E94262BD8AEE8FD24F7AC1"><enum>(3)</enum><text>the term
<term>liabilities</term> means—</text>
<subparagraph id="id5A19902C9719477EB75F585115920333"><enum>(A)</enum><text>with respect to a United
States financial company—</text>
<clause id="id1B00450675384644B39FE1964629AD58"><enum>(i)</enum><text>the total risk-weighted
assets of the financial company, as determined under the risk-based capital
rules applicable to bank holding companies, as adjusted to reflect exposures
that are deducted from regulatory capital; less</text>
</clause><clause id="id85FC5D5D1A5B471D8442723136D0EE38"><enum>(ii)</enum><text>the total regulatory
capital of the financial company under the risk-based capital rules applicable
to bank holding companies;</text>
</clause></subparagraph><subparagraph id="id144AA338E52C4EA5B3F4E8FE3F221E23"><enum>(B)</enum><text>with respect to a
foreign-based financial company—</text>
<clause id="idA87E2AEB8400484184428877F96E1DC0"><enum>(i)</enum><text>the total risk-weighted
assets of the United States operations of the financial company, as determined
under the applicable risk-based capital rules, as adjusted to reflect exposures
that are deducted from regulatory capital; less</text>
</clause><clause id="id9308802724104B168DB626218A332131"><enum>(ii)</enum><text>the total regulatory
capital of the United States operations of the financial company, as determined
under the applicable risk-based capital rules; and</text>
</clause></subparagraph><subparagraph id="id862694F718634C4D9B661858ED5B18C5"><enum>(C)</enum><text>with respect to an
insurance company or other nonbank financial company supervised by the Board,
such assets of the company as the Board shall specify by rule, in order to
provide for consistent and equitable treatment of such companies.</text>
</subparagraph></paragraph></subsection><subsection id="id91C09A8566F3427EB1D279A40B5A6FFF"><enum>(b)</enum><header>Concentration
limit</header><text>Subject to the recommendations by the Council under
subsection (e), a financial company may not merge or consolidate with, acquire
all or substantially all of the assets of, or otherwise acquire control of,
another company, if the total consolidated liabilities of the acquiring
financial company upon consummation of the transaction would exceed 10 percent
of the aggregate consolidated liabilities of all financial companies at the end
of the calendar year preceding the transaction.</text>
</subsection><subsection id="id6E82D535F19A468F9299950ADD7FF8B8"><enum>(c)</enum><header>Exception to
concentration limit</header><text>With the prior written consent of the Board,
the concentration limit under subsection (b) shall not apply to an
acquisition—</text>
<paragraph id="id177B1564DADB4C808AF7CE4D35514B34"><enum>(1)</enum><text>of a bank in default or
in danger of default;</text>
</paragraph><paragraph id="id487A7F40830D4B5CBFF4434A92162C6F"><enum>(2)</enum><text>with respect to which
assistance is provided by the Federal Deposit Insurance Corporation under
section 13(c) of the Federal Deposit Insurance Act (12 U.S.C. 1823(c));
or</text>
</paragraph><paragraph id="idDE6E7E2262AF499889867AEB7AEE21A0"><enum>(3)</enum><text>that would result only in
a de minimis increase in the liabilities of the financial company.</text>
</paragraph></subsection><subsection id="id9EE4A0F772E643D2BEC3499178B47386"><enum>(d)</enum><header>Rulemaking and
guidance</header><text>The Board shall issue regulations implementing this
section in accordance with the recommendations of the Council under subsection
(e), including the definition of terms, as necessary. The Board may issue
interpretations or guidance regarding the application of this section to an
individual financial company or to financial companies in general.</text>
</subsection><subsection id="id805DA4A2193944E1AAEDF567E05752A4"><enum>(e)</enum><header>Council study and
rulemaking</header>
<paragraph id="id6F78D7F66FCD403A992AF64057E2852B"><enum>(1)</enum><header>Study and
recommendations</header><text>Not later than 6 months after the date of
enactment of this section, the Council shall—</text>
<subparagraph id="id35229B81169D4BEDB486D07770A01CB0"><enum>(A)</enum><text>complete a study of the
extent to which the concentration limit under this section would affect
financial stability, moral hazard in the financial system, the efficiency and
competitiveness of United States financial firms and financial markets, and the
cost and availability of credit and other financial services to households and
businesses in the United States; and</text>
</subparagraph><subparagraph id="idC541355512734A1589E7AF09E79D30BB"><enum>(B)</enum><text>make recommendations
regarding any modifications to the concentration limit that the Council
determines would more effectively implement this section.</text>
</subparagraph></paragraph><paragraph id="idAE50785FF85F49FAAD11819C13943EA8"><enum>(2)</enum><header>Rulemaking</header><text>Not
later than 9 months after the date of completion of the study under paragraph
(1), and notwithstanding subsections (b) and (d), the Board shall issue final
regulations implementing this section, which shall reflect any recommendations
by the Council under paragraph
(1)(B).</text>
</paragraph></subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</section><enum>VII</enum><header>Wall Street
Transparency and Accountability</header>
<section id="id0656467FAEDB4B0AA0B9BAE4EF0659DE"><enum>701.</enum><header>Short
title</header><text display-inline="no-display-inline">This title may be cited
as the <quote><short-title>Wall Street Transparency and
Accountability Act of 2010</short-title></quote>.</text>
</section><subtitle id="idBD959770EF2445F19EB1733A4B1E1663"><enum>A</enum><header>Regulation of
Over-the-Counter Swaps Markets</header>
<part id="id122C3FC5C3C343A3A7255CF0170AAE9C"><enum>I</enum><header>Regulatory
authority</header>
<section id="HEEC855D9C26149468A5F57E6BDE31B5F"><enum>711.</enum><header>Definitions</header><text display-inline="no-display-inline">In this subtitle, the terms <term>prudential
regulator</term>, <term>swap</term>, <term>swap dealer</term>, <term>major swap
participant</term>, <term>swap data repository</term>, <term>associated person
of a swap dealer or major swap participant</term>, <term>eligible contract
participant</term>, <term>swap execution facility</term>, <term>security-based
swap</term>, <term>security-based swap dealer</term>, <term>major
security-based swap participant</term>, <term>swap data repository</term>, and
<term>associated person of a security-based swap dealer or major security-based
swap participant</term> have the meanings given the terms in section 1a of the
Commodity Exchange Act (7 U.S.C. 1a).</text>
</section><section id="id182F86F696C0475EAE01D8A45D8B05E3"><enum>712.</enum><header>Review of regulatory
authority</header>
<subsection id="id34561EDA62FA44BEAC54193E14AAB0CB"><enum>(a)</enum><header>Regulatory
authority</header>
<paragraph id="ID79f927b0497d490981c602d7f40e0ecf"><enum>(1)</enum><header>In
general</header><text>Except as provided in paragraphs (4) and (8), the
Commodity Futures Trading Commission and the Securities and Exchange Commission
shall each prescribe such regulations as may be necessary to carry out the
purposes of this title.</text>
</paragraph><paragraph id="IDbcec10b249e543f9881af8f5742ecd1e"><enum>(2)</enum><header>Coordination,
consistency, and comparability</header><text>Both Commissions required under
paragraph (1) to prescribe regulations shall consult and coordinate with each
other for the purposes of assuring, to the extent possible, that the
regulations prescribed by each such Commission are consistent and comparable
with the regulations prescribed by the other.</text>
</paragraph><paragraph id="ID50b07d7782534ababd6e311c3d4c8ab4"><enum>(3)</enum><header>Procedures and
deadline</header><text>Such regulations shall be prescribed in accordance with
applicable requirements of title 5, United States Code, and, shall be issued in
final form not later than 180 days after the date of enactment of this
Act.</text>
</paragraph><paragraph id="ID7d8be1e4567d405c94e2056395475743"><enum>(4)</enum><header>Applicability</header><text>The
requirements of paragraph (1) shall not apply to an order issued—</text>
<subparagraph id="ID0755e34b65bb4a559d53df017b1c108c"><enum>(A)</enum><text>in connection with or
arising from a violation or potential violation of any provision of the
Commodity Exchange Act (7 U.S.C. 1 et seq.);</text>
</subparagraph><subparagraph id="ID6f6d9d81cdca44b1a99337e6def109ab"><enum>(B)</enum><text>in connection with or
arising from a violation or potential violation of any provision of the
securities laws; or</text>
</subparagraph><subparagraph id="IDf1082ecac7104792ba66be9d790bda89"><enum>(C)</enum><text>in any proceeding that is
conducted on the record in accordance with sections 556 and 557 of title 5,
United States Code.</text>
</subparagraph></paragraph><paragraph id="IDa69c2f0c7f9a4710855837f84d5a4a0b"><enum>(5)</enum><header>Effect</header><text>Nothing
in this subsection authorizes any consultation or procedure for consultation
that is not consistent with the requirements of subchapter II of chapter 5, and
chapter 7, of title 5, United States Code (commonly known as the
<quote>Administrative Procedure Act</quote>).</text>
</paragraph><paragraph id="ID5166f77b5685447c9a44303e968ca3c3"><enum>(6)</enum><header>Rules;
orders</header><text>In developing and promulgating rules or orders pursuant to
this subsection, each Commission shall consider the views of the prudential
regulators.</text>
</paragraph><paragraph commented="no" id="id3283AF9C3D5547B7B5B543D4CE7B7C7D"><enum>(7)</enum><header>Treatment of similar
products and entities</header>
<subparagraph commented="no" id="idD7708A61B31D442CBD835DC1C26C7A32"><enum>(A)</enum><header>In
general</header><text>In adopting rules and orders under this subsection, the
Commodity Futures Trading Commission and the Securities and Exchange Commission
shall treat functionally or economically similar products or entities described
in paragraphs (1) and (2) in a similar manner.</text>
</subparagraph><subparagraph commented="no" id="id1BDD1435ACAD4F479004F8462A724C4A"><enum>(B)</enum><header>Effect</header><text>Nothing
in this subtitle requires the Commodity Futures Trading Commission or the
Securities and Exchange Commission to adopt joint rules or orders that treat
functionally or economically similar products or entities described in
paragraphs (1) and (2) in an identical manner.</text>
</subparagraph></paragraph><paragraph id="ID76281536eb0444368ff9232b1e575ef0"><enum>(8)</enum><header>Mixed
swaps</header><text>The Commodity Futures Trading Commission and the Securities
and Exchange Commission shall jointly prescribe such regulations regarding
mixed swaps, as described in section 1a(47)(D) of the Commodity Exchange Act (7
U.S.C. 1a(47)(D)) and in section (68)(D) of the Securities Exchange Act of 1934
(15 U.S.C. (68)(D)), as may be necessary to carry out the purposes of this
title.</text>
</paragraph></subsection><subsection id="HD8AFDDA26AD048A78919393FE067B67A"><enum>(b)</enum><header>Limitation</header>
<paragraph id="H56747654ACE6409C95FFF10BA0057945"><enum>(1)</enum><header>Commodity Futures
Trading Commission</header><text>Nothing in this title, unless specifically
provided, confers jurisdiction on the Commodity Futures Trading Commission to
issue a rule, regulation, or order providing for oversight or regulation
of—</text>
<subparagraph id="HF68ED3A05DA54F92AEB233A192D6978C"><enum>(A)</enum><text>security-based swaps;
or</text>
</subparagraph><subparagraph id="H8420C1F2000A4F68BBB905359D1FE3A8"><enum>(B)</enum><text>with regard to its
activities or functions concerning security-based swaps—</text>
<clause id="HA65B0C781070430692690A45EED9123C"><enum>(i)</enum><text>security-based swap
dealers;</text>
</clause><clause id="H82F9A978A44746DBB5DFBEA8F93EA889"><enum>(ii)</enum><text>major security-based
swap participants;</text>
</clause><clause id="H3AC552BDE20648B19F41E8D4767AFDE4"><enum>(iii)</enum><text>security-based swap
data repositories;</text>
</clause><clause id="HB703EBE76CE94437B4B44173832B8E38"><enum>(iv)</enum><text>persons associated with
a security-based swap dealer or major security-based swap participant;</text>
</clause><clause id="H9EC0E8FE2E544DE3B97BA883D370B6A1"><enum>(v)</enum><text>eligible contract
participants with respect to security-based swaps; or</text>
</clause><clause id="HFCA45C886A074498A0AAFE9DAFF3C416"><enum>(vi)</enum><text>swap execution
facilities with respect to security-based swaps.</text>
</clause></subparagraph></paragraph><paragraph id="HF8CDB17D4AE44FDD92D28B404EF034DE"><enum>(2)</enum><header>Securities and Exchange
Commission</header><text display-inline="yes-display-inline">Nothing in this
title, unless specifically provided, confers jurisdiction on the Securities and
Exchange Commission or State securities regulators to issue a rule, regulation,
or order providing for oversight or regulation of—</text>
<subparagraph id="H96D29B7226384D9998397BCE325A566C"><enum>(A)</enum><text>swaps; or</text>
</subparagraph><subparagraph id="H8732F20CE73E4C3B93F0AE28A07E4D52"><enum>(B)</enum><text>with regard to its
activities or functions concerning swaps—</text>
<clause id="H6A81C28FA0BB4F959D5D74E8EACC95AE"><enum>(i)</enum><text>swap dealers;</text>
</clause><clause id="HB09733EEE3C14D7DB5055C40C7E2065D"><enum>(ii)</enum><text>major swap
participants;</text>
</clause><clause id="H263F7297D69B4CDCB4E413CE6CA704DB"><enum>(iii)</enum><text>swap data
repositories;</text>
</clause><clause id="H86E86150DF434683BB6649F6C36E602F"><enum>(iv)</enum><text>persons associated with
a swap dealer or major swap participant;</text>
</clause><clause id="H1C69CF1112814003A57FFD8C643DD165"><enum>(v)</enum><text>eligible contract
participants with respect to swaps; or</text>
</clause><clause id="H6E52E60B3DB14177BA422C123A535A0E"><enum>(vi)</enum><text>swap execution
facilities with respect to swaps.</text>
</clause></subparagraph></paragraph><paragraph id="IDc89356f3068440a487a71866f13362b9"><enum>(3)</enum><header>Prohibition on certain
futures associations and national securities associations</header>
<subparagraph id="id01E0B695FE5647C69B67F0C4005DA45B"><enum>(A)</enum><header>Futures
associations</header><text>Notwithstanding any other provision of law
(including regulations), unless otherwise authorized by this title, no futures
association registered under section 17 of the Commodity Exchange Act (7 U.S.C.
21) may issue a rule, regulation, or order for the oversight or regulation of,
or otherwise assert jurisdiction over, for any purpose, any security-based
swap, except that this shall not limit the authority of a national futures
association to examine for compliance with and enforce its rules on advertising
and capital adequacy.</text>
</subparagraph><subparagraph id="id2BF750B0CE5B4978BA29651F1EE0B179"><enum>(B)</enum><header>National securities
associations</header><text>Notwithstanding any other provision of law
(including regulations), unless otherwise authorized by this title, no national
securities association registered under section 15A of the Securities Exchange
Act of 1934 (15 U.S.C. 78o–3) may issue a rule, regulation, or order for the
oversight or regulation of, or otherwise assert jurisdiction over, for any
purpose, any swap, except that this shall not limit the authority of a national
securities association to examine for compliance with and enforce its rules on
advertising and capital adequacy.</text>
</subparagraph></paragraph></subsection><subsection id="H592B0D402CD94847814362ACED566E7E"><enum>(c)</enum><header>Objection to Commission
regulation</header>
<paragraph id="H17D1BA4D83EF448AAB5DDD1B8AC4F8C3"><enum>(1)</enum><header>Filing of petition for
review</header>
<subparagraph id="idF7C174A0B6E24F8EA45F6D0B46A301DE"><enum>(A)</enum><header>In
general</header><text>If either Commission referred to in this section
determines that a final rule, regulation, or order of the other Commission
conflicts with subsection (a)(4) or (b), then the complaining Commission may
obtain review of the final rule, regulation, or order in the United States
Court of Appeals for the District of Columbia Circuit by filing in the court,
not later than 60 days after the date of publication of the final rule,
regulation, or order, a written petition requesting that the rule, regulation,
or order be set aside.</text>
</subparagraph><subparagraph id="id9C7203DBA1464B47879CC7766569A080"><enum>(B)</enum><header>Expedited
proceeding</header><text>A proceeding described in subparagraph (A) shall be
expedited by the United States Court of Appeals for the District of Columbia
Circuit.</text>
</subparagraph></paragraph><paragraph id="HF356981FAA304B62894BDCA7C201FEFF"><enum>(2)</enum><header>Transmittal of petition
and record</header>
<subparagraph id="idFE10401357144B54BDE6EA65C79273B9"><enum>(A)</enum><header>In
general</header><text>A copy of a petition described in paragraph (1) shall be
transmitted not later than 1 business day after the date of filing by the
complaining Commission to the Secretary of the responding Commission.</text>
</subparagraph><subparagraph id="idEF4F925EF5884414A8D844083ED13183"><enum>(B)</enum><header>Duty of responding
Commission</header><text>On receipt of the copy of a petition described in
paragraph (1), the responding Commission shall file with the United States
Court of Appeals for the District of Columbia Circuit—</text>
<clause id="id22B4B3821B95489A82EF3350887EAC37"><enum>(i)</enum><text>a copy of the rule,
regulation, or order under review (including any documents referred to
therein); and</text>
</clause><clause id="id92F21C61006C43138FC290D01D93B72E"><enum>(ii)</enum><text>any other materials
prescribed by the United States Court of Appeals for the District of Columbia
Circuit.</text>
</clause></subparagraph></paragraph><paragraph id="H3DA1BF92395A4BA08364BA5993621B06"><enum>(3)</enum><header>Standard of
review</header><text>The United States Court of Appeals for the District of
Columbia Circuit shall—</text>
<subparagraph id="id333D355DDDC34ED389B422165287CB45"><enum>(A)</enum><text>give deference to the
views of neither Commission; and</text>
</subparagraph><subparagraph id="idCF6F908325AE415F93B6F99A4BFE3440"><enum>(B)</enum><text>determine to affirm or
set aside a rule, regulation, or order of the responding Commission under this
subsection, based on the determination of the court as to whether the rule,
regulation, or order is in conflict with subsection (a)(4) or (b), as
applicable.</text>
</subparagraph></paragraph><paragraph id="H962AE2BD955F435D9EFD8E1FC7AD8D0E"><enum>(4)</enum><header>Judicial
stay</header><text>The filing of a petition by the complaining Commission
pursuant to paragraph (1) shall operate as a stay of the rule, regulation, or
order until the date on which the determination of the United States Court of
Appeals for the District of Columbia Circuit is final (including any appeal of
the determination).</text>
</paragraph></subsection><subsection commented="no" id="HBD88447A308F46098286DC42A8205B2B"><enum>(d)</enum><header>Adoption of rules on
uncleared swaps</header><text display-inline="yes-display-inline">Notwithstanding subsections (b) and (c),
the Commodity Futures Trading Commission and the Securities and Exchange
Commission shall, after consulting with each other Commission, adopt
rules—</text>
<paragraph id="id95F9A26E79F64318AEA5DDCBF499C02F"><enum>(1)</enum><text>to require the
maintenance of records of all activities relating to transactions in swaps and
security-based swaps under the respective jurisdictions of the Commodity
Futures Trading Commission and the Securities and Exchange Commission that are
uncleared;</text>
</paragraph><paragraph id="id88D4365AF73D49599E852ED6A0A6014B"><enum>(2)</enum><text>to make available,
consistent with section 8 of the Commodity Exchange Act (7 U.S.C. 12), to the
Securities and Exchange Commission information relating to swaps transactions
that are uncleared; and</text>
</paragraph><paragraph id="id43B078F9FAF843A4894888EC9712B678"><enum>(3)</enum><text>to make available to the
Commodity Futures Trading Commission information relating to security-based
swaps transactions that are uncleared.</text>
</paragraph></subsection><subsection id="ID4e1fe9523f194605877c4bfc6e0424ee"><enum>(e)</enum><header>Definitions</header><text>Notwithstanding
subsections (b) and (c), the Commodity Futures Trading Commission and the
Securities and Exchange Commission shall jointly adopt rules to define the term
<quote>security-based swap agreement</quote> in section 1a(47)(A)(v) of the
Commodity Exchange Act (7 U.S.C. 1a(47)(A)(v)) and in section 3(a)(78) of the
Securities Exchange Act of 1934 (15 U.S.C. 78c(a)(78)).</text>
</subsection><subsection id="ID7abeb1a0b24046b7aab074506858610d"><enum>(f)</enum><header>Global rulemaking
timeframe</header><text>Unless otherwise provided in a particular provision of
this title, or an amendment made by this title, the Commodity Futures Trading
Commission or the Securities and Exchange Commission, or both, shall
individually, and not jointly, promulgate rules and regulations required of
each Commission under this title or an amendment made by this title not later
than 180 days after the date of enactment of this Act.</text>
</subsection><subsection id="IDfd9eeff753554b168f9d2e633920d899"><enum>(g)</enum><header>Expedited rulemaking
process</header><text>The Commodity Futures Trading Commission or the
Securities and Exchange Commission, or both, may use emergency and expedited
procedures (including any administrative or other procedure as appropriate) to
carry out this title and the amendments made by this title if, in either of the
Commissions’ discretion, it considers it necessary to do so.</text>
</subsection></section><section id="HB1A6627AA9474C34B7CE633E0919BD59"><enum>713.</enum><header>Recommendations for
changes to portfolio margining laws</header><text display-inline="no-display-inline">Not later than 180 days after the date of
enactment of this Act, the Securities and Exchange Commission, the Commodity
Futures Trading Commission, and the prudential regulators shall submit to the
appropriate committees of Congress recommendations for legislative changes to
the Federal laws to facilitate the portfolio margining of securities and
commodity futures and options, commodity options, swaps, and other financial
instrument positions.</text>
</section><section display-inline="no-display-inline" id="H88E7B71481114C7093271F6B1BFE1F7A" section-type="subsequent-section"><enum>714.</enum><header>Abusive
swaps</header><text display-inline="no-display-inline">The Commodity Futures
Trading Commission or the Securities and Exchange Commission, or both,
individually may, by rule or order—</text>
<paragraph display-inline="no-display-inline" id="id315A5CDAE68E41438B9228B1ADAAD3C0"><enum>(1)</enum><text display-inline="yes-display-inline">collect information as may be necessary
concerning the markets for any types of—</text>
<subparagraph display-inline="no-display-inline" id="id9907D30A18154210B52AA6B6897EB232"><enum>(A)</enum><text display-inline="yes-display-inline">swap (as defined in section 1a of the
Commodity Exchange Act (7 U.S.C. 1a)); or</text>
</subparagraph><subparagraph display-inline="no-display-inline" id="idA4D22FAF1244447BA4FCEB73676CEF5C"><enum>(B)</enum><text display-inline="yes-display-inline">security-based swap (as defined in section
1a of the Commodity Exchange Act (7 U.S.C. 1a)); and</text>
</subparagraph></paragraph><paragraph display-inline="no-display-inline" id="id47C7EB2CBB174DA1901C2B35DB5E894D"><enum>(2)</enum><text display-inline="yes-display-inline">issue a report with respect to any types of
swaps or security-based swaps that the Commodity Futures Trading Commission or
the Securities and Exchange Commission determines to be detrimental to—</text>
<subparagraph display-inline="no-display-inline" id="id5F228B8BA812482A98895652528C1E92"><enum>(A)</enum><text display-inline="yes-display-inline">the stability of a financial market;
or</text>
</subparagraph><subparagraph display-inline="no-display-inline" id="id8B7E5320D35B4CCE85A03FA7FE3FF83C"><enum>(B)</enum><text display-inline="yes-display-inline">participants in a financial market.</text>
</subparagraph></paragraph></section><section id="HBF0440C5DE044AAC8979DDDF56B1348B"><enum>715.</enum><header>Authority to prohibit
participation in swap activities</header><text display-inline="no-display-inline">Except as provided in section 4 of the
Commodity Exchange Act (7 U.S.C. 6) (as amended by section 738), if the
Commodity Futures Trading Commission or the Securities and Exchange Commission
determines that the regulation of swaps or security-based swaps markets in a
foreign country undermines the stability of the United States financial system,
either Commission, in consultation with the Secretary of the Treasury, may
prohibit an entity domiciled in the foreign country from participating in the
United States in any swap or security-based swap activities.</text>
</section><section id="IDb21b7c6320634cc5a1b80b791c65db44"><enum>716.</enum><header>Prohibition against
Federal government bailouts of swaps entities</header>
<subsection id="ID9dae238605064a809dacea3a1a76e056"><enum>(a)</enum><header>Prohibition on Federal
assistance</header><text>Notwithstanding any other provision of law (including
regulations), no Federal assistance may be provided to any swaps entity with
respect to any swap, security-based swap, or other activity of the swaps
entity.</text>
</subsection><subsection id="ID8458bbe41bac4e6da48eeb40d49e6c38"><enum>(b)</enum><header>Definitions</header><text>In
this section:</text>
<paragraph id="IDe0fcca2b76294ec9aa4949a195f7ec9d"><enum>(1)</enum><header>Federal
assistance</header><text>The term <term>Federal assistance</term> means the use
of any funds, including advances from any Federal Reserve credit facility,
discount window, or pursuant to the third undesignated paragraph of section 13
of the Federal Reserve Act (12 U.S.C. 343) (relating to emergency lending
authority), Federal Deposit Insurance Corporation insurance, or guarantees for
the purpose of—</text>
<subparagraph id="ID310bdfc3fbf54d9b953120c2998151e7"><enum>(A)</enum><text>making any loan to, or
purchasing any stock, equity interest, or debt obligation of, any swaps
entity;</text>
</subparagraph><subparagraph id="ID7be92469b7994b68b49d4e15b8f271c4"><enum>(B)</enum><text>purchasing the assets of
any swaps entity;</text>
</subparagraph><subparagraph id="ID6d6c1fa951404d9b9e7ed703a759f246"><enum>(C)</enum><text>guaranteeing any loan or
debt issuance of any swaps entity; or</text>
</subparagraph><subparagraph id="ID660e214a518e420b9250a1a6f64f4b0c"><enum>(D)</enum><text>entering into any
assistance arrangement (including tax breaks), loss sharing, or profit sharing
with any swaps entity.</text>
</subparagraph></paragraph><paragraph id="IDe182cb609b1f4d3b9c65f4f73e2f03bd"><enum>(2)</enum><header>Swaps
entity</header><text>The term <term>swaps entity</term> means any swap dealer,
security-based swap dealer, major swap participant, major security-based swap
participant, swap execution facility, designated contract market, national
securities exchange, central counterparty, clearing house, clearing agency, or
derivatives clearing organization that is registered under—</text>
<subparagraph id="ID80bec639261b4eccbd5bce41afaf4efb"><enum>(A)</enum><text>the Commodity Exchange
Act (7 U.S.C. 1 et seq.);</text>
</subparagraph><subparagraph id="IDc36875815e084cf5bd19650f9839856d"><enum>(B)</enum><text>the Securities Exchange
Act of 1934 (15 U.S.C. 78a et seq.); or</text>
</subparagraph><subparagraph id="IDed7754b1aa994c249cf63d768a97e6ae"><enum>(C)</enum><text>any other Federal or
State law (including regulations).</text>
</subparagraph></paragraph></subsection></section><section id="ID10df74a542db48fbabb4d75e382d9714"><enum>717.</enum><header>New product
approval—CFTC—SEC process</header>
<subsection id="ID26b23dc783b24136b72d32a508b519ca"><enum>(a)</enum><header>Amendments to the
Commodity Exchange Act</header><text>Section 2(a)(1)(C) of the Commodity
Exchange Act (7 U.S.C. 2(a)(1)(C)) is amended—</text>
<paragraph id="IDf674b434635942788ea863d5933aa55b"><enum>(1)</enum><text>in clause (i) by striking
<quote>This</quote> and inserting <quote>(I) Except as provided in subclause
(II), this</quote>; and</text>
</paragraph><paragraph id="ID9c364d95d77242c4b68cfab8c248ff8a"><enum>(2)</enum><text>by adding at the end of
clause (i) the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id2ADD0810644149B3BD23A544AB10023B" reported-display-style="italic" style="OLC">
<subclause id="ID295b4495e1bd47f78a099b8036ba942d"><enum>(II)</enum><text>This Act shall apply to
and the Commission shall have jurisdiction with respect to accounts,
agreements, and transactions involving, and may permit the listing for trading
pursuant to section 5c(c) of, a put, call, or other option on 1 or more
securities (as defined in section 2(a)(1) of the Securities Act of 1933 or
section 3(a)(10) of the Securities Exchange Act of 1934 on the date of
enactment of the Futures Trading Act of 1982), including any group or index of
such securities, or any interest therein or based on the value thereof, that is
exempted by the Securities and Exchange Commission pursuant to section 36(a)(1)
of the Securities Exchange Act of 1934 with the condition that the Commission
exercise concurrent jurisdiction over such put, call, or other option;
provided, however, that nothing in this paragraph shall be construed to affect
the jurisdiction and authority of the Securities and Exchange Commission over
such put, call, or other
option.</text>
</subclause><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="IDeb1a5f72dd8b48bb8711e729bfe9c80a"><enum>(b)</enum><header>Amendment to the
Securities Exchange Act of 1934</header><text>The Securities Exchange Act of
1934 is amended by adding the following section after section 3A (15 U.S.C.
78c–1):</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id25C4C7ABCDA94B169B8FE23E830C77EF" reported-display-style="italic" style="OLC">
<section id="ID723114f25e634626bba18fbc76a471ce"><enum>3B.</enum><header>Securities-related
derivatives</header>
<subsection id="IDd0f3ed3825364bf19eeed230cc9ab181"><enum>(a)</enum><text>Any agreement, contract,
or transaction (or class thereof) that is exempted by the Commodity Futures
Trading Commission pursuant to section 4(c)(1) of the Commodity Exchange Act (7
U.S.C. 6(c)(1)) with the condition that the Commission exercise concurrent
jurisdiction over such agreement, contract, or transaction (or class thereof)
shall be deemed a security for purposes of the securities laws.</text>
</subsection><subsection id="ID80d7b60ef30a4c05873b0c3e8fcde6f3"><enum>(b)</enum><text>With respect to any
agreement, contract, or transaction (or class thereof) that is exempted by the
Commodity Futures Trading Commission pursuant to section 4(c)(1) of the
Commodity Exchange Act (7 U.S.C. 6(c)(1)) with the condition that the
Commission exercise concurrent jurisdiction over such agreement, contract, or
transaction (or class thereof), references in the securities laws to the
<quote>purchase</quote> or <quote>sale</quote> of a security shall be deemed to
include the execution, termination (prior to its scheduled maturity date),
assignment, exchange, or similar transfer or conveyance of, or extinguishing of
rights or obligations under such agreement, contract, or transaction, as the
context may
require.</text>
</subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="ID2c5b1185d9144e91813909f0e6b5ed72"><enum>(c)</enum><header>Amendment to Securities
Exchange Act of 1934</header><text>Section 19(b) of the Securities Exchange Act
of 1934 (15 U.S.C. 78s(b)) is amended by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id1693F86E12F2479BA712B6815BC52A0E" reported-display-style="italic" style="OLC">
<paragraph id="ID58ed70271f2a484390fdc040b0bab72b"><enum>(10)</enum><text>Notwithstanding the
provisions of paragraph (2), the time period within which the Commission is
required by order to approve a proposed rule change or institute proceedings to
determine whether the proposed rule change should be disapproved is stayed
pending a determination by the Commission upon the request of the Commodity
Futures Trading Commission or its Chairman that the Commission issue a
determination as to whether a product that is the subject of such proposed rule
change is a security pursuant to section 718 of the
<short-title>Wall Street Transparency and Accountability
Act of
2010</short-title>.</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="IDecf28bd555e8478c981789d9c9df7d35"><enum>(d)</enum><header>Amendment to Commodity
Exchange Act</header><text>Section 5c(c)(1) of the Commodity Exchange Act (7
U.S.C. 7a–2(c)(1)) is amended—</text>
<paragraph id="id2D8F37FFD6BF4FCCABFBBCAC698F0A29"><enum>(1)</enum><text>by striking
<quote>Subject to paragraph (2)</quote> and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id8CCDD48A9D7E4DCF95DC8BC811899A71" reported-display-style="italic" style="OLC">
<subparagraph id="idC0EDA7D2907646DC93C9610FF48CDCD3"><enum>(A)</enum><header>Election</header><text>Subject
to paragraph (2)</text>
</subparagraph><after-quoted-block>;
and</after-quoted-block></quoted-block>
</paragraph><paragraph id="id82E3322B51B0423C92B8596F6A4057C2"><enum>(2)</enum><text>by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id04BAEE9B83284E68971F23B6CA40D0AC" reported-display-style="italic" style="OLC">
<subparagraph id="ID57789f3df69c4ed799c6c13f95340551"><enum>(B)</enum><header>Certification</header><text>The
certification of a product pursuant to this paragraph shall be stayed pending a
determination by the Commission upon the request of the Securities and Exchange
Commission or its Chairman that the Commission issue a determination as to
whether the product that is the subject of such certification is a contract of
sale of a commodity for future delivery, an option on such a contract, or an
option on a commodity pursuant to section 718 of the
<short-title>Wall Street Transparency and Accountability
Act of
2010</short-title>.</text>
</subparagraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection></section><section id="IDeab87e84ac9548c2991ca78e4dda69eb"><enum>718.</enum><header>Determining status of
novel derivative products</header>
<subsection id="ID26753fb6146046d59a951c4688a7676a"><enum>(a)</enum><header>Process for determining
the status of a novel derivative product</header>
<paragraph id="ID9cab825261704229a30b2b6830e39c95"><enum>(1)</enum><header>Notice</header>
<subparagraph id="ID64a76f9c1a164b0a8bfacfc4f223f60d"><enum>(A)</enum><header>In
general</header><text>Any person filing a proposal to list or trade a novel
derivative product that may have elements of both securities and contracts of
sale of a commodity for future delivery (or options on such contracts or
options on commodities) may concurrently provide notice and furnish a copy of
such filing with both the Securities and Exchange Commission and the Commodity
Futures Trading Commission. Any such notice shall state that notice has been
made with both Commissions.</text>
</subparagraph><subparagraph id="ID76c00472675e49e0bfc85f62a2e23e6f"><enum>(B)</enum><header>Notification</header><text>If
no concurrent notice is made pursuant to subparagraph (A), within 5 business
days after determining that a proposal that seeks to list or trade a novel
derivative product may have elements of both securities and contracts of sale
of a commodity for future delivery (or options on such contracts or options on
commodities), the Securities and Exchange Commission or the Commodity Futures
Trading Commission, as applicable, shall notify the other Commission and
provide a copy of such filing to the other Commission.</text>
</subparagraph></paragraph><paragraph id="ID15ea89a8d68f4f45996dd0d731e0f089"><enum>(2)</enum><header>Request for
determination</header>
<subparagraph id="IDc816f1609efb4c5e8c2fcce427c8bfc4"><enum>(A)</enum><header>In
general</header><text>No later than 21 days after receipt of a notice under
paragraph (1), or upon its own initiative if no such notice is received, the
Commodity Futures Trading Commission may request that the Securities and
Exchange Commission issue a determination as to whether a product is a
security, as defined in section 3(a)(10) of the Securities Exchange Act of 1934
(15 U.S.C. 78c(a)(10)).</text>
</subparagraph><subparagraph id="IDf0a923aae00041b396a219164b25a084"><enum>(B)</enum><header>Request</header><text>No
later than 21 days after receipt of a notice under paragraph (1), or upon its
own initiative if no such notice is received, the Securities and Exchange
Commission may request that the Commodity Futures Trading Commission issue a
determination as to whether a product is a contract of sale of a commodity for
future delivery, an option on such a contract, or an option on a commodity
subject to the Commodity Futures Trading Commission’s exclusive jurisdiction
under section 2(a)(1)(A) of the Commodity Exchange Act (7 U.S.C.
2(a)(1)(A)).</text>
</subparagraph><subparagraph id="IDc921b6156f1e45ffa1dcae7bf31ddd42"><enum>(C)</enum><header>Requirement relating to
request</header><text>A request under subparagraph (A) or (B) shall be made by
submitting such request, in writing, to the Securities and Exchange Commission
or the Commodity Futures Trading Commission, as applicable.</text>
</subparagraph><subparagraph id="ID8f9d5cf3ea664fd4ae39786e2c7d1c56"><enum>(D)</enum><header>Effect</header><text>Nothing
in this paragraph shall be construed to prevent—</text>
<clause id="ID010c9136ba5940d192fb15a1b75552f1"><enum>(i)</enum><text>the Commodity Futures
Trading Commission from requesting that the Securities and Exchange Commission
grant an exemption pursuant to section 36(a)(1) of the Securities Exchange Act
of 1934 (15 U.S.C. 78mm(a)(1)) with respect to a product that is the subject of
a filing under paragraph (1); or</text>
</clause><clause id="ID7d6d80845e2e43f38bbb167070434138"><enum>(ii)</enum><text>the Securities and
Exchange Commission from requesting that the Commodity Futures Trading
Commission grant an exemption pursuant to section 4(c)(1) of the Commodity
Exchange Act (7 U.S.C. 6(c)(1)) with respect to a product that is the subject
of a filing under paragraph (1).</text>
</clause><continuation-text continuation-text-level="subparagraph"><italic>Provided</italic>, however, that
nothing in this subparagraph shall be construed to require the Commodity
Futures Trading Commission or the Securities and Exchange Commission to issue
an exemption requested pursuant to this subparagraph; <italic>provided
further</italic>, That an order granting or denying an exemption described in
this subparagraph and issued under paragraph (3)(B) shall not be subject to
judicial review pursuant to subsection (b).</continuation-text></subparagraph><subparagraph id="IDacfd88cf3d504817a3d217628ee58335"><enum>(E)</enum><header>Withdrawal of
request</header><text>A request under subparagraph (A) or (B) may be withdrawn
by the Commission making the request at any time prior to a determination being
made pursuant to paragraph (3) for any reason by providing written notice to
the head of the other Commission.</text>
</subparagraph></paragraph><paragraph id="ID9c448c146dd14265862e7c6f7be8fda1"><enum>(3)</enum><header>Determination</header><text>Notwithstanding
any other provision of law, no later than 120 days after the date of receipt of
a request—</text>
<subparagraph id="IDc56552c49ec84184ac296445be63abc1"><enum>(A)</enum><text>under subparagraph (A) or
(B) of paragraph (2), unless such request has been withdrawn pursuant to
paragraph (2)(E), the Securities and Exchange Commission or the Commodity
Futures Trading Commission, as applicable, shall, by order, issue the
determination requested in subparagraph (A) or (B) of paragraph (2), as
applicable, and the reasons therefore; or</text>
</subparagraph><subparagraph id="ID170c1593d280400a8577d4b131c5a63d"><enum>(B)</enum><text>under paragraph (2)(D),
unless such request has been withdrawn, the Securities and Exchange Commission
or the Commodity Futures Trading Commission, as applicable, shall grant an
exemption or provide reasons for not granting such exemption, provided that any
decision by the Securities and Exchange Commission not to grant such exemption
shall not be reviewable under section 25 of the Securities Exchange Act of 1934
(15 U.S.C. 78y).</text>
</subparagraph></paragraph></subsection><subsection id="ID0e89dfb4fb004f589c96db677c688c6d"><enum>(b)</enum><header>Judicial
resolution</header>
<paragraph id="ID2be3ea99da7d4701a38dfe39b6cfb154"><enum>(1)</enum><header>In
general</header><text>The Commodity Futures Trading Commission or the
Securities and Exchange Commission may petition the United States Court of
Appeals for the District of Columbia Circuit for review of a final order of the
other Commission, with respect to a novel derivative product that may have
elements of both securities and contracts of sale of a commodity for future
delivery (or options on such contracts or options on commodities) that it
believes affects its statutory jurisdiction, including an order or orders
issued under subsection (a)(3)(A), by filing in such court, within 60 days
after the date of entry of such order, a written petition requesting a review
of the order. Any such proceeding shall be expedited by the Court of
Appeals.</text>
</paragraph><paragraph id="ID4d009765b6a14cd2aee01501a2ae5c43"><enum>(2)</enum><header>Transmittal of petition
and record</header><text>A copy of a petition described in paragraph (1) shall
be transmitted not later than 1 business day after filing by the complaining
Commission to the responding Commission. On receipt of the petition, the
responding Commission shall file with the court a copy of the order under
review and any documents referred to therein, and any other materials
prescribed by the court.</text>
</paragraph><paragraph id="ID2a6fc03c33d043d7b83ee31f70fbcc2c"><enum>(3)</enum><header>Standard of
review</header><text>The court, in considering a petition filed pursuant to
paragraph (1), shall give no deference to, or presumption in favor of, the
views of either Commission.</text>
</paragraph><paragraph id="ID679883dbe5d84acaa190ce3c6763e63f"><enum>(4)</enum><header>Judicial
stay</header><text>The filing of a petition by the complaining Commission
pursuant to paragraph (1) shall operate as a stay of the order, until the date
on which the determination of the court is final (including any appeal of the
determination).</text>
</paragraph></subsection></section></part><part id="H63A477D36A8C40878783DFAA0495B74B"><enum>II</enum><header>Regulation of Swap
Markets</header>
<section id="H6EB314D83E75400CAD3329F8927AE825"><enum>721.</enum><header>Definitions</header>
<subsection id="H50529562B4E147A5B79BE3E18E2C1A3C"><enum>(a)</enum><header>In
general</header><text>Section 1a of the Commodity Exchange Act (7 U.S.C. 1a) is
amended—</text>
<paragraph id="id88FE01BFEC5245E88C5C108CD2447E3B"><enum>(1)</enum><text>by redesignating
paragraphs (2), (3) and (4), (5) through (17), (18) through (23), (24) through
(28), (29), (30), (31) through (33), and (34) as paragraphs (6), (8) and (9),
(11) through (23), (26) through (31), (34) through (38), (40), (41), (44)
through (46), and (51), respectively;</text>
</paragraph><paragraph id="id6F54D5D5F67B480581AC12574AA7F640"><enum>(2)</enum><text>by inserting after
paragraph (1) the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id513CD77D769242DCAEB946E599A51205" reported-display-style="italic" style="OLC">
<paragraph id="id9394DF1CDC214FDB8912362C56555342"><enum>(2)</enum><header>Appropriate federal
banking agency</header><text>The term <term>appropriate Federal banking
agency</term> has the meaning given the term in section 3 of the Federal
Deposit Insurance Act (12 U.S.C. 1813).</text>
</paragraph><paragraph id="H1B71BE84E21446109CB6633313C000E0"><enum>(3)</enum><header>Associated person of a
security-based swap dealer or major security-based swap
participant</header><text display-inline="yes-display-inline">The term
<term>associated person of a security-based swap dealer or major security-based
swap participant</term> has the meaning given the term in section 3(a) of the
Securities Exchange Act of 1934 (15 U.S.C. 78c(a)).</text>
</paragraph><paragraph id="IDc1a850b5a4a14cc79a3114cb14e2a3db"><enum>(4)</enum><header>Associated person of a
swap dealer or major swap participant</header>
<subparagraph id="idFD6A95A15AD448DCB60166CBFAEE3948"><enum>(A)</enum><header>In
general</header><text>The term <term>associated person of a swap dealer or
major swap participant</term> means—</text>
<clause id="id5DDBEC0B81D148DDB80A2875E13E1A31"><enum>(i)</enum><text>any partner, officer,
director, or branch manager of a swap dealer or major swap participant
(including any individual who holds a similar status or performs a similar
function with respect to any partner, officer, director, or branch manager of a
swap dealer or major swap participant);</text>
</clause><clause id="id5DDD0B9BA42E437F9664091AEBF3F5D2"><enum>(ii)</enum><text>any person that directly
or indirectly controls, is controlled by, or is under common control with, a
swap dealer or major swap participant; and</text>
</clause><clause id="id9C4ADDF512694632A79942F04C8DE307"><enum>(iii)</enum><text>any employee of a swap
dealer or major swap participant.</text>
</clause></subparagraph><subparagraph id="idE6801E69727E435195243E9E75492A6B"><enum>(B)</enum><header>Exclusion</header><text>Other
than for purposes of section 4s(b)(6), the term <term>associated person of a
swap dealer or major swap participant</term> does not include any person
associated with a swap dealer or major swap participant the functions of which
are solely clerical or ministerial.</text>
</subparagraph></paragraph><paragraph display-inline="no-display-inline" id="HDA4056D445BF4CE1A980FDD960A472C9"><enum>(5)</enum><header>Board</header><text>The
term <term>Board</term> means the Board of Governors of the Federal Reserve
System.</text>
</paragraph><after-quoted-block>;</after-quoted-block></quoted-block>
</paragraph><paragraph display-inline="no-display-inline" id="id36708C5ABA3A480A98B22BAF41C6416A"><enum>(3)</enum><text>by inserting after
paragraph (6) (as redesignated by paragraph (1)) the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idF98401CAB9584228BDFD32F46F079155" reported-display-style="italic" style="OLC">
<paragraph id="IDba0743ec37924ef5a529bccaef01f19e"><enum>(7)</enum><header>Cleared
swap</header><text>The term <term>cleared swap</term> means any swap that is,
directly or indirectly, submitted to and cleared by a derivatives clearing
organization registered with the
Commission.</text>
</paragraph><after-quoted-block>;</after-quoted-block></quoted-block>
</paragraph><paragraph id="ID2cf957095e8c4e77ab699836fbb7d0ab"><enum>(4)</enum><text>in paragraph (9) (as
redesignated by paragraph (1)), by striking <quote>except onions</quote> and
all that follows through the period at the end and inserting the following:
<quote>except onions (as provided in section 13–1) and motion picture box
office receipts (or any index, measure, value, or data related to such
receipts), and all services, rights, and interests (except motion picture box
office receipts, or any index, measure, value or data related to such receipts)
in which contracts for future delivery are presently or in the future dealt
in.</quote>;</text>
</paragraph><paragraph id="ID3723bdcd65264121a602e6a59dcdf9ab"><enum>(5)</enum><text>by inserting after
paragraph (9) (as redesignated by paragraph (1)) the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id322512CB86B24F41A6A553B99774BEB4" reported-display-style="italic" style="OLC">
<paragraph id="IDd03d68ed0ecf4a4c864fb47617fb4e66"><enum>(10)</enum><header>Commodity
pool</header>
<subparagraph id="IDe946bdab39e54a34a5b27242dd767d16"><enum>(A)</enum><header>In
general</header><text>The term <term>commodity pool</term> means any investment
trust, syndicate, or similar form of enterprise operated for the purpose of
trading in commodity interests, including any—</text>
<clause id="ID37e29ae002ce4aabb3984e2fa2d217ea"><enum>(i)</enum><text>commodity for future
delivery, security futures product, or swap;</text>
</clause><clause id="IDef7f9a8d81724268aec1227b4afccc0b"><enum>(ii)</enum><text>agreement, contract, or
transaction described in section 2(c)(2)(C)(i) or section 2(c)(2)(D)(i);</text>
</clause><clause id="IDb714b982301d4f90bcb7c1b4b50b8108"><enum>(iii)</enum><text>commodity option
authorized under section 4c; or</text>
</clause><clause id="ID75e3a8418c3042e38b95cde6448b3ee2"><enum>(iv)</enum><text>leverage transaction
authorized under section 19.</text>
</clause></subparagraph><subparagraph id="ID1d32a2c617b94f338800b818d2c47dee"><enum>(B)</enum><header>Further
definition</header><text>The Commission, by rule or regulation, may include
within, or exclude from, the term <term>commodity pool</term> any investment
trust, syndicate, or similar form of enterprise if the Commission determines
that the rule or regulation will effectuate the purposes of this
Act.</text>
</subparagraph></paragraph><after-quoted-block>;</after-quoted-block></quoted-block>
</paragraph><paragraph id="IDa86e5a450ebf4d3a9ae823ce676910f2"><enum>(6)</enum><text>by striking paragraph
(11) (as redesignated by paragraph (1)) and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id4705982CADCB43169149215B3800A5E8" reported-display-style="italic" style="OLC">
<paragraph id="IDad7a8672538f427cb5b3014d268689c3"><enum>(11)</enum><header>Commodity pool
operator</header>
<subparagraph id="ID46a61bb082c04e66ad8717d257038fe1"><enum>(A)</enum><header>In
general</header><text>The term <term>commodity pool operator</term> means any
person—</text>
<clause id="ID4ff78683209d462eb2111444f534bb8c"><enum>(i)</enum><text>engaged in a business
that is of the nature of a commodity pool, investment trust, syndicate, or
similar form of enterprise, and who, in connection therewith, solicits,
accepts, or receives from others, funds, securities, or property, either
directly or through capital contributions, the sale of stock or other forms of
securities, or otherwise, for the purpose of trading in commodity interest,
including any—</text>
<subclause id="ID7b7c752f7aa7493cb27e45d204f080f9"><enum>(I)</enum><text>commodity for future
delivery, security futures product, or swap;</text>
</subclause><subclause id="IDcb9e3cd9009c4dbd82fac45d3c09d1e8"><enum>(II)</enum><text>agreement, contract, or
transaction described in section 2(c)(2)(C)(i) or section 2(c)(2)(D)(i);</text>
</subclause><subclause id="IDd7a15fba75dd4c6c871e88ca693995d7"><enum>(III)</enum><text>commodity option
authorized under section 4c; or</text>
</subclause><subclause id="IDf149c2dc0a184545a6127cf51c25b8ab"><enum>(IV)</enum><text>leverage transaction
authorized under section 19; or</text>
</subclause></clause><clause id="ID07b82d3ddc0b4773bc87fab3878380a9"><enum>(ii)</enum><text>who is registered with
the Commission as a commodity pool operator.</text>
</clause></subparagraph><subparagraph id="IDbca8016b846e4ec0a58864b06eb3fac8"><enum>(B)</enum><header>Further
definition</header><text>The Commission, by rule or regulation, may include
within, or exclude from, the term <term>commodity pool operator</term> any
person engaged in a business that is of the nature of a commodity pool,
investment trust, syndicate, or similar form of enterprise if the Commission
determines that the rule or regulation will effectuate the purposes of this
Act.</text>
</subparagraph></paragraph><after-quoted-block>;</after-quoted-block></quoted-block>
</paragraph><paragraph display-inline="no-display-inline" id="id58BE99CA150B473B8E6188356D6A29B9"><enum>(7)</enum><text>in paragraph (12) (as
redesignated by paragraph (1)), in subparagraph (A)—</text>
<subparagraph id="id2BDD45D1968F457E958DD1BE93BD8043"><enum>(A)</enum><text>in clause (i)—</text>
<clause id="id48C94A270B444F6CA623EB45C40B5697"><enum>(i)</enum><text>in subclause (I), by
striking <quote>made or to be made on or subject to the rules of a contract
market or derivatives transaction execution facility</quote> and inserting
<quote>, security futures product, or swap</quote>;</text>
</clause><clause id="ID5a0429f163b840dd81751ea034b28d84"><enum>(ii)</enum><text>by redesignating
subclauses (II) and (III) as subclauses (III) and (IV);</text>
</clause><clause id="ID2beb9ce9cc1643bfa37b440907f826a9"><enum>(iii)</enum><text>by inserting after
subclause (I) the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idE15AFDFC6D974742BFD87B95994C8A81" reported-display-style="italic" style="OLC">
<subclause id="id9471E91F6E524A24B8E6608405A08FF8"><enum>(II)</enum><text>any agreement, contract,
or transaction described in section 2(c)(2)(C)(i) or section
2(c)(2)(D)(i)</text>
</subclause><after-quoted-block>;
and</after-quoted-block></quoted-block>
</clause><clause id="id033706083A2E478883FF8E1AE104B108"><enum>(iv)</enum><text>in subclause (IV) (as so
redesignated), by striking <quote>or</quote>;</text>
</clause></subparagraph><subparagraph id="id8A5F3B5923204F1BBD5D23F98008E794"><enum>(B)</enum><text>in clause (ii), by
striking the period at the end and inserting a semicolon; and</text>
</subparagraph><subparagraph id="ID025c73e09d74453c9891a305c94be2d7"><enum>(C)</enum><text>by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id8A1216EB40964C4591F5A935120F2F35" reported-display-style="italic" style="OLC">
<clause id="id7483B42AD97E4D05B1AC9BBDF08A0291"><enum>(iii)</enum><text>is registered with the
Commission as a commodity trading advisor; or</text>
</clause><clause id="idCEC9FA94AF934E4294EB2FEC9304023A"><enum>(iv)</enum><text>the Commission, by rule
or regulation, may include if the Commission determines that the rule or
regulation will effectuate the purposes of this
Act.</text>
</clause><after-quoted-block>;</after-quoted-block></quoted-block>
</subparagraph></paragraph><paragraph display-inline="no-display-inline" id="id46FD9989A0FC492EAC55EFE5BEF8F040"><enum>(8)</enum><text>in paragraph (17) (as
redesignated by paragraph (1)), in subparagraph (A), in the matter preceding
clause (i), by striking <quote>paragraph (12)(A)</quote> and inserting
<quote>paragraph (18)(A)</quote>;</text>
</paragraph><paragraph display-inline="no-display-inline" id="id964620ADE6CE42DBA05F6DB00FC53FF4"><enum>(9)</enum><text>in paragraph (18) (as
redesignated by paragraph (1))—</text>
<subparagraph display-inline="no-display-inline" id="id79B3CBBD9D7E48DA88BD2F80F8BB8960"><enum>(A)</enum><text>in subparagraph
(A)—</text>
<clause display-inline="no-display-inline" id="id0DCB10BF354E42AE9172ED17794A2846"><enum>(i)</enum><text>in the matter following
clause (vii)(III)—</text>
<subclause display-inline="no-display-inline" id="idD8318DE7C767429AB98AE0DFAF24E566"><enum>(I)</enum><text>by striking
<quote>section 1a (11)(A)</quote> and inserting <quote>paragraph
(17)(A)</quote>; and</text>
</subclause><subclause display-inline="no-display-inline" id="id6C2A3DAE61734343B5E5A9A5D17B1B05"><enum>(II)</enum><text>by striking
<quote>$25,000,000</quote> and inserting <quote>$50,000,000</quote>; and</text>
</subclause></clause><clause display-inline="no-display-inline" id="id968F3962420648F8AB13138A2BD398F8"><enum>(ii)</enum><text>in clause (xi), in the
matter preceding subclause (I), by striking <quote>total assets in an
amount</quote> and inserting <quote>amounts invested on a discretionary basis,
the aggregate of which is</quote>;</text>
</clause></subparagraph></paragraph><paragraph display-inline="no-display-inline" id="id80D8A366E7A44181B5F5D1AF254B2732"><enum>(10)</enum><text>by striking paragraph
(22) (as redesignated by paragraph (1)) and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id7755931DD3624378B813DF94F381868F" reported-display-style="italic" style="OLC">
<paragraph id="ID3749e96d45084fb798ba593043fcc38c"><enum>(22)</enum><header>Floor broker</header>
<subparagraph id="ID07872326b1d74eac81677de619ecb6d9"><enum>(A)</enum><header>In
general</header><text>The term <term>floor broker</term> means any
person—</text>
<clause id="IDf46744bedbef46dfa4a1d0cc56997c89"><enum>(i)</enum><text>who, in or surrounding
any pit, ring, post, or other place provided by a contract market for the
meeting of persons similarly engaged, shall purchase or sell for any other
person—</text>
<subclause id="ID1d2f1e353e5c41569af3a860dfc1ef1b"><enum>(I)</enum><text>any commodity for future
delivery, security futures product, or swap; or</text>
</subclause><subclause id="IDcc0b86211e5f401492aa7844a889a576"><enum>(II)</enum><text>any commodity option
authorized under section 4c; or</text>
</subclause></clause><clause id="ID883d606e5f9d4aa6b33f8a30a10cc1ea"><enum>(ii)</enum><text>who is registered with
the Commission as a floor broker.</text>
</clause></subparagraph><subparagraph id="ID13b266597e5e4448ba32c27689f3b291"><enum>(B)</enum><header>Further
definition</header><text>The Commission, by rule or regulation, may include
within, or exclude from, the term <term>floor broker</term> any person in or
surrounding any pit, ring, post, or other place provided by a contract market
for the meeting of persons similarly engaged who trades for any other person if
the Commission determines that the rule or regulation will effectuate the
purposes of this
Act.</text>
</subparagraph></paragraph><after-quoted-block>;</after-quoted-block></quoted-block>
</paragraph><paragraph display-inline="no-display-inline" id="id753EB7CD85554A83AFB73787C019016A"><enum>(11)</enum><text>by striking paragraph
(23) (as redesignated by paragraph (1)) and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id24890D9761FD41CF979B077BAF0E7E50" reported-display-style="italic" style="OLC">
<paragraph id="ID6ffc8610a9cc4cb5aabcb667a5a1478d"><enum>(23)</enum><header>Floor trader</header>
<subparagraph id="ID67e9e96634604042b1d53205605b6260"><enum>(A)</enum><header>In
general</header><text>The term <term>floor trader</term> means any
person—</text>
<clause id="IDd100ee71dfe84e769f0b3f265f5094e6"><enum>(i)</enum><text>who, in or surrounding
any pit, ring, post, or other place provided by a contract market for the
meeting of persons similarly engaged, purchases, or sells solely for such
person’s own account—</text>
<subclause id="IDadeb8a747e424582b9ef4b2407dda7c3"><enum>(I)</enum><text>any commodity for future
delivery, security futures product, or swap; or</text>
</subclause><subclause id="IDd8ac7dc346584da59e7a887afd64e820"><enum>(II)</enum><text>any commodity option
authorized under section 4c; or</text>
</subclause></clause><clause id="ID064f8a25f48e4423aed937b792c7c276"><enum>(ii)</enum><text>who is registered with
the Commission as a floor trader.</text>
</clause></subparagraph><subparagraph id="ID0ec407ea7c7a4964bae437a4f50a7350"><enum>(B)</enum><header>Further
definition</header><text>The Commission, by rule or regulation, may include
within, or exclude from, the term <quote>floor trader</quote> any person in or
surrounding any pit, ring, post, or other place provided by a contract market
for the meeting of persons similarly engaged who trades solely for such
person’s own account if the Commission determines that the rule or regulation
will effectuate the purposes of this
Act.</text>
</subparagraph></paragraph><after-quoted-block>;</after-quoted-block></quoted-block>
</paragraph><paragraph display-inline="no-display-inline" id="idDAD8F54ABA6B4CCCA1EA55536AA37127"><enum>(12)</enum><text>by inserting after
paragraph (23) (as redesignated by paragraph (1)) the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id79031FCC199A486E87C989F3080C5DB1" reported-display-style="italic" style="OLC">
<paragraph id="HBD8FD18474DE45FC90DD417978A256EC"><enum>(24)</enum><header>Foreign exchange
forward</header><text>The term <term>foreign exchange forward</term> means a
transaction that solely involves the exchange of 2 different currencies on a
specific future date at a fixed rate agreed upon on the inception of the
contract covering the exchange.</text>
</paragraph><paragraph id="HBAEADDF1393C4AC1B9285A2C43D454A5"><enum>(25)</enum><header>Foreign exchange
swap</header><text>The term <term>foreign exchange swap</term> means a
transaction that solely involves—</text>
<subparagraph id="id31428AF10C864713AA1C883574BB2D2F"><enum>(A)</enum><text>an exchange of 2
different currencies on a specific date at a fixed rate that is agreed upon on
the inception of the contract covering the exchange; and</text>
</subparagraph><subparagraph id="id3378CB2C2E0E4A72AD43955DA42A011A"><enum>(B)</enum><text>a reverse exchange of the
2 currencies described in subparagraph (A) at a later date and at a fixed rate
that is agreed upon on the inception of the contract covering the
exchange.</text>
</subparagraph></paragraph><after-quoted-block>;</after-quoted-block></quoted-block>
</paragraph><paragraph display-inline="no-display-inline" id="id7678360699FA4146A5646BEA1405A3B5"><enum>(13)</enum><text>by striking paragraph
(28) (as redesignated by paragraph (1)) and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id1EB1CBB48C27427BA4DE372F00369A2E" reported-display-style="italic" style="OLC">
<paragraph id="ID449121883ced4efb8eca99e3ee52c6fb"><enum>(28)</enum><header>Futures commission
merchant</header>
<subparagraph id="IDfb3a8f90737d43aab9f87b3b670a6974"><enum>(A)</enum><header>In
general</header><text>The term <term>futures commission merchant</term> means
an individual, association, partnership, corporation, or trust—</text>
<clause id="ID96aa492be2994c4aa66d10be7638d328"><enum>(i)</enum><text>that—</text>
<subclause id="ID4a9c2f87d8e44ddf83e4f6cc26675c58"><enum>(I)</enum><text>is engaged in soliciting
or in accepting orders for—</text>
<item id="ID756608b0e5a94b0dbe851cb07ee576c0"><enum>(aa)</enum><text>the purchase or sale of
a commodity for future delivery;</text>
</item><item id="ID0fc412cc1e9047d18ea6bd3b9f1f7fb1"><enum>(bb)</enum><text>a security futures
product;</text>
</item><item id="IDfb617108a2e441c9a94e98bc839754a7"><enum>(cc)</enum><text>a swap;</text>
</item><item id="IDa619b50e672448d09078ff6373dd3a54"><enum>(dd)</enum><text>any agreement, contract,
or transaction described in section 2(c)(2)(C)(i) or section
2(c)(2)(D)(i);</text>
</item><item id="IDdd219882ad40477ba8449a026f6b882f"><enum>(ee)</enum><text>any commodity option
authorized under section 4c; or</text>
</item><item id="ID4bfd042a3090412ab9a171bddbe98fac"><enum>(ff)</enum><text>any leverage transaction
authorized under section 19; or</text>
</item></subclause><subclause id="IDccc8d50424814d9aa9bceb95492eb75d"><enum>(II)</enum><text>is acting as a
counterparty in any agreement, contract, or transaction described in section
2(c)(2)(C)(i) or section 2(c)(2)(D)(i); and</text>
</subclause><subclause commented="no" display-inline="no-display-inline" id="ID611c6359feaf43898fc11b5bcef1a7ee"><enum>(III)</enum><text display-inline="yes-display-inline">in or in connection with the activities
described in subclause (I) or (II), accepts any money, securities, or property
(or extends credit in lieu thereof) to margin, guarantee, or secure any trades
or contracts that result or may result therefrom; or</text>
</subclause></clause><clause id="IDc26c603aec4643418c8b439ae7354c1c"><enum>(ii)</enum><text>that is registered with
the Commission as a futures commission merchant.</text>
</clause></subparagraph><subparagraph id="IDc39df3630d0d47a1a93e45a627206056"><enum>(B)</enum><header>Further
definition</header><text>The Commission, by rule or regulation, may include
within, or exclude from, the term <quote>futures commission merchant</quote>
any person who engages in soliciting or accepting orders for, or acting as a
counterparty in, any agreement, contract, or transaction subject to this Act,
and who accepts any money, securities, or property (or extends credit in lieu
thereof) to margin, guarantee, or secure any trades or contracts that result or
may result therefrom, if the Commission determines that the rule or regulation
will effectuate the purposes of this
Act.</text>
</subparagraph></paragraph><after-quoted-block>;</after-quoted-block></quoted-block>
</paragraph><paragraph display-inline="no-display-inline" id="id31400F361CCC40AD907E2A315336B8EB"><enum>(14)</enum><text>in paragraph (30) (as
redesignated by paragraph (1)), in subparagraph (B), by striking
<quote>state</quote> and inserting <quote>State</quote>;</text>
</paragraph><paragraph display-inline="no-display-inline" id="idA6553CFC3E5541F28B9CDC2988BFEC60"><enum>(15)</enum><text>by striking paragraph
(31) (as redesignated by paragraph (1)) and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id87AED6CE3FD941668E3C6371A69EAE02" reported-display-style="italic" style="OLC">
<paragraph id="ID5da0456a236a47169f880bdead7d1d16"><enum>(31)</enum><header>Introducing
broker</header>
<subparagraph id="ID0c110674f44947218f7aeb90a73b8579"><enum>(A)</enum><header>In
general</header><text>The term <term>introducing broker</term> means any person
(except an individual who elects to be and is registered as an associated
person of a futures commission merchant)—</text>
<clause id="ID3815975f119a4fe5bdfd62a9fe0a6650"><enum>(i)</enum><text>who—</text>
<subclause id="ID45a8620d7c294c2382df0dbb4a4eaf27"><enum>(I)</enum><text>is engaged in soliciting
or in accepting orders for—</text>
<item id="ID54d855c50e524d42858e20a76e5f7cef"><enum>(aa)</enum><text>the purchase or sale of
any commodity for future delivery, security futures product, or swap;</text>
</item><item id="ID100e3328a2e1440885c4ac30461548af"><enum>(bb)</enum><text>any agreement, contract,
or transaction described in section 2(c)(2)(C)(i) or section
2(c)(2)(D)(i);</text>
</item><item id="ID57d98ab52008492684787fef4c54113b"><enum>(cc)</enum><text>any commodity option
authorized under section 4c; or</text>
</item><item id="ID67611a29b15e4691a3dcb8a604ef09c1"><enum>(dd)</enum><text>any leverage transaction
authorized under section 19; and</text>
</item></subclause><subclause id="IDb82c0ea5ae734c50bf11c385054bd6fe"><enum>(II)</enum><text>does not accept any
money, securities, or property (or extend credit in lieu thereof) to margin,
guarantee, or secure any trades or contracts that result or may result
therefrom; or</text>
</subclause></clause><clause id="ID1f45b535158b4b73af9acf79225e2426"><enum>(ii)</enum><text>who is registered with
the Commission as an introducing broker.</text>
</clause></subparagraph><subparagraph id="ID234eade5bddd48d196bdc0f2c38d2f32"><enum>(B)</enum><header>Further
definition</header><text>The Commission, by rule or regulation, may include
within, or exclude from, the term <quote>introducing broker</quote> any person
who engages in soliciting or accepting orders for any agreement, contract, or
transaction subject to this Act, and who does not accept any money, securities,
or property (or extend credit in lieu thereof) to margin, guarantee, or secure
any trades or contracts that result or may result therefrom, if the Commission
determines that the rule or regulation will effectuate the purposes of this
Act.</text>
</subparagraph></paragraph><after-quoted-block>;</after-quoted-block></quoted-block>
</paragraph><paragraph display-inline="no-display-inline" id="id72A8A700D5464B9B879082CC8A759859"><enum>(16)</enum><text>by inserting after
paragraph (31) (as redesignated by paragraph (1)) the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id3EB336A043554A25AE3C5513B9F73950" reported-display-style="italic" style="OLC">
<paragraph id="idD12FAF407BFF4106881ADFEC16DBB0B3"><enum>(32)</enum><header>Major security-based
swap participant</header><text>The term <term>major security-based swap
participant</term> has the meaning given the term in section 3(a) of the
Securities Exchange Act of 1934 (15 U.S.C. 78c(a)).</text>
</paragraph><paragraph commented="no" id="IDfde7cca54c004290b5c34aa15a7f1b47"><enum>(33)</enum><header>Major swap
participant</header>
<subparagraph commented="no" id="IDaf0b78e4b87543479e546e7ec9dcbaa7"><enum>(A)</enum><header>In
general</header><text>The term <term>major swap participant</term> means any
person who is not a swap dealer, and—</text>
<clause id="idB3B4BF9AF87F4D5DB99108F15C04B727"><enum>(i)</enum><text>maintains a substantial
position in swaps for any of the major swap categories as determined by the
Commission, excluding—</text>
<subclause id="id8D824CD852B14DB6BBC438631EC279B8"><enum>(I)</enum><text>positions held for
hedging or mitigating commercial risk; and</text>
</subclause><subclause id="id14C9212CD2F94F6EB39E1F59C0F48C5D"><enum>(II)</enum><text>positions maintained by
any employee benefit plan (or any contract held by such a plan) as defined in
paragraphs (3) and (32) of section 3 of the Employee Retirement Income Security
Act of 1974 (29 U.S.C. 1002) for the primary purpose of hedging or mitigating
any risk directly associated with the operation of the plan; or</text>
</subclause></clause><clause commented="no" id="ID117afd5e9cd9454ba6ac9d0c2323a4ca"><enum>(ii)</enum><text>whose outstanding swaps
create substantial counterparty exposure that could have serious adverse
effects on the financial stability of the United States banking system or
financial markets; or</text>
</clause><clause id="id94088031F4504753AAB4B61ADBBC99AC"><enum>(iii)</enum><subclause commented="no" display-inline="yes-display-inline" id="idB7CBC9B981524FC0AED76452316E8440"><enum>(I)</enum><text>is a financial entity,
other than an entity predominantly engaged in providing financing for the
purchase of an affiliate’s merchandise or manufactured goods, that is highly
leveraged relative to the amount of capital it holds; and</text>
</subclause><subclause changed="added" id="id9B4E9387A02942FE931D33B7A03921FB" indent="up1" reported-display-style="italic"><enum>(II)</enum><text>maintains a substantial
position in outstanding swaps in any major swap category as determined by the
Commission.</text>
</subclause></clause></subparagraph><subparagraph id="ID8844081c88554fa49fb039c2c8eaf07f"><enum>(B)</enum><header>Definition of
substantial position</header><text>For purposes of subparagraph (A), the
Commission shall define by rule or regulation the term <term>substantial
position</term> at the threshold that the Commission determines to be prudent
for the effective monitoring, management, and oversight of entities that are
systemically important or can significantly impact the financial system of the
United States.</text>
</subparagraph><subparagraph id="ID53e8ed7fc0ab40b78f3500125fc1dd02"><enum>(C)</enum><header>Scope of
designation</header><text>For purposes of subparagraph (A), a person may be
designated as a major swap participant for 1 or more categories of swaps
without being classified as a major swap participant for all classes of
swaps.</text>
</subparagraph><subparagraph id="IDdcdd7d2613ef42b5ada67a4370c0894c"><enum>(D)</enum><header>Capital</header><text>In
setting capital requirements for a person that is designated as a major swap
participant for a single type or single class or category of swaps or
activities, the prudential regulator and the Commission shall take into account
the risks associated with other types of swaps or classes of swaps or
categories of swaps engaged in and the other activities conducted by that
person that are not otherwise subject to regulation applicable to that person
by virtue of the status of the person as a major swap
participant.</text>
</subparagraph></paragraph><after-quoted-block>;</after-quoted-block></quoted-block>
</paragraph><paragraph display-inline="no-display-inline" id="id255E9E973CAD4F84AE9311EEFAEEA7C8"><enum>(17)</enum><text>by inserting after
paragraph (38) (as redesignated by paragraph (1)) the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id6C9047C1CC1E4DDFABB8BE2DF69FB5C5" reported-display-style="italic" style="OLC">
<paragraph id="IDbcc20afd95c04ecf8889d8a6bcefc51a"><enum>(39)</enum><header>Prudential
regulator</header><text>The term <term>prudential regulator</term>
means—</text>
<subparagraph id="ID491ab78e511743e79cbc6252ec563cb0"><enum>(A)</enum><text>the Office of the
Comptroller of the Currency, in the case of—</text>
<clause id="ID5e2fad5001c84b6e8c66cc8c5e321680"><enum>(i)</enum><text>any national banking
association;</text>
</clause><clause id="IDf7b42c3f37684b8d8a466475a7898bf6"><enum>(ii)</enum><text>any Federal branch or
agency of a foreign bank; or</text>
</clause><clause id="IDfc482ea7a85d42cb9c90e4656248614e"><enum>(iii)</enum><text>any Federal savings
association;</text>
</clause></subparagraph><subparagraph id="ID2a753cefc6c3415a93683baa9482976f"><enum>(B)</enum><text>the Federal Deposit
Insurance Corporation, in the case of—</text>
<clause id="IDcb0a9ab813cb4c81ae6e2cd0bc2905e1"><enum>(i)</enum><text>any insured State
bank;</text>
</clause><clause id="IDcdb06fcda31c4988ba24e99a776a9ffd"><enum>(ii)</enum><text>any foreign bank having
an insured branch; or</text>
</clause><clause id="IDf311418b3d1d4687b994401bec82024d"><enum>(iii)</enum><text>any State savings
association;</text>
</clause></subparagraph><subparagraph id="ID574c8d38eb31478cbc6bde77a9724752"><enum>(C)</enum><text>the Board of Governors of
the Federal Reserve System, in the case of—</text>
<clause id="IDef9e822569d94f4f8b4d98f9e49fb68d"><enum>(i)</enum><text>any noninsured State
member bank;</text>
</clause><clause id="ID7d447dc1ac8945e381dd2c451e0ce806"><enum>(ii)</enum><text>any branch or agency of
a foreign bank with respect to any provision of the Federal Reserve Act (12
U.S.C. 221 et seq.) which is made applicable under the International Banking
Act of 1978 (12 U.S.C. 3101 et seq.);</text>
</clause><clause id="ID12883a84b7b0481a8776ce9ca40c0318"><enum>(iii)</enum><text>any foreign bank which
does not operate an insured branch;</text>
</clause><clause id="IDa8952f0cf4d64aeca393afb2de7cb9ef"><enum>(iv)</enum><text>any agency or commercial
lending company other than a Federal agency; or</text>
</clause><clause id="IDbdf9b253706344a7b7f7682f09e8778c"><enum>(v)</enum><text>supervisory or regulatory
proceedings arising from the authority given to the Board of Governors under
section 7(c)(1) of the International Banking Act of 1978 (12 U.S.C.
3105(c)(1)), including such proceedings under the Financial Institutions
Supervisory Act of 1966 (12 U.S.C. 1464 et seq.); and</text>
</clause></subparagraph><subparagraph id="ID787a86ba066b406fbb16791ca449c14e"><enum>(D)</enum><text>the Farm Credit
Administration, in the case of a swap dealer, major swap participant,
security-based swap dealer, or major security-based swap participant that is an
institution chartered under the Farm Credit Act of 1971 (12 U.S.C. 2001 et
seq.).</text>
</subparagraph></paragraph><after-quoted-block>;</after-quoted-block></quoted-block>
</paragraph><paragraph id="H3618AE4DE9E64A00BD2D46B8FB177FC4"><enum>(18)</enum><text>in paragraph (40) (as
redesignated by paragraph (1))—</text>
<subparagraph id="HB7C53BE37FF549529B90A43F0C0F200E"><enum>(A)</enum><text>by striking subparagraph
(B);</text>
</subparagraph><subparagraph id="id9AAC06C68E8843BA819FECDB317E35EB"><enum>(B)</enum><text>by redesignating
subparagraphs (C), (D), and (E) as subparagraphs (B), (C), and (F),
respectively;</text>
</subparagraph><subparagraph id="idFF4F6AEF47FE489889E0E8AC7671A99F"><enum>(C)</enum><text>in subparagraph (C) (as
so redesignated), by striking <quote>and</quote>;</text>
</subparagraph><subparagraph id="HEB501D08A96548C4AA4783EA0B710F9B"><enum>(D)</enum><text>by inserting after
subparagraph (C) (as so redesignated) the following:</text>
<quoted-block changed="added" id="H00DA67270C6A4CDFA8EF8A01DF360606" reported-display-style="italic" style="OLC">
<subparagraph id="HE502AA124E9C4C05A490462374D91507"><enum>(D)</enum><text>a swap execution facility
registered under section 5h;</text>
</subparagraph><subparagraph id="H627CF94ADBE74C13AA41B7D2B2C94BD0"><enum>(E)</enum><text>a swap data repository;
and</text>
</subparagraph><after-quoted-block>; </after-quoted-block></quoted-block>
</subparagraph></paragraph><paragraph id="id47F54FE0615B49B59F368BB7B34ECA1A"><enum>(19)</enum><text>by inserting after
paragraph (41) (as redesignated by paragraph (1)) the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id30CD0FE968924993B69897C75C0AF9BD" reported-display-style="italic" style="OLC">
<paragraph display-inline="no-display-inline" id="H34EACB70F624493F96A8F64E94AC0912"><enum>(42)</enum><header>Security-based
swap</header><text display-inline="yes-display-inline">The term
<term>security-based swap</term> has the meaning given the term in section 3(a)
of the Securities Exchange Act of 1934 (15 U.S.C. 78c(a)).</text>
</paragraph><paragraph display-inline="no-display-inline" id="idE3FFE8A2DE9C4031BFA219676D346458"><enum>(43)</enum><header>Security-based swap
dealer</header><text display-inline="yes-display-inline">The term
<term>security-based swap dealer</term> has the meaning given the term in
section 3(a) of the Securities Exchange Act of 1934 (15 U.S.C.
78c(a)).</text>
</paragraph><after-quoted-block>;
</after-quoted-block></quoted-block>
</paragraph><paragraph display-inline="no-display-inline" id="H2976F5A6011D4D17964F62E1FA80A910"><enum>(20)</enum><text display-inline="yes-display-inline">in paragraph (46) (as redesignated by
paragraph (1)), by striking <quote>subject to section 2(h)(7)</quote> and
inserting <quote>subject to section 2(h)(5)</quote>;</text>
</paragraph><paragraph display-inline="no-display-inline" id="id6849182A360C4FCFB6F1F97C4C5160E4"><enum>(21)</enum><text display-inline="yes-display-inline">by inserting after paragraph (46) (as
redesignated by paragraph (1)) the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="H0A5829096F8242A7850E1E208BD4DF83" reported-display-style="italic" style="OLC">
<paragraph id="ID1a87a63938e045df9691421c59422ee9"><enum>(47)</enum><header>Swap</header>
<subparagraph id="ID92fd7258e0ff45efaf2b18fcc115174b"><enum>(A)</enum><header>In
general</header><text>Except as provided in subparagraph (B), the term
<term>swap</term> means any agreement, contract, or transaction—</text>
<clause id="IDb31aac84de8a41a9afa92c7061cccd83"><enum>(i)</enum><text>that is a put, call, cap,
floor, collar, or similar option of any kind that is for the purchase or sale,
or based on the value, of 1 or more interest or other rates, currencies,
commodities, securities, instruments of indebtedness, indices, quantitative
measures, or other financial or economic interests or property of any
kind;</text>
</clause><clause id="ID0c2311460abe499783c0a7788a99b3d5"><enum>(ii)</enum><text>that provides for any
purchase, sale, payment, or delivery (other than a dividend on an equity
security) that is dependent on the occurrence, nonoccurrence, or the extent of
the occurrence of an event or contingency associated with a potential
financial, economic, or commercial consequence;</text>
</clause><clause id="ID698861d8583544ae9ec65717fe63cc64"><enum>(iii)</enum><text>that provides on an
executory basis for the exchange, on a fixed or contingent basis, of 1 or more
payments based on the value or level of 1 or more interest or other rates,
currencies, commodities, securities, instruments of indebtedness, indices,
quantitative measures, or other financial or economic interests or property of
any kind, or any interest therein or based on the value thereof, and that
transfers, as between the parties to the transaction, in whole or in part, the
financial risk associated with a future change in any such value or level
without also conveying a current or future direct or indirect ownership
interest in an asset (including any enterprise or investment pool) or liability
that incorporates the financial risk so transferred, including any agreement,
contract, or transaction commonly known as—</text>
<subclause id="id1C2F01338F78413F809A612375D122E2"><enum>(I)</enum><text>an interest rate
swap;</text>
</subclause><subclause id="id660B51B406024D7E8F25EE1638C214C4"><enum>(II)</enum><text>a rate floor;</text>
</subclause><subclause id="id0EB1EE4534804AC2852AA1F3B9D84CE7"><enum>(III)</enum><text>a rate cap;</text>
</subclause><subclause id="id38F8BD25B2F8486AAB4C9B738008544F"><enum>(IV)</enum><text>a rate collar;</text>
</subclause><subclause id="id52DD4599312B4DFCB08D00E7D679EA4D"><enum>(V)</enum><text>a cross-currency rate
swap;</text>
</subclause><subclause id="id753B6D426C794179AAA25129A478A1AE"><enum>(VI)</enum><text>a basis swap;</text>
</subclause><subclause id="id11B25DAE9F1648FDA691920D1EF49EF9"><enum>(VII)</enum><text>a currency swap;</text>
</subclause><subclause id="id0A0D4FABDAE949EEA2D913F74A236E89"><enum>(VIII)</enum><text>a foreign exchange
swap;</text>
</subclause><subclause id="id217A31BE9A0641B0B75B1873AC605D84"><enum>(IX)</enum><text>a total return
swap;</text>
</subclause><subclause id="id8D0DC445DB8B4BE5A16F7F402113DA8E"><enum>(X)</enum><text>an equity index
swap;</text>
</subclause><subclause id="idF5C191AF38B3485986049B321093BE40"><enum>(XI)</enum><text>an equity swap;</text>
</subclause><subclause id="id6751E709897C45AF860127005901734D"><enum>(XII)</enum><text>a debt index
swap;</text>
</subclause><subclause id="idE6D409BDDE7F4F4FAAC066167A13450B"><enum>(XIII)</enum><text>a debt swap;</text>
</subclause><subclause id="id21010053E1F84A9CB567AA44BF23ABBC"><enum>(XIV)</enum><text>a credit spread;</text>
</subclause><subclause id="id6447E222B0B447E8AF315C9167973B88"><enum>(XV)</enum><text>a credit default
swap;</text>
</subclause><subclause id="id2E288F33CCB145E6A4E8286A0D74AF4C"><enum>(XVI)</enum><text>a credit swap;</text>
</subclause><subclause id="id81DDEC98113844A08C208FB1B602BB9A"><enum>(XVII)</enum><text>a weather swap;</text>
</subclause><subclause id="id6DBF6B79E6C04478AE7E7FFFD2D4AA01"><enum>(XVIII)</enum><text>an energy
swap;</text>
</subclause><subclause id="id2F35A914396643AAB30546282BFBEFC1"><enum>(XIX)</enum><text>a metal swap;</text>
</subclause><subclause id="idA4EBE1CFEB4540AEBD9401E5E13CDF0A"><enum>(XX)</enum><text>an agricultural
swap;</text>
</subclause><subclause id="idEA71CE88B3BA4B3D91D0A2E79D8B4BF2"><enum>(XXI)</enum><text>an emissions swap;
and</text>
</subclause><subclause id="id20287223C0EE42619134CCE2F747876E"><enum>(XXII)</enum><text>a commodity
swap;</text>
</subclause></clause><clause id="IDddebe056921149f8b5a9e146e5a7377d"><enum>(iv)</enum><text>that is an agreement,
contract, or transaction that is, or in the future becomes commonly known to
the trade as a swap;</text>
</clause><clause id="ID40d20eb87e3f4569a119ebf7eb9e52d1"><enum>(v)</enum><text>including any
security-based swap agreement which meets the definition of <quote>swap
agreement</quote> as defined in section 206A of the Gramm-Leach-Bliley Act (15
U.S.C. 78c note) of which a material term is based on the price, yield, value,
or volatility of any security or any group or index of securities, or any
interest therein; or</text>
</clause><clause id="IDcc4455d44a5442b1afae1d8b8781dea7"><enum>(vi)</enum><text>that is any combination
or permutation of, or option on, any agreement, contract, or transaction
described in any of clauses (i) through (v).</text>
</clause></subparagraph><subparagraph id="ID749210a188084acba142d2a0e6bd9a08"><enum>(B)</enum><header>Exclusions</header><text>The
term <term>swap</term> does not include—</text>
<clause id="ID291aa5b11b214d4692c6adf49b7ff3f1"><enum>(i)</enum><text>any contract of sale of a
commodity for future delivery (or option on such a contract), leverage contract
authorized under section 19, security futures product, or agreement, contract,
or transaction described in section 2(c)(2)(C)(i) or section
2(c)(2)(D)(i);</text>
</clause><clause id="IDa21c45d9528343808eaff47463de7cc7"><enum>(ii)</enum><text>any sale of a
nonfinancial commodity or security for deferred shipment or delivery, so long
as the transaction is intended to be physically settled;</text>
</clause><clause id="ID0189205e2c8448ea89d76c62e302850b"><enum>(iii)</enum><text>any put, call,
straddle, option, or privilege on any security, certificate of deposit, or
group or index of securities, including any interest therein or based on the
value thereof, that is subject to—</text>
<subclause id="id510EABF6F24643A5B45482EB1B0ECA19"><enum>(I)</enum><text>the Securities Act of
1933 (15 U.S.C. 77a et seq.); and</text>
</subclause><subclause id="id5BF637D54EDF4AFCA05D7F1155944487"><enum>(II)</enum><text>the Securities Exchange
Act of 1934 (15 U.S.C. 78a et seq.);</text>
</subclause></clause><clause id="IDdb30ef80d1924b5daa575e3189fbdb2e"><enum>(iv)</enum><text>any put, call, straddle,
option, or privilege relating to a foreign currency entered into on a national
securities exchange registered pursuant to section 6(a) of the Securities
Exchange Act of 1934 (15 U.S.C. 78f(a));</text>
</clause><clause id="ID5c730d286e92412b9f78d49104d9253d"><enum>(v)</enum><text>any agreement, contract,
or transaction providing for the purchase or sale of 1 or more securities on a
fixed basis that is subject to—</text>
<subclause id="id831C5A61CC4142F18B1CD8E5EAE347E6"><enum>(I)</enum><text>the Securities Act of
1933 (15 U.S.C. 77a et seq.); and</text>
</subclause><subclause id="id7C5D0E3C7C334EB9975164A0A50CAC3A"><enum>(II)</enum><text>the Securities Exchange
Act of 1934 (15 U.S.C. 78a et seq.);</text>
</subclause></clause><clause id="ID10f24d86b11b4c7488acfd7c0dde8ec2"><enum>(vi)</enum><text>any agreement, contract,
or transaction providing for the purchase or sale of 1 or more securities on a
contingent basis that is subject to the Securities Act of 1933 (15 U.S.C. 77a
et seq.) and the Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.),
unless the agreement, contract, or transaction predicates the purchase or sale
on the occurrence of a bona fide contingency that might reasonably be expected
to affect or be affected by the creditworthiness of a party other than a party
to the agreement, contract, or transaction;</text>
</clause><clause id="ID407d4186598b4406b10718537e775a38"><enum>(vii)</enum><text>any note, bond, or
evidence of indebtedness that is a security, as defined in section 2(a) of the
Securities Act of 1933 (15 U.S.C. 77b(a));</text>
</clause><clause id="IDf004f362df4d489ea8ebc79788d1ed12"><enum>(viii)</enum><text>any agreement,
contract, or transaction that is—</text>
<subclause id="ID79562824c83947aa85be00f0214e4431"><enum>(I)</enum><text>based on a security;
and</text>
</subclause><subclause id="IDb36a4773cfd54511934621a389312972"><enum>(II)</enum><text>entered into directly or
through an underwriter (as defined in section 2(a) of the Securities Act of
1933 (15 U.S.C. 77b(a))) by the issuer of such security for the purposes of
raising capital, unless the agreement, contract, or transaction is entered into
to manage a risk associated with capital raising;</text>
</subclause></clause><clause id="ID7f102f99a2f147d887ca173cc18fdcf2"><enum>(ix)</enum><text>any agreement, contract,
or transaction a counterparty of which is a Federal Reserve bank, the Federal
Government, or a Federal agency that is expressly backed by the full faith and
credit of the United States; and</text>
</clause><clause id="ID2368074b9e104c468ba14b0796c3e939"><enum>(x)</enum><text>any security-based swap,
other than a security-based swap as described in subparagraph (D).</text>
</clause></subparagraph><subparagraph id="ID98025699b3a64fe49ef5022ec471a74a"><enum>(C)</enum><header>Rule of construction
regarding master agreements</header>
<clause id="id81F9A5BB5A3D4864818B36EA32D344B7"><enum>(i)</enum><header>In
general</header><text>Except as provided in clause (ii), the term
<term>swap</term> includes a master agreement that provides for an agreement,
contract, or transaction that is a swap under subparagraph (A), together with
each supplement to any master agreement, without regard to whether the master
agreement contains an agreement, contract, or transaction that is not a swap
pursuant to subparagraph (A).</text>
</clause><clause id="idD9383FFF25D1427BB51575B5C3353AA8"><enum>(ii)</enum><header>Exception</header><text>For
purposes of clause (i), the master agreement shall be considered to be a swap
only with respect to each agreement, contract, or transaction covered by the
master agreement that is a swap pursuant to subparagraph (A).</text>
</clause></subparagraph><subparagraph id="ID79573fd59a9643f496e149971df7947a"><enum>(D)</enum><header>Mixed
swap</header><text>The term <term>security-based swap</term> includes any
agreement, contract, or transaction that is as described in section 3(a)(68)(A)
of the Securities Exchange Act of 1934 (15 U.S.C. 78c(a)(68)(A)) and also is
based on the value of 1 or more interest or other rates, currencies,
commodities, instruments of indebtedness, indices, quantitative measures, other
financial or economic interest or property of any kind (other than a single
security or a narrow-based security index), or the occurrence, non-occurrence,
or the extent of the occurrence of an event or contingency associated with a
potential financial, economic, or commercial consequence (other than an event
described in subparagraph (A)(iii)).</text>
</subparagraph><subparagraph id="ID786919a62dca409387703a2b1a71778c"><enum>(E)</enum><header>Treatment of foreign
exchange swaps and forwards</header>
<clause id="ID869d97ca5fe94ff584d857ce53bf903d"><enum>(i)</enum><header>In
general</header><text>Foreign exchange swaps and foreign exchange forwards
shall be considered swaps under this paragraph unless the Secretary makes a
written determination that either foreign exchange swaps or foreign exchange
forwards or both—</text>
<subclause id="ID692dfe07b6744513a0b5b725fd660793"><enum>(I)</enum><text>should be not be
regulated as swaps under this Act; and</text>
</subclause><subclause id="IDf534e9ed043c467090bf7355a7afec70"><enum>(II)</enum><text>are not structured to
evade the <short-title>Wall Street Transparency and
Accountability Act of 2010</short-title> in violation of any rule promulgated
by the Commission pursuant to section 111(c) of that Act.</text>
</subclause></clause><clause id="IDe323c07a91d34b998c4010a1fa8a23ad"><enum>(ii)</enum><header>Congressional notice;
effectiveness</header><text>The Secretary shall submit any written
determination under clause (i) to the appropriate committees of Congress,
including the Committee on Agriculture, Nutrition, and Forestry of the Senate
and the Committee on Agriculture of the House of Representatives. Any such
written determination by the Secretary shall not be effective until it is
submitted to the appropriate committees of Congress.</text>
</clause><clause id="IDf4b394e306fc47629f9160408513e42b"><enum>(iii)</enum><header>Reporting</header><text>Notwithstanding
a written determination by the Secretary under clause (i), all foreign exchange
swaps and foreign exchange forwards shall be reported to either a swap data
repository, or, if there is no swap data repository that would accept such
swaps or forwards, to the Commission pursuant to section 4r within such time
period as the Commission may by rule or regulation prescribe.</text>
</clause><clause id="ID8f4f3ef41de348a183dcc395c682a310"><enum>(iv)</enum><header>Business
standards</header><text>Notwithstanding clauses (ix) and (x) of subparagraph
(B) and clause (ii), any party to a foreign exchange swap or forward that is a
swap dealer or major swap participant shall conform to the business conduct
standards contained in section 4s(h).</text>
</clause><clause id="IDe38af50932b7409cb0151061e3a8ba8f"><enum>(v)</enum><header>Secretary</header><text>For
purposes of this subparagraph only, the term <term>Secretary</term> means the
Secretary of the Treasury.</text>
</clause></subparagraph><subparagraph id="IDd055a33b173f466a9e0825e8640c1b59"><enum>(F)</enum><header>Exception for certain
foreign exchange swaps and forwards</header>
<clause id="ID3e16670398674e93bf4752b50be1facb"><enum>(i)</enum><header>Registered
entities</header><text>Any foreign exchange swap and any foreign exchange
forward that is listed and traded on or subject to the rules of a designated
contract market or a swap execution facility, or that is cleared by a
derivatives clearing organization shall not be exempt from any provision of
this Act or amendments made by the <short-title>Wall
Street Transparency and Accountability Act of 2010</short-title> prohibiting
fraud or manipulation.</text>
</clause><clause id="ID8e2cab7b2f924aec94ae0172cfde2e44"><enum>(ii)</enum><header>Retail
transactions</header><text>Nothing in subparagraph (E) shall affect, or be
construed to affect, the applicability of this Act or the jurisdiction of the
Commission with respect to agreements, contracts, or transactions in foreign
currency pursuant to section 2(c)(2).</text>
</clause></subparagraph></paragraph><paragraph id="id5DBE395AF55C4B46A11565D5E6648C5B"><enum>(48)</enum><header>Swap data
repository</header><text display-inline="yes-display-inline">The term
<term>swap data repository</term> means any person that collects, calculates,
prepares, or maintains information or records with respect to transactions or
positions in, or the terms and conditions of, swaps entered into by third
parties.</text>
</paragraph><paragraph id="ID61e96435f02b4d9e9d1c285f7e629944"><enum>(49)</enum><header>Swap dealer</header>
<subparagraph id="ID11907043d4f24d239b1f9963aeec34cf"><enum>(A)</enum><header>In
general</header><text>The term <term>swap dealer</term> means any person
who—</text>
<clause id="IDc0754007cb3a45beadc671ff6cd3cef1"><enum>(i)</enum><text>holds itself out as a
dealer in swaps;</text>
</clause><clause id="ID67bed3e23169462a9f611d364f0d78ef"><enum>(ii)</enum><text>makes a market in
swaps;</text>
</clause><clause id="ID81cf9c2eabf84dc59d6b576a10b59ff0"><enum>(iii)</enum><text>regularly engages in
the purchase and sale of swaps in the ordinary course of business; or</text>
</clause><clause id="ID370312521639493cb12de88b389b53f5"><enum>(iv)</enum><text>engages in any activity
causing the person to be commonly known in the trade as a dealer or market
maker in swaps.</text>
</clause></subparagraph><subparagraph id="IDd6b7babc608a4f50908526e60cf65fd1"><enum>(B)</enum><header>Inclusion</header><text>A
person may be designated as a swap dealer for a single type or single class or
category of swap or activities and considered not to be a swap dealer for other
types, classes, or categories of swaps or activities.</text>
</subparagraph><subparagraph id="ID8c31627c27b64fdeb8c6e879acdb1198"><enum>(C)</enum><header>Capital</header><text>In
setting capital requirements for a person that is designated as a swap dealer
for a single type or single class or category of swap or activities, the
prudential regulator and the Commission shall take into account the risks
associated with other types of swaps or classes of swaps or categories of swaps
engaged in and the other activities conducted by that person that are not
otherwise subject to regulation applicable to that person by virtue of the
status of the person as a swap dealer.</text>
</subparagraph><subparagraph id="ID3e3ee6db0e5f44838d9a851b91f681db"><enum>(D)</enum><header>Exception</header><text>The
term <term>swap dealer</term> does not include a person that buys or sells
swaps for such person’s own account, either individually or in a fiduciary
capacity, but not as a part of a regular business.</text>
</subparagraph></paragraph><paragraph id="id91E0AEA5517D4A1BB05E221691C9CF02"><enum>(50)</enum><header>Swap execution
facility</header><text>The term <term>swap execution facility</term> means a
facility in which multiple participants have the ability to execute or trade
swaps by accepting bids and offers made by other participants that are open to
multiple participants in the facility or system, through any means of
interstate commerce, including any trading facility, that—</text>
<subparagraph id="id24FA7C3B4B124063A92E74AE2436CCF0"><enum>(A)</enum><text>facilitates the execution
of swaps between persons; and</text>
</subparagraph><subparagraph id="id94174728A517428CB9AD199E9B3CFFFC"><enum>(B)</enum><text>is not a designated
contract market.</text>
</subparagraph></paragraph><after-quoted-block>;
and</after-quoted-block></quoted-block>
</paragraph><paragraph display-inline="no-display-inline" id="idCCB84A7B957142F2AE21619780F0396D"><enum>(22)</enum><text>in paragraph (51) (as
redesignated by paragraph (1)), in subparagraph (A)(i), by striking
<quote>partipants</quote> and inserting <quote>participants</quote>.</text>
</paragraph></subsection><subsection id="ID23bf2953e4394663bd6f386557c9c754"><enum>(b)</enum><header>Authority To define
terms</header><text>The Commodity Futures Trading Commission may adopt a rule
to define—</text>
<paragraph id="id4BF797E025B64B53BE05F75CA1FA80D0"><enum>(1)</enum><text>the term <term>commercial
risk</term>; and</text>
</paragraph><paragraph id="id56AB96CDD49D4136AD090C4FA58668D0"><enum>(2)</enum><text>any other term included
in an amendment to the <act-name parsable-cite="COMEX">Commodity Exchange
Act</act-name> (7 U.S.C. 1 et seq.) made by this subtitle.</text>
</paragraph></subsection><subsection id="H685CDA6D192245748B898DB3B9CD1E79"><enum>(c)</enum><header>Modification of
definitions</header><text display-inline="yes-display-inline">To include
transactions and entities that have been structured to evade this subtitle (or
an amendment made by this subtitle), the Commodity Futures Trading Commission
shall adopt a rule to further define the terms <term>swap</term>, <term>swap
dealer</term>, <term>major swap participant</term>, and <term>eligible contract
participant</term>.</text>
</subsection><subsection commented="no" id="H6CEA4455F6D4447F93FF9770129674C0"><enum>(d)</enum><header>Exemptions</header><text>Section
4(c)(1) of the Commodity Exchange Act (7 U.S.C. 6(c)(1)) is amended by striking
<quote>except that</quote> and all that follows through the period at the end
and inserting the following: “except that—</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id0B8E51177F314ED19005342379A44808" reported-display-style="italic" style="OLC">
<subparagraph commented="no" id="IDda7d968dee5d43029a978e38bc31dd1b"><enum>(A)</enum><text display-inline="yes-display-inline">unless the Commission is expressly
authorized by any provision described in this subparagraph to grant exemptions,
with respect to amendments made by subtitle A of the Wall Street Transparency
and Accountability Act of 2010—</text>
<clause commented="no" id="id5543356A18EB4D2D9C2E7F7E8BF0AFFB"><enum>(i)</enum><text display-inline="yes-display-inline">with respect to—</text>
<subclause commented="no" id="id1C0DA2D087EC475683A6CCFD048C236D"><enum>(I)</enum><text display-inline="yes-display-inline">paragraphs (2), (3), (4), (5), and (7),
clause (vii)(III) of paragraph (17), paragraphs (23), (24), (31), (32), (38),
(39), (41), (42), (46), (47), (48), and (49) of section 1a, and sections
2(a)(13), 2(c)(D), 4a(a), 4a(b), 4d(c), 4d(d), 4r, 4s, 5b(a), 5b(b), 5(d),
5(g), 5(h), 5b(c), 5b(i), 8e, and 21; and</text>
</subclause><subclause commented="no" id="idBA01AEB485CB4473B21E68059E4A7A37"><enum>(II)</enum><text>section 206(e) of the
Gramm-Leach-Bliley Act (Public Law 106–102; 15 U.S.C. 78c note); and</text>
</subclause></clause><clause commented="no" id="idCB14191825974D858F033E9C53D30FDB"><enum>(ii)</enum><text display-inline="yes-display-inline">in subsection (c) of section 111 and
section 132; and</text>
</clause></subparagraph><subparagraph commented="no" id="id9C512A6684B540EE9047C522329A2550"><enum>(B)</enum><text>the Commission and the
Securities and Exchange Commission may by rule, regulation, or order jointly
exclude any agreement, contract, or transaction from section 2(a)(1)(D)) if the
Commission determines that the exemption would be consistent with the public
interest.</text>
</subparagraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection commented="no" id="id01363679787E49E9B3B0BEDD535E199F"><enum>(e)</enum><header>Conforming
Amendments</header>
<paragraph id="id181330EA337748AEAC21ABECC7603B76"><enum>(1)</enum><text>Section 2(c)(2)(B)(i)(II)
of the <act-name parsable-cite="COMEX">Commodity Exchange Act</act-name> (7
U.S.C. 2(c)(2)(B)(i)(II)) is amended—</text>
<subparagraph id="id7127B12990DC454C9070121DB93CF20B"><enum>(A)</enum><text>in item (cc)—</text>
<clause id="id5F95A0519D4641E4BE52DA8C31E4369F"><enum>(i)</enum><text>in subitem (AA), by
striking <quote>section 1a(20)</quote> and inserting <quote>section 1a</quote>;
and</text>
</clause><clause id="id308DD92E161F40A582D8BF9C7337EAB5"><enum>(ii)</enum><text>in subitem (BB), by
striking <quote>section 1a(20)</quote> and inserting <quote>section 1a</quote>;
and</text>
</clause></subparagraph><subparagraph id="id097A838257C84559AE20F92DA3330926"><enum>(B)</enum><text>in item (dd), by striking
<quote>section 1a(12)(A)(ii)</quote> and inserting <quote>section
1a(18)(A)(ii)</quote>.</text>
</subparagraph></paragraph><paragraph id="id4E3B8251F8844325AF3C9A460EEBDD43"><enum>(2)</enum><text>Section 4m(3) of the
<act-name parsable-cite="COMEX">Commodity Exchange Act</act-name> (7 U.S.C.
6m(3)) is amended by striking <quote>section 1a(6)</quote> and inserting
<quote>section 1a</quote>.</text>
</paragraph><paragraph id="id026189129C5345D29B02247E10B49328"><enum>(3)</enum><text>Section 4q(a)(1) of the
<act-name parsable-cite="COMEX">Commodity Exchange Act</act-name> (7 U.S.C.
6o–1(a)(1)) is amended by striking <quote>section 1a(4)</quote> and inserting
<quote>section 1a(9)</quote>.</text>
</paragraph><paragraph id="idB81751AB49F3464EA5D836A0B9554DE6"><enum>(4)</enum><text>Section 5(e)(1) of the
<act-name parsable-cite="COMEX">Commodity Exchange Act</act-name> (7 U.S.C.
7(e)(1)) is amended by striking <quote>section 1a(4)</quote> and inserting
<quote>section 1a(9)</quote>.</text>
</paragraph><paragraph id="id5CE628D5F0184DE18918767B10366822"><enum>(5)</enum><text>Section 5a(b)(2)(F) of
the <act-name parsable-cite="COMEX">Commodity Exchange Act</act-name> (7 U.S.C.
7a(b)(2)(F)) is amended by striking <quote>section 1a(4)</quote> and inserting
<quote>section 1a(9)</quote>.</text>
</paragraph><paragraph id="idD280ADB57E364F37B36805F98E77B708"><enum>(6)</enum><text>Section 5b(a) of the
<act-name parsable-cite="COMEX">Commodity Exchange Act</act-name> (7 U.S.C.
7a–1(a)) is amended, in the matter preceding paragraph (1), by striking
<quote>section 1a(9)</quote> and inserting <quote>section 1a</quote>.</text>
</paragraph><paragraph id="id6A92AEA984FD40A4BBEEA53DA0299C9A"><enum>(7)</enum><text>Section 5c(c)(2)(B) of
the <act-name parsable-cite="COMEX">Commodity Exchange Act</act-name> (7 U.S.C.
7a–2(c)(2)(B)) is amended by striking <quote>section 1a(4)</quote> and
inserting <quote>section 1a(9)</quote>.</text>
</paragraph><paragraph id="id48EC6BEC1D7D4522993674C0EE3AC60B"><enum>(8)</enum><text>Section 6(g)(5)(B)(i) of
the Securities Exchange Act of 1934 (15 U.S.C. 78f(g)(5)(B)(i)) is
amended—</text>
<subparagraph id="idB3E0A2DBAF8A43919A7860D6D7E2F9D0"><enum>(A)</enum><text>in subclause (I), by
striking <quote>section 1a(12)(B)(ii)</quote> and inserting <quote>section
1a(18)(B)(ii)</quote>; and</text>
</subparagraph><subparagraph id="id1CDC9D02B257438A975141DAF960BEA0"><enum>(B)</enum><text>in subclause (II), by
striking <quote>section 1a(12)</quote> and inserting <quote>section
1a(18)</quote>.</text>
</subparagraph></paragraph><paragraph id="id5BCAE89895D84668BA9F4FA4C91949BE"><enum>(9)</enum><text>The Legal Certainty for
Bank Products Act of 2000 (7 U.S.C. 27 et seq.) is amended—</text>
<subparagraph id="id5B3360CECDC24B2A910198E6C8A2A87B"><enum>(A)</enum><text>in section 402—</text>
<clause id="id63761E22106D4BC6ACC12CE02EEB0FA1"><enum>(i)</enum><text>in subsection (a)(7), by
striking <quote>section 1a(20)</quote> and inserting <quote>section
1a</quote>;</text>
</clause><clause id="idA61F2D1DCD8A453296D9BBE8C48080E8"><enum>(ii)</enum><text>in subsection (b)(2), by
striking <quote>section 1a(12)</quote> and inserting <quote>section
1a</quote>;</text>
</clause><clause id="idAC92AD2A17DC4ECAAEA2AC6867B94FE8"><enum>(iii)</enum><text>in subsection (c), by
striking <quote>section 1a(4)</quote> and inserting <quote>section 1a</quote>;
and</text>
</clause><clause id="id9C6F26B1D5964AD6994982955E5B0E0C"><enum>(iv)</enum><text>in subsection
(d)—</text>
<subclause id="idEA09BEEE49D64775A52BF4F95B040A7E"><enum>(I)</enum><text>in the matter preceding
paragraph (1), by striking <quote>section 1a(4)</quote> and inserting
<quote>section 1a(9)</quote>;</text>
</subclause><subclause id="id4561EB8C00844E0EAAC6202DD20C8D28"><enum>(II)</enum><text>in paragraph (1)—</text>
<item id="id523A73F3211C45F6B58ACAF767197AF4"><enum>(aa)</enum><text>in subparagraph (A), by
striking <quote>section 1a(12)</quote> and inserting <quote>section 1a</quote>;
and</text>
</item><item id="id8CB90D88062B4B40B90C98B72C32ABA5"><enum>(bb)</enum><text>in subparagraph (B), by
striking <quote>section 1a(33)</quote> and inserting <quote>section
1a</quote>;</text>
</item></subclause><subclause id="idC7EB1999F54549168A87E5CE00CC7D99"><enum>(III)</enum><text>in paragraph
(2)—</text>
<item id="idF5C364012E604DA492D5F5EA032E3F06"><enum>(aa)</enum><text>in subparagraph (A), by
striking <quote>section 1a(10)</quote> and inserting <quote>section
1a</quote>;</text>
</item><item id="id1C6E1E534A954D11915AF40B96A6E526"><enum>(bb)</enum><text>in subparagraph (B), by
striking <quote>section 1a(12)(B)(ii)</quote> and inserting <quote>section
1a(18)(B)(ii)</quote>;</text>
</item><item id="idA0C3934B95C3404FB36F5B5172476D15"><enum>(cc)</enum><text>in subparagraph (C), by
striking <quote>section 1a(12)</quote> and inserting <quote>section
1a(18)</quote>; and</text>
</item><item id="idEB10485F6D4E4E05A2BB2BA384A02348"><enum>(dd)</enum><text>in subparagraph (D), by
striking <quote>section 1a(13)</quote> and inserting <quote>section 1a</quote>;
and</text>
</item></subclause></clause></subparagraph><subparagraph id="id3AAB2B7B795742ABBD3A5D4FD2C2288B"><enum>(B)</enum><text>in section 404(1), by
striking <quote>section 1a(4)</quote> and inserting <quote>section
1a</quote>.</text>
</subparagraph></paragraph></subsection></section><section id="IDdd9ad8fe536d46ae9579779884453fbd"><enum>722.</enum><header>Jurisdiction</header>
<subsection id="ID5dc88c941a464262b7f34d6f664e33cd"><enum>(a)</enum><header>Exclusive
jurisdiction</header><text>Section 2(a)(1)(A) of the Commodity Exchange Act (7
U.S.C. 2(a)(1)(A)) is amended in the first sentence—</text>
<paragraph id="IDb9d078ae53f64e6c80c33aaa7d0e9053"><enum>(1)</enum><text>by inserting <quote>the
<short-title>Wall Street Transparency and Accountability
Act of 2010</short-title> (including an amendment made by that Act) and</quote>
after <quote>otherwise provided in</quote>;</text>
</paragraph><paragraph id="IDfef186d53b7f4d9fb12365cd529acf4e"><enum>(2)</enum><text>by striking <quote>(c)
through (i) of this section</quote> and inserting <quote>(c) and
(f)</quote>;</text>
</paragraph><paragraph id="ID1744877a83804f2c925dc32ca0ea2c8b"><enum>(3)</enum><text>by striking
<quote>contracts of sale</quote> and inserting <quote>swaps or contracts of
sale</quote>; and</text>
</paragraph><paragraph id="idA1D964EE31FE4D678597DCE59956EF86"><enum>(4)</enum><text>by striking <quote>or
derivatives transaction execution facility registered pursuant to section 5 or
5a</quote> and inserting <quote>pursuant to section 5</quote>.</text>
</paragraph></subsection><subsection id="IDa9626dcc7f87407483b94cf15d3ed40a"><enum>(b)</enum><header>Regulation of swaps
under Federal and State law</header><text>Section 12 of the Commodity Exchange
Act (7 U.S.C. 16) is amended by adding at the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id75BEFD16239C4AC49ACFD9A81C2DED27" reported-display-style="italic" style="OLC">
<subsection id="ID280e83c492fe48b8a8e6685af5edbc32"><enum>(h)</enum><header>Regulation of swaps as
insurance under State law</header><text>A swap—</text>
<paragraph id="ID5c2a39cfd4884e46b4c5ba537767c8f1"><enum>(1)</enum><text>shall not be considered
to be insurance; and</text>
</paragraph><paragraph id="IDb3a7acbb39c440f795668295babf71fe"><enum>(2)</enum><text>may not be regulated as
an insurance contract under the law of any
State.</text>
</paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="ID10c960b8d70b4498bbb8c0c560d2750d"><enum>(c)</enum><header>Agreements, contracts,
and transactions traded on an organized exchange</header><text>Section
2(c)(2)(A) of the Commodity Exchange Act (7 U.S.C. 2(c)(2)(A)) is
amended—</text>
<paragraph id="ID725990dd126c42248c7f778572e5a2af"><enum>(1)</enum><text>in clause (i), by
striking <quote>or</quote> at the end;</text>
</paragraph><paragraph id="IDdc07827985b446cf98a1755eb252c373"><enum>(2)</enum><text>by redesignating clause
(ii) as clause (iii); and</text>
</paragraph><paragraph id="IDd3bd008c6e2744aa86e2f718aaab1d9f"><enum>(3)</enum><text>by inserting after clause
(i) the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idB49F91B9E5C545FBB7CF5B2ABA3C8998" reported-display-style="italic" style="OLC">
<clause id="ID19392097318e49599fe33ffed2636a28"><enum>(ii)</enum><text>a swap;
or</text>
</clause><after-quoted-block>. </after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="ID7005bf0a348642a2b6bba6e223caf82c"><enum>(d)</enum><header>Applicability</header><text>Section
2 of the Commodity Exchange Act (7 U.S.C. 2) (as amended by section 723(a)(3))
is amended by adding at the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idD6A3C404650A491AAE9DE7103E8A63C2" reported-display-style="italic" style="OLC">
<subsection id="idA6B73E6706A944C3BB6A8E35FC606E22"><enum>(i)</enum><header>Applicability</header><text>The
provisions of this Act relating to swaps that were enacted by the Wall Street
Transparency and Accountability Act of 2010 (including any rule prescribed or
regulation promulgated under that Act), shall not apply to activities outside
the United States unless those activities—</text>
<paragraph id="IDe26b9eb9e32b4939a986d9f29096425e"><enum>(1)</enum><text>have a direct and
significant connection with activities in, or effect on, commerce of the United
States; or</text>
</paragraph><paragraph id="IDb0e2cd5d297f4a10a1603e2d7407c2e9"><enum>(2)</enum><text>contravene such rules or
regulations as the Commission may prescribe or promulgate as are necessary or
appropriate to prevent the evasion of any provision of this Act that was
enacted by the Wall Street Transparency and Accountability Act of
2010.</text>
</paragraph></subsection><after-quoted-block>. </after-quoted-block></quoted-block>
</subsection><subsection id="IDc85c21bd9eff4a75858d5f238a1deddf"><enum>(e)</enum><header>Just and reasonable
rates</header><text>Section 2(a)(1)(C) of the Commodity Exchange Act (7 U.S.C.
2(a)(1)(C)) (as amended by section 717(a)) is amended by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idA90660CFB1004F59A6194E056014B014" reported-display-style="italic" style="OLC">
<clause id="IDd91138b6eea44925a02201fce63e5ce5"><enum>(vi)</enum><text>Notwithstanding the
exclusive jurisdiction of the Commission with respect to accounts, agreements,
and transactions involving swaps or contracts of sale of a commodity for future
delivery under this Act, no provision of this Act shall be construed—</text>
<subclause id="ID12902e8ab7fc4c609f944145bb3b4ccd"><enum>(I)</enum><text>to supersede or limit the
authority of the Federal Energy Regulatory Commission under the Federal Power
Act (16 U.S.C. 791a et seq.) or the Natural Gas Act (15 U.S.C. 717 et
seq.);</text>
</subclause><subclause id="IDf4d2e5d27e9140e0ad741b3fb6723f26"><enum>(II)</enum><text>to restrict the Federal
Energy Regulatory Commission from carrying out the duties and responsibilities
of the Federal Energy Regulatory Commission to ensure just and reasonable rates
and protect the public interest under the Acts described in subclause (I);
or</text>
</subclause><subclause id="id0BB32B9A391E4CEF8003A93DFF51ED16"><enum>(III)</enum><text>to supersede or limit
the authority of a State regulatory authority (as defined in section 3(21) of
the Federal Power Act (16 U.S.C. 796(21)) that has jurisdiction to regulate
rates and charges for the sale of electric energy within the State, or restrict
that State regulatory authority from carrying out the duties and
responsibilities of the State regulatory authority pursuant to the jurisdiction
of the State regulatory authority to regulate rates and charges for the
transmission or sale of electric energy.</text>
</subclause></clause><clause id="idBA2A5E2AC24A4B6594A895025C59936E"><enum>(vii)</enum><text>Nothing in clause (vi)
shall affect the Commission's authority with respect to the trading, execution,
or clearing of any agreement, contract, or transaction on or subject to the
rules of a registered entity, including a designated contract market,
derivatives clearing organization, or swaps execution
facility.</text>
</clause><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="ID08db3b6a174f4728a4714f15816a15d2"><enum>(f)</enum><header>Public interest
waiver</header><text>Section 4(c) of the Commodity Exchange Act (7 U.S.C. 6(c))
(as amended by section 721(d)) is amended by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id5F7A80AAA4354F4BB829FF53A9E655D5" reported-display-style="italic" style="OLC">
<paragraph id="IDb44fc2187efc4962b2397fa060f06989"><enum>(6)</enum><text>If the Commission
determines that the exemption would be consistent with the public interest and
the purposes of this Act, the Commission shall, in accordance with paragraphs
(1) and (2), exempt from the requirements of this Act an agreement, contract,
or transaction that is entered into—</text>
<subparagraph id="idD32AB2E7119C40AB8CFE476F719DED19"><enum>(A)</enum><text>pursuant to a tariff or
rate schedule approved or permitted to take effect by the Federal Energy
Regulatory Commission;</text>
</subparagraph><subparagraph id="idC2BBE2A05F4249169B055FD2E6A49A1C"><enum>(B)</enum><text>pursuant to a tariff or
rate schedule establishing rates or charges for, or protocols governing, the
sale of electric energy approved or permitted to take effect by the regulatory
authority of the State or municipality having jurisdiction to regulate rates
and charges for the sale of electric energy within the State or municipality;
or</text>
</subparagraph><subparagraph id="id75BF968FE73D432EB13957A0D7F0B632"><enum>(C)</enum><text>between entities
described in section 201(f) of the Federal Power Act (16 U.S.C.
824(f)).</text>
</subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection></section><section id="idD340A3F73CE44C89B7193C3473BD1210"><enum>723.</enum><header>Clearing</header>
<subsection id="IDc155710fe6fe4c24852e871dbcf15554"><enum>(a)</enum><header>Clearing
requirement</header>
<paragraph id="ID88159b45cba3405da040fabbcabf60df"><enum>(1)</enum><header>In
general</header><text>Section 2 of the Commodity Exchange Act (7 U.S.C. 2) is
amended—</text>
<subparagraph id="idF637B520063541679E65B31BA3C2703B"><enum>(A)</enum><text>by striking subsections
(d), (e), (g), and (h); and</text>
</subparagraph><subparagraph id="id2FB0A29007BD494AB3414AF2FC000FE9"><enum>(B)</enum><text>by redesignating
subsection (i) as subsection (g).</text>
</subparagraph></paragraph><paragraph id="IDd8bc50247d6e4aff924a6bb29ea86ddf"><enum>(2)</enum><header>Swaps; limitation on
participation</header><text>Section 2 of the Commodity Exchange Act (7 U.S.C.
2) (as amended by paragraph (1)) is amended by inserting after subsection (c)
the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id99229560819943E18202761005D99FB1" reported-display-style="italic" style="OLC">
<subsection id="IDe0558b767f984759b6c85e2ac1ba6fe7"><enum>(d)</enum><header>Swaps</header><text>Nothing
in this Act (other than subparagraphs (A), (B), (C), and (D) of subsection
(a)(1), subsections (f) and (g), sections 1a, 2(c)(2)(A)(ii), 2(e), 2(h), 4(c),
4a, 4b, and 4b–1, subsections (a), (b), and (g) of section 4c, sections 4d, 4e,
4f, 4g, 4h, 4i, 4j, 4k, 4l, 4m, 4n, 4o, 4p, 4r, 4s, 4t, 5, 5b, 5c, 5e, and 5h,
subsections (c) and (d) of section 6, sections 6c, 6d, 8, 8a, and 9,
subsections (e)(2) and (f) of section 12, subsections (a) and (b) of section
13, sections 17, 20, 21, and 22(a)(4), and any other provision of this Act that
is applicable to registered entities and Commission registrants) governs or
applies to a swap.</text>
</subsection><subsection id="ID78651c404df1466eb5a3530f76b6d007"><enum>(e)</enum><header>Limitation on
participation</header><text>It shall be unlawful for any person, other than an
eligible contract participant, to enter into a swap unless the swap is entered
into on, or subject to the rules of, a board of trade designated as a contract
market under section
5.</text>
</subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph><paragraph id="ID03e842a18fca4fdcb3dfa07164bcb6b9"><enum>(3)</enum><header>Mandatory clearing of
swaps</header><text>Section 2 of the Commodity Exchange Act (7 U.S.C. 2) is
amended by inserting after subsection (g) (as redesignated by paragraph (1)(B))
the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id7D16B4CFF2434CB8A8D0DBDC4226E93D" reported-display-style="italic" style="OLC">
<subsection id="IDc6dbdf8194c5430ca1c9d91f2fd57444"><enum>(h)</enum><header>Clearing
requirement</header>
<paragraph id="ID9d433e86ffba4d2f9a02c7b9f4039683"><enum>(1)</enum><header>Submission</header>
<subparagraph id="ID22dcdbdb89f2498ba10e825a2a8aadf3"><enum>(A)</enum><header>In
general</header><text>Except as provided in paragraphs (9) and (10), any person
who is a party to a swap shall submit such swap for clearing to a derivatives
clearing organization that is registered under this Act or a derivatives
clearing organization that is exempt from registration under section 5b(j) of
this Act.</text>
</subparagraph><subparagraph id="ID0a0350560fa7495fb47738892d4e0c46"><enum>(B)</enum><header>Open
access</header><text>The rules of a registered derivatives clearing
organization shall—</text>
<clause id="IDe06f4eefa5de40ec85c38c5b1eb163ff"><enum>(i)</enum><text>prescribe that all swaps
with the same terms and conditions are economically equivalent and may be
offset with each other within the derivatives clearing organization; and</text>
</clause><clause id="ID974f5b74feb4466d8c846f3746500aff"><enum>(ii)</enum><text>provide for
nondiscriminatory clearing of a swap executed bilaterally or on or through the
rules of an unaffiliated designated contract market or swap execution facility,
subject to the requirements of section 5(b).</text>
</clause></subparagraph></paragraph><paragraph id="ID173a142c28464466a004505bce077ff3"><enum>(2)</enum><header>Commission
approval</header>
<subparagraph id="IDe6b0ff26a32e4b7c97659dc1e8b2d93e"><enum>(A)</enum><header>In
general</header><text>A derivatives clearing organization shall submit to the
Commission for prior approval any group, category, type, or class of swaps that
the derivatives clearing organization seeks to accept for clearing, which
submission the Commission shall make available to the public.</text>
</subparagraph><subparagraph id="ID6ed84f63e30b47568dc8a7781f990cb4"><enum>(B)</enum><header>Deadline</header><text>The
Commission shall take final action on a request submitted pursuant to
subparagraph (A) not later than 90 days after submission of the request, unless
the derivatives clearing organization submitting the request agrees to an
extension of the time limitation established under this subparagraph.</text>
</subparagraph><subparagraph id="ID447a902766634dcba498158d6cd79cd5"><enum>(C)</enum><header>Approval</header><text>The
Commission shall approve, unconditionally or subject to such terms and
conditions as the Commission determines to be appropriate, any request
submitted pursuant to subparagraph (A) if the Commission finds that the request
is consistent with section 5b(c)(2). The Commission shall not approve any such
request if the Commission does not make such finding.</text>
</subparagraph><subparagraph id="ID370075c113d24016be930cb5c0fa293a"><enum>(D)</enum><header>Rules</header><text>The
Commission shall adopt rules for a derivatives clearing organization’s
submission for approval, pursuant to this paragraph, of any group, category,
type, or class of swaps that the derivative clearing organization seeks to
accept for clearing.</text>
</subparagraph></paragraph><paragraph id="ID8d23faed5d0143f2ad978efbfa0cf40a"><enum>(3)</enum><header>Stay of clearing
requirement</header><text>At any time after issuance of an approval pursuant to
paragraph (2):</text>
<subparagraph id="IDb96ca659d7594e16a182c1a5191b5aa5"><enum>(A)</enum><header>Review
process</header><text>The Commission, on application of a counterparty to a
swap or on its own initiative, may stay the clearing requirement of paragraph
(1) until the Commission completes a review of the terms of the swap, or the
group, category, type, or class of swaps, and the clearing arrangement.</text>
</subparagraph><subparagraph id="IDa93795abf1034d899c8a914d34e4ee28"><enum>(B)</enum><header>Deadline</header><text>The
Commission shall complete a review undertaken pursuant to subparagraph (A) not
later than 90 days after issuance of the stay, unless the derivatives clearing
organization that clears the swap, or the group, category, type, or class of
swaps, agrees to an extension of the time limitation established under this
subparagraph.</text>
</subparagraph><subparagraph id="ID814b33499e954af4964fd220e80334fe"><enum>(C)</enum><header>Determination</header><text>Upon
completion of the review undertaken pursuant to subparagraph (A)—</text>
<clause id="IDb339745c9788409fb2ef1ce85f102225"><enum>(i)</enum><text>the Commission may
determine, unconditionally or subject to such terms and conditions as the
Commission determines to be appropriate, that the swap, or the group, category,
type, or class of swaps, must be cleared pursuant to this subsection if the
Commission finds that such clearing—</text>
<subclause id="ID908602b4a4fb4f21823109c2b31af5a4"><enum>(I)</enum><text>is consistent with
section 5b(c)(2); and</text>
</subclause><subclause id="ID2bff846712e2430f9c44eaeb64f09d67"><enum>(II)</enum><text>is otherwise in the
public interest, for the protection of investors, and consistent with the
purposes of this Act;</text>
</subclause></clause><clause id="ID014e0341973d4c4ba68868f760843224"><enum>(ii)</enum><text>the Commission may
determine that the clearing requirement of paragraph (1) shall not apply to the
swap, or the group, category, type, or class of swaps; or</text>
</clause><clause id="ID1e962a7dd6964e959b8a373ddcde1cd1"><enum>(iii)</enum><text>if a determination is
made that the clearing requirement of paragraph (1) shall no longer apply, then
it shall still be permissible to clear such swap, or the group, category, type,
or class of swaps.</text>
</clause></subparagraph><subparagraph id="ID69796bdd9c404783b695a70fa85e64fe"><enum>(D)</enum><header>Rules</header><text>The
Commission shall adopt rules for reviewing, pursuant to this paragraph, a
derivatives clearing organization’s clearing of a swap, or a group, category,
type, or class of swaps that the Commission has accepted for clearing.</text>
</subparagraph></paragraph><paragraph id="ID52bb369946204d9ca88fe39e32c8bd29"><enum>(4)</enum><header>Swaps required to be
accepted for clearing</header>
<subparagraph id="ID1acd087505c244d4ac3e263673655c41"><enum>(A)</enum><header>Rulemaking</header><text>The
Commission shall adopt rules to further identify any group, category, type, or
class of swaps not submitted for approval under paragraph (2) that the
Commission deems should be accepted for clearing. In adopting such rules, the
Commission shall take into account the following factors:</text>
<clause id="ID65cb24edf8aa4214a53cb94b9e208054"><enum>(i)</enum><text>The extent to which any
of the terms of the group, category, type, or class of swaps, including price,
are disseminated to third parties or are referenced in other agreements,
contracts, or transactions.</text>
</clause><clause id="ID259d994874d94b188e70f7c0c59502eb"><enum>(ii)</enum><text>The volume of
transactions in the group, category, type, or class of swaps.</text>
</clause><clause id="ID6f7b78e75fad4eb79177949f8a266197"><enum>(iii)</enum><text>The extent to which the
terms of the group, category, type, or class of swaps are similar to the terms
of other agreements, contracts, or transactions that are cleared.</text>
</clause><clause id="IDcbc2d355c53c4b6b9a49aa73ef99a23f"><enum>(iv)</enum><text>Whether any differences
in the terms of the group, category, type, or class of swaps, compared to other
agreements, contracts, or transactions that are cleared, are of economic
significance.</text>
</clause><clause id="ID92843730ee7e4216a38974c3c07af1ef"><enum>(v)</enum><text>Whether a derivatives
clearing organization is prepared to clear the group, category, type, or class
of swaps and such derivatives clearing organization has in place effective risk
management systems.</text>
</clause><clause id="ID98d38b1e38be43eeb933a5d80ec01f91"><enum>(vi)</enum><text>Any other factors the
Commission determine to be appropriate.</text>
</clause></subparagraph><subparagraph id="IDe4866864d8a6481e96a06e75b4bad8b5"><enum>(B)</enum><header>Other
designations</header><text>At any time after the adoption of the rules required
under subparagraph (A), the Commission may separately designate a particular
swap or class of swaps as subject to the clearing requirement in paragraph (1),
taking into account the factors described in clauses (i) through (vi) of
subparagraph (A) and the rules adopted under such subparagraph.</text>
</subparagraph><subparagraph id="IDab51e25ec4cb43ad9ceae098383a3a3a"><enum>(C)</enum><header>In
general</header><text>In accordance with subparagraph (A), the Commission
shall, consistent with the public interest, adopt rules under the expedited
process described in subparagraph (D) to establish criteria for determining
that a swap, or any group, category, type, or class of swap is required to be
cleared.</text>
</subparagraph><subparagraph id="ID36316f37d46b4f46b4c262bbcac78b76"><enum>(D)</enum><header>Expedited rulemaking
authority</header>
<clause id="ID127dc4e0169040a7948c3a63788313ab"><enum>(i)</enum><header>Procedure</header><text>The
promulgation of regulations under subparagraph (A) may be made without regard
to—</text>
<subclause id="ID4da4dd2357964e21a84c4537a020b86d"><enum>(I)</enum><text>the notice and comment
provisions of section 553 of title 5, United States Code; and</text>
</subclause><subclause id="IDaf51cd84470549218aa7954c1b90ac64"><enum>(II)</enum><text>chapter 35 of title 44,
United States Code (commonly known as the <quote>Paperwork Reduction
Act</quote>).</text>
</subclause></clause><clause id="IDb4a14d1452af420da628c5c9e81e3e3f"><enum>(ii)</enum><header>Agency
rulemaking</header><text>In carrying out subparagraph (A), the Commission shall
use the authority provided under section 808 of title 5, United States
Code.</text>
</clause></subparagraph></paragraph><paragraph id="IDf7f9c38701d646e5a23312797dc796c1"><enum>(5)</enum><header>Prevention of
evasion</header>
<subparagraph id="ID32d7324052ce445b80d36cc866b9ab1b"><enum>(A)</enum><header>In
general</header><text>The Commission may prescribe rules under this subsection
(and issue interpretations of rules prescribed under this subsection) as
determined by the Commission to be necessary to prevent evasions of the
mandatory clearing requirements under this Act.</text>
</subparagraph><subparagraph id="IDe0b16b19fa98473093390e3d66fe9483"><enum>(B)</enum><header>Duty of commission to
investigate and take certain actions</header><text>To the extent the Commission
finds that a particular swap, group, category, type, or class of swaps would
otherwise be subject to mandatory clearing but no derivatives clearing
organization has listed the swap, group, category, type, or class of swaps for
clearing, the Commission shall—</text>
<clause id="IDfadcd431940e41abb7102087e9b0f9f6"><enum>(i)</enum><text>investigate the relevant
facts and circumstances;</text>
</clause><clause id="IDd7a36d98c8a7415ca7e355a366a9caf0"><enum>(ii)</enum><text>within 30 days issue a
public report containing the results of the investigation; and</text>
</clause><clause id="ID1d71cc17407b406f8e4ee3d4309eec27"><enum>(iii)</enum><text>take such actions as
the Commission determines to be necessary and in the public interest, which may
include requiring the retaining of adequate margin or capital by parties to the
swap, group, category, type, or class of swaps.</text>
</clause></subparagraph><subparagraph id="ID661bdb3ddfca44da8d23f965b29e075c"><enum>(C)</enum><header>Effect on
authority</header><text>Nothing in this paragraph shall—</text>
<clause id="IDaa43806c19794ff394d40d19f088bf58"><enum>(i)</enum><text>authorize the Commission
to require a derivatives clearing organization to list for clearing a swap,
group, category, type, or class of swaps if the clearing of the swap, group,
category, type, or class of swaps would adversely affect the business
operations of the derivatives clearing organization, threaten the financial
integrity of the derivatives clearing organization, or pose a systemic risk to
the derivatives clearing organization; and</text>
</clause><clause id="ID1ca60b7e3ecd416d8bbaf755ab181594"><enum>(ii)</enum><text>affect the authority of
the Commission to enforce the open access provisions of paragraph (1) with
respect to a swap, group, category, type, or class of swaps that is listed for
clearing by a derivatives clearing organization.</text>
</clause></subparagraph></paragraph><paragraph id="ID1df6f8c93eb24bcfb7466766c2110bf5"><enum>(6)</enum><header>Required
reporting</header>
<subparagraph id="IDbed6080969404001b17de9ecda744a0b"><enum>(A)</enum><header>Both
counterparties</header><text>Both counterparties to a swap that is not cleared
by any derivatives clearing organization shall report such a swap either to a
registered swap repository described in section 21 or, if there is no
repository that would accept the swap, to the Commission pursuant to section
4r.</text>
</subparagraph><subparagraph id="ID1c190e6b076f489db5d7a7e9fbcff96a"><enum>(B)</enum><header>Timing</header><text>Counterparties
to a swap shall submit the reports required under subparagraph (A) not later
than such time period as the Commission may by rule or regulation
prescribe.</text>
</subparagraph></paragraph><paragraph id="IDda8dd515d2f344868c744fec17537cb4"><enum>(7)</enum><header>Transition
rules</header>
<subparagraph id="ID8eb58525b1fc47d5983c0069efc39ee2"><enum>(A)</enum><header>Reporting transition
rules</header><text>Rules adopted by the Commission under this section shall
provide for the reporting of data, as follows:</text>
<clause id="IDbe76a9f0186e489f81a9f52b9af5e4d6"><enum>(i)</enum><header>Swaps entered into
before date of enactment of this subsection</header><text>Swaps entered into
before the date of the enactment of this subsection shall be reported to a
registered swap repository or the Commission not later than 180 days after the
effective date of this subsection.</text>
</clause><clause id="ID7ace726185564234acf86e42a8a88904"><enum>(ii)</enum><header>Swaps entered into on
or after date of enactment of this subsection</header><text>Swaps entered into
on or after such date of enactment shall be reported to a registered swap
repository or the Commission not later than the later of—</text>
<subclause id="IDa4af9afe36ff4deaaa852af16320f4e2"><enum>(I)</enum><text>90 days after such
effective date; or</text>
</subclause><subclause id="ID6b0df42ed0b545ff8885e6098ddb20f2"><enum>(II)</enum><text>such other time after
entering into the swap as the Commission may prescribe by rule or
regulation.</text>
</subclause></clause></subparagraph><subparagraph id="ID9c2dc482288a4e7883279f7feda1da87"><enum>(B)</enum><header>Clearing transition
rules</header>
<clause id="IDaff14cfa2a43415aa93bfc8506416370"><enum>(i)</enum><header>Swaps entered into
before the date of the enactment of this subsection</header><text>Swaps entered
into before the date of the enactment of this subsection are exempt from the
clearing requirements of this subsection if reported pursuant to subparagraph
(A)(i).</text>
</clause><clause id="ID03df5e0fa2c84f4c90123113145411e6"><enum>(ii)</enum><header>Swaps entered into
before application of clearing requirement</header><text>Swaps entered into
before application of the clearing requirement pursuant to this subsection are
exempt from the clearing requirements of this subsection if reported pursuant
to subparagraph (A)(ii).</text>
</clause></subparagraph></paragraph><paragraph id="IDd078df0964c34cf093c7ec12079f844b"><enum>(8)</enum><header>Trade
execution</header>
<subparagraph id="ID90004f9bb5ca459ba02644ab95921d5d"><enum>(A)</enum><header>In
general</header><text>With respect to transactions involving swaps subject to
the clearing requirement of paragraph (1), counterparties shall—</text>
<clause id="IDfcc6254aa86b4cf4a93a58970c4106bf"><enum>(i)</enum><text>execute the transaction
on a board of trade designated as a contract market under section 5; or</text>
</clause><clause id="IDc1ca7da1908a4fe9ab0685e37664260a"><enum>(ii)</enum><text>execute the transaction
on a swap execution facility registered under section 5h or a swap execution
facility that is exempt from registration under section 5h(f) of this
Act.</text>
</clause></subparagraph><subparagraph id="ID02752d42c002454abe234abbe4275e34"><enum>(B)</enum><header>Exception</header><text>The
requirements of clauses (i) and (ii) of subparagraph (A) shall not apply if no
board of trade or swap execution facility makes the swap available to trade or
a swap transactions where a commercial end user opts to use the clearing
exemption under paragraph (9).</text>
</subparagraph></paragraph><paragraph id="IDf9868b31554a4d019cd9335e673e5eae"><enum>(9)</enum><header>Required
exemption</header><text>Subject to paragraph (4), the Commission shall exempt a
swap from the requirements of paragraphs (1) and (8) and any rules issued under
this subsection, if no derivatives clearing organization registered under this
Act or no derivatives clearing organization that is exempt from registration
under section 5b(j) of this Act will accept the swap from clearing.</text>
</paragraph><paragraph id="IDc7111778ce4f447996c1343c42613aef"><enum>(10)</enum><header>End user clearing
exemption</header>
<subparagraph id="IDb4f6581bd1864349ad14a1f017962b2f"><enum>(A)</enum><header>Definition of
commercial end user</header>
<clause id="IDae7460c820044891a87147875d85965a"><enum>(i)</enum><header>In
general</header><text>In this paragraph, the term <term>commercial end
user</term> means any person other than a financial entity described in clause
(ii) who, as its primary business activity, owns, uses, produces, processes,
manufactures, distributes, merchandises, or markets goods, services, or
commodities (which shall include but not be limited to coal, natural gas,
electricity, ethanol, crude oil, gasoline, propane, distillates, and other
hydrocarbons) either individually or in a fiduciary capacity.</text>
</clause><clause id="ID14c115c86da5463296dc1b20d49176db"><enum>(ii)</enum><header>Financial
entity</header><text>The term <term>financial entity</term> means—</text>
<subclause id="ID79bb0701813541b79b50c0f8bf3b6c41"><enum>(I)</enum><text>a swap dealer, major swap
participant, security-based swap dealer, or major security-based swap
participant;</text>
</subclause><subclause id="id453689B8E5AC4E62A6D62B5C2A1B8551"><enum>(II)</enum><text>a person predominantly
engaged in activities that are in the business of banking or financial in
nature, as defined in Section 4(k) of the Bank Holding Company Act of
1956;</text>
</subclause><subclause id="IDbffd829ffc6c44c4b9fdbbd5debc406c"><enum>(III)</enum><text>a person predominantly
engaged in activities that are financial in nature;</text>
</subclause><subclause id="ID5cde1a8bb2cd4541b9ebf237765c7a49"><enum>(IV)</enum><text>a commodity pool or a
private fund as defined in section 202(a) of the Investment Advisers Act of
1940 (15 U.S.C. 80b–2(a)); or</text>
</subclause><subclause id="IDa27d32731e134dd7bb2296a089feeb2e"><enum>(V)</enum><text>a person that is
registered or required to be registered with the Commission.</text>
</subclause></clause></subparagraph><subparagraph id="ID112fc74dedac4ffcbf943a1f2c2e0fb5"><enum>(B)</enum><header>End user clearing
exemption</header>
<clause id="IDfb267fe7aa344146901a482f2dceead4"><enum>(i)</enum><header>In
general</header><text>Subject to clause (ii), in the event that a swap is
subject to the mandatory clearing requirement under paragraph (1), and 1 of the
counterparties to the swap is a commercial end user, that counterparty—</text>
<subclause id="ID92abddaecc6648eda50a81230f562d52"><enum>(I)</enum><item commented="no" display-inline="yes-display-inline" id="idEA21815EA69B44C39426603D4D902BF0"><enum>(aa)</enum><text>may elect not to clear
the swap, as required under paragraph (1); or</text>
</item><item changed="added" id="ID6eb5adc1428941d485d62555087ee357" indent="up1" reported-display-style="italic"><enum>(bb)</enum><text>may
elect to require clearing of the swap; and</text>
</item></subclause><subclause id="ID92bc31a40cd14c5eafa7bd8fa3ccf80a"><enum>(II)</enum><text>if the end user makes an
election under subclause (I)(bb), shall have the sole right to select the
derivatives clearing organization at which the swap will be cleared.</text>
</subclause></clause><clause id="IDdc208b98e41c403ca6eafe6da3c82a2e"><enum>(ii)</enum><header>Limitation</header><text>A
commercial end user may only make an election under clause (i) if the end user
is using the swap to hedge its own commercial risk.</text>
</clause></subparagraph><subparagraph id="IDa8a48dc603d449fbbf133a5eb04bc848"><enum>(C)</enum><header>Treatment of
affiliates</header>
<clause id="ID99beba677d294ce08da831dcffdca930"><enum>(i)</enum><header>In
general</header><text>An affiliate of a commercial end user (including
affiliate entities predominantly engaged in providing financing for the
purchase of the merchandise or manufactured goods of the commercial end user)
may make an election under subparagraph (B)(i) only if the affiliate, acting on
behalf of the commercial end user and as an agent, uses the swap to hedge or
mitigate the commercial risk of the commercial end user parent or other
affiliate of the commercial end user that is not a financial entity.</text>
</clause><clause id="id88C7D53B0F034BDD86E1CF85D5BF79B7"><enum>(ii)</enum><header>Prohibition relating
to certain affiliates</header><text>An affiliate of a commercial end user shall
not use the exemption under subparagraph (B) if the affiliate is—</text>
<subclause id="id2666B863A0BD4018A83146CD74F8F8B2"><enum>(I)</enum><text>a swap dealer;</text>
</subclause><subclause id="idE7172CA354E846998C58DED54573A767"><enum>(II)</enum><text>a security-based swap
dealer;</text>
</subclause><subclause id="idBB749BA9DAD74F35B9E19F81E8E18B37"><enum>(III)</enum><text>a major swap
participant;</text>
</subclause><subclause id="idA2C6ED4790944653932A10BA10F543C8"><enum>(IV)</enum><text>a major security-based
swap participant;</text>
</subclause><subclause id="idC26A8E20EBD74626A04AFFF12308154E"><enum>(V)</enum><text>an issuer that would be
an investment company, as defined in section 3 of the Investment Company Act of
1940 (15 U.S.C. 80a–3), but for paragraph (1) or (7) of subsection (c) of that
Act (15 U.S.C. 80a–3(c));</text>
</subclause><subclause id="idF4E48E60514247D0B4AB70747F21F5CF"><enum>(VI)</enum><text>a commodity pool;</text>
</subclause><subclause id="id6AC9FF493B0848F3824D0BD30ED3FD91"><enum>(VII)</enum><text>a bank holding company
with over $50,000,000,000 in consolidated assets; or</text>
</subclause><subclause id="id09C2DC5F78664E00A7452AA1038DFB9B"><enum>(VIII)</enum><text>an affiliate of any
entity described in subclauses (I) through (VII).</text>
</subclause></clause></subparagraph><subparagraph id="id74D2DA36A3324876A1996413E985D9EA"><enum>(D)</enum><header>Abuse of
exemption</header><text>The Commission may prescribe such rules or issue
interpretations of the rules as the Commission determines to be necessary to
prevent abuse of the exemption described in subparagraph (B). The Commission
may also request information from those entities claiming the clearing
exemption as necessary to prevent abuse of the exemption described in
subparagraph (B).</text>
</subparagraph><subparagraph id="idE58A2EF39A994760883D93010D066A72"><enum>(E)</enum><header>Option to
clear</header>
<clause id="IDb1b700f1a5164426ac332ce2d248b5e5"><enum>(i)</enum><header>Swaps required to be
cleared entered into with a financial entity</header><text>With respect to any
swap that is required to be cleared by a derivatives clearing organization and
entered into by a swap dealer or a major swap participant with a financial
entity, the financial entity shall have the sole right to select the
derivatives clearing organization at which the swap will be cleared.</text>
</clause><clause id="ID645e3aa6b6a14531b3c23b1e521d9db6"><enum>(ii)</enum><header>Swaps not required to
be cleared entered into with a financial entity or commercial end
user</header><text>With respect to any swap that is not required to be cleared
by a derivatives clearing organization and entered into by a swap dealer or a
major swap participant with a financial entity or commercial end user, the
financial entity or commercial end user—</text>
<subclause id="ID13ef6fd3ea9a4ba6bd07a8b80336dbe1"><enum>(I)</enum><text>may elect to require
clearing of the swap; and</text>
</subclause><subclause id="ID42442d7c23b542449677cd20c80edf5c"><enum>(II)</enum><text>shall have the sole
right to select the derivatives clearing organization at which the swap will be
cleared.</text>
</subclause></clause></subparagraph></paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="IDe4659116ca1b4d71812112686d9d2296"><enum>(b)</enum><header>Commodity exchange
act</header><text>Section 2 of the Commodity Exchange Act (7 U.S.C. 2) is
amended by adding at the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id2B6509B385514CC38694A43C8AD87793" reported-display-style="italic" style="OLC">
<subsection id="IDf41906d3b2334b64a8148e143fdd64f2"><enum>(j)</enum><header>Audit Committee
Approval</header><text>Exemptions from the requirements of subsection (h)(2)(F)
to clear a swap and subsection (b) to trade a swap through a board of trade or
swap execution facility shall be available to a counterparty that is an issuer
of securities that are registered under section 12 of the Securities Exchange
Act of 1934 (15 U.S.C. 78l) or that is required to file reports pursuant to
section 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78o) only if
the issuer’s audit committee has reviewed and approved its decision to enter
into swaps that are subject to such
exemptions.</text>
</subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection commented="no" id="id1231FF0DF00B4D9C9390924E61F2B6A4"><enum>(c)</enum><header>Grandfather
provisions</header>
<paragraph id="IDeca5634094764160804ca9a5fff0631e"><enum>(1)</enum><header>Legal certainty for
certain transactions in exempt commodities</header><text>Not later than 60 days
after the date of enactment of this Act, a person may submit to the Commodity
Futures Trading Commission a petition to remain subject to section 2(h) of the
Commodity Exchange Act (7 U.S.C. 2(h)) (as in effect on the day before the date
of enactment of this Act).</text>
</paragraph><paragraph id="IDeca6a86bf6484a07bbb9a35099ecb2b9"><enum>(2)</enum><header>Consideration;
authority of Commodity Futures Trading Commission</header><text>The Commodity
Futures Trading Commission—</text>
<subparagraph id="IDf0b886ae80b247c88172f66152386f43"><enum>(A)</enum><text>shall consider any
petition submitted under subparagraph (A) in a prompt manner; and</text>
</subparagraph><subparagraph id="IDf2ec0c9695734c5baf0c1f0efabba762"><enum>(B)</enum><text>may allow a person to
continue operating subject to section 2(h) of the Commodity Exchange Act (7
U.S.C. 2(h)) (as in effect on the day before the date of enactment of this Act)
for not longer than a 1-year period.</text>
</subparagraph></paragraph><paragraph commented="no" id="idBFB0232BFD544B1D82ABB65F8E286582"><enum>(3)</enum><header>Agricultural
swaps</header>
<subparagraph commented="no" id="idD443427375534AB3BBEC67537C5C0691"><enum>(A)</enum><header>In
general</header><text>Except as provided in paragraph (2), no person shall
offer to enter into, enter into, or confirm the execution of, any swap in an
agricultural commodity (as defined by the Commodity Futures Trading
Commission).</text>
</subparagraph><subparagraph commented="no" id="idAD7A7D0F47F94350B5E7A047209A00D2"><enum>(B)</enum><header>Exception</header><text>Notwithstanding
paragraph (1), a person may offer to enter into, enter into, or confirm the
execution of, any swap in an agricultural commodity pursuant to section 4(c) of
the Commodity Exchange Act (7 U.S.C. 6(c)) or any rule, regulation, or order
issued thereunder (including any rule, regulation, or order in effect as of the
date of enactment of this Act) by the Commodity Futures Trading Commission to
allow swaps under such terms and conditions as the Commission shall
prescribe.</text>
</subparagraph></paragraph><paragraph commented="no" id="id1596FBB517B049608389E5D8889604E3"><enum>(4)</enum><header>Required
reporting</header><text>If the exception described in paragraph (2) applies,
and there is no facility that makes the swap available to trade, the
counterparties shall comply with any recordkeeping and transaction reporting
requirements that may be prescribed by the Commission with respect to swaps
subject to the requirements of paragraph (1).</text>
</paragraph></subsection></section><section id="IDc2cf3d63c7f74259be0ff2ae5124c582"><enum>724.</enum><header>Swaps; segregation and
bankruptcy treatment</header>
<subsection id="ID85dfe1de1cab4cffaf3397f26b71bc08"><enum>(a)</enum><header>Segregation
requirements for cleared swaps</header><text>Section 4d of the Commodity
Exchange Act (7 U.S.C. 6d) (as amended by section 732) is amended by adding at
the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id9B48427AFC844AD3BCDC6AADE390C895" reported-display-style="italic" style="OLC">
<subsection id="IDcd70db1f4941426087c548ee9393193d"><enum>(f)</enum><header>Swaps</header>
<paragraph id="id3EEE014D166C4B2BB951BCE0655B1B4C"><enum>(1)</enum><header>Registration
requirement</header><text>It shall be unlawful for any person to accept any
money, securities, or property (or to extend any credit in lieu of money,
securities, or property) from, for, or on behalf of a swaps customer to margin,
guarantee, or secure a swap cleared by or through a derivatives clearing
organization (including money, securities, or property accruing to the customer
as the result of such a swap), unless the person shall have registered under
this Act with the Commission as a futures commission merchant, and the
registration shall not have expired nor been suspended nor revoked.</text>
</paragraph><paragraph id="idC8C26CFDC8BA47A3A4616987077866DF"><enum>(2)</enum><header>Cleared swaps</header>
<subparagraph id="idE7F2B89120904B9CB2A2EC1632210515"><enum>(A)</enum><header>Segregation
required</header><text>A futures commission merchant shall treat and deal with
all money, securities, and property of any swaps customer received to margin,
guarantee, or secure a swap cleared by or though a derivatives clearing
organization (including money, securities, or property accruing to the swaps
customer as the result of such a swap) as belonging to the swaps
customer.</text>
</subparagraph><subparagraph id="id327061FABD204AAF940B8A44BC457427"><enum>(B)</enum><header>Commingling
prohibited</header><text>Money, securities, and property of a swaps customer
described in subparagraph (A) shall be separately accounted for and shall not
be commingled with the funds of the futures commission merchant or be used to
margin, secure, or guarantee any trades or contracts of any swaps customer or
person other than the person for whom the same are held.</text>
</subparagraph></paragraph><paragraph id="id24CAC9DF7D5C464E8FD66F0C3F3424C7"><enum>(3)</enum><header>Exceptions</header>
<subparagraph id="id441097EA903840DB8090BB4293A09277"><enum>(A)</enum><header>Use of funds</header>
<clause id="idCB7FA531895A4A779C878B5F16705A80"><enum>(i)</enum><header>In
general</header><text>Notwithstanding paragraph (2), money, securities, and
property of a swaps customer of a futures commission merchant described in
paragraph (2) may, for convenience, be commingled and deposited in the same 1
or more accounts with any bank or trust company or with a derivatives clearing
organization.</text>
</clause><clause id="idC5F033D649B346688AD82945EA276D18"><enum>(ii)</enum><header>Withdrawal</header><text>Notwithstanding
paragraph (2), such share of the money, securities, and property described in
clause (i) as in the normal course of business shall be necessary to margin,
guarantee, secure, transfer, adjust, or settle a cleared swap with a
derivatives clearing organization, or with any member of the derivatives
clearing organization, may be withdrawn and applied to such purposes, including
the payment of commissions, brokerage, interest, taxes, storage, and other
charges, lawfully accruing in connection with the cleared swap.</text>
</clause></subparagraph><subparagraph id="id96E9FA8DB4F54808A6FBA0F001CBAE9F"><enum>(B)</enum><header>Commission
action</header><text>Notwithstanding paragraph (2), in accordance with such
terms and conditions as the Commission may prescribe by rule, regulation, or
order, any money, securities, or property of the swaps customer of a futures
commission merchant described in paragraph (2) may be commingled and deposited
as provided in this section with any other money, securities, or property
received by the futures commission merchant and required by the Commission to
be separately accounted for and treated and dealt with as belonging to the
swaps customer of the futures commission merchant.</text>
</subparagraph></paragraph><paragraph id="idF591D86336C14A3FBFB055A201E795EF"><enum>(4)</enum><header>Permitted
investments</header><text>Money described in paragraph (2) may be invested in
obligations of the United States, in general obligations of any State or of any
political subdivision of a State, and in obligations fully guaranteed as to
principal and interest by the United States, or in any other investment that
the Commission may by rule or regulation prescribe, and such investments shall
be made in accordance with such rules and regulations and subject to such
conditions as the Commission may prescribe.</text>
</paragraph><paragraph id="ID19168a383253410a8f64de63f93026fa"><enum>(5)</enum><header>Commodity
contract</header><text>A swap cleared by or through a derivatives clearing
organization shall be considered to be a commodity contract as such term is
defined in section 761 of title 11, United States Code, with regard to all
money, securities, and property of any swaps customer received by a futures
commission merchant or a derivatives clearing organization to margin,
guarantee, or secure the swap (including money, securities, or property
accruing to the customer as the result of the swap).</text>
</paragraph><paragraph id="id373CF2CE74CF487E91CB9DD4128E3252"><enum>(6)</enum><header>Prohibition</header><text>It
shall be unlawful for any person, including any derivatives clearing
organization and any depository institution, that has received any money,
securities, or property for deposit in a separate account or accounts as
provided in paragraph (2) to hold, dispose of, or use any such money,
securities, or property as belonging to the depositing futures commission
merchant or any person other than the swaps customer of the futures commission
merchant.</text>
</paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="ID73826c29ccb04a60ae949f073e5527d2"><enum>(b)</enum><header>Bankruptcy treatment of
cleared swaps</header><text>Section 761 of title 11, United States Code, is
amended—</text>
<paragraph id="id03675C2B34C645B0B73A7D566B0932CB"><enum>(1)</enum><text>in paragraph (4), by
striking subparagraph (F) and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idB45ABA6EFAD143BBAF4E1B62D0FB339F" reported-display-style="italic" style="OLC">
<subparagraph id="id38AB96D32E9C4C619E704F4E704F4ABF"><enum>(F)</enum><clause commented="no" display-inline="yes-display-inline" id="idA4A555E6F7554D35AA2B9663DC828AFB"><enum>(i)</enum><text>any other contract,
option, agreement, or transaction that is similar to a contract, option,
agreement, or transaction referred to in this paragraph; and</text>
</clause><clause changed="added" id="idEE6D18C31F99444D8534BBC97266A3D9" indent="up1" reported-display-style="italic"><enum>(ii)</enum><text>with respect to a
futures commission merchant or a clearing organization, any other contract,
option, agreement, or transaction, in each case, that is cleared by a clearing
organization;</text>
</clause></subparagraph><after-quoted-block>;
and</after-quoted-block></quoted-block>
</paragraph><paragraph id="IDf51aef59dc894e72b2247706c66efe6c"><enum>(2)</enum><text>in paragraph (9)(A)(i),
by striking <quote>the commodity futures account</quote> and inserting <quote>a
commodity contract account</quote>.</text>
</paragraph></subsection><subsection id="IDf7002e00d9464b0d84f995bd4e7e94a6"><enum>(c)</enum><header>Segregation
requirements for uncleared swaps</header><text>Section 4s of the Commodity
Exchange Act (as added by section 731) is amended by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id92109B6244B14D42987C789CA1735381" reported-display-style="italic" style="OLC">
<subsection id="IDdcdd590d971043009eca8970a33e60f1"><enum>(l)</enum><header>Segregation
requirements</header>
<paragraph id="ID1f27dad6506241b3bebcfdd99a253cdd"><enum>(1)</enum><header>Segregation of assets
held as collateral in uncleared swap transactions</header>
<subparagraph id="ID1344d1a0a0594287a7ee65b66ada5ad3"><enum>(A)</enum><header>Notification</header><text>A
swap dealer or major swap participant shall be required to notify the
counterparty of the swap dealer or major swap participant at the beginning of a
swap transaction that the counterparty has the right to require segregation of
the funds or other property supplied to margin, guarantee, or secure the
obligations of the counterparty.</text>
</subparagraph><subparagraph id="IDc6b0a9d8b99145d69d5bfb3c31d45ca3"><enum>(B)</enum><header>Segregation and
maintenance of funds</header><text>At the request of a counterparty to a swap
that provides funds or other property to a swap dealer or major swap
participant to margin, guarantee, or secure the obligations of the
counterparty, the swap dealer or major swap participant shall—</text>
<clause id="IDefe7df97f3b1401e9a14f9a9190b9957"><enum>(i)</enum><text>segregate the funds or
other property for the benefit of the counterparty; and</text>
</clause><clause id="IDc88f930bcdf14fb0ad492a161638cfc7"><enum>(ii)</enum><text>in accordance with such
rules and regulations as the Commission may promulgate, maintain the funds or
other property in a segregated account separate from the assets and other
interests of the swap dealer or major swap participant.</text>
</clause></subparagraph></paragraph><paragraph id="ID40c542b80a794a4aa001a67f0883f933"><enum>(2)</enum><header>Applicability</header><text>The
requirements described in paragraph (1) shall—</text>
<subparagraph id="IDe9ac577775c14b57ba142d9908dfc586"><enum>(A)</enum><text>apply only to a swap
between a counterparty and a swap dealer or major swap participant that is not
submitted for clearing to a derivatives clearing organization; and</text>
</subparagraph><subparagraph id="ID446891ea6a644cbc91a3e1f2368cb67d"><enum>(B)</enum><clause commented="no" display-inline="yes-display-inline" id="id5591DF5F751048EE960A7E13BC36199F"><enum>(i)</enum><text>not apply to variation
margin payments; or</text>
</clause><clause changed="added" id="id26BB223F6E5A40B882DEBB9AC6160536" indent="up1" reported-display-style="italic"><enum>(ii)</enum><text>not preclude any
commercial arrangement regarding—</text>
<subclause id="id1F514C3E672B40A9BD67A29309393034"><enum>(I)</enum><text>the investment of
segregated funds or other property that may only be invested in such
investments as the Commission may permit by rule or regulation; and</text>
</subclause><subclause id="id0659D83442534133A30FD32CBAAB70F6"><enum>(II)</enum><text>the related allocation
of gains and losses resulting from any investment of the segregated funds or
other property.</text>
</subclause></clause></subparagraph></paragraph><paragraph id="IDd11fef3b33ae4626805205d048d0c877"><enum>(3)</enum><header>Use of independent
third-party custodians</header><text>The segregated account described in
paragraph (1) shall be—</text>
<subparagraph id="ID72b414198d764d078449d772e68f7364"><enum>(A)</enum><text>carried by an independent
third-party custodian; and</text>
</subparagraph><subparagraph id="IDc1bc0af082e0453ab240ef5e0465ed05"><enum>(B)</enum><text>designated as a
segregated account for and on behalf of the counterparty.</text>
</subparagraph></paragraph><paragraph id="IDf015a8accb7642b9b7b9d418319d3c11"><enum>(4)</enum><header>Reporting
requirement</header><text>If the counterparty does not choose to require
segregation of the funds or other property supplied to margin, guarantee, or
secure the obligations of the counterparty, the swap dealer or major swap
participant shall report to the counterparty of the swap dealer or major swap
participant on a quarterly basis that the back office procedures of the swap
dealer or major swap participant relating to margin and collateral requirements
are in compliance with the agreement of the
counterparties.</text>
</paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection></section><section id="IDce84e80d11904bcb949951bccb424d06"><enum>725.</enum><header>Derivatives clearing
organizations</header>
<subsection commented="no" id="id16F2523B959E44CEBA3E84816DEFCC5E"><enum>(a)</enum><header>Registration
requirement</header><text>Section 5b of the Commodity Exchange Act (7 U.S.C.
7a–1) is amended by striking subsections (a) and (b) and inserting the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="H6512A32F9F434096A6D5DA027DCC9013" reported-display-style="italic" style="OLC">
<subsection commented="no" id="HCD558D093A1F49479E93BB7E02DC4D4F"><enum>(a)</enum><header>Registration
requirement</header>
<paragraph id="H415C32827D9B4164BF5506F797B3CBF9"><enum>(1)</enum><header>In
general</header><text>Except as provided in paragraph (2), it shall be unlawful
for a derivatives clearing organization, directly or indirectly, to make use of
the mails or any means or instrumentality of interstate commerce to perform the
functions of a derivatives clearing organization with respect to—</text>
<subparagraph id="H88F49785D1D94D86A35F1A3D9ACDE95F"><enum>(A)</enum><text>a contract of sale of a
commodity for future delivery (or an option on the contract of sale) or option
on a commodity, in each case, unless the contract or option is—</text>
<clause id="H73DEC4C3D0714434BBB0DC54F9A4BE55"><enum>(i)</enum><text>excluded from this Act by
subsection (a)(1)(C)(i), (c), or (f) of section 2; or</text>
</clause><clause id="H7AF30D880D3A4198A038A870D975DC93"><enum>(ii)</enum><text>a security futures
product cleared by a clearing agency registered with the Securities and
Exchange Commission under the Securities Exchange Act of 1934 (15 U.S.C. 78a et
seq.); or</text>
</clause></subparagraph><subparagraph id="HECF2AEAB863B4874B7CD16B97FAB3C8F"><enum>(B)</enum><text>a swap.</text>
</subparagraph></paragraph><paragraph id="ID5ced5ad74bd44f13b78dd513f65ef66e"><enum>(2)</enum><header>Exception</header><text>Paragraph
(1) shall not apply to a derivatives clearing organization that is registered
with the Commission.</text>
</paragraph></subsection><subsection id="ID80744ee80c3547e9bc77cf321035c55e"><enum>(b)</enum><header>Voluntary
registration</header><text>A person that clears 1 or more agreements,
contracts, or transactions that are not required to be cleared under this Act
may register with the Commission as a derivatives clearing
organization.</text>
</subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection commented="no" id="ID6c1fef548b8b4707a17ca82abaf733e3"><enum>(b)</enum><header>Registration for
depository institutions and clearing agencies; exemptions; compliance officer;
annual reports</header><text>Section 5b of the Commodity Exchange Act (7 U.S.C.
7a–1) is amended by adding at the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="H21533A6B72BE4157A59988E7CC193A22" reported-display-style="italic" style="OLC">
<subsection id="IDd1dea6021c724d30b867863b1d3cf736"><enum>(g)</enum><header>Required registration
for depository institutions and clearing agencies</header><text>A person that
is required to be registered as a derivatives clearing organization under this
section shall register with the Commission regardless of whether the person is
also licensed as a depository institution (as that term is defined in section 3
of the Federal Deposit Insurance Act (12 U.S.C. 1813) or a clearing agency
registered with the Securities and Exchange Commission under the Securities
Exchange Act of 1934 (15 U.S.C. 78a et seq.).</text>
</subsection><subsection id="ID50a0dd96b76a413c8a2548c5271177f7"><enum>(h)</enum><header>Existing depository
institutions and clearing agencies</header>
<paragraph id="ID97eba5626a61407e811c42ae402c53c1"><enum>(1)</enum><header>In
general</header><text>A depository institution or clearing agency registered
with the Securities and Exchange Commission under the Securities Exchange Act
of 1934 (15 U.S.C. 78a et seq.) that is required to be registered as a
derivatives clearing organization under this section is deemed to be registered
under this section to the extent that, before the date of enactment of this
subsection—</text>
<subparagraph id="IDb96dce07489849c98bf4f83131292a54"><enum>(A)</enum><text>the depository
institution cleared swaps as a multilateral clearing organization; or</text>
</subparagraph><subparagraph id="ID1959c12cb06f4d3a9b246b3732cbd267"><enum>(B)</enum><text>the clearing agency
cleared swaps.</text>
</subparagraph></paragraph><paragraph id="IDa3e096444c47448da61119793b34c629"><enum>(2)</enum><header>Conversion of
depository institutions</header><text>A depository institution to which this
paragraph applies may, by the vote of the shareholders owning not less than 51
percent of the voting interests of the depository institution, be converted
into a State corporation, partnership, limited liability company, or similar
legal form pursuant to a plan of conversion, if the conversion is not in
contravention of applicable State law.</text>
</paragraph></subsection><subsection id="idD3C9C4DB684941C4A211EC5AC4FCE041"><enum>(i)</enum><header>Exemptions</header><text>The
Commission may exempt, conditionally or unconditionally, a derivatives clearing
organization from registration under this section for the clearing of swaps if
the Commission determines that the derivatives clearing organization is subject
to comparable, comprehensive supervision and regulation by the Securities and
Exchange Commission or the appropriate government authorities in the home
country of the organization. Such conditions may include, but are not limited
to, requiring that the derivatives clearing organization be available for
inspection by the Commission and make available all information requested by
the Commission.</text>
</subsection><subsection id="id8310173473164208B3BAE5C197A57A38"><enum>(j)</enum><header>Designation of chief
compliance officer</header>
<paragraph id="id174DD1FC72E54EE38A77CF4CC0B399C8"><enum>(1)</enum><header>In
general</header><text>Each derivatives clearing organization shall designate an
individual to serve as a chief compliance officer.</text>
</paragraph><paragraph id="idAEFA9E48A7AC428E8B747F53B489BB22"><enum>(2)</enum><header>Duties</header><text>The
chief compliance officer shall—</text>
<subparagraph id="id74A11751D007445CA41D5B3548699560"><enum>(A)</enum><text>report directly to the
board or to the senior officer of the derivatives clearing organization;</text>
</subparagraph><subparagraph id="idD9E1BD640270409484F4137728FB839B"><enum>(B)</enum><text>review the compliance of
the derivatives clearing organization with respect to the core principles
described in subsection (c)(2);</text>
</subparagraph><subparagraph id="idCFBAC08193604852B1B0C643A861B0AF"><enum>(C)</enum><text>in consultation with the
board of the derivatives clearing organization, a body performing a function
similar to the board of the derivatives clearing organization, or the senior
officer of the derivatives clearing organization, resolve any conflicts of
interest that may arise;</text>
</subparagraph><subparagraph id="idE5E3527A72F74881BBB3FD3719376F45"><enum>(D)</enum><text>be responsible for
administering each policy and procedure that is required to be established
pursuant to this section;</text>
</subparagraph><subparagraph id="id5B81CA64CEFF49418DB414F92E507537"><enum>(E)</enum><text>ensure compliance with
this Act (including regulations) relating to agreements, contracts, or
transactions, including each rule prescribed by the Commission under this
section;</text>
</subparagraph><subparagraph id="idFDE151F718CF42FCA59B6C15FF957B3A"><enum>(F)</enum><text>establish procedures for
the remediation of noncompliance issues identified by the compliance officer
through any—</text>
<clause id="idD6CD9D68198740CFB24B64E39DBB1EE7"><enum>(i)</enum><text>compliance office
review;</text>
</clause><clause id="id8378D16C939D427789765DF6EC12CEB6"><enum>(ii)</enum><text>look-back;</text>
</clause><clause id="id2049335684F147719AB213AC5080429A"><enum>(iii)</enum><text>internal or external
audit finding;</text>
</clause><clause id="idCF21B18EAF4C4B6A916A0EE4949BE15E"><enum>(iv)</enum><text>self-reported error;
or</text>
</clause><clause id="id024E64B4187D42859919B7CF31E8B4DD"><enum>(v)</enum><text>validated complaint;
and</text>
</clause></subparagraph><subparagraph id="id4BD06DD70DF74219805528967E18CD59"><enum>(G)</enum><text>establish and follow
appropriate procedures for the handling, management response, remediation,
retesting, and closing of noncompliance issues.</text>
</subparagraph></paragraph><paragraph id="id753F4F7B11AB41D0866F24489E90E595"><enum>(3)</enum><header>Annual reports</header>
<subparagraph id="idC5AB75BEC9DB4171BF7EDAFA14095B74"><enum>(A)</enum><header>In
general</header><text>In accordance with rules prescribed by the Commission,
the chief compliance officer shall annually prepare and sign a report that
contains a description of—</text>
<clause id="id7DA9AEB29A9E41F582494D5E1B29FB4A"><enum>(i)</enum><text>the compliance of the
derivatives clearing organization of the compliance officer with respect to
this Act (including regulations); and</text>
</clause><clause id="id748A8E7C5FD842DE94AB02752910DCCC"><enum>(ii)</enum><text>each policy and
procedure of the derivatives clearing organization of the compliance officer
(including the code of ethics and conflict of interest policies of the
derivatives clearing organization).</text>
</clause></subparagraph><subparagraph id="id88469BB8DF2742578FF20E5DA4FD45C0"><enum>(B)</enum><header>Requirements</header><text>A
compliance report under subparagraph (A) shall—</text>
<clause id="idB3C3C0DEE18C46AAA049F2559990160A"><enum>(i)</enum><text>accompany each
appropriate financial report of the derivatives clearing organization that is
required to be furnished to the Commission pursuant to this section; and</text>
</clause><clause id="id07CC5F716315451D8D30E3AF04B6ED6E"><enum>(ii)</enum><text>include a certification
that, under penalty of law, the compliance report is accurate and
complete.</text>
</clause></subparagraph></paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection commented="no" id="HC6E15B866A0D418385FEB099C209C528"><enum>(c)</enum><header>Core principles for
derivatives clearing organizations</header><text>Section 5b(c) of the Commodity
Exchange Act (7 U.S.C. 7a–1(c)) is amended by striking paragraph (2) and
inserting the following:</text>
<quoted-block changed="added" id="H64633476118B4B45AA3405A653DB4D4B" reported-display-style="italic" style="OLC">
<paragraph id="HD43B8B1010A34A6D904F1752AF2E3FA0"><enum>(2)</enum><header>Core principles for
derivatives clearing organizations</header>
<subparagraph id="ID5f65f0db69d7401bbfd38b7140cc437f"><enum>(A)</enum><header>Compliance</header>
<clause id="ID606016b5bf1143aaa48f50d2eacff8e1"><enum>(i)</enum><header>In
general</header><text>To be registered and to maintain registration as a
derivatives clearing organization, a derivatives clearing organization shall
comply with each core principle described in this paragraph and any requirement
that the Commission may impose by rule or regulation pursuant to section
8a(5).</text>
</clause><clause id="ID0a21caa89a22479dbc901f7daa546f7d"><enum>(ii)</enum><header>Discretion of
derivatives clearing organization</header><text>Subject to any rule or
regulation prescribed by the Commission, a derivatives clearing organization
shall have reasonable discretion in establishing the manner by which the
derivatives clearing organization complies with each core principle described
in this paragraph.</text>
</clause></subparagraph><subparagraph id="IDfc33dafd64e744a393ef3aa452d9756a"><enum>(B)</enum><header>Financial
resources</header>
<clause id="ID447d5095b1ba4d529c1900959f896fba"><enum>(i)</enum><header>In
general</header><text>Each derivatives clearing organization shall have
adequate financial, operational, and managerial resources, as determined by the
Commission, to discharge each responsibility of the derivatives clearing
organization.</text>
</clause><clause id="IDf9025cca6e644f11bc95c253d3bdc98e"><enum>(ii)</enum><header>Minimum amount of
financial resources</header><text>Each derivatives clearing organization shall
possess financial resources that, at a minimum, exceed the total amount that
would—</text>
<subclause id="ID7dcf2a15277b42118c4027d0c923d104"><enum>(I)</enum><text>enable the organization
to meet its financial obligations to its members and participants
notwithstanding a default by the member or participant creating the largest
financial exposure for that organization in extreme but plausible market
conditions; and</text>
</subclause><subclause id="IDa12c4ae8d32743339a69ac5472741f3d"><enum>(II)</enum><text>enable the derivatives
clearing organization to cover the operating costs of the derivatives clearing
organization for a period of 1 year (as calculated on a rolling basis).</text>
</subclause></clause></subparagraph><subparagraph id="ID9fc00b8e61864575b7a1711f5c5fac48"><enum>(C)</enum><header>Participant and product
eligibility</header>
<clause id="ID9f93ce9de9d44bf3968f430ba5e3fd4f"><enum>(i)</enum><header>In
general</header><text>Each derivatives clearing organization shall
establish—</text>
<subclause id="ID5f14dc773dd44514887d2ef7b96d4756"><enum>(I)</enum><text>appropriate admission and
continuing eligibility standards (including sufficient financial resources and
operational capacity to meet obligations arising from participation in the
derivatives clearing organization) for members of, and participants in, the
derivatives clearing organization; and</text>
</subclause><subclause id="IDf6ae43209d2b454a9d759b7695c0d95a"><enum>(II)</enum><text>appropriate standards
for determining the eligibility of agreements, contracts, and transactions
submitted to the derivatives clearing organization for clearing.</text>
</subclause></clause><clause id="ID5b12b1ffefc04ee1aa3f22bd61847ff3"><enum>(ii)</enum><header>Required
procedures</header><text>Each derivatives clearing organization shall establish
and implement procedures to verify, on an ongoing basis, the compliance of each
participation and membership requirement of the derivatives clearing
organization.</text>
</clause><clause id="ID1a06ad3119174b2099b6592522b06a9a"><enum>(iii)</enum><header>Requirements</header><text>The
participation and membership requirements of each derivatives clearing
organization shall—</text>
<subclause id="IDbc832651895f413cab9c4ffaf59f38ba"><enum>(I)</enum><text>be objective;</text>
</subclause><subclause id="ID5fe7132ec6104187bc0761e5f549d8bf"><enum>(II)</enum><text>be publicly disclosed;
and</text>
</subclause><subclause id="ID40d1298c77ed48a6a972ae653e1a04bb"><enum>(III)</enum><text>permit fair and open
access.</text>
</subclause></clause></subparagraph><subparagraph id="ID898cf573af264ade88fa5223e69d32c6"><enum>(D)</enum><header>Risk
management</header>
<clause id="ID716289f86ec24ec69ab1fc004e6a2c5f"><enum>(i)</enum><header>In
general</header><text>Each derivatives clearing organization shall ensure that
the derivatives clearing organization possesses the ability to manage the risks
associated with discharging the responsibilities of the derivatives clearing
organization through the use of appropriate tools and procedures.</text>
</clause><clause id="ID196ee22fab34487daac1a9aaa3fc56c8"><enum>(ii)</enum><header>Measurement of credit
exposure</header><text>Each derivatives clearing organization shall—</text>
<subclause id="ID163e6e05895a4278a1473637d4c21647"><enum>(I)</enum><text>not less than once during
each business day of the derivatives clearing organization, measure the credit
exposures of the derivatives clearing organization to each member and
participant of the derivatives clearing organization; and</text>
</subclause><subclause id="IDec37aa0265d34e2680c04fd8662b768e"><enum>(II)</enum><text>monitor each exposure
described in subclause (I) periodically during the business day of the
derivatives clearing organization.</text>
</subclause></clause><clause id="IDb4b8e389b8ce484e8839b8f3a91d41d5"><enum>(iii)</enum><header>Limitation of
exposure to potential losses from defaults</header><text>Each derivatives
clearing organization, through margin requirements and other risk control
mechanisms, shall limit the exposure of the derivatives clearing organization
to potential losses from defaults by members and participants of the
derivatives clearing organization to ensure that—</text>
<subclause id="ID47c37c6a57824944a3eda85b64f11e2c"><enum>(I)</enum><text>the operations of the
derivatives clearing organization would not be disrupted; and</text>
</subclause><subclause id="ID8e18f827c0774c20b68e03926c3572f3"><enum>(II)</enum><text>nondefaulting members or
participants would not be exposed to losses that nondefaulting members or
participants cannot anticipate or control.</text>
</subclause></clause><clause id="IDc97251a5398b402296e17ef292f36c72"><enum>(iv)</enum><header>Margin
requirements</header><text>The margin required from each member and participant
of a derivatives clearing organization shall be sufficient to cover potential
exposures in normal market conditions.</text>
</clause><clause id="ID47b06ee03f844bacbc62f10a84dc99d9"><enum>(v)</enum><header>Requirements regarding
models and parameters</header><text>Each model and parameter used in setting
margin requirements under clause (iv) shall be—</text>
<subclause id="ID077338d6bedb4a7f915a5181864595c4"><enum>(I)</enum><text>risk-based; and</text>
</subclause><subclause id="ID82d25a24bff049b9b5a97bc946099cd1"><enum>(II)</enum><text>reviewed on a regular
basis.</text>
</subclause></clause></subparagraph><subparagraph id="IDbeaca101f8c64d5da42f2493dc204444"><enum>(E)</enum><header>Settlement
procedures</header><text>Each derivatives clearing organization shall—</text>
<clause id="IDa7b84e2b10f24633962b11c95e26c22f"><enum>(i)</enum><text>complete money
settlements on a timely basis (but not less frequently than once each business
day);</text>
</clause><clause id="ID1f3b75c8c32c479cb9cf7a5bcf24d2c1"><enum>(ii)</enum><text>employ money settlement
arrangements to eliminate or strictly limit the exposure of the derivatives
clearing organization to settlement bank risks (including credit and liquidity
risks from the use of banks to effect money settlements);</text>
</clause><clause id="IDb6ceb2639cd54ec79b8d0caf0bddcc3d"><enum>(iii)</enum><text>ensure that money
settlements are final when effected;</text>
</clause><clause id="IDc711f29346d24ab6be67acdb7fc017f1"><enum>(iv)</enum><text>maintain an accurate
record of the flow of funds associated with each money settlement;</text>
</clause><clause id="ID17383912a4b448779d09020bf0cacfa3"><enum>(v)</enum><text>possess the ability to
comply with each term and condition of any permitted netting or offset
arrangement with any other clearing organization;</text>
</clause><clause id="IDc42415f2faab47539f930f20a5ff0a74"><enum>(vi)</enum><text>regarding physical
settlements, establish rules that clearly state each obligation of the
derivatives clearing organization with respect to physical deliveries;
and</text>
</clause><clause id="ID13ac4da3b26b4133b94f6e77c3744611"><enum>(vii)</enum><text>ensure that each risk
arising from an obligation described in clause (vi) is identified and
managed.</text>
</clause></subparagraph><subparagraph id="HBA28443102FB483895F9495448E89493"><enum>(F)</enum><header>Treatment of
funds</header>
<clause id="ID95d9cef590574b488cfcd6638396d19f"><enum>(i)</enum><header>Required standards and
procedures</header><text>Each derivatives clearing organization shall establish
standards and procedures that are designed to protect and ensure the safety of
member and participant funds and assets.</text>
</clause><clause id="ID56d1c23e09904446938c0ce5dfcd2d08"><enum>(ii)</enum><header>Holding of funds and
assets</header><text>Each derivatives clearing organization shall hold member
and participant funds and assets in a manner by which to minimize the risk of
loss or of delay in the access by the derivatives clearing organization to the
assets and funds.</text>
</clause><clause id="IDe29d5c28bf4a41dd95301ebba30835d1"><enum>(iii)</enum><header>Permissible
investments</header><text>Funds and assets invested by a derivatives clearing
organization shall be held in instruments with minimal credit, market, and
liquidity risks.</text>
</clause></subparagraph><subparagraph id="HD0872AD40CA94A56A6CB53A97AD10901"><enum>(G)</enum><header>Default rules and
procedures</header>
<clause id="ID53caa8f7044b4da9be5b4417f5412d66"><enum>(i)</enum><header>In
general</header><text>Each derivatives clearing organization shall have rules
and procedures designed to allow for the efficient, fair, and safe management
of events during which members or participants—</text>
<subclause id="IDd479584c2c654d24afcc662c894b8ab6"><enum>(I)</enum><text>become insolvent;
or</text>
</subclause><subclause id="ID61eee8e311eb49e18649f4e6538eb137"><enum>(II)</enum><text>otherwise default on the
obligations of the members or participants to the derivatives clearing
organization.</text>
</subclause></clause><clause id="ID09d15b25743946de9d997c3c77e76c70"><enum>(ii)</enum><header>Default
procedures</header><text>Each derivatives clearing organization shall—</text>
<subclause id="ID085e1f37ac4c4c06b406765f0236bac8"><enum>(I)</enum><text>clearly state the default
procedures of the derivatives clearing organization;</text>
</subclause><subclause id="IDea7f156bd4f744569bae29db769dd27d"><enum>(II)</enum><text>make publicly available
the default rules of the derivatives clearing organization; and</text>
</subclause><subclause id="ID4b8993ced0fb4bb9b37de3c4c0d15c2d"><enum>(III)</enum><text>ensure that the
derivatives clearing organization may take timely action—</text>
<item id="ID3bf510ba10204d8ab26e9c465acf46f9"><enum>(aa)</enum><text>to contain losses and
liquidity pressures; and</text>
</item><item id="ID9387c7057cbf4ebb821b5d8f12d8615f"><enum>(bb)</enum><text>to continue meeting each
obligation of the derivatives clearing organization.</text>
</item></subclause></clause></subparagraph><subparagraph id="HA3375EB9FB2B40FDB5A3A53142094FF3"><enum>(H)</enum><header>Rule
enforcement</header><text>Each derivatives clearing organization shall—</text>
<clause id="IDfca2d49bcab7432b8599105d4cb99ae6"><enum>(i)</enum><text>maintain adequate
arrangements and resources for—</text>
<subclause id="IDa4d854ac81f6443b985ed4b5621a2ff0"><enum>(I)</enum><text>the effective monitoring
and enforcement of compliance with the rules of the derivatives clearing
organization; and</text>
</subclause><subclause id="ID4c420b6e5a37408b82161ae7ea25fabf"><enum>(II)</enum><text>the resolution of
disputes;</text>
</subclause></clause><clause id="ID65a92fb163924f938257c97b438bb41e"><enum>(ii)</enum><text>have the authority and
ability to discipline, limit, suspend, or terminate the activities of a member
or participant due to a violation by the member or participant of any rule of
the derivatives clearing organization; and</text>
</clause><clause id="ID6dfe434c41a9433eb1634d65233c0600"><enum>(iii)</enum><text>report to the
Commission regarding rule enforcement activities and sanctions imposed against
members and participants as provided in clause (ii).</text>
</clause></subparagraph><subparagraph id="H90D26C48FEA9408BB714AFAD7E14659D"><enum>(I)</enum><header>System
safeguards</header><text>Each derivatives clearing organization shall—</text>
<clause id="ID2ee43705a7194616b5fc0d874ed31bdb"><enum>(i)</enum><text>establish and maintain a
program of risk analysis and oversight to identify and minimize sources of
operational risk through the development of appropriate controls and
procedures, and automated systems, that are reliable, secure, and have adequate
scalable capacity;</text>
</clause><clause id="ID8e98f39804564c21a5b497cdd5b722cb"><enum>(ii)</enum><text>establish and maintain
emergency procedures, backup facilities, and a plan for disaster recovery that
allows for—</text>
<subclause id="IDaaff3a5feb5b4f6085db7101aefb7f7c"><enum>(I)</enum><text>the timely recovery and
resumption of operations of the derivatives clearing organization; and</text>
</subclause><subclause id="ID62982ee4b73c4459a2cbc58829311165"><enum>(II)</enum><text>the fulfillment of each
obligation and responsibility of the derivatives clearing organization;
and</text>
</subclause></clause><clause id="IDb4b7a9cfebe2487f9da2cdb26281a0cb"><enum>(iii)</enum><text>periodically conduct
tests to verify that the backup resources of the derivatives clearing
organization are sufficient to ensure daily processing, clearing, and
settlement.</text>
</clause></subparagraph><subparagraph id="IDda1db2dfd0b74f9e83f18c2bd5d4f318"><enum>(J)</enum><header>Reporting</header><text>Each
derivatives clearing organization shall provide to the Commission all
information that the Commission determines to be necessary to conduct oversight
of the derivatives clearing organization.</text>
</subparagraph><subparagraph id="IDfa97e5fb72e84ffeb3ce7c96954516b5"><enum>(K)</enum><header>Recordkeeping</header><text>Each
derivatives clearing organization shall maintain records of all activities
related to the business of the derivatives clearing organization as a
derivatives clearing organization—</text>
<clause id="ID2645be67f61c4a6ea1f379f0a220a490"><enum>(i)</enum><text>in a form and manner that
is acceptable to the Commission; and</text>
</clause><clause id="ID9412ff1980124080af08280f1c25fb3a"><enum>(ii)</enum><text>for a period of not less
than 5 years.</text>
</clause></subparagraph><subparagraph id="HF05CBB8A292C404BA48406BEBFE5C5B7"><enum>(L)</enum><header>Public
information</header>
<clause id="ID993cec5ba2c64c04bdda4de355fcdf9c"><enum>(i)</enum><header>In
general</header><text>Each derivatives clearing organization shall provide to
market participants sufficient information to enable the market participants to
identify and evaluate accurately the risks and costs associated with using the
services of the derivatives clearing organization.</text>
</clause><clause id="ID6bdcca32a15b4089b402e7d705e6a6c0"><enum>(ii)</enum><header>Availability of
information</header><text>Each derivatives clearing organization shall make
information concerning the rules and operating procedures governing the
clearing and settlement systems of the derivatives clearing organization
available to market participants.</text>
</clause><clause id="IDb28192dbd51442b1babaaa20aa80700e"><enum>(iii)</enum><header>Public
disclosure</header><text>Each derivatives clearing organization shall disclose
publicly and to the Commission information concerning—</text>
<subclause id="ID200f767ebe8343a7bdb3b8401da4e5b0"><enum>(I)</enum><text>the terms and conditions
of each contract, agreement, and other transaction cleared and settled by the
derivatives clearing organization;</text>
</subclause><subclause id="ID7ddf20ac7ee9459ca2e12c95b7aa806e"><enum>(II)</enum><text>each clearing and other
fee that the derivatives clearing organization charges the members and
participants of the derivatives clearing organization;</text>
</subclause><subclause id="IDd0b7490588ee4cb5bedda83a0f248732"><enum>(III)</enum><text>the margin-setting
methodology, and the size and composition, of the financial resource package of
the derivatives clearing organization;</text>
</subclause><subclause id="ID3dc0ea621b8246498d777e2816f481cc"><enum>(IV)</enum><text>daily settlement prices,
volume, and open interest for each contract settled or cleared by the
derivatives clearing organization; and</text>
</subclause><subclause id="ID387f7045b9a3419ba01d4c9dd55d747f"><enum>(V)</enum><text>any other matter relevant
to participation in the settlement and clearing activities of the derivatives
clearing organization.</text>
</subclause></clause></subparagraph><subparagraph id="H0025A6CEAC3E4703A44B5203B2EC3E09"><enum>(M)</enum><header>Information-sharing</header><text>Each
derivatives clearing organization shall—</text>
<clause id="ID5529e4419a174255a25cf8deadd7f8b1"><enum>(i)</enum><text>enter into, and abide by
the terms of, each appropriate and applicable domestic and international
information-sharing agreement; and</text>
</clause><clause id="IDa8be7054f8fa4edfb3630d4eebc9c63e"><enum>(ii)</enum><text>use relevant information
obtained from each agreement described in clause (i) in carrying out the risk
management program of the derivatives clearing organization.</text>
</clause></subparagraph><subparagraph id="H25A6E668D12040399D3FB76D6B5B062A"><enum>(N)</enum><header>Antitrust
considerations</header><text>Unless necessary or appropriate to achieve the
purposes of this Act, a derivatives clearing organization shall not—</text>
<clause id="ID702d9c78706040afb9e5cadf91a25e0f"><enum>(i)</enum><text>adopt any rule or take
any action that results in any unreasonable restraint of trade; or</text>
</clause><clause id="IDf6653e1756254556ac15729c85f9e8d5"><enum>(ii)</enum><text>impose any material
anticompetitive burden.</text>
</clause></subparagraph><subparagraph id="H8E7776591BF54D85B7C25F4B63DFB054"><enum>(O)</enum><header>Governance fitness
standards</header>
<clause id="IDc9e34b8ea670400d9a056b89ce67301a"><enum>(i)</enum><header>Governance
arrangements</header><text>Each derivatives clearing organization shall
establish governance arrangements that are transparent—</text>
<subclause id="ID649fba1f52064bc18e66f37496d4bc66"><enum>(I)</enum><text>to fulfill public
interest requirements; and</text>
</subclause><subclause id="ID66e278b47238487e83f60941cbf7f209"><enum>(II)</enum><text>to support the
objectives of owners and participants.</text>
</subclause></clause><clause id="ID041d05f9e1f74f5c9eb62522e25cd6b3"><enum>(ii)</enum><header>Fitness
standards</header><text>Each derivatives clearing organization shall establish
and enforce appropriate fitness standards for—</text>
<subclause id="ID5c3899b4bfdb495b927bf380287f82f3"><enum>(I)</enum><text>directors;</text>
</subclause><subclause id="IDca4bf85fa6b640b4a019ccef7a101e9a"><enum>(II)</enum><text>members of any
disciplinary committee;</text>
</subclause><subclause id="ID90a76f2db2c740b8984ff34d5bd1b7b6"><enum>(III)</enum><text>members of the
derivatives clearing organization;</text>
</subclause><subclause id="ID382b21392d3e453a8c2a058e22373a46"><enum>(IV)</enum><text>any other individual or
entity with direct access to the settlement or clearing activities of the
derivatives clearing organization; and</text>
</subclause><subclause id="ID59b7b4dd275c40508033125ab7ef249a"><enum>(V)</enum><text>any party affiliated with
any individual or entity described in this clause.</text>
</subclause></clause></subparagraph><subparagraph id="HD9F04C1582F54A808E93869877FFAF6F"><enum>(P)</enum><header>Conflicts of
interest</header><text>Each derivatives clearing organization shall—</text>
<clause id="ID82e611a5ee4445759013d51c74efdd9f"><enum>(i)</enum><text>establish and enforce
rules to minimize conflicts of interest in the decision-making process of the
derivatives clearing organization; and</text>
</clause><clause id="IDf1803bded9cd4271bc1946fac8e31bb7"><enum>(ii)</enum><text>establish a process for
resolving conflicts of interest described in clause (i).</text>
</clause></subparagraph><subparagraph id="ID8f3b6065dc1b445e92eae7f76cec8e67"><enum>(Q)</enum><header>Composition of
governing boards</header><text>Each derivatives clearing organization shall
ensure that the composition of the governing board or committee of the
derivatives clearing organization includes market participants.</text>
</subparagraph><subparagraph id="IDd98881bcafce40d9b9d7677345a7fcf9"><enum>(R)</enum><header>Legal
risk</header><text>Each derivatives clearing organization shall have a
well-founded, transparent, and enforceable legal framework for each aspect of
the activities of the derivatives clearing organization.</text>
</subparagraph><subparagraph id="idAB1E205B586F431AB5B52B9D17A58EFB"><enum>(S)</enum><header>Modification of core
principles</header><text>The Commission may conform the core principles
established in this paragraph to reflect evolving United States and
international
standards.</text>
</subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="idB406099F79E846498CF2A6E13A9E0AE9"><enum>(d)</enum><header>Conflicts of
interest</header><text>The Commodity Futures Trading Commission shall adopt
rules mitigating conflicts of interest in connection with the conduct of
business by a swap dealer or a major swap participant with a derivatives
clearing organization, board of trade, or a swap execution facility that clears
or trades swaps in which the swap dealer or major swap participant has a
material debt or material equity investment.</text>
</subsection><subsection id="H2FA25A10909F48A29DB90ED340074A37"><enum>(e)</enum><header>Reporting
requirements</header><text>Section 5b of the Commodity Exchange Act (7 U.S.C.
7a–1) (as amended by subsection (b)) is amended by adding at the end the
following:</text>
<quoted-block changed="added" id="H3A9F0EBD6EED4A8FB71A94F288B04780" reported-display-style="italic" style="OLC">
<subsection id="H05900D2CAB31437DBED54B3D7A656DD3"><enum>(k)</enum><header>Reporting
requirements</header>
<paragraph id="IDb985195fcf4a413a98584036f72516f0"><enum>(1)</enum><header>Duty of derivatives
clearing organizations</header><text>Each derivatives clearing organization
that clears swaps shall provide to the Commission all information that is
determined by the Commission to be necessary to perform each responsibility of
the Commission under this Act.</text>
</paragraph><paragraph id="ID84a59ede2c564c6ea0ea1ac35dc452f4"><enum>(2)</enum><header>Data collection and
maintenance requirements</header><text>The Commission shall adopt data
collection and maintenance requirements for swaps cleared by derivatives
clearing organizations that are comparable to the corresponding requirements
for—</text>
<subparagraph id="ID447d5ababe904606928395b4928bc571"><enum>(A)</enum><text>swaps data reported to
swap data repositories; and</text>
</subparagraph><subparagraph id="IDfac52deccd8242479a3eafb4572de94a"><enum>(B)</enum><text>swaps traded on swap
execution facilities.</text>
</subparagraph></paragraph><paragraph id="ID599608398d554cdc9c263de8665defb9"><enum>(3)</enum><header>Reports on
security-based swap agreements to be shared with the Securities and Exchange
Commission</header>
<subparagraph id="id393BE4A439104658B63F245EB51DE840"><enum>(A)</enum><header>In
general</header><text>A derivatives clearing organization that clears
security-based swap agreements (as defined in section 3(a)(79) of the
Securities Exchange Act) shall, upon request, make available to the Securities
and Exchange Commission all books and records relating to such security-based
swap agreements, consistent with the confidentiality and disclosure
requirements of section 8.</text>
</subparagraph><subparagraph id="id93A03EE0331547CAAFA057D692E3160D"><enum>(B)</enum><header>Jurisdiction</header><text>Nothing
in this paragraph shall affect the exclusive jurisdiction of the Commission to
prescribe recordkeeping and reporting requirements for a derivatives clearing
organization that is registered with the Commission.”</text>
</subparagraph></paragraph><paragraph id="ID0bedf25f163a427f9f236adde8000d6e"><enum>(4)</enum><header>Information
sharing</header><text>Subject to section 8, and upon request, the Commission
shall share information collected under paragraph (2) with—</text>
<subparagraph id="ID6e0bc1a3acb94d7688398950d86054d0"><enum>(A)</enum><text>the Board;</text>
</subparagraph><subparagraph id="ID535dc889fce844f9b6ee1fe376a38a50"><enum>(B)</enum><text>the Securities and
Exchange Commission;</text>
</subparagraph><subparagraph id="ID196e688c1e5f4c6fa82108df41b5f35a"><enum>(C)</enum><text>each appropriate
prudential regulator;</text>
</subparagraph><subparagraph id="ID67e83123bf2a4156aa3ba577ec31bd6a"><enum>(D)</enum><text>the Financial Stability
Oversight Council;</text>
</subparagraph><subparagraph id="idFB2DF50D032647A3AC6C33803406AA95"><enum>(E)</enum><text>the Department of
Justice; and</text>
</subparagraph><subparagraph id="ID4307529b39a94d46bef192f8e0e89736"><enum>(F)</enum><text>any other person that the
Commission determines to be appropriate, including—</text>
<clause id="ID3f0219a37c7c4041989caf72b5fec3e9"><enum>(i)</enum><text>foreign financial
supervisors (including foreign futures authorities);</text>
</clause><clause id="IDe8f86bdae9ef42658af640436e8a5e43"><enum>(ii)</enum><text>foreign central banks;
and</text>
</clause><clause id="ID5f2e7d591197427fa5ae9d2e78a3d3e4"><enum>(iii)</enum><text>foreign
ministries.</text>
</clause></subparagraph></paragraph><paragraph id="id3402EEDCF7264783B47D0C17568E668A"><enum>(5)</enum><header>Confidentiality and
indemnification agreement</header><text>Before the Commission may share
information with any entity described in paragraph (4)—</text>
<subparagraph id="id67F9EA48B30F4121BBEDA6DDC6DC35BE"><enum>(A)</enum><text>the Commission shall
receive a written agreement from each entity stating that the entity shall
abide by the confidentiality requirements described in section 8 relating to
the information on swap transactions that is provided; and</text>
</subparagraph><subparagraph id="id70E0875C887D48F6A6C7EA2D79EC8325"><enum>(B)</enum><text>each entity shall agree
to indemnify the Commission for any expenses arising from litigation relating
to the information provided under section 8.</text>
</subparagraph></paragraph><paragraph id="ID88e846e1e6ba49f0b1b07dc020112bd5"><enum>(6)</enum><header>Public
information</header><text>Each derivatives clearing organization that clears
swaps shall provide to the Commission (including any designee of the
Commission) information under paragraph (2) in such form and at such frequency
as is required by the Commission to comply with the public reporting
requirements contained in section
2(a)(13).</text>
</paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="HABD7B76838DF4AF08EFC6E8DF6F3CFB9"><enum>(f)</enum><header>Public
disclosure</header><text>Section 8(e) of the Commodity Exchange Act (7 U.S.C.
12(e)) is amended in the last sentence—</text>
<paragraph id="ID2c8540802ac6486b8690da876b6e765a"><enum>(1)</enum><text>by inserting <quote>,
central bank and ministries,</quote> after <quote>department</quote> each place
it appears; and</text>
</paragraph><paragraph id="IDab2c8566ec4846069f7e73ab5bef68ec"><enum>(2)</enum><text>by striking <quote>. is a
party.</quote> and inserting <quote>, is a party.</quote>.</text>
</paragraph></subsection><subsection id="HC8EE223077ED435F91087D43C7B3DA90"><enum>(g)</enum><header>Legal certainty for
identified banking products</header>
<paragraph id="IDea5a6940bc044feebc3d87c3d828c63f"><enum>(1)</enum><header>Repeals</header><text>The
Legal Certainty for Bank Products Act of 2000 (7 U.S.C. 27 et seq.) is
amended—</text>
<subparagraph id="ID28d9c6aaa8c347258d2221ae1a58f838"><enum>(A)</enum><text>by striking sections 404
and 407 (7 U.S.C. 27b, 27e);</text>
</subparagraph><subparagraph id="ID2819c481db564b91821dfb61d50b83a5"><enum>(B)</enum><text>in section 402 (7 U.S.C.
27), by striking subsection (d); and</text>
</subparagraph><subparagraph id="ID2c64abe5312942848c4eb44d58bf4beb"><enum>(C)</enum><text>in section 408 (7 U.S.C.
27f)—</text>
<clause id="ID01195c070ae9467b8e0263e2f434c72f"><enum>(i)</enum><text>in subsection (c)—</text>
<subclause id="IDaf8598bfa2eb443aa0fc7942eba26bc2"><enum>(I)</enum><text>by striking <quote>in the
case</quote> and all that follows through <quote>a hybrid</quote> and inserting
<quote>in the case of a hybrid</quote>;</text>
</subclause><subclause id="ID1189f30411df4f3586e3997ac9b0e129"><enum>(II)</enum><text>by striking <quote>;
or</quote> and inserting a period; and</text>
</subclause><subclause id="IDee3d5473baa04829bb900727564f8413"><enum>(III)</enum><text>by striking paragraph
(2);</text>
</subclause></clause><clause id="ID1ac920c8a9524d30b5439d2dc80e0880"><enum>(ii)</enum><text>by striking subsection
(b); and</text>
</clause><clause id="IDc5e6cc1d6be74b9190423ed81afdfcb2"><enum>(iii)</enum><text>by redesignating
subsection (c) as subsection (b).</text>
</clause></subparagraph></paragraph><paragraph id="IDa1fe13a70fbd4f0094654dc1c5dc00b1"><enum>(2)</enum><header>Legal Certainty for
Bank Products Act of 2000</header><text>Section 403 of the Legal Certainty for
Bank Products Act of 2000 (7 U.S.C. 27a) is amended to read as follows:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id5292AD142BB6449C95C383A85393C886" reported-display-style="italic" style="OLC">
<section commented="no" id="ID91c4ba47d23b4722b6a87a41070b8c91"><enum>403.</enum><header>Exclusion of
identified banking product</header>
<subsection commented="no" id="IDe4f54bef10f44750a1ff0b51885a2b2f"><enum>(a)</enum><header>Exclusion</header><text>Except
as provided in subsection (b) or (c)—</text>
<paragraph commented="no" id="id3AD289F0D12141F2BFA6772BFEEDF36A"><enum>(1)</enum><text>the Commodity Exchange
Act (7 U.S.C. 1 et seq.) shall not apply to, and the Commodity Futures Trading
Commission shall not exercise regulatory authority under the Commodity Exchange
Act (7 U.S.C. 1 et seq.) with respect to, an identified banking product;
and</text>
</paragraph><paragraph id="ID19600838cd3e43fbbf112eabeae9db36"><enum>(2)</enum><text>the definitions of
<quote>security-based swap</quote> in section 3(a)(68) of the Securities
Exchange Act of 1934 and <quote>security-based swap agreement</quote> in
section 3(a)(79) of the Securities Exchange Act of 1934 do not include any
identified bank product.</text>
</paragraph></subsection><subsection commented="no" id="IDb77e533fac3e4a9f8830d0f18ef7f6bf"><enum>(b)</enum><header>Exception</header><text>An
appropriate Federal banking agency may except an identified banking product of
a bank under its regulatory jurisdiction from the exclusion in subsection (a)
if the agency determines, in consultation with the Commodity Futures Trading
Commission and the Securities and Exchange Commission, that the product—</text>
<paragraph commented="no" id="ID90c96f56152e42deaa078e75f3a30728"><enum>(1)</enum><text>would meet the definition
of a <quote>swap</quote> under section 1a(46) of the Commodity Exchange Act (7
U.S.C. 1a) or a <quote>security-based swap</quote> under that section 3(a)(68)
of the Securities Exchange Act of 1934; and</text>
</paragraph><paragraph commented="no" id="ID91909f522d4d49a28683adfd0f2c6cd9"><enum>(2)</enum><text>has become known to the
trade as a swap or security-based swap, or otherwise has been structured as an
identified banking product for the purpose of evading the provisions of the
Commodity Exchange Act (7 U.S.C. 1 et seq.), the Securities Act of 1933 (15
U.S.C. 77a et seq.), or the Securities Exchange Act of 1934 (15 U.S.C. 78a et
seq.).</text>
</paragraph></subsection><subsection id="IDf0ec79e7e9a74ab88a117c89e852dda5"><enum>(c)</enum><header>Exception</header><text>The
exclusions in subsection (a) shall not apply to an identified bank product
that—</text>
<paragraph id="ID61b25d4b841f4433adb0439a559c99d6"><enum>(1)</enum><text>is a product of a bank
that is not under the regulatory jurisdiction of an appropriate Federal banking
agency;</text>
</paragraph><paragraph id="ID56a57377fc324d97b09eb0518d2057e5"><enum>(2)</enum><text>meets the definition of
swap in section 1a(46) of the Commodity Exchange Act or security-based swap in
section 3(a)(68) of the Securities Exchange Act of 1934; and</text>
</paragraph><paragraph id="ID8ca70991eab744729d23fea5f47cb4f6"><enum>(3)</enum><text>has become known to the
trade as a swap or security-based swap, or otherwise has been structured as an
identified banking product for the purpose of evading the provisions of the
Commodity Exchange Act (7 U.S.C. 1 et seq.), the Securities Act of 1933 (15
U.S.C. 77a et seq.), or the Securities Exchange Act of 1934 (15 U.S.C. 78a et
seq.).</text>
</paragraph></subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection></section><section id="idC7CBAA79B99F4BB4A4A008D641FE52C3"><enum>726.</enum><header>Rulemaking on conflict
of interest</header>
<subsection id="IDa96a670dc8004ac58d6f8b87374fc089"><enum>(a)</enum><header>In
general</header><text>Not later than 180 days after the date of enactment of
the Wall Street Transparency and Accountability Act of 2010, the Commodity
Futures Trading Commission shall determine whether to adopt rules to establish
limits on the control of any derivatives clearing organization that clears
swaps, or swap execution facility or board of trade designated as a contract
market that posts swaps or makes swaps available for trading, by a bank holding
company (as defined in section 2 of the Bank Holding Company Act of 1956 (12
U.S.C. 1841)) with total consolidated assets of $50,000,000,000 or more, a
nonbank financial company (as defined in section 102) supervised by the Board
of Governors of the Federal Reserve System, an affiliate of such a bank holding
company or nonbank financial company, a swap dealer, major swap participant, or
associated person of a swap dealer or major swap participant.</text>
</subsection><subsection id="IDbb5fd4f98d2049fc98f7cf20671b19f7"><enum>(b)</enum><header>Purposes</header><text>The
Commission shall adopt rules if it determines, after the review described in
subsection (a), that such rules are necessary or appropriate to improve the
governance of, or to mitigate systemic risk, promote competition, or mitigate
conflicts of interest in connection with a swap dealer or major swap
participant’s conduct of business with, a derivatives clearing organization,
contract market, or swap execution facility that clears or posts swaps or makes
swaps available for trading and in which such swap dealer or major swap
participant has a material debt or equity investment.</text>
</subsection></section><section id="H6CA8106E1C444F8FA122F3DB7593A9C5"><enum>727.</enum><header>Public reporting of
swap transaction data</header><text display-inline="no-display-inline">Section
2(a) of the Commodity Exchange Act (7 U.S.C. 2(a)) is amended by adding at the
end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id9890DE07C18449DAA5AD894522A7A120" reported-display-style="italic" style="OLC">
<paragraph id="idEE426E77835A45A0A27B3FAAE40A0C3C"><enum>(13)</enum><header>Public availability of
swap transaction data</header>
<subparagraph id="id3CBBC09305BD44EF9988294A489FFDA2"><enum>(A)</enum><header>Definition of real-time
public reporting</header><text>In this paragraph, the term <term>real-time
public reporting</term> means to report data relating to a swap transaction as
soon as technologically practicable after the time at which the swap
transaction has been executed.</text>
</subparagraph><subparagraph id="id73256B4295DB4CEBAD4E88869B4A36BF"><enum>(B)</enum><header>Purpose</header><text>The
purpose of this section is to authorize the Commission to make swap transaction
and pricing data available to the public in such form and at such times as the
Commission determines appropriate to enhance price discovery.</text>
</subparagraph><subparagraph id="idA1EF508AD0294095BAA89CB97BBC1A4D"><enum>(C)</enum><header>General
rule</header><text>The Commission is authorized and required to provide by rule
for the public availability of swap transaction and pricing data as
follows:</text>
<clause id="id7B747E3F100C47FCA85BE24390E88E0C"><enum>(i)</enum><text>With respect to those
swaps that are subject to the mandatory clearing requirement described in
subsection (h)(2) (including those swaps that are exempted from the requirement
pursuant to subsection (h)(10)), the Commission shall require real-time public
reporting for such transactions.</text>
</clause><clause id="idC091D284C7BC43538BC892370B0B4060"><enum>(ii)</enum><text>With respect to those
swaps that are not subject to the mandatory clearing requirement described in
subsection (h)(2), but are cleared at a registered derivatives clearing
organization, the Commission shall require real-time public reporting for such
transactions.</text>
</clause><clause id="id5A5D168D814243D3A9C4EBF224419DB7"><enum>(iii)</enum><text>With respect to swaps
that are not cleared at a registered derivatives clearing organization and
which are reported to a swap data repository or the Commission under subsection
(h), the Commission shall make available to the public, in a manner that does
not disclose the business transactions and market positions of any person,
aggregate data on such swap trading volumes and positions.</text>
</clause><clause id="ID714d18bc7dab49759d14653ae1ed957e"><enum>(iv)</enum><text>With respect to swaps
that are exempt from the requirements of subsection (h)(1), pursuant to
subsection (h)(10), the Commission shall require real-time public reporting for
such transactions.</text>
</clause></subparagraph><subparagraph id="idDF516D841230436291B5B0391EBDB45B"><enum>(D)</enum><header>Registered entities and
public reporting</header><text>The Commission may require registered entities
to publicly disseminate the swap transaction and pricing data required to be
reported under this paragraph.</text>
</subparagraph><subparagraph id="id50BB361F6863405FA7E56AC9C612D331"><enum>(E)</enum><header>Rulemaking
required</header><text>With respect to the rule providing for the public
availability of transaction and pricing data for swaps described in clauses (i)
and (ii) of subparagraph (C), the rule promulgated by the Commission shall
contain provisions—</text>
<clause id="idDC6349FB66014828B311F81FE61EB1AD"><enum>(i)</enum><text>to ensure such
information does not identify the participants;</text>
</clause><clause id="id5AC4C4F942C24475A351D1C139FE9933"><enum>(ii)</enum><text>to specify the criteria
for determining what constitutes a large notional swap transaction (block
trade) for particular markets and contracts;</text>
</clause><clause id="id0EF54C12F6C64CBA85C1C068641AE25F"><enum>(iii)</enum><text>to specify the
appropriate time delay for reporting large notional swap transactions (block
trades) to the public; and</text>
</clause><clause id="id80EC1A624BC845E99BFB1E4F7AC939BE"><enum>(iv)</enum><text>that take into account
whether the public disclosure will materially reduce market liquidity.</text>
</clause></subparagraph><subparagraph id="id91DFE51997DA45738B567900731BBA96"><enum>(F)</enum><header>Timeliness of
reporting</header><text>Parties to a swap (including agents of the parties to a
swap) shall be responsible for reporting swap transaction information to the
appropriate registered entity in a timely manner as may be prescribed by the
Commission.</text>
</subparagraph></paragraph><paragraph commented="no" id="id0EDE192DB8E54E758BE0FE1E1AD8F9EA"><enum>(14)</enum><header>Semiannual and annual
public reporting of aggregate swap data</header>
<subparagraph commented="no" id="id8E5C0180220E4CF19EE4A8E50E4E48A9"><enum>(A)</enum><header>In
general</header><text>In accordance with subparagraph (B), the Commission shall
issue a written report on a semiannual and annual basis to make available to
the public information relating to—</text>
<clause commented="no" id="idA30C2B0DCBF047FF9B705AA273DE0F95"><enum>(i)</enum><text>the trading and clearing
in the major swap categories; and</text>
</clause><clause commented="no" id="id1B5C5CA3BFB44AAEB458F9BFBF6CC172"><enum>(ii)</enum><text>the market participants
and developments in new products.</text>
</clause></subparagraph><subparagraph commented="no" id="id28F581E6CF234FB9808A4EC9ED68E9B4"><enum>(B)</enum><header>Use;
consultation</header><text>In preparing a report under subparagraph (A), the
Commission shall—</text>
<clause commented="no" id="idDA0D4B68418541889BE7E3DCE6A9C32C"><enum>(i)</enum><text>use information from swap
data repositories and derivatives clearing organizations; and</text>
</clause><clause commented="no" id="id1A4E73FAB093494FB4F71F5183F51A9C"><enum>(ii)</enum><text>consult with the Office
of the Comptroller of the Currency, the Bank for International Settlements, and
such other regulatory bodies as may be
necessary.</text>
</clause></subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</section><section id="HE8F13071E3EA41FB9AF9E98A29A8F2E0"><enum>728.</enum><header>Swap data
repositories</header><text display-inline="no-display-inline">The Commodity
Exchange Act is amended by inserting after section 20 (7 U.S.C. 24) the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="HA2CBED438DE740689C4DACEA62CB88AE" reported-display-style="italic" style="OLC">
<section id="H126ABA08D83C45E8BADC11B6CB9F566A"><enum>21.</enum><header>Swap data
repositories</header>
<subsection id="id4AA02386DE2848CC8A640D838CDA8D27"><enum>(a)</enum><header>Registration
requirement</header>
<paragraph id="id913FA353CBAE4B06BABCB21FFA46B808"><enum>(1)</enum><header>In
general</header><text>It shall be unlawful for any person, unless registered
with the Commission, directly or indirectly to make use of the mails or any
means or instrumentality of interstate commerce to perform the functions of a
swap data repository.</text>
</paragraph><paragraph id="id6E3A03F40D074D34B0A378511ADCAB4A"><enum>(2)</enum><header>Inspection and
examination</header><text>Each registered swap data repository shall be subject
to inspection and examination by any representative of the Commission.</text>
</paragraph><paragraph id="idEA79A3C80D47475596FF650F95715488"><enum>(3)</enum><header>Compliance with core
principles</header>
<subparagraph id="idDB7AE7A4F9384152A577A2305E8E12FF"><enum>(A)</enum><header>In
general</header><text>To be registered, and maintain registration, as a swap
data repository, the swap data repository shall comply with—</text>
<clause id="idA4FC3A6C44DD4C698C09C44D8C1DF072"><enum>(i)</enum><text>the core principles
described in this subsection; and</text>
</clause><clause id="id8B829674C1F249E18A7ED2E21831E23E"><enum>(ii)</enum><text>any requirement that the
Commission may impose by rule or regulation pursuant to section 8a(5).</text>
</clause></subparagraph><subparagraph id="id2EC3C668C38D445BA51897CD75E7ECE3"><enum>(B)</enum><header>Reasonable discretion
of swap data repository</header><text>Unless otherwise determined by the
Commission by rule or regulation, a swap data repository described in
subparagraph (A) shall have reasonable discretion in establishing the manner in
which the swap data repository complies with the core principles described in
this subsection.</text>
</subparagraph></paragraph></subsection><subsection id="idC8CC5779D17A4D179C29495072068798"><enum>(b)</enum><header>Standard
setting</header>
<paragraph id="idF52A13D8DD2C451EA793CF3C5C4446E5"><enum>(1)</enum><header>Data
identification</header><text>The Commission shall prescribe standards that
specify the data elements for each swap that shall be collected and maintained
by each registered swap data repository.</text>
</paragraph><paragraph id="id98AE4EA150BD46B383146563AD3BCE9C"><enum>(2)</enum><header>Data collection and
maintenance</header><text>The Commission shall prescribe data collection and
data maintenance standards for swap data repositories.</text>
</paragraph><paragraph id="id65F5BE4F94C5431295C79C6D12AA0AE5"><enum>(3)</enum><header>Comparability</header><text>The
standards prescribed by the Commission under this subsection shall be
comparable to the data standards imposed by the Commission on derivatives
clearing organizations in connection with their clearing of swaps.</text>
</paragraph><paragraph id="id02F933E42904471FAF934C4AFA3B01E9"><enum>(4)</enum><header>Sharing of information
with Securities and Exchange Commission</header><text>Registered swap data
repositories shall make available to the Securities and Exchange Commission,
upon request, all books and records relating to security-based swap agreements
that are maintained by such swap data repository, consistent with the
confidentiality and disclosure requirements of section 8. Nothing in this
paragraph shall affect the exclusive jurisdiction of the Commission to
prescribe recordkeeping and reporting requirements for a swap data repository
that is registered with the Commission.</text>
</paragraph></subsection><subsection id="id495F160BB0BD4A2CA25F025B86E43224"><enum>(c)</enum><header>Duties</header><text>A
swap data repository shall—</text>
<paragraph id="id032ECF304D284AD3B7EE68BFDA903188"><enum>(1)</enum><text>accept data prescribed by
the Commission for each swap under subsection (b);</text>
</paragraph><paragraph id="id4379EADDEB4744B8BBF1A48456DC3B1A"><enum>(2)</enum><text>confirm with both
counterparties to the swap the accuracy of the data that was submitted;</text>
</paragraph><paragraph id="idB7EC1CB3111D4A4785EF7599DFBC801D"><enum>(3)</enum><text>maintain the data
described in paragraph (1) in such form, in such manner, and for such period as
may be required by the Commission;</text>
</paragraph><paragraph id="id37C9190D0F924E63A506FA570301B353"><enum>(4)</enum><subparagraph commented="no" display-inline="yes-display-inline" id="id95D5D65DF5B2497BAF8BE2257184C16E"><enum>(A)</enum><text>provide direct
electronic access to the Commission (or any designee of the Commission,
including another registered entity); and</text>
</subparagraph><subparagraph changed="added" id="idF11ED447BEC14529BC11F1F53D0E1782" indent="up1" reported-display-style="italic"><enum>(B)</enum><text>provide the information
described in paragraph (1) in such form and at such frequency as the Commission
may require to comply with the public reporting requirements contained in
section 2(a)(13);</text>
</subparagraph></paragraph><paragraph id="id7CAADA9D57AA40299C8DF4EB1FDAA125"><enum>(5)</enum><text>at the direction of the
Commission, establish automated systems for monitoring, screening, and
analyzing swap data, including compliance and frequency of end user clearing
exemption claims by individual and affiliated entities;</text>
</paragraph><paragraph id="id823B02DA044446A79E6219FC8F028455"><enum>(6)</enum><text>maintain the privacy of
any and all swap transaction information that the swap data repository receives
from a swap dealer, counterparty, or any other registered entity; and</text>
</paragraph><paragraph id="id2CEA74F959344086AD8B7B45851E8195"><enum>(7)</enum><text>on a confidential basis
pursuant to section 8, upon request, and after notifying the Commission of the
request, make available all data obtained by the swap data repository,
including individual counterparty trade and position data, to—</text>
<subparagraph id="id3B23E6D0C27C411691AC4D9FAC020805"><enum>(A)</enum><text>each appropriate
prudential regulator;</text>
</subparagraph><subparagraph id="id6F5E54E0C6F74B938DE76BCE56794FF0"><enum>(B)</enum><text>the Financial Stability
Oversight Council;</text>
</subparagraph><subparagraph id="IDc3314202ce0d417c89d05b1482a453e2"><enum>(C)</enum><text>the Securities and
Exchange Commission;</text>
</subparagraph><subparagraph id="id3EDD289A03B24D48BBFC12FD5FF4745E"><enum>(D)</enum><text>the Department of
Justice; and</text>
</subparagraph><subparagraph id="idFF06BB2D24B64794A61ED9444F941803"><enum>(E)</enum><text>any other person that the
Commission determines to be appropriate, including—</text>
<clause id="idAE44E11F7A5448E5B6CC6AD83F3EE271"><enum>(i)</enum><text>foreign financial
supervisors (including foreign futures authorities);</text>
</clause><clause id="idCE73448921244A798BD9114B5FA7F85C"><enum>(ii)</enum><text>foreign central
banks;</text>
</clause><clause id="id99165F2E85004E719A79FFA41E4B5196"><enum>(iii)</enum><text>foreign ministries;
and</text>
</clause></subparagraph></paragraph><paragraph id="ID3400aa719b854ae292f05f9d38bb06f5"><enum>(8)</enum><text>establish and maintain
emergency procedures, backup facilities, and a plan for disaster recovery that
allows for the timely recovery and resumption of operations and the fulfillment
of the responsibilities and obligations of the organization.</text>
</paragraph></subsection><subsection id="id916466B4AB894AA0A816D0E0EBAD7558"><enum>(d)</enum><header>Confidentiality and
indemnification agreement</header><text>Before the swap data repository may
share information with any entity described above—</text>
<paragraph id="id287EEC9BB22544C3BABBC62CCBA8E2C2"><enum>(1)</enum><text>the swap data repository
shall receive a written agreement from each entity stating that the entity
shall abide by the confidentiality requirements described in section 8 relating
to the information on swap transactions that is provided; and</text>
</paragraph><paragraph id="id71C32D53CDFF49BFB98B842F956078C2"><enum>(2)</enum><text>each entity shall agree
to indemnify the swap data repository and the Commission for any expenses
arising from litigation relating to the information provided under section
8.</text>
</paragraph></subsection><subsection id="id4A0D02324D9848B586979208ED43C48A"><enum>(e)</enum><header>Designation of chief
compliance officer</header>
<paragraph id="id8F65EEBC47374070BD10D13F7F8B9549"><enum>(1)</enum><header>In
general</header><text>Each swap data repository shall designate an individual
to serve as a chief compliance officer.</text>
</paragraph><paragraph id="id08910421B5AD407E9BA32371BBFACBAE"><enum>(2)</enum><header>Duties</header><text>The
chief compliance officer shall—</text>
<subparagraph id="id970D93B93E4F45669D74E4EC884F1DAA"><enum>(A)</enum><text>report directly to the
board or to the senior officer of the swap data repository;</text>
</subparagraph><subparagraph id="idC8E0BD1B61C34DD2A6DE2B66612B7270"><enum>(B)</enum><text>review the compliance of
the swap data repository with respect to the core principles described in
subsection (f);</text>
</subparagraph><subparagraph id="id1F473441695D401FBF23B43B380302FE"><enum>(C)</enum><text>in consultation with the
board of the swap data repository, a body performing a function similar to the
board of the swap data repository, or the senior officer of the swap data
repository, resolve any conflicts of interest that may arise;</text>
</subparagraph><subparagraph id="idDF9654CDB8744B5E9A921BC985DF5962"><enum>(D)</enum><text>be responsible for
administering each policy and procedure that is required to be established
pursuant to this section;</text>
</subparagraph><subparagraph id="id4BB8ABB9B4FC4810A23C55F2E74B48BA"><enum>(E)</enum><text>ensure compliance with
this Act (including regulations) relating to agreements, contracts, or
transactions, including each rule prescribed by the Commission under this
section;</text>
</subparagraph><subparagraph id="idA3D51813398D46CB9AFC89BF0A11C0D4"><enum>(F)</enum><text>establish procedures for
the remediation of noncompliance issues identified by the chief compliance
officer through any—</text>
<clause id="id81FCB25EA7AD42DD9C48DDD33DA825FA"><enum>(i)</enum><text>compliance office
review;</text>
</clause><clause id="id234B0C9C55BF436893B9D6E848678D32"><enum>(ii)</enum><text>look-back;</text>
</clause><clause id="idCE740676C2464C37B345B5445027325A"><enum>(iii)</enum><text>internal or external
audit finding;</text>
</clause><clause id="id43065B5284954354BAD33C10C158BFBA"><enum>(iv)</enum><text>self-reported error;
or</text>
</clause><clause id="id9D31700B5EA74274AC03C234418DD7DD"><enum>(v)</enum><text>validated complaint;
and</text>
</clause></subparagraph><subparagraph id="id42E863B3127B4263AE8B0E0AE9B507D1"><enum>(G)</enum><text>establish and follow
appropriate procedures for the handling, management response, remediation,
retesting, and closing of noncompliance issues.</text>
</subparagraph></paragraph><paragraph id="id9C818E2DAE0A4B08BEE1A2F055C6C2F2"><enum>(3)</enum><header>Annual reports</header>
<subparagraph id="id195C291256E942DC91CED2E6950B7B80"><enum>(A)</enum><header>In
general</header><text>In accordance with rules prescribed by the Commission,
the chief compliance officer shall annually prepare and sign a report that
contains a description of—</text>
<clause id="idBDDD8C39516C496C8B146FE587E98C8F"><enum>(i)</enum><text>the compliance of the
swap data repository of the chief compliance officer with respect to this Act
(including regulations); and</text>
</clause><clause id="id2962F5163BFD4F34A36CF0FC60667BB3"><enum>(ii)</enum><text>each policy and
procedure of the swap data repository of the chief compliance officer
(including the code of ethics and conflict of interest policies of the swap
data repository).</text>
</clause></subparagraph><subparagraph id="id666E737E9E8741B89A81193CA9416B7A"><enum>(B)</enum><header>Requirements</header><text>A
compliance report under subparagraph (A) shall—</text>
<clause id="id025B59EE525E4587A7EA0E8C5C5E439A"><enum>(i)</enum><text>accompany each
appropriate financial report of the swap data repository that is required to be
furnished to the Commission pursuant to this section; and</text>
</clause><clause id="id202D2B3C1164475A92DB7CC76B7C9543"><enum>(ii)</enum><text>include a certification
that, under penalty of law, the compliance report is accurate and
complete.</text>
</clause></subparagraph></paragraph></subsection><subsection id="id2172269A58064E7EB69D618DB148BFEA"><enum>(f)</enum><header>Core principles
applicable To swap data repositories</header>
<paragraph commented="no" id="idDE23781BC3B24A408C518FAEAD35AC2B"><enum>(1)</enum><header>Antitrust
considerations</header><text>Unless necessary or appropriate to achieve the
purposes of this Act, a swap data repository shall not</text>
<subparagraph commented="no" id="idB2E5C99B4FED4FC5A77EF3BBA7113A2E"><enum>(A)</enum><text>adopt any rule or take
any action that results in any unreasonable restraint of trade; or</text>
</subparagraph><subparagraph commented="no" id="idE5BB39DA37604152B8A786CB75D4DD13"><enum>(B)</enum><text>impose any material
anticompetitive burden on the trading, clearing, or reporting of
transactions.</text>
</subparagraph></paragraph><paragraph commented="no" id="id3301360AC955413D9504D1FF0DFCB822"><enum>(2)</enum><header>Governance
arrangements</header><text>Each swap data repository shall establish governance
arrangements that are transparent—</text>
<subparagraph commented="no" id="id382B51C6444145339DE31565B26088A7"><enum>(A)</enum><text>to fulfill public
interest requirements; and</text>
</subparagraph><subparagraph commented="no" id="id95D45DB31BF544B9A579A9576785065A"><enum>(B)</enum><text>to support the objectives
of the Federal Government, owners, and participants.</text>
</subparagraph></paragraph><paragraph commented="no" id="id3AAF88B383EB4F908669E0CB7761B0F6"><enum>(3)</enum><header>Conflicts of
interest</header><text>Each swap data repository shall—</text>
<subparagraph commented="no" id="id6AD55ED5DEF1488491CB652CF1D89FBB"><enum>(A)</enum><text>establish and enforce
rules to minimize conflicts of interest in the decision-making process of the
swap data repository; and</text>
</subparagraph><subparagraph commented="no" id="idB945A778F9C14B4F86F45EFE5DAA2C57"><enum>(B)</enum><text>establish a process for
resolving conflicts of interest described in subparagraph (A).</text>
</subparagraph></paragraph></subsection><subsection id="idFAB44B4A12724B7089CE16FC0AF27687"><enum>(g)</enum><header>Required registration
for swap data repositories</header><text display-inline="yes-display-inline">Any person that is required to be
registered as a swap data repository under this section shall register with the
Commission regardless of whether that person is also licensed as a bank or
registered with the Securities and Exchange Commission as a swap data
repository.</text>
</subsection><subsection id="id1A71DE92FEAA4D9BAFB10877C96AE1F7"><enum>(h)</enum><header>Rules</header><text display-inline="yes-display-inline">The Commission shall adopt rules governing
persons that are registered under this
section.</text>
</subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</section><section id="H1704392BE539494096549027726EB5AD"><enum>729.</enum><header>Reporting and
recordkeeping</header><text display-inline="no-display-inline">The Commodity
Exchange Act is amended by inserting after section 4q (7 U.S.C. 6o–1) the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="HDD993CC3E175412CABA7BE1D54CF87D6" reported-display-style="italic" style="OLC">
<section id="H04F72E1C82AF4CCA8277E75C3FAF8E21"><enum>4r.<?LEXA-Enum 4r.?></enum><header>Reporting
and recordkeeping for uncleared swaps</header>
<subsection id="ID1d12b46085ba464d840ab80741d36f59"><enum>(a)</enum><header>Required reporting of
swaps not accepted by any derivatives clearing organization</header>
<paragraph id="IDf19c5d654fe14e31b709e7e558b2f085"><enum>(1)</enum><header>In
general</header><text>Each swap that is not accepted for clearing by any
derivatives clearing organization shall be reported to—</text>
<subparagraph id="IDe0beed349d944f8b9b95441f81265c0e"><enum>(A)</enum><text>a swap data repository
described in section 21; or</text>
</subparagraph><subparagraph id="ID625830b92b4c46ddb8bb8c30075bd465"><enum>(B)</enum><text>in the case in which
there is no swap data repository that would accept the swap, to the Commission
pursuant to this section within such time period as the Commission may by rule
or regulation prescribe.</text>
</subparagraph></paragraph><paragraph id="idB5F2C0A36EC24119B1043F4026D2596B"><enum>(2)</enum><header>Transition rule for
preenactment swaps</header>
<subparagraph id="idC42D66521E734371A8ACC1A6DFF11367"><enum>(A)</enum><header>Swaps entered into
before the date of enactment of the Wall Street Transparency and Accountability
Act of 2010</header><text>Each swap entered into before the date of enactment
of the <short-title>Wall Street Transparency and
Accountability Act of 2010</short-title>, the terms of which have not expired
as of the date of enactment of that Act, shall be reported to a registered swap
data repository or the Commission by a date that is not later than—</text>
<clause id="id3ACE2486B7444D44828CCAD3D46C567D"><enum>(i)</enum><text>30 days after issuance of
the interim final rule; or</text>
</clause><clause id="id5FBBF39D22EF4EAAA8A1D394AE625754"><enum>(ii)</enum><text>such other period as the
Commission determines to be appropriate.</text>
</clause></subparagraph><subparagraph id="id2954272CACED4F8499FD626386147B94"><enum>(B)</enum><header>Commission
rulemaking</header><text>The Commission shall promulgate an interim final rule
within 90 days of the date of enactment of this section providing for the
reporting of each swap entered into before the date of enactment as referenced
in subparagraph (A).</text>
</subparagraph><subparagraph id="id6761B2BDC5F54C3B8069ADD4D2EF50DC"><enum>(C)</enum><header>Effective
date</header><text>The reporting provisions described in this section shall be
effective upon the enactment of this section.</text>
</subparagraph></paragraph><paragraph id="id7500A93735CD417E8136747E3868C210"><enum>(3)</enum><header>Reporting
obligations</header>
<subparagraph id="id4FC2BD3E0894400CAC62AC0D15B07D7F"><enum>(A)</enum><header>Swaps in which only 1
counterparty is a swap dealer or major swap participant</header><text>With
respect to a swap in which only 1 counterparty is a swap dealer or major swap
participant, the swap dealer or major swap participant shall report the swap as
required under paragraphs (1) and (2).</text>
</subparagraph><subparagraph id="idD89AF190B5324F749A4E9F6B51011000"><enum>(B)</enum><header>Swaps in which 1
counterparty is a swap dealer and the other a major swap
participant</header><text>With respect to a swap in which 1 counterparty is a
swap dealer and the other a major swap participant, the swap dealer shall
report the swap as required under paragraphs (1) and (2).</text>
</subparagraph><subparagraph id="idDB47BDCF9D474E92AE78E29DB278F037"><enum>(C)</enum><header>Other
swaps</header><text>With respect to any other swap not described in
subparagraph (A) or (B), the counterparties to the swap shall select a
counterparty to report the swap as required under paragraphs (1) and
(2).</text>
</subparagraph></paragraph></subsection><subsection id="ID2658ecff690a4218bc90c54ce4d4fe8d"><enum>(b)</enum><header>Duties of certain
individuals</header><text>Any individual or entity that enters into a swap
shall meet each requirement described in subsection (c) if the individual or
entity did not—</text>
<paragraph id="ID7915bbccdd014b489b432470349801ec"><enum>(1)</enum><text>clear the swap in
accordance with section 2(h)(1); or</text>
</paragraph><paragraph id="IDa4a1d56d261d473890dd4064a108a597"><enum>(2)</enum><text>have the data regarding
the swap accepted by a swap data repository in accordance with rules (including
timeframes) adopted by the Commission under section 21.</text>
</paragraph></subsection><subsection id="ID5d7b26cdf49c46e2afd7639bd2704a5e"><enum>(c)</enum><header>Requirements</header><text>An
individual or entity described in subsection (b) shall—</text>
<paragraph id="IDb409473aa6444f5790fd66dc3c46036f"><enum>(1)</enum><text>upon written request from
the Commission, provide reports regarding the swaps held by the individual or
entity to the Commission in such form and in such manner as the Commission may
request; and</text>
</paragraph><paragraph id="IDfc9cb861f7af40e68020a2fc86b45de2"><enum>(2)</enum><text>maintain books and
records pertaining to the swaps held by the individual or entity in such form,
in such manner, and for such period as the Commission may require, which shall
be open to inspection by—</text>
<subparagraph id="ID825ac84f961c4e24a772a47c8f1b951e"><enum>(A)</enum><text>any representative of the
Commission;</text>
</subparagraph><subparagraph id="IDb8982f60300b40cd987e52fabcec7e5a"><enum>(B)</enum><text>an appropriate prudential
regulator;</text>
</subparagraph><subparagraph id="ID937bc41323764f68adcc09cba609ac60"><enum>(C)</enum><text>the Securities and
Exchange Commission;</text>
</subparagraph><subparagraph id="ID2927ab2acaaa4dc3ba05c2be26137f5e"><enum>(D)</enum><text>the Financial Stability
Oversight Council; and</text>
</subparagraph><subparagraph id="ID8c621acbe27b46028d7ca82e400ac24c"><enum>(E)</enum><text>the Department of
Justice.</text>
</subparagraph></paragraph></subsection><subsection id="IDe795e8bfe1fe4d4a83b1f530f303913e"><enum>(d)</enum><header>Identical
data</header><text>In prescribing rules under this section, the Commission
shall require individuals and entities described in subsection (b) to submit to
the Commission a report that contains data that is not less comprehensive than
the data required to be collected by swap data repositories under section
21.</text>
</subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</section><section id="idEA51D72FD8184F40884454A5C12A0D84"><enum>730.</enum><header>Large swap trader
reporting</header><text display-inline="no-display-inline">The Commodity
Exchange Act (7 U.S.C. 1 et seq.) is amended by adding after section 4s (as
added by section 731) the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idDE1F4CA0BCC7454280558A05FBD515CB" reported-display-style="italic" style="OLC">
<section id="id242C9B8403134F7AB3537EA9D41AE87B"><enum>4t.<?LEXA-Enum 4t.?></enum><header>Large swap
trader reporting</header>
<subsection id="ID52ef09fd377d456a969598ab5b6fe478"><enum>(a)</enum><header>Prohibition</header>
<paragraph id="ID30470235afe84c46bc74e719437ccd29"><enum>(1)</enum><header>In
general</header><text>Except as provided in paragraph (2), it shall be unlawful
for any person to enter into any swap that the Commission determines to perform
a significant price discovery function with respect to registered entities
if—</text>
<subparagraph id="ID08fce5e55cd442388a98a747cb079e9e"><enum>(A)</enum><text>the person directly or
indirectly enters into the swap during any 1 day in an amount equal to or in
excess of such amount as shall be established periodically by the Commission;
and</text>
</subparagraph><subparagraph id="ID7647b2d656654ea882a8cfb1b8439349"><enum>(B)</enum><text>the person directly or
indirectly has or obtains a position in the swap equal to or in excess of such
amount as shall be established periodically by the Commission.</text>
</subparagraph></paragraph><paragraph id="ID339252361a4f4edaafac12ae7236f6e4"><enum>(2)</enum><header>Exception</header><text>Paragraph
(1) shall not apply if—</text>
<subparagraph id="IDe0b88e14163b42aca59df5c76e26ad01"><enum>(A)</enum><text>the person files or
causes to be filed with the properly designated officer of the Commission such
reports regarding any transactions or positions described in subparagraphs (A)
and (B) of paragraph (1) as the Commission may require by rule or regulation;
and</text>
</subparagraph><subparagraph id="ID34ba6049daf249c09cb62383032d1b08"><enum>(B)</enum><text>in accordance with the
rules and regulations of the Commission, the person keeps books and records of
all such swaps and any transactions and positions in any related commodity
traded on or subject to the rules of any board of trade, and of cash or spot
transactions in, inventories of, and purchase and sale commitments of, such a
commodity.</text>
</subparagraph></paragraph></subsection><subsection id="ID9a11860ed852493db60ed30477f989be"><enum>(b)</enum><header>Requirements</header>
<paragraph id="id145937DFC3A74C4AB7236699E044DA23"><enum>(1)</enum><header>In
general</header><text>Books and records described in subsection (a)(2)(B)
shall—</text>
<subparagraph id="IDa9f0a766fea344db804c8e5e9401246d"><enum>(A)</enum><text>show such complete
details concerning all transactions and positions as the Commission may
prescribe by rule or regulation;</text>
</subparagraph><subparagraph id="ID0014ca8115264ed6a9fb5eef5a4535e7"><enum>(B)</enum><text>be open at all times to
inspection and examination by any representative of the Commission; and</text>
</subparagraph><subparagraph id="ID408d58365b6f41d2946aa31bd3a59b1d"><enum>(C)</enum><text>be open at all times to
inspection and examination by the Securities and Exchange Commission, to the
extent such books and records relate to transactions in security-based swap
agreements (as that term is defined in section 3(a)(79) of the Securities
Exchange Act of 1934), and consistent with the confidentiality and disclosure
requirements of section 8.</text>
</subparagraph></paragraph><paragraph id="id4CAF460512BA45C9BBCE990D96A98528"><enum>(2)</enum><header>Jurisdiction</header><text>Nothing
in paragraph (1) shall affect the exclusive jurisdiction of the Commission to
prescribe recordkeeping and reporting requirements for large swap traders under
this section.</text>
</paragraph></subsection><subsection id="ID7f809267d43840bcbb99374e5b74d18f"><enum>(c)</enum><header>Applicability</header><text>For
purposes of this section, the swaps, futures, and cash or spot transactions and
positions of any person shall include the swaps, futures, and cash or spot
transactions and positions of any persons directly or indirectly controlled by
the person.</text>
</subsection><subsection id="IDb94f1427a8b047a69f6ae575600f51d9"><enum>(d)</enum><header>Significant price
discovery function</header><text>In making a determination as to whether a swap
performs or affects a significant price discovery function with respect to
registered entities, the Commission shall consider the factors described in
section
4a(a)(3).</text>
</subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</section><section id="ID8761ef6f75604ae19af489b1782c1c91"><enum>731.</enum><header>Registration and
regulation of swap dealers and major swap participants</header><text display-inline="no-display-inline">The Commodity Exchange Act (7 U.S.C. 1 et
seq.) is amended by inserting after section 4r (as added by section 729) the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idF017C4894DE14082B43E8979A648F8E3" reported-display-style="italic" style="OLC">
<section id="ID40c1f68721b64c92aaacf80bf2dc4f57"><enum>4s.<?LEXA-Enum 4s.?></enum><header>Registration and regulation of swap dealers and
major swap participants</header>
<subsection id="idF00C38B74D7C46E09158BC32566EE5F4"><enum>(a)</enum><header>Registration</header>
<paragraph id="idA22603B50DF74C509CAE6561B8320CA7"><enum>(1)</enum><header>Swap
dealers</header><text>It shall be unlawful for any person to act as a swap
dealer unless the person is registered as a swap dealer with the
Commission.</text>
</paragraph><paragraph id="id503AA5257D1448258989E2471158634D"><enum>(2)</enum><header>Major swap
participants</header><text>It shall be unlawful for any person to act as a
major swap participant unless the person is registered as a major swap
participant with the Commission.</text>
</paragraph></subsection><subsection id="id1A4A559A65A34CCDB25EE2C2C63CBDF8"><enum>(b)</enum><header>Requirements</header>
<paragraph id="idDD88B170446C49229D4BC3A2FBE5B27C"><enum>(1)</enum><header>In
general</header><text>A person shall register as a swap dealer or major swap
participant by filing a registration application with the Commission.</text>
</paragraph><paragraph id="id08A93866950D47259ED5AD2549BE6AAA"><enum>(2)</enum><header>Contents</header>
<subparagraph id="id981156F47D4B4C24A89DEA2710376D78"><enum>(A)</enum><header>In
general</header><text>The application shall be made in such form and manner as
prescribed by the Commission, and shall contain such information, as the
Commission considers necessary concerning the business in which the applicant
is or will be engaged.</text>
</subparagraph><subparagraph id="id04EFD6EFF6D44022899C8E032C39A868"><enum>(B)</enum><header>Continual
reporting</header><text>A person that is registered as a swap dealer or major
swap participant shall continue to submit to the Commission reports that
contain such information pertaining to the business of the person as the
Commission may require.</text>
</subparagraph></paragraph><paragraph id="id16B9385990EE4249B06FF79C37F440E5"><enum>(3)</enum><header>Expiration</header><text>Each
registration under this section shall expire at such time as the Commission may
prescribe by rule or regulation.</text>
</paragraph><paragraph id="id128C628284E945D8A206E7CD6530EA39"><enum>(4)</enum><header>Rules</header><text>Except
as provided in subsections (c), (e), and (f), the Commission may prescribe
rules applicable to non-bank swap dealers and non-bank major swap participants,
including rules that limit the activities of swap dealers and major swap
participants.</text>
</paragraph><paragraph id="id4EC9C26B703D44F497B50D183DB0B986"><enum>(5)</enum><header>Transition</header><text>Rules
under this section shall provide for the registration of swap dealers and major
swap participants not later than 1 year after the date of enactment of the
<short-title>Wall Street Transparency and Accountability
Act of 2010</short-title>.</text>
</paragraph><paragraph id="idA662D2A5C54140E29A861E15B57DD098"><enum>(6)</enum><header>Statutory
disqualification</header><text>Except to the extent otherwise specifically
provided by rule, regulation, or order, it shall be unlawful for a swap dealer
or a major swap participant to permit any person associated with a swap dealer
or a major swap participant who is subject to a statutory disqualification to
effect or be involved in effecting swaps on behalf of the swap dealer or major
swap participant, if the swap dealer or major swap participant knew, or in the
exercise of reasonable care should have known, of the statutory
disqualification.</text>
</paragraph></subsection><subsection id="id4C1443C9124140C0823A8773580DC28C"><enum>(c)</enum><header>Dual
registration</header>
<paragraph id="id282770FA4615439CB3E01B4F2AEA9F38"><enum>(1)</enum><header>Swap
dealer</header><text>Any person that is required to be registered as a swap
dealer under this section shall register with the Commission regardless of
whether the person also is a depository institution or is registered with the
Securities and Exchange Commission as a security-based swap dealer.</text>
</paragraph><paragraph id="id5049B5B3A2804AC9AC90EAC29D94AA72"><enum>(2)</enum><header>Major swap
participant</header><text>Any person that is required to be registered as a
major swap participant under this section shall register with the Commission
regardless of whether the person also is a depository institution or is
registered with the Securities and Exchange Commission as a major
security-based swap participant.</text>
</paragraph></subsection><subsection id="id517E4ED274E54073A8E7CE3B22A09AF4"><enum>(d)</enum><header>Rulemakings</header>
<paragraph id="idA24A1C5605EE45BBB7B04C1D17C1B3A4"><enum>(1)</enum><header>In
general</header><text>The Commission shall adopt rules for persons that are
registered as swap dealers or major swap participants under this
section.</text>
</paragraph><paragraph id="id49F9EBCB23C341DA88E0DDA04B1AD90B"><enum>(2)</enum><header>Exception for
prudential requirements</header>
<subparagraph id="idB0DD43585AE24ADC8E4A744C0821A55F"><enum>(A)</enum><header>In
general</header><text>The Commission may not prescribe rules imposing
prudential requirements on swap dealers or major swap participants for which
there is a prudential regulator.</text>
</subparagraph><subparagraph id="id5E6A26945CB24DAD845835097464C910"><enum>(B)</enum><header>Applicability</header><text>Subparagraph
(A) does not limit the authority of the Commission to prescribe appropriate
business conduct, reporting, and recordkeeping requirements to protect
investors.</text>
</subparagraph></paragraph></subsection><subsection id="ID13c26d70545f42839afa29b5a720f1e9"><enum>(e)</enum><header>Capital and margin
requirements</header>
<paragraph id="ID1818f5e2e6bf4020872d00f9083372db"><enum>(1)</enum><header>In general</header>
<subparagraph id="IDc74d153335c142c7b4109b6fa37f0e1f"><enum>(A)</enum><header>Swap dealers and major
swap participants that are depository institutions</header><text>Each
registered swap dealer and major swap participant that is a depository
institution, as that term is defined in section 3 of the Federal Deposit
Insurance Act (12 U.S.C. 1813), shall meet such minimum capital requirements
and minimum initial and variation margin requirements as the appropriate
Federal banking agency shall by rule or regulation prescribe under paragraph
(2)(A) to help ensure the safety and soundness of the swap dealer or major swap
participant.</text>
</subparagraph><subparagraph id="ID192e92fc8f904f81ab38a5cc8ede9a9d"><enum>(B)</enum><header>Swap dealers and major
swap participants that are not depository institutions</header><text>Each
registered swap dealer and major swap participant that is not a depository
institution, as that term is defined in section 3 of the Federal Deposit
Insurance Act (12 U.S.C. 1813), shall meet such minimum capital requirements
and minimum initial and variation margin requirements as the Commission and the
Securities and Exchange Commission shall by rule or regulation prescribe under
paragraph (2)(B) to help ensure the safety and soundness of the swap dealer or
major swap participant.</text>
</subparagraph></paragraph><paragraph id="ID5d0139276267499da01dfb57824fe93f"><enum>(2)</enum><header>Rules</header>
<subparagraph id="ID76801a4dfd5b47178a0fbe65d6cf51e4"><enum>(A)</enum><header>Swap dealers and major
swap participants that are depository institutions</header><text>The
appropriate Federal banking agencies, in consultation with the Commission and
the Securities and Exchange Commission, shall adopt rules imposing capital and
margin requirements under this subsection for swap dealers and major swap
participants that are depository institutions, as that term is defined in
section 3 of the Federal Deposit Insurance Act (12 U.S.C. 1813).</text>
</subparagraph><subparagraph id="ID1f507e7f43d5491aa57936fa4a47ac8e"><enum>(B)</enum><header>Swap dealers and major
swap participants that are not depository institutions</header><text>The
Commission shall adopt rules imposing capital and margin requirements under
this subsection for swap dealers and major swap participants that are not
depository institutions, as that term is defined in section 3 of the Federal
Deposit Insurance Act (12 U.S.C. 1813).</text>
</subparagraph></paragraph><paragraph id="ID0b58421f0d8748119451fe841654a8cf"><enum>(3)</enum><header>Capital</header>
<subparagraph id="ID6f64cece809149c790ed319f4f2fe395"><enum>(A)</enum><header>Swap dealers and major
swap participants that are depository institutions</header><text>The capital
requirements prescribed under paragraph (2)(A) for swap dealers and major swap
participants that are depository institutions shall contain—</text>
<clause id="ID4b5d4cfe390342bfaf76f97ae686328b"><enum>(i)</enum><text>a capital requirement
that is greater than zero for swaps that are cleared by a registered
derivatives clearing organization or a derivatives clearing organization that
is exempt from registration under section 5b(j); and</text>
</clause><clause id="IDb71dc5cc90be478a91a1dc6c468df965"><enum>(ii)</enum><text>to offset the greater
risk to the swap dealer or major swap participant and to the financial system
arising from the use of swaps that are not cleared, substantially higher
capital requirements for swaps that are not cleared by a registered derivatives
clearing organization or a derivatives clearing organization that is exempt
from registration under section 5b(j) than for swaps that are cleared.</text>
</clause></subparagraph><subparagraph id="ID68e771ea9764427abfa678c4c63c0742"><enum>(B)</enum><header>Swap dealers and major
swap participants that are not depository institutions</header><text>The
capital requirements prescribed under paragraph (2)(B) for swap dealers and
major swap participants that are not depository institutions shall be as strict
as or stricter than the capital requirements prescribed for swap dealers and
major swap participants that are depository institutions under paragraph
(2)(A).</text>
</subparagraph><subparagraph id="IDd5886bab39b64edf9f4180b14e06eb80"><enum>(C)</enum><header>Rule of
construction</header>
<clause id="IDac8ba587a6c2436486c9cdaff34b51f2"><enum>(i)</enum><header>In
general</header><text>Nothing in this section shall limit, or be construed to
limit, the authority—</text>
<subclause id="ID94a298daa8cf4d4cbb722a96099b198a"><enum>(I)</enum><text>of the Commission to set
financial responsibility rules for a futures commission merchant or introducing
broker registered pursuant to section 4f(a) (except for section 4f(a)(3)) in
accordance with section 4f(b); or</text>
</subclause><subclause id="IDf256be6c08b74a70b72500eaa9439d3c"><enum>(II)</enum><text>of the Securities and
Exchange Commission to set financial responsibility rules for a broker or
dealer registered pursuant to section 15(b) of the Securities Exchange Act of
1934 (15 U.S.C. 78o(b)) (except for section 15(b)(11) of that Act (15 U.S.C.
78o(b)(11)) in accordance with section 15(c)(3) of the Securities Exchange Act
of 1934 (15 U.S.C. 78o(c)(3)).</text>
</subclause></clause><clause id="ID88b15ab04d31469f9e6e5e214ee69c35"><enum>(ii)</enum><header>Futures commission
merchants and other dealers</header><text>A futures commission merchant,
introducing broker, broker, or dealer shall maintain sufficient capital to
comply with the stricter of any applicable capital requirements to which such
futures commission merchant, introducing broker, broker, or dealer is subject
to under this Act or the Securities Exchange Act of 1934 (15 U.S.C. 78a et
seq.).</text>
</clause></subparagraph></paragraph><paragraph id="IDa41dd98ad9fb4d928c3a7dfe48175402"><enum>(4)</enum><header>Margin</header>
<subparagraph id="ID5c6092e74fd749988fec6be10784c7e1"><enum>(A)</enum><header>Swap dealers and major
swap participants that are depository institutions</header><text>The
appropriate Federal banking agency for swap dealers and major swap participants
that are depository institutions shall impose both initial and variation margin
requirements in accordance with paragraph (2)(A) on all swaps that are not
cleared by a registered derivatives clearing organization or a derivatives
clearing organization that is exempt from registration under section
5b(j).</text>
</subparagraph><subparagraph id="ID48a6683f86034f5db34496e60bc9620a"><enum>(B)</enum><header>Swap dealers and major
swap participants that are not depository institutions</header><text>The
Commission and the Securities and Exchange Commission shall impose both initial
and variation margin requirements in accordance with paragraph (2)(B) for swap
dealers and major swap participants that are not depository institutions on all
swaps that are not cleared by a registered derivatives clearing organization or
a derivatives clearing organization that is exempt from registration under
section 5b(j). Any such initial and variation margin requirements shall be as
strict as or stricter than the margin requirements prescribed under paragraph
(4)(A).</text>
</subparagraph></paragraph><paragraph id="ID0ae0f944ba4d4937902ce1878d4aed5b"><enum>(5)</enum><header>Margin
requirements</header><text>In prescribing margin requirements under this
subsection, the appropriate Federal banking agency with respect to swap dealers
and major swap participants that are depository institutions and the Commission
with respect to swap dealers and major swap participants that are not
depository institutions may permit the use of noncash collateral, as the agency
or the Commission determines to be consistent with—</text>
<subparagraph id="ID1d4e756364b64c1bb69a741d012e7741"><enum>(A)</enum><text>preserving the financial
integrity of markets trading swaps; and</text>
</subparagraph><subparagraph id="IDcde8a872d01442ec8c6c32ed921af5f2"><enum>(B)</enum><text>preserving the stability
of the United States financial system.</text>
</subparagraph></paragraph><paragraph id="IDc1c3324e9c234e7a8d95ee1b4ddba957"><enum>(6)</enum><header>Comparability of
capital and margin requirements</header>
<subparagraph id="ID062cea6e276247c39ffac2fbe8e116e1"><enum>(A)</enum><header>In
general</header><text>The appropriate Federal banking agencies, the Commission,
and the Securities and Exchange Commission shall periodically (but not less
frequently than annually) consult on minimum capital requirements and minimum
initial and variation margin requirements.</text>
</subparagraph><subparagraph id="ID396304cfa5574c7ebcb1fb5e6d7f009b"><enum>(B)</enum><header>Comparability</header><text>The
entities described in subparagraph (A) shall, to the maximum extent
practicable, establish and maintain comparable minimum capital requirements and
minimum initial and variation margin requirements, including the use of non
cash collateral, for—</text>
<clause id="ID3dc13949b03b4b3c9ce17c592b31e364"><enum>(i)</enum><text>swap dealers; and</text>
</clause><clause id="ID651911df578f4277b3d7dcecae9891b8"><enum>(ii)</enum><text>major swap
participants.</text>
</clause></subparagraph></paragraph><paragraph id="ID41c01a07948240ecb22645fb834ef607"><enum>(7)</enum><header>Requested
margin</header><text>If any party to a swap that is exempt from the margin
requirements of paragraph (4)(A)(i) pursuant to the provisions of paragraph
(4)(A)(ii), or from the margin requirements of paragraph (4)(B)(i) pursuant to
the provisions of paragraph (4)(B)(ii), requests that such swap be margined,
then—</text>
<subparagraph id="IDc742ea12f6724ed38337a386a26a785e"><enum>(A)</enum><text>the exemption shall not
apply; and</text>
</subparagraph><subparagraph id="ID50bb315c51f6487d81d862673fcd8d36"><enum>(B)</enum><text>the counterparty to such
swap shall provide the requested margin.</text>
</subparagraph></paragraph><paragraph id="ID20628606bd2841b09752b0ac2aa397ea"><enum>(8)</enum><header>Applicability with
respect to counterparties</header><text>Paragraph (4) shall not apply to
initial and variation margin for swaps in which 1 of the counterparties is
not—</text>
<subparagraph id="ID922b28c329fc43d79909f0c205a69e2c"><enum>(A)</enum><text>a swap dealer;</text>
</subparagraph><subparagraph id="ID2873a6289b644167882c3c59cfc06dac"><enum>(B)</enum><text>a major swap participant;
or</text>
</subparagraph><subparagraph id="ID3bc16d4bdd1b47638d44fed35fd75731"><enum>(C)</enum><text>a financial entity as
described in section 2(h)(9)(A)(ii), and such counterparty is eligible for and
utilizing the commercial end user clearing exemption under section
2(h)(9).</text>
</subparagraph></paragraph></subsection><subsection id="id2E76116D73B64D038508990BBA5135FA"><enum>(f)</enum><header>Reporting and
recordkeeping</header>
<paragraph id="id0E443BD117F84D3988A73E2C1EFEF3E7"><enum>(1)</enum><header>In
general</header><text>Each registered swap dealer and major swap
participant—</text>
<subparagraph id="id9F9F37037E0B491C90DF10FEAA913B5B"><enum>(A)</enum><text>shall make such reports
as are required by the Commission by rule or regulation regarding the
transactions and positions and financial condition of the registered swap
dealer or major swap participant;</text>
</subparagraph><subparagraph id="id5D8502C00479494CBB7F0E800104C712"><enum>(B)</enum><clause commented="no" display-inline="yes-display-inline" id="id1A21DE5CBA634886894D405EEDDFC62C"><enum>(i)</enum><text>for which there is a
prudential regulator, shall keep books and records of all activities related to
the business as a swap dealer or major swap participant in such form and manner
and for such period as may be prescribed by the Commission by rule or
regulation; and</text>
</clause><clause changed="added" id="id6B20C6D8BCFF44FAA59DC39EF84BB805" indent="up1" reported-display-style="italic"><enum>(ii)</enum><text>for which there is no
prudential regulator, shall keep books and records in such form and manner and
for such period as may be prescribed by the Commission by rule or regulation;
and</text>
</clause></subparagraph><subparagraph id="id45A2F909A59C4C5AAC4EE80ED9CB1D65"><enum>(C)</enum><text>shall keep books and
records described in subparagraph (B) open to inspection and examination by any
representative of the Commission.</text>
</subparagraph></paragraph><paragraph id="id1EA2D92696B043A48CB61F124AB9FCF7"><enum>(2)</enum><header>Rules</header><text>The
Commission shall adopt rules governing reporting and recordkeeping for swap
dealers and major swap participants.</text>
</paragraph></subsection><subsection id="id49CFCF20B7494B65976DFAA976EE2C9D"><enum>(g)</enum><header>Daily trading
records</header>
<paragraph id="id24D7237BE306452EAE673333C47E7393"><enum>(1)</enum><header>In
general</header><text>Each registered swap dealer and major swap participant
shall maintain daily trading records of the swaps of the registered swap dealer
and major swap participant and all related records (including related cash or
forward transactions) and recorded communications, including electronic mail,
instant messages, and recordings of telephone calls, for such period as may be
required by the Commission by rule or regulation.</text>
</paragraph><paragraph id="idE4521D77F9BD476B87E363F364347F51"><enum>(2)</enum><header>Information
requirements</header><text>The daily trading records shall include such
information as the Commission shall require by rule or regulation.</text>
</paragraph><paragraph id="id31AC3D0DDF034E429686EB4F9AC1C2A0"><enum>(3)</enum><header>Counterparty
records</header><text>Each registered swap dealer and major swap participant
shall maintain daily trading records for each counterparty in a manner and form
that is identifiable with each swap transaction.</text>
</paragraph><paragraph id="id3A3EB9CF7C7442DD9FE6464D11461045"><enum>(4)</enum><header>Audit
trail</header><text>Each registered swap dealer and major swap participant
shall maintain a complete audit trail for conducting comprehensive and accurate
trade reconstructions.</text>
</paragraph><paragraph id="idA2D45843B6274B6C863F153CEA2C6688"><enum>(5)</enum><header>Rules</header><text>The
Commission shall adopt rules governing daily trading records for swap dealers
and major swap participants.</text>
</paragraph></subsection><subsection id="idD7889979966A444790E805864E92CC41"><enum>(h)</enum><header>Business conduct
standards</header>
<paragraph id="id585C23DDA2144528A32A25EA025E33A4"><enum>(1)</enum><header>In
general</header><text>Each registered swap dealer and major swap participant
shall conform with such business conduct standards as may be prescribed by the
Commission by rule or regulation that relate to—</text>
<subparagraph id="id6DD9065CA280495684DB0A1B927B36C6"><enum>(A)</enum><text>fraud, manipulation, and
other abusive practices involving swaps (including swaps that are offered but
not entered into);</text>
</subparagraph><subparagraph id="id28510842D2FE456FB240F224B00C9FDA"><enum>(B)</enum><text>diligent supervision of
the business of the registered swap dealer and major swap participant;</text>
</subparagraph><subparagraph id="idC705EFF1EEF24EC38E18C4184D6A6D9F"><enum>(C)</enum><text>adherence to all
applicable position limits; and</text>
</subparagraph><subparagraph id="id718925936A98476CA94D542A7C26AAD6"><enum>(D)</enum><text>such other matters as the
Commission determines to be appropriate.</text>
</subparagraph></paragraph><paragraph id="id273B51CF69AB4969BDB427C560CFE8EE"><enum>(2)</enum><header>Special rule; fiduciary
duties to certain entities</header>
<subparagraph id="idF97D48B7F9DA474985D376EE56F68CDA"><enum>(A)</enum><header>Governmental
entities</header><text>A swap dealer that provides advice regarding, or offers
to enter into, or enters into a swap with a State, State agency, city, county,
municipality, or other political subdivision of a State or a Federal agency
shall have a fiduciary duty to the State, State agency, city, county,
municipality, or other political subdivision of a State, or the Federal agency,
as appropriate.</text>
</subparagraph><subparagraph id="id49306089E1C94FF7A5AD3D621F7E59A5"><enum>(B)</enum><header>Pension plans;
endowments; retirement plans</header><text>A swap dealer that provides advice
regarding, or offers to enter into, or enters into a swap with a pension plan,
endowment, or retirement plan shall have a fiduciary duty to the pension plan,
endowment, or retirement plan, as appropriate.</text>
</subparagraph></paragraph><paragraph id="id8C4A98652AE0456CB2A9596FD4433DD6"><enum>(3)</enum><header>Business conduct
requirements</header><text>Business conduct requirements adopted by the
Commission shall—</text>
<subparagraph id="id40C06C5AA04D4F629DBB6DC68D752AC3"><enum>(A)</enum><text>establish the standard of
care for a swap dealer or major swap participant to verify that any
counterparty meets the eligibility standards for an eligible contract
participant;</text>
</subparagraph><subparagraph id="id6345EF2B204D46E3ABBA69033BB5E23A"><enum>(B)</enum><text>require disclosure by the
swap dealer or major swap participant to any counterparty to the transaction
(other than a swap dealer, major swap participant, security-based swap dealer,
or major security-based swap participant) of—</text>
<clause id="idF8B40DC16B344798A922F81B6920FDAA"><enum>(i)</enum><text>information about the
material risks and characteristics of the swap;</text>
</clause><clause id="idE4D695B833F04C3BA8AFA7BCEDA76E6F"><enum>(ii)</enum><text>the source and amount of
any fees or other material remuneration that the swap dealer or major swap
participant would directly or indirectly expect to receive in connection with
the swap;</text>
</clause><clause id="id07A890B1F1A74122BEA9B8409BBD25A5"><enum>(iii)</enum><text>any other material
incentives or conflicts of interest that the swap dealer or major swap
participant may have in connection with the swap; and</text>
</clause><clause id="id21C8937E5BDB4C439C6A799B2B656E59"><enum>(iv)</enum><subclause commented="no" display-inline="yes-display-inline" id="id501933D952DE45F2BCFAA45B69EA72B8"><enum>(I)</enum><text>for cleared swaps, upon
the request of the counterparty, the daily mark from the appropriate
derivatives clearing organization; and</text>
</subclause><subclause changed="added" id="id5D1531F6E3BB4372A93FC8274539C104" indent="up1" reported-display-style="italic"><enum>(II)</enum><text>for uncleared swaps, the
daily mark of the swap dealer or the major swap participant;</text>
</subclause></clause></subparagraph><subparagraph id="idFF1ECAD1AACF4EE1B411D4F7B4A630AD"><enum>(C)</enum><text>establish a standard of
conduct for a swap dealer or major swap participant to communicate in a fair
and balanced manner based on principles of fair dealing and good faith;</text>
</subparagraph><subparagraph id="id52D2A13F311E4830BEA2B4D268C3AD93"><enum>(D)</enum><text>establish a standard of
conduct for a swap dealer or major swap participant, with respect to a
counterparty that is an eligible contract participant within the meaning of
subclause (I) or (II) of clause (vii) of section 1a(18) of this Act, to have a
reasonable basis to believe that the counterparty has an independent
representative that—</text>
<clause id="idB3A25912536A47D697F5A73F393DFAF1"><enum>(i)</enum><text>has sufficient knowledge
to evaluate the transaction and risks;</text>
</clause><clause id="id027F03FA6A0B45D5969C241B6B5C75B8"><enum>(ii)</enum><text>is not subject to a
statutory disqualification;</text>
</clause><clause id="id10DA18FD0C524FE0A068162ADAF19F12"><enum>(iii)</enum><text>is independent of the
swap dealer or major swap participant;</text>
</clause><clause id="id70E7D41C36BD44DD8CBE8805A8A57A3F"><enum>(iv)</enum><text>undertakes a duty to act
in the best interests of the counterparty it represents;</text>
</clause><clause id="id044B3E077B4F4E54B0BE64E3C8A2611C"><enum>(v)</enum><text>makes appropriate
disclosures; and</text>
</clause><clause id="id7BD25213262A498981ECF91AB148D2A1"><enum>(vi)</enum><text>will provide written
representations to the eligible contract participant regarding fair pricing and
the appropriateness of the transaction; and</text>
</clause></subparagraph><subparagraph id="id79CE921CA28C47DCAB28F9FA9E7CB692"><enum>(E)</enum><text>establish such other
standards and requirements as the Commission may determine are appropriate in
the public interest, for the protection of investors, or otherwise in
furtherance of the purposes of this Act.</text>
</subparagraph></paragraph><paragraph id="id49290532113F43F78995F4AEBDA8DFF3"><enum>(4)</enum><header>Rules</header><text>The
Commission shall prescribe rules under this subsection governing business
conduct standards for swap dealers and major swap participants.</text>
</paragraph></subsection><subsection id="id3AECB35D92E34B2A9A2E55388DA727AB"><enum>(i)</enum><header>Documentation and back
office standards</header>
<paragraph id="id6816287A887A4C9F9255E9C8DFCC3188"><enum>(1)</enum><header>In
general</header><text>Each registered swap dealer and major swap participant
shall conform with such standards as may be prescribed by the Commission by
rule or regulation that relate to timely and accurate confirmation, processing,
netting, documentation, and valuation of all swaps.</text>
</paragraph><paragraph id="id25C26B7228854D2E90BD05F3A475CC08"><enum>(2)</enum><header>Rules</header><text>The
Commission shall adopt rules governing documentation and back office standards
for swap dealers and major swap participants.</text>
</paragraph></subsection><subsection id="id67EBA00918154BFA87BC1D568DE90AB5"><enum>(j)</enum><header>Duties</header><text display-inline="yes-display-inline">Each registered swap dealer and major swap
participant at all times shall comply with the following requirements:</text>
<paragraph id="idD2518E811B944324AD9267698C592749"><enum>(1)</enum><header>Monitoring of
trading</header><text>The swap dealer or major swap participant shall monitor
its trading in swaps to prevent violations of applicable position
limits.</text>
</paragraph><paragraph id="idDF6248731B804F60BD7C42528306DE4C"><enum>(2)</enum><header>Risk management
procedures</header><text>The swap dealer or major swap participant shall
establish robust and professional risk management systems adequate for managing
the day-to-day business of the swap dealer or major swap participant.</text>
</paragraph><paragraph id="idE597F637D3E54FB88833461DE1680932"><enum>(3)</enum><header>Disclosure of general
information</header><text>The swap dealer or major swap participant shall
disclose to the Commission and to the prudential regulator for the swap dealer
or major swap participant, as applicable, information concerning—</text>
<subparagraph id="idAA78357CECE04516A9E0A2202DF9B30D"><enum>(A)</enum><text>terms and conditions of
its swaps;</text>
</subparagraph><subparagraph id="idD0AF8B2B195649BDAE5DAD9B0AC0ACF0"><enum>(B)</enum><text>swap trading operations,
mechanisms, and practices;</text>
</subparagraph><subparagraph id="idD4FA39410A144FFEB19BDCCA9B929BFD"><enum>(C)</enum><text>financial integrity
protections relating to swaps; and</text>
</subparagraph><subparagraph id="idCEC47F2584134BF5869C9EB34781AC23"><enum>(D)</enum><text>other information
relevant to its trading in swaps.</text>
</subparagraph></paragraph><paragraph id="idE0AA2CFF7010404B98295809CA7160E1"><enum>(4)</enum><header>Ability to obtain
information</header><text>The swap dealer or major swap participant
shall—</text>
<subparagraph id="idC3EFD4EE01CC4C96AF8A62468AECECF2"><enum>(A)</enum><text>establish and enforce
internal systems and procedures to obtain any necessary information to perform
any of the functions described in this section; and</text>
</subparagraph><subparagraph id="id68C80DA2BEEB47A9BF52D8E208B2B738"><enum>(B)</enum><text>provide the information
to the Commission and to the prudential regulator for the swap dealer or major
swap participant, as applicable, on request.</text>
</subparagraph></paragraph><paragraph id="idB554FC79D78F4A519DCBC02F0C60572D"><enum>(5)</enum><header>Conflicts of
interest</header><text>The swap dealer and major swap participant shall
implement conflict-of-interest systems and procedures that—</text>
<subparagraph id="id7FD0F2091A9D496E9C8F2E45D48A9E87"><enum>(A)</enum><text>establish structural and
institutional safeguards to ensure that the activities of any person within the
firm relating to research or analysis of the price or market for any commodity
or swap or acting in a role of providing clearing activities or making
determinations as to accepting clearing customers are separated by appropriate
informational partitions within the firm from the review, pressure, or
oversight of persons whose involvement in pricing, trading, or clearing
activities might potentially bias their judgment or supervision and contravene
the core principles of open access and the business conduct standards described
in this Act; and</text>
</subparagraph><subparagraph id="id4B7BB34C76724DAD81EE08C8BA96F04A"><enum>(B)</enum><text>address such other issues
as the Commission determines to be appropriate.</text>
</subparagraph></paragraph><paragraph id="idBABFB07210564C92AFFF2AE0DFA7E6C1"><enum>(6)</enum><header>Antitrust
considerations</header><text>Unless necessary or appropriate to achieve the
purposes of this Act, a swap dealer or major swap participant shall not—</text>
<subparagraph id="id58A6BAB55C3C4AE4ABE55669BC7AE28F"><enum>(A)</enum><text>adopt any process or take
any action that results in any unreasonable restraint of trade; or</text>
</subparagraph><subparagraph id="idBBA9574A05BF46D4B1A8B7F6A2E3313D"><enum>(B)</enum><text>impose any material
anticompetitive burden on trading or clearing.</text>
</subparagraph></paragraph></subsection><subsection id="idD05B2C5A554640B6BF655589EFDD8D62"><enum>(k)</enum><header>Designation of Chief
Compliance Officer</header>
<paragraph id="idAF650A09CA4D45A5A147EAA89BFFC0FB"><enum>(1)</enum><header>In
general</header><text>Each swap dealer and major swap participant shall
designate an individual to serve as a chief compliance officer.</text>
</paragraph><paragraph id="id51BF065CF6A14BE48949455BEFD6C7D1"><enum>(2)</enum><header>Duties</header><text>The
chief compliance officer shall—</text>
<subparagraph id="id8954B952F68A4E8C8ED659A1C156AADC"><enum>(A)</enum><text>report directly to the
board or to the senior officer of the swap dealer or major swap
participant;</text>
</subparagraph><subparagraph id="id017765CF5FDE4E31BA05C2253EB330B6"><enum>(B)</enum><text>review the compliance of
the swap dealer or major swap participant with respect to the swap dealer and
major swap participant requirements described in this section;</text>
</subparagraph><subparagraph id="idAD6660B0A3944713A2CEBB6626659B9D"><enum>(C)</enum><text>in consultation with the
board of directors, a body performing a function similar to the board, or the
senior officer of the organization, resolve any conflicts of interest that may
arise;</text>
</subparagraph><subparagraph id="idB184C117EDBB4C14881F1F2DAD8AC737"><enum>(D)</enum><text>be responsible for
administering each policy and procedure that is required to be established
pursuant to this section;</text>
</subparagraph><subparagraph id="id733FFC6407E14052813113F7C5AB85C3"><enum>(E)</enum><text>ensure compliance with
this Act (including regulations) relating to swaps, including each rule
prescribed by the Commission under this section;</text>
</subparagraph><subparagraph id="id8393968BCF0F46CAB7CCFF52836A7431"><enum>(F)</enum><text>establish procedures for
the remediation of noncompliance issues identified by the chief compliance
officer through any—</text>
<clause id="id176AE338866F46B49E071E64098CE09F"><enum>(i)</enum><text>compliance office
review;</text>
</clause><clause id="idBD8BFB3C261F462081276C26105680AF"><enum>(ii)</enum><text>look-back;</text>
</clause><clause id="id68FA59C7B09D433A9F1CE84FB8C37E5A"><enum>(iii)</enum><text>internal or external
audit finding;</text>
</clause><clause id="idE6D16431CD2D44F8BDCCB79C7D2C0DE6"><enum>(iv)</enum><text>self-reported error;
or</text>
</clause><clause id="idA295494B488F455481ED250F54A5858E"><enum>(v)</enum><text>validated complaint;
and</text>
</clause></subparagraph><subparagraph id="id9B99CF95E16B41E9929CE6F72A04AFD1"><enum>(G)</enum><text>establish and follow
appropriate procedures for the handling, management response, remediation,
retesting, and closing of noncompliance issues.</text>
</subparagraph></paragraph><paragraph id="idBF876F3FCCB34D5EBF220DB1A2604BF9"><enum>(3)</enum><header>Annual reports</header>
<subparagraph id="idCDB1BB62AB4542618B8180C21E182C0F"><enum>(A)</enum><header>In
general</header><text>In accordance with rules prescribed by the Commission,
the chief compliance officer shall annually prepare and sign a report that
contains a description of—</text>
<clause id="id9519A63EDD114AF4820A329199E27624"><enum>(i)</enum><text>the compliance of the
swap dealer or major swap participant with respect to this Act (including
regulations); and</text>
</clause><clause id="idF191C3363C4C49058A934C0F933476F6"><enum>(ii)</enum><text>each policy and
procedure of the swap dealer or major swap participant of the chief compliance
officer (including the code of ethics and conflict of interest
policies).</text>
</clause></subparagraph><subparagraph id="id5C00276145FD48F79F9B095A4FB689FB"><enum>(B)</enum><header>Requirements</header><text>A
compliance report under subparagraph (A) shall—</text>
<clause id="id20AEE9A8F4CA41E3BCC9A40661114092"><enum>(i)</enum><text>accompany each
appropriate financial report of the swap dealer or major swap participant that
is required to be furnished to the Commission pursuant to this section;
and</text>
</clause><clause id="id72450B33679C4244985C1BB84A045B62"><enum>(ii)</enum><text>include a certification
that, under penalty of law, the compliance report is accurate and
complete.</text>
</clause></subparagraph></paragraph></subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</section><section id="IDc500754a58444da8b9d51c211d02ff63"><enum>732.</enum><header>Conflicts of
interest</header><text display-inline="no-display-inline">Section 4d of the
Commodity Exchange Act (7 U.S.C. 6d) is amended—</text>
<paragraph id="IDef367b5f44824d538a152a4e853dc8b6"><enum>(1)</enum><text>by redesignating
subsection (c) as subsection (e); and</text>
</paragraph><paragraph id="IDf1255fc86a5b44ecb80ac271f4371cd1"><enum>(2)</enum><text>by inserting after
subsection (b) the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id1C717F7F431B4E3BAA11B3E026539EE2" reported-display-style="italic" style="OLC">
<subsection id="ID83c565973d964759aff903a3dc8f1f1f"><enum>(c)</enum><header>Conflicts of
interest</header><text>The Commission shall require that futures commission
merchants and introducing brokers implement conflict-of-interest systems and
procedures that—</text>
<paragraph id="IDdca3f78b6ffd409db7da572c0687de16"><enum>(1)</enum><text>establish structural and
institutional safeguards to ensure that the activities of any person within the
firm relating to research or analysis of the price or market for any commodity
are separated by appropriate informational partitions within the firm from the
review, pressure, or oversight of persons whose involvement in trading or
clearing activities might potentially bias the judgment or supervision of the
persons; and</text>
</paragraph><paragraph id="IDf32942437a3c420b857839741e393a18"><enum>(2)</enum><text>address such other issues
as the Commission determines to be appropriate.</text>
</paragraph></subsection><subsection id="ID3929f698db6749c58687a170eb0eeb15"><enum>(d)</enum><header>Designation of Chief
Compliance Officer</header>
<paragraph id="IDd7d36155c01d441b9d865a10c0ebc24b"><enum>(1)</enum><header>In
general</header><text>Each futures commission merchant shall designate an
individual to serve as a chief compliance officer.</text>
</paragraph><paragraph id="ID018cfab8bf35430788c7fee1c3c12580"><enum>(2)</enum><header>Duties</header><text>The
chief compliance officer shall—</text>
<subparagraph id="IDa309aefb7a6d45d38c8455a85a71d0a4"><enum>(A)</enum><text>report directly to the
board or to the senior officer of the futures commission merchant;</text>
</subparagraph><subparagraph id="ID913eeec5ec054e4d803490700156a393"><enum>(B)</enum><text>review the compliance of
the futures commission merchant with respect to requirements described in this
section;</text>
</subparagraph><subparagraph id="ID64be574f672b4e728c18dd0810899073"><enum>(C)</enum><text>in consultation with the
board of directors, a body performing a function similar to the board, or the
senior officer of the organization, resolve any conflicts of interest that may
arise;</text>
</subparagraph><subparagraph id="ID3f4def81410a4fa2a45e78cb5b5118c9"><enum>(D)</enum><text>be responsible for
administering each policy and procedure that is required to be established
pursuant to this section;</text>
</subparagraph><subparagraph id="ID7d5506fc7b9e4f8fa5393832e0d64fa3"><enum>(E)</enum><text>ensure compliance with
this Act (including regulations and each rule prescribed by the Commission
under this section) relating, but not limited, to—</text>
<clause id="id6CDFAF814BCA4CA382642DDE2FFC310E"><enum>(i)</enum><text>contracts of sale of a
commodity for future delivery;</text>
</clause><clause id="id80B9F151B99B4BCE8FE797CA9BB422AB"><enum>(ii)</enum><text>options on the contracts
described in clause (i);</text>
</clause><clause id="id89BD4DCDEB6F4525933A553FDA062660"><enum>(iii)</enum><text>commodity
options;</text>
</clause><clause id="id40533786C3384855A9550A53D2F4143F"><enum>(iv)</enum><text>retail commodity
transactions;</text>
</clause><clause id="idB1BBDD675CB14C95B03C6AAB351AE98B"><enum>(v)</enum><text>security futures
products;</text>
</clause><clause id="id81591F3571DE4ED4951F4F2BFA970648"><enum>(vi)</enum><text>leverage contracts;
and</text>
</clause><clause id="idF08D668DE0734CDEBE31D81D68D30D37"><enum>(vii)</enum><text>swaps;</text>
</clause></subparagraph><subparagraph id="IDe46b85d3cbe54c9dacccd1757112f7e7"><enum>(F)</enum><text>establish procedures for
the remediation of noncompliance issues identified by the chief compliance
officer through any—</text>
<clause id="ID6bd94e654acc4a5ab01cba129e382a20"><enum>(i)</enum><text>compliance office
review;</text>
</clause><clause id="IDa19154e1c277494f8241ca20425544b5"><enum>(ii)</enum><text>look-back;</text>
</clause><clause id="ID6d740079cd1d411a9bd1b2f43f95ef44"><enum>(iii)</enum><text>internal or external
audit finding;</text>
</clause><clause id="IDbb7841824f74455e85dc653baac12c0f"><enum>(iv)</enum><text>self-reported error;
or</text>
</clause><clause id="ID9c87d5c9fbf94d98b000d28bcb25e61e"><enum>(v)</enum><text>validated complaint;
and</text>
</clause></subparagraph><subparagraph id="IDf19201ca2b684a8cb4381dcab1aabc01"><enum>(G)</enum><text>establish and follow
appropriate procedures for the handling, management response, remediation,
retesting, and closing of noncompliance issues.</text>
</subparagraph></paragraph><paragraph id="ID3c6fed6606694a8a8676259940df7df8"><enum>(3)</enum><header>Annual reports</header>
<subparagraph id="ID210d3b578d7a426bb88c344e54980e69"><enum>(A)</enum><header>In
general</header><text>In accordance with rules prescribed by the Commission,
the chief compliance officer shall annually prepare and sign a report that
contains a description of—</text>
<clause id="ID546beec829664d75973a7809772dab83"><enum>(i)</enum><text>the compliance of the
futures commission merchant with respect to this Act (including regulations);
and</text>
</clause><clause id="ID9003f799d29c4decb89ef838f9d8a541"><enum>(ii)</enum><text>each policy and
procedure of the futures commission merchant of the chief compliance officer
(including the code of ethics and conflict of interest policies).</text>
</clause></subparagraph><subparagraph id="ID7ec549433b2f4571a8af1cc3714da189"><enum>(B)</enum><header>Requirements</header><text>A
compliance report under subparagraph (A) shall—</text>
<clause id="ID4ab18212d2924aacbe4cbea3e6147939"><enum>(i)</enum><text>accompany each
appropriate financial report of the futures commission merchant that is
required to be furnished to the Commission pursuant to this section; and</text>
</clause><clause id="ID4ec1bca7b89e428ba40b3939895d83c6"><enum>(ii)</enum><text>include a certification
that, under penalty of law, the compliance report is accurate and
complete.</text>
</clause></subparagraph></paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></section><section id="ID8290fc2255b14d858400e9ce4a501c10"><enum>733.</enum><header>Swap execution
facilities</header><text display-inline="no-display-inline">The Commodity
Exchange Act is amended by inserting after section 5g (7 U.S.C. 7b–2) the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id95E0144E66724221AC853CC8811C8503" reported-display-style="italic" style="OLC">
<section id="ID9b224ee6fcb243ecafa0dfac9ddb70e6"><enum>5h.<?LEXA-Enum 5h.?></enum><header>Swap
execution facilities</header>
<subsection id="idA95AD7379B1943768C0E21C49A88C113"><enum>(a)</enum><header>Registration</header>
<paragraph id="idC15A1FEAC3964950A17F0A4A3FEAB31D"><enum>(1)</enum><header>In
general</header><text>No person may operate a facility for the trading or
processing of swaps unless the facility is registered as a swap execution
facility or as a designated contract market under this section.</text>
</paragraph><paragraph id="id7E66A1307A40452D9A5DB325A8D42A3A"><enum>(2)</enum><header>Dual
registration</header><text>Any person that is registered as a swap execution
facility under this section shall register with the Commission regardless of
whether the person also is registered with the Securities and Exchange
Commission as a swap execution facility.</text>
</paragraph></subsection><subsection id="id14FDA8C3CFC8462FB73346F8D26BBF15"><enum>(b)</enum><header>Trading and trade
processing</header><text>A swap execution facility that is registered under
subsection (a) may—</text>
<paragraph id="id3AC8473C0A654586BF817D210E320493"><enum>(1)</enum><text>make available for
trading any swap; and</text>
</paragraph><paragraph id="id218969797A3B48A6B813FE3A1C8E0F08"><enum>(2)</enum><text>facilitate trade
processing of any swap.</text>
</paragraph></subsection><subsection id="IDb9a2ee1cef6f4859a40a4edf77f04d08"><enum>(c)</enum><header>Identification of
facility used To trade swaps by contract markets</header><text>A board of trade
that operates a contract market shall, to the extent that the board of trade
also operates a swap execution facility and uses the same electronic trade
execution system for listing and executing trades of swaps on or through the
contract market and the swap execution facility, identify whether the
electronic trading of such swaps is taking place on or through the contract
market or the swap execution facility.</text>
</subsection><subsection id="id3E1DB548E83844849A7D18310E913F5B"><enum>(d)</enum><header>Core principles for
swap execution facilities</header>
<paragraph id="idD89721A274D54FD7B4DC9B2D6B21DFF4"><enum>(1)</enum><header>Compliance with core
principles</header>
<subparagraph id="idEF3F410FEA894300B5476F0F07E3C633"><enum>(A)</enum><header>In
general</header><text>To be registered, and maintain registration, as a swap
execution facility, the swap execution facility shall comply with—</text>
<clause id="idAE347149124B461CACE88201C1F08E22"><enum>(i)</enum><text>the core principles
described in this subsection; and</text>
</clause><clause id="id8F613C2553A3498BAA024BBCEAEF5388"><enum>(ii)</enum><text>any requirement that the
Commission may impose by rule or regulation pursuant to section 8a(5).</text>
</clause></subparagraph><subparagraph id="idC9D2A15AD5B54D47B6CB538D7CD1123C"><enum>(B)</enum><header>Reasonable discretion
of swap execution facility</header><text>Unless otherwise determined by the
Commission by rule or regulation, a swap execution facility described in
subparagraph (A) shall have reasonable discretion in establishing the manner in
which the swap execution facility complies with the core principles described
in this subsection.</text>
</subparagraph></paragraph><paragraph id="idC681DB755E2D420CA321F8BC2097D647"><enum>(2)</enum><header>Compliance with
rules</header><text>A swap execution facility shall—</text>
<subparagraph id="id850FA6DABE1E4472AF003300F8A74E98"><enum>(A)</enum><text>monitor and enforce
compliance with any rule of the swap execution facility, including—</text>
<clause id="id7AC9C67722E945CC8ACB7255E7F9A8A9"><enum>(i)</enum><text>the terms and conditions
of the swaps traded or processed on or through the swap execution facility;
and</text>
</clause><clause id="id152053455B32464C8B71132C1499B4C6"><enum>(ii)</enum><text>any limitation on access
to the swap execution facility;</text>
</clause></subparagraph><subparagraph id="id82A4E6211BC445559A3464DF7353D80E"><enum>(B)</enum><text>establish and enforce
trading, trade processing, and participation rules that will deter abuses and
have the capacity to detect, investigate, and enforce those rules, including
means—</text>
<clause id="idD3D1405AB5404BFA88A15AAB8047B664"><enum>(i)</enum><text>to provide market
participants with impartial access to the market; and</text>
</clause><clause id="idE54D42BE4BF24408BF968C62E68175E0"><enum>(ii)</enum><text>to capture information
that may be used in establishing whether rule violations have occurred;</text>
</clause></subparagraph><subparagraph id="id98BCD4D14CFA4BB085EBA7987A0819F0"><enum>(C)</enum><text>establish rules governing
the operation of the facility, including rules specifying trading procedures to
be used in entering and executing orders traded or posted on the facility,
including block trades; and</text>
</subparagraph><subparagraph id="id7F42F21A0CA64C83A507EFA6615F06EF"><enum>(D)</enum><text>provide by its rules that
when a swap dealer or major swap participant enters into or facilitates a swap
that is subject to the mandatory clearing requirement of section 2(h)(2)(F),
the swap dealer or major swap participant shall be responsible for compliance
with the mandatory trading requirement of section 113(d) of the Wall Street
Transparency and Accountability Act of 2010.</text>
</subparagraph></paragraph><paragraph id="id58A11DF614324587996B4794B639A5CA"><enum>(3)</enum><header>Swaps not readily
susceptible to manipulation</header><text>The swap execution facility shall
permit trading only in swaps that are not readily susceptible to
manipulation.</text>
</paragraph><paragraph id="idA388CCAB8BC746CABD5834D6B25BAB78"><enum>(4)</enum><header>Monitoring of trading
and trade processing</header><text>The swap execution facility shall—</text>
<subparagraph id="id3D62E59C3EBF4713AA0FA2A8C5435E2B"><enum>(A)</enum><text>establish and enforce
rules or terms and conditions defining, or specifications detailing—</text>
<clause id="id6B8DF8B13CCF4731B50D259E3DE0F57E"><enum>(i)</enum><text>trading procedures to be
used in entering and executing orders traded on or through the facilities of
the swap execution facility; and</text>
</clause><clause id="id9F165776A0314640828BAA76120C1D49"><enum>(ii)</enum><text>procedures for trade
processing of swaps on or through the facilities of the swap execution
facility; and</text>
</clause></subparagraph><subparagraph id="id636462CCAEF34025B268651DC143582B"><enum>(B)</enum><text>monitor trading in swaps
to prevent manipulation, price distortion, and disruptions of the delivery or
cash settlement process through surveillance, compliance, and disciplinary
practices and procedures, including methods for conducting real-time monitoring
of trading and comprehensive and accurate trade reconstructions.</text>
</subparagraph></paragraph><paragraph id="idF5CA6D47213E4488985BEB5CD28741DC"><enum>(5)</enum><header>Ability to obtain
information</header><text>The swap execution facility shall—</text>
<subparagraph id="id8A9AE6515C834C32B61AE51F4BD5C2D4"><enum>(A)</enum><text>establish and enforce
rules that will allow the facility to obtain any necessary information to
perform any of the functions described in this section;</text>
</subparagraph><subparagraph id="id4F38A77D425A4F18A2D569CBB0EC675F"><enum>(B)</enum><text>provide the information
to the Commission on request; and</text>
</subparagraph><subparagraph id="idC0AE738C63184FDD936E4395CE7E34ED"><enum>(C)</enum><text>have the capacity to
carry out such international information-sharing agreements as the Commission
may require.</text>
</subparagraph></paragraph><paragraph id="id84D41534B30D40D89AC565F971A14C5B"><enum>(6)</enum><header>Position limits or
accountability</header>
<subparagraph id="id2FE47EDAF48246F2B5F97FA53347948C"><enum>(A)</enum><header>In
general</header><text>To reduce the potential threat of market manipulation or
congestion, especially during trading in the delivery month, a swap execution
facility that is a trading facility shall adopt for each of the contracts of
the facility, as is necessary and appropriate, position limitations or position
accountability for speculators.</text>
</subparagraph><subparagraph id="id22868D7E6CEE4E0D83F7B3632AD01C0D"><enum>(B)</enum><header>Position
limits</header><text>For any contract that is subject to a position limitation
established by the Commission pursuant to section 4a(a), the swap execution
facility shall set its position limitation at a level no higher than the
Commission limitation.</text>
</subparagraph><subparagraph id="id0014B88E794F48BAA8C949F2351D9B28"><enum>(C)</enum><header>Position
enforcement</header><text>For any contract that is subject to a position
limitation established by the Commission pursuant to section 4a(a), a swap
execution facility shall reject any proposed swap transaction if, based on
information readily available to a swap execution facility, any proposed swap
transaction would cause a swap execution facility customer that would be a
party to such swap transaction to exceed such position limitation.</text>
</subparagraph></paragraph><paragraph id="id8F914AA81A46474A8FAD4AA90268B1CE"><enum>(7)</enum><header>Financial integrity of
transactions</header><text>The swap execution facility shall establish and
enforce rules and procedures for ensuring the financial integrity of swaps
entered on or through the facilities of the swap execution facility, including
the clearance and settlement of the swaps pursuant to section 2(h)(1).</text>
</paragraph><paragraph id="idA249FED9CAF744D095AAC311E4D65DCC"><enum>(8)</enum><header>Emergency
authority</header><text>The swap execution facility shall adopt rules to
provide for the exercise of emergency authority, in consultation or cooperation
with the Commission, as is necessary and appropriate, including the authority
to liquidate or transfer open positions in any swap or to suspend or curtail
trading in a swap.</text>
</paragraph><paragraph id="id20E8EBE7CC7341B2B783ABEF642A21DA"><enum>(9)</enum><header>Timely publication of
trading information</header>
<subparagraph id="id8B8ED89283DE48BAAB8700912DF5F18D"><enum>(A)</enum><header>In
general</header><text>The swap execution facility shall make public timely
information on price, trading volume, and other trading data on swaps to the
extent prescribed by the Commission.</text>
</subparagraph><subparagraph id="id6850BD5E314D4A15B6A045DF411AEFC8"><enum>(B)</enum><header>Capacity of swap
execution facility</header><text>The swap execution facility shall be required
to have the capacity to electronically capture trade information with respect
to transactions executed on the facility.</text>
</subparagraph></paragraph><paragraph id="id144ABBE228394684A4CB0A61F45AA38F"><enum>(10)</enum><header>Recordkeeping and
reporting</header>
<subparagraph id="id03563478BFD84A0E8B653623AACEE23A"><enum>(A)</enum><header>In
general</header><text>A swap execution facility shall—</text>
<clause id="id9CB35D12FCFF4D2DAB90664CD5C34E7A"><enum>(i)</enum><text>maintain records of all
activities relating to the business of the facility, including a complete audit
trail, in a form and manner acceptable to the Commission for a period of 5
years; and</text>
</clause><clause id="id91467E19FFFD4E68A1D2072F622F53EB"><enum>(ii)</enum><text>report to the
Commission, in a form and manner acceptable to the Commission, such information
as the Commission determines to be necessary or appropriate for the Commission
to perform the duties of the Commission under this Act.</text>
</clause></subparagraph><subparagraph id="idA47249A7A9A64FE9BB4E02348832F7BA"><enum>(B)</enum><header>Requirements</header><text>The
Commission shall adopt data collection and reporting requirements for swap
execution facilities that are comparable to corresponding requirements for
derivatives clearing organizations and swap data repositories.</text>
</subparagraph></paragraph><paragraph id="idA8856149177E4E199A7FFAEABB5165BE"><enum>(11)</enum><header>Antitrust
considerations</header><text>Unless necessary or appropriate to achieve the
purposes of this Act, the swap execution facility shall not—</text>
<subparagraph id="id6B7108ACF36644448F1260FF8E65E67C"><enum>(A)</enum><text>adopt any rules or taking
any actions that result in any unreasonable restraint of trade; or</text>
</subparagraph><subparagraph id="idBCC8FE704344415B82B47BEC8D5F3395"><enum>(B)</enum><text>impose any material
anticompetitive burden on trading or clearing.</text>
</subparagraph></paragraph><paragraph id="id15C7B8FCEDFA4CD5975DDA4B36D89EC4"><enum>(12)</enum><header>Conflicts of
interest</header><text>The swap execution facility shall—</text>
<subparagraph id="id247F0CC5CDAF4A7E809E75B157319DDE"><enum>(A)</enum><text>establish and enforce
rules to minimize conflicts of interest in its decision-making process;
and</text>
</subparagraph><subparagraph id="idCE761AE39D954DF1A03174DF7EA659E7"><enum>(B)</enum><text>establish a process for
resolving the conflicts of interest.</text>
</subparagraph></paragraph><paragraph id="idDA794E96444147DBB43B6FD46FC9E0E2"><enum>(13)</enum><header>Financial
resources</header>
<subparagraph id="id6FBB6DE325F64D0EBA1FFB52C8169471"><enum>(A)</enum><header>In
general</header><text>The swap execution facility shall have adequate
financial, operational, and managerial resources to discharge each
responsibility of the swap execution facility.</text>
</subparagraph><subparagraph id="id6B6B8D719B774988ABBE654ED5FD81CB"><enum>(B)</enum><header>Determination of
resource adequacy</header><text>The financial resources of a swap execution
facility shall be considered to be adequate if the value of the financial
resources exceeds the total amount that would enable the swap execution
facility to cover the operating costs of the swap execution facility for a
1-year period, as calculated on a rolling basis.</text>
</subparagraph></paragraph><paragraph id="id76051B905AF44C019DFF3649E52F0922"><enum>(14)</enum><header>System
safeguards</header><text>The swap execution facility shall—</text>
<subparagraph id="idA555DFC1CFCE47A092B86CB611B235DA"><enum>(A)</enum><text>establish and maintain a
program of risk analysis and oversight to identify and minimize sources of
operational risk, through the development of appropriate controls and
procedures, and automated systems, that—</text>
<clause id="id4B86C8DC9A7447ADB3098A3C3662DE93"><enum>(i)</enum><text>are reliable and secure;
and</text>
</clause><clause id="id876FF5309B7942F6AACFAE489109D918"><enum>(ii)</enum><text>have adequate scalable
capacity;</text>
</clause></subparagraph><subparagraph id="idC83BF1D16EC14227ADED129F581A367A"><enum>(B)</enum><text>establish and maintain
emergency procedures, backup facilities, and a plan for disaster recovery that
are designed to allow for—</text>
<clause id="idDE7C7048C7E64B7788C7D4A929B34461"><enum>(i)</enum><text>the timely recovery and
resumption of operations; and</text>
</clause><clause id="id3D715A93FA704B089D0EE3BB38893FFA"><enum>(ii)</enum><text>the fulfillment of the
responsibilities and obligation of the swap execution facility; and</text>
</clause></subparagraph><subparagraph id="idF0B03C71ABE64E8189B45047DAD2DD5C"><enum>(C)</enum><text>periodically conduct
tests to verify that the backup resources of the swap execution facility are
sufficient to ensure continued—</text>
<clause id="id631A366E7D9B42CE97E4550122FE7604"><enum>(i)</enum><text>order processing and
trade matching;</text>
</clause><clause id="id19D870C4A176449F83A88849A10A0BAA"><enum>(ii)</enum><text>price reporting;</text>
</clause><clause id="idE08A90E70BAA4CD48FD39F7ED4632ADC"><enum>(iii)</enum><text>market surveillance
and</text>
</clause><clause id="idC4EC8322ADA441649C1BD2FB007E9071"><enum>(iv)</enum><text>maintenance of a
comprehensive and accurate audit trail.</text>
</clause></subparagraph></paragraph><paragraph id="id2C72AFA7A99640E3BAC7D27A19EF2761"><enum>(15)</enum><header>Designation of chief
compliance officer</header>
<subparagraph id="id4E2160E460E94527BB59EB673F548979"><enum>(A)</enum><header>In
general</header><text>Each swap execution facility shall designate an
individual to serve as a chief compliance officer.</text>
</subparagraph><subparagraph id="idFD6041BDF1A34BE28EF7564511DF67EB"><enum>(B)</enum><header>Duties</header><text>The
chief compliance officer shall—</text>
<clause id="id65D0080242704EE79CA00022F293BAD8"><enum>(i)</enum><text>report directly to the
board or to the senior officer of the facility;</text>
</clause><clause id="id0BB2FA61BBB74FF89853EC7B74F32851"><enum>(ii)</enum><text>review compliance with
the core principles in this subsection;</text>
</clause><clause id="idDDD4A8BFBE604761B79A1F50C93D823B"><enum>(iii)</enum><text>in consultation with
the board of the facility, a body performing a function similar to that of a
board, or the senior officer of the facility, resolve any conflicts of interest
that may arise;</text>
</clause><clause id="idBF801A07505F428A943387B369EF92DB"><enum>(iv)</enum><text>be responsible for
establishing and administering the policies and procedures required to be
established pursuant to this section;</text>
</clause><clause id="id9D0434A9B00441879F9DAC3F269FFDDA"><enum>(v)</enum><text>ensure compliance with
this Act and the rules and regulations issued under this Act, including rules
prescribed by the Commission pursuant to this section; and</text>
</clause><clause id="id8115C3F975F24009B458C98AF46AB649"><enum>(vi)</enum><text>establish procedures for
the remediation of noncompliance issues found during compliance office reviews,
look backs, internal or external audit findings, self-reported errors, or
through validated complaints.</text>
</clause></subparagraph><subparagraph id="id415EBDC2ABFF48D4BF5CDB6E6A7EB120"><enum>(C)</enum><header>Requirements for
procedures</header><text>In establishing procedures under subparagraph (B)(vi),
the chief compliance officer shall design the procedures to establish the
handling, management response, remediation, retesting, and closing of
noncompliance issues.</text>
</subparagraph><subparagraph id="id99EE6DCCD8C044FB828204FD1AD8C3BD"><enum>(D)</enum><header>Annual reports</header>
<clause id="id8CE2D63A916643F18EC042B6ED31F9C6"><enum>(i)</enum><header>In
general</header><text>In accordance with rules prescribed by the Commission,
the chief compliance officer shall annually prepare and sign a report that
contains a description of—</text>
<subclause id="idACA694D591904D4EA06C496D167D04D0"><enum>(I)</enum><text>the compliance of the
swap execution facility with this Act; and</text>
</subclause><subclause id="id1B0B5FAE977E4A5CB1AA5FAFA4D25F5D"><enum>(II)</enum><text>the policies and
procedures, including the code of ethics and conflict of interest policies, of
the swap execution facility.</text>
</subclause></clause><clause id="id4BEFB409AB2841BD989C9D964CB3F77D"><enum>(ii)</enum><header>Requirements</header><text>The
chief compliance officer shall—</text>
<subclause id="id4B14D6D08C8041289A4E0A350CDB46B1"><enum>(I)</enum><text>submit each report
described in clause (i) with the appropriate financial report of the swap
execution facility that is required to be submitted to the Commission pursuant
to this section; and</text>
</subclause><subclause id="idB9CC770120AC430A92960B5B000A4E01"><enum>(II)</enum><text>include in the report a
certification that, under penalty of law, the report is accurate and
complete.</text>
</subclause></clause></subparagraph></paragraph></subsection><subsection id="idDF7609078399418EB7BD255ABB8A81D6"><enum>(e)</enum><header>Exemptions</header><text>The
Commission may exempt, conditionally or unconditionally, a swap execution
facility from registration under this section if the Commission finds that the
facility is subject to comparable, comprehensive supervision and regulation on
a consolidated basis by the Securities and Exchange Commission, a prudential
regulator, or the appropriate governmental authorities in the home country of
the facility.</text>
</subsection><subsection id="idDA0BFB7F60CC42F88271099A375A2FB1"><enum>(f)</enum><header>Rules</header><text>The
Commission shall prescribe rules governing the regulation of alternative swap
execution facilities under this
section.</text>
</subsection></section><after-quoted-block>.
</after-quoted-block></quoted-block>
</section><section id="ID51560e560fa641da896cce1b16852fa8"><enum>734.</enum><header>Derivatives
transaction execution facilities and exempt boards of trade</header>
<subsection id="idDD6756D1773B47C3BF1CA2AAE2FBD489"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">Sections 5a and 5d of
the Commodity Exchange Act (7 U.S.C. 7a, 7a–3) are repealed.</text>
</subsection><subsection id="idA9FF5547300F4FC8B48B89480D4902A1"><enum>(b)</enum><header>Conforming
amendments</header>
<paragraph id="ID21364db7c3ed49919d93a57990ba47b7"><enum>(1)</enum><text>Section 2 of the
Commodity Exchange Act (7 U.S.C. 2) is amended—</text>
<subparagraph id="idE4EDFF8447124A63868D04A8BC7068A9"><enum>(A)</enum><text>in subsection (a)(1)(A),
in the first sentence, by striking <quote>or 5a</quote>; and</text>
</subparagraph><subparagraph id="id066293C7CC1F4574BCB3F37083F7A074"><enum>(B)</enum><text>in paragraph (2) of
subsection (g) (as redesignated by section 723(a)(1)(B)), by striking
<quote>section 5a of this Act</quote> and all that follows through <quote>5d of
this Act</quote> and inserting <quote>section 5b of this Act</quote>.</text>
</subparagraph></paragraph><paragraph id="idA95A91E7D70F4036A5FF363F7D429913"><enum>(2)</enum><text>Section 6(g)(1)(A) of the
Securities Exchange Act of 1934 (15 U.S.C. 78f(g)(1)(A)) is amended—</text>
<subparagraph id="id1EC1F8924E8E4230A81948B773E7FB9F"><enum>(A)</enum><text>by striking
<quote>that—</quote> and all that follows through <quote>(i) has been
designated</quote> and inserting <quote>that has been
designated</quote>;</text>
</subparagraph><subparagraph id="id25D6A84DB43649578BCC3D9E3E236CC6"><enum>(B)</enum><text>by striking <quote>;
or</quote> and inserting <quote>; and</quote> and</text>
</subparagraph><subparagraph id="idAC694DE0541542E1A034AF7E3753B259"><enum>(C)</enum><text>by striking clause
(ii).</text>
</subparagraph></paragraph></subsection></section><section id="idFD98E0467BC14C869E5797116FD9AD50"><enum>735.</enum><header>Designated contract
markets</header>
<subsection id="idCD260A283B1F488795C15DE899B74EA7"><enum>(a)</enum><header>Criteria for
Designation</header><text>Section 5 of the Commodity Exchange Act (7 U.S.C. 7)
is amended by striking subsection (b).</text>
</subsection><subsection id="ID53ad2c1fa7d04d7cae369dec17babe81"><enum>(b)</enum><header>Core principles for
contract markets</header><text>Section 5 of the Commodity Exchange Act (7
U.S.C. 7) is amended by striking subsection (d) and inserting the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idA9ADF12BD251412297164BF15FBD2F28" reported-display-style="italic" style="OLC">
<subsection id="IDcb528b9cfb6d4898979be8769d609f13"><enum>(d)</enum><header>Core principles for
contract markets</header>
<paragraph id="IDdfcb478068104276bc735d981bc1b99d"><enum>(1)</enum><header>Designation as contract
market</header>
<subparagraph id="idDCE71E71BA4D494C8969D0F0CCD27A8F"><enum>(A)</enum><header>In
general</header><text>To be designated, and maintain a designation, as a
contract market, a board of trade shall comply with—</text>
<clause id="id9D3946A385A34B2399B035D2DFECCBE0"><enum>(i)</enum><text>any core principle
described in this subsection; and</text>
</clause><clause id="id02483F46C42F4ECEB5BEEA976B08DF57"><enum>(ii)</enum><text>any requirement that the
Commission may impose by rule or regulation pursuant to section 8a(5).</text>
</clause></subparagraph><subparagraph id="id7471598C522044E1AF21EEA39E742D61"><enum>(B)</enum><header>Reasonable discretion
of contract market</header><text>Unless otherwise determined by the Commission
by rule or regulation, a board of trade described in subparagraph (A) shall
have reasonable discretion in establishing the manner in which the board of
trade complies with the core principles described in this subsection.</text>
</subparagraph></paragraph><paragraph id="ID15f68e97f8ce44cbb1fefd4b7c51994c"><enum>(2)</enum><header>Compliance with
rules</header>
<subparagraph id="IDae77affb4a92443394557533cd347b5c"><enum>(A)</enum><header>In
general</header><text>The board of trade shall establish, monitor, and enforce
compliance with the rules of the contract market, including—</text>
<clause id="idE13086300AC34F66B9844D9FC4C3F210"><enum>(i)</enum><text>access
requirements;</text>
</clause><clause id="id63AF0353A539484EB2AD3B629351CD75"><enum>(ii)</enum><text>the terms and conditions
of any contracts to be traded on the contract market; and</text>
</clause><clause id="id32655A6DFCDD489E94CB212AEA46F756"><enum>(iii)</enum><text>rules prohibiting
abusive trade practices on the contract market.</text>
</clause></subparagraph><subparagraph id="ID47a5958cfc854f5f9c8f26b665c09208"><enum>(B)</enum><header>Capacity of contract
market</header><text>The board of trade shall have the capacity to detect,
investigate, and apply appropriate sanctions to any person that violates any
rule of the contract market.</text>
</subparagraph><subparagraph id="IDa1453a382ad04787a18ebe6444a2f1b7"><enum>(C)</enum><header>Requirement of
rules</header><text>The rules of the contract market shall provide the board of
trade with the ability and authority to obtain any necessary information to
perform any function described in this subsection, including the capacity to
carry out such international information-sharing agreements as the Commission
may require.</text>
</subparagraph></paragraph><paragraph id="IDbb09df1955544102aeb8e2ef4fffbf2d"><enum>(3)</enum><header>Contracts not readily
subject to manipulation</header><text>The board of trade shall list on the
contract market only contracts that are not readily susceptible to
manipulation.</text>
</paragraph><paragraph id="ID3bbad565f2e04a21835941bf6f55787f"><enum>(4)</enum><header>Prevention of market
disruption</header><text>The board of trade shall have the capacity and
responsibility to prevent manipulation, price distortion, and disruptions of
the delivery or cash-settlement process through market surveillance,
compliance, and enforcement practices and procedures, including—</text>
<subparagraph id="idE28C43BB8EF346668902935822558562"><enum>(A)</enum><text>methods for conducting
real-time monitoring of trading; and</text>
</subparagraph><subparagraph id="idA1064E7D11184334816DC59185C7F22A"><enum>(B)</enum><text>comprehensive and
accurate trade reconstructions.</text>
</subparagraph></paragraph><paragraph id="IDe15f30c77f544d86b505f6bdfd1457c2"><enum>(5)</enum><header>Position limitations or
accountability</header>
<subparagraph id="ID5c515356ea1f445889a6bc8d5e7461d6"><enum>(A)</enum><header>In
general</header><text>To reduce the potential threat of market manipulation or
congestion (especially during trading in the delivery month), the board of
trade shall adopt for each contract of the board of trade, as is necessary and
appropriate, position limitations or position accountability for
speculators.</text>
</subparagraph><subparagraph id="ID8886943ba8a240f39494af51438a48f1"><enum>(B)</enum><header>Maximum allowable
position limitation</header><text>For any contract that is subject to a
position limitation established by the Commission pursuant to section 4a(a),
the board of trade shall set the position limitation of the board of trade at a
level not higher than the position limitation established by the
Commission.</text>
</subparagraph></paragraph><paragraph id="IDa4a2b3b059f24d489f4d1735a4acde6a"><enum>(6)</enum><header>Emergency
authority</header><text>The board of trade, in consultation or cooperation with
the Commission, shall adopt rules to provide for the exercise of emergency
authority, as is necessary and appropriate, including the authority—</text>
<subparagraph id="IDb5b0d9fad035471da047e899dea41096"><enum>(A)</enum><text>to liquidate or transfer
open positions in any contract;</text>
</subparagraph><subparagraph id="ID0e449f3b0ddf43d3aa3d70d8a148336b"><enum>(B)</enum><text>to suspend or curtail
trading in any contract; and</text>
</subparagraph><subparagraph id="IDf2efb88bb4044d4795ff5052b57bdfc4"><enum>(C)</enum><text>to require market
participants in any contract to meet special margin requirements.</text>
</subparagraph></paragraph><paragraph id="IDfb14626cde5a43bfa19700ab78a81729"><enum>(7)</enum><header>Availability of general
information</header><text>The board of trade shall make available to market
authorities, market participants, and the public accurate information
concerning—</text>
<subparagraph id="ID344451100a0941c68d784fb9c998b0e0"><enum>(A)</enum><text>the terms and conditions
of the contracts of the contract market; and</text>
</subparagraph><subparagraph id="IDc85667e51b504167ace74ce9ef05d6ea"><enum>(B)</enum><clause commented="no" display-inline="yes-display-inline" id="id301B7EB632FF4E439B724D1E2BFD4103"><enum>(i)</enum><text>the rules, regulations,
and mechanisms for executing transactions on or through the facilities of the
contract market; and</text>
</clause><clause changed="added" id="id8F312475AA534FBEB938B3C53E6B556A" indent="up1" reported-display-style="italic"><enum>(ii)</enum><text>the rules and
specifications describing the operation of the contract market’s—</text>
<subclause id="id887C715B917647B0A0114CA5D3CABDF4"><enum>(I)</enum><text>electronic matching
platform; or</text>
</subclause><subclause id="id0C4D6E0C717849989B04CFA2BF787C6F"><enum>(II)</enum><text>trade execution
facility.</text>
</subclause></clause></subparagraph></paragraph><paragraph id="ID9a4712f00fb547259445771eeb3a99d1"><enum>(8)</enum><header>Daily publication of
trading information</header><text>The board of trade shall make public daily
information on settlement prices, volume, open interest, and opening and
closing ranges for actively traded contracts on the contract market.</text>
</paragraph><paragraph id="ID7371e21c628441d1b473afaf9eee10b3"><enum>(9)</enum><header>Execution of
transactions</header>
<subparagraph id="ID503bb852fa7c47378080d989521ce29b"><enum>(A)</enum><header>In
general</header><text>The board of trade shall provide a competitive, open, and
efficient market and mechanism for executing transactions that protects the
price discovery process of trading in the centralized market of the board of
trade.</text>
</subparagraph><subparagraph id="ID30495424ada44cc2aa032eecd5468155"><enum>(B)</enum><header>Rules</header><text>The
rules of the board of trade may authorize, for bona fide business
purposes—</text>
<clause id="ID90e8be502ff94fb597b8690fd2311c6b"><enum>(i)</enum><text>transfer trades or office
trades;</text>
</clause><clause id="IDda1dc74b1e42456e8e1d909f9df258fb"><enum>(ii)</enum><text>an exchange of—</text>
<subclause id="IDab6952e8c87e46ad9537ad72e758ac72"><enum>(I)</enum><text>futures in connection
with a cash commodity transaction;</text>
</subclause><subclause id="IDfbfcd407a2c149a99a51e532908a49bb"><enum>(II)</enum><text>futures for cash
commodities; or</text>
</subclause><subclause id="ID3079f0f2bc3c4be8a62e632044c10cfe"><enum>(III)</enum><text>futures for swaps;
or</text>
</subclause></clause><clause id="IDf7c675d68f6a405194e933d4b503ff95"><enum>(iii)</enum><text>a futures commission
merchant, acting as principal or agent, to enter into or confirm the execution
of a contract for the purchase or sale of a commodity for future delivery if
the contract is reported, recorded, or cleared in accordance with the rules of
the contract market or a derivatives clearing organization.</text>
</clause></subparagraph></paragraph><paragraph id="ID5dd5555a2a46425dbb2fdc38c13a3a8f"><enum>(10)</enum><header>Trade
information</header><text>The board of trade shall maintain rules and
procedures to provide for the recording and safe storage of all identifying
trade information in a manner that enables the contract market to use the
information—</text>
<subparagraph id="idEBB4B935A9D04D598D5117046C4F5003"><enum>(A)</enum><text>to assist in the
prevention of customer and market abuses; and</text>
</subparagraph><subparagraph id="idE56ACC3904A14CC1A186CDE7B6C43541"><enum>(B)</enum><text>to provide evidence of
any violations of the rules of the contract market.</text>
</subparagraph></paragraph><paragraph id="ID92491436a99547378553e7ada27f96c6"><enum>(11)</enum><header>Financial integrity of
transactions</header><text>The board of trade shall establish and
enforce—</text>
<subparagraph id="idFAA4B2CD76254F5EA7E9781102CAEF8B"><enum>(A)</enum><text>rules and procedures for
ensuring the financial integrity of transactions entered into on or through the
facilities of the contract market (including the clearance and settlement of
the transactions with a derivatives clearing organization); and</text>
</subparagraph><subparagraph id="idF7BD72F2A3DC4C1AAD4F557258AE0D22"><enum>(B)</enum><text>rules to ensure—</text>
<clause id="id8B43138309094123BEEC1FCA11A3130D"><enum>(i)</enum><text>the financial integrity
of any—</text>
<subclause id="id22F740C677C74AD2BF433ABD337BE2B9"><enum>(I)</enum><text>futures commission
merchant; and</text>
</subclause><subclause id="id2AAF0F4630094C0683489C5FE4BCC795"><enum>(II)</enum><text>introducing broker;
and</text>
</subclause></clause><clause id="id07E3B8DB97674541AF5CE1603EA4B808"><enum>(ii)</enum><text>the protection of
customer funds.</text>
</clause></subparagraph></paragraph><paragraph id="IDe26b5148e95c417d8a5753e0a0cbe297"><enum>(12)</enum><header>Protection of markets
and market participants</header><text>The board of trade shall establish and
enforce rules—</text>
<subparagraph id="idC0656E3A665E4B85AB2CEDDC9613F621"><enum>(A)</enum><text>to protect markets and
market participants from abusive practices committed by any party, including
abusive practices committed by a party acting as an agent for a participant;
and</text>
</subparagraph><subparagraph id="id22E208CC8DCB420EBD35D75894511771"><enum>(B)</enum><text>to promote fair and
equitable trading on the contract market.</text>
</subparagraph></paragraph><paragraph id="ID91d946909c084d7ebee1a7e89519bb64"><enum>(13)</enum><header>Disciplinary
procedures</header><text>The board of trade shall establish and enforce
disciplinary procedures that authorize the board of trade to discipline,
suspend, or expel members or market participants that violate the rules of the
board of trade, or similar methods for performing the same functions, including
delegation of the functions to third parties.</text>
</paragraph><paragraph id="ID9964e45718d5462a83b3c99ed9bd0815"><enum>(14)</enum><header>Dispute
resolution</header><text>The board of trade shall establish and enforce rules
regarding, and provide facilities for alternative dispute resolution as
appropriate for, market participants and any market intermediaries.</text>
</paragraph><paragraph id="ID3afef5d37b48440cb6508b9b054e6062"><enum>(15)</enum><header>Governance fitness
standards</header><text>The board of trade shall establish and enforce
appropriate fitness standards for directors, members of any disciplinary
committee, members of the contract market, and any other person with direct
access to the facility (including any party affiliated with any person
described in this paragraph).</text>
</paragraph><paragraph id="ID846587ad2a2249a1b76fd7b10bc5cb92"><enum>(16)</enum><header>Conflicts of
interest</header><text>The board of trade shall establish and enforce
rules—</text>
<subparagraph id="id34634121AE414356BC637E6C235D4D1C"><enum>(A)</enum><text>to minimize conflicts of
interest in the decision-making process of the contract market; and</text>
</subparagraph><subparagraph id="id52FDDDEF8812490E95A1047523B32113"><enum>(B)</enum><text>to establish a process
for resolving conflicts of interest described in subparagraph (A).</text>
</subparagraph></paragraph><paragraph id="IDc2ae8edc418d439dbc853389aa7e300a"><enum>(17)</enum><header>Composition of
governing boards of contract markets</header><text>The governance arrangements
of the board of trade shall be designed to promote the objectives of market
participants.</text>
</paragraph><paragraph id="ID54d753e7c6fa4ac3a55fe6ac7a9fbb6c"><enum>(18)</enum><header>Recordkeeping</header><text>The
board of trade shall maintain records of all activities relating to the
business of the contract market—</text>
<subparagraph id="idAF2333E71C8A46A1A8BE16975305AC08"><enum>(A)</enum><text>in a form and manner that
is acceptable to the Commission; and</text>
</subparagraph><subparagraph id="id611AB6CB5AF94EF7A83D8BF83DE58A42"><enum>(B)</enum><text>for a period of at least
5 years.</text>
</subparagraph></paragraph><paragraph id="ID6c32f7f463b3445696a81716b0b95149"><enum>(19)</enum><header>Antitrust
considerations</header><text>Unless necessary or appropriate to achieve the
purposes of this Act, the board of trade shall not—</text>
<subparagraph id="ID14965c4416104986a8c72d0c4b3b1d2c"><enum>(A)</enum><text>adopt any rule or taking
any action that results in any unreasonable restraint of trade; or</text>
</subparagraph><subparagraph id="IDdc88af555be14003a16b582ecf565a1d"><enum>(B)</enum><text>impose any material
anticompetitive burden on trading on the contract market.</text>
</subparagraph></paragraph><paragraph id="ID984b698f414d49fdaa0aa8b2fe03e074"><enum>(20)</enum><header>System
safeguards</header><text>The board of trade shall—</text>
<subparagraph id="ID95700d782a014f238e20a2196231bfcc"><enum>(A)</enum><text>establish and maintain a
program of risk analysis and oversight to identify and minimize sources of
operational risk, through the development of appropriate controls and
procedures, and the development of automated systems, that are reliable,
secure, and have adequate scalable capacity;</text>
</subparagraph><subparagraph id="IDd331f991b0434fc88870257ebe531cdc"><enum>(B)</enum><text>establish and maintain
emergency procedures, backup facilities, and a plan for disaster recovery that
allow for the timely recovery and resumption of operations and the fulfillment
of the responsibilities and obligations of the board of trade; and</text>
</subparagraph><subparagraph id="IDb5868436faf64af7992120e44965eab0"><enum>(C)</enum><text>periodically conduct
tests to verify that backup resources are sufficient to ensure continued order
processing and trade matching, price reporting, market surveillance, and
maintenance of a comprehensive and accurate audit trail.</text>
</subparagraph></paragraph><paragraph id="ID1cc11923b44b48ffb4f32aa08a926f37"><enum>(21)</enum><header>Financial
resources</header>
<subparagraph id="IDd9b4cebf4de445168ffdd1b7412264ed"><enum>(A)</enum><header>In
general</header><text>The board of trade shall have adequate financial,
operational, and managerial resources to discharge each responsibility of the
board of trade.</text>
</subparagraph><subparagraph id="IDe67f7766ab614fd2b4bd7f8fb9732179"><enum>(B)</enum><header>Determination of
adequacy</header><text>The financial resources of the board of trade shall be
considered to be adequate if the value of the financial resources exceeds the
total amount that would enable the contract market to cover the operating costs
of the contract market for a 1-year period, as calculated on a rolling
basis.</text>
</subparagraph></paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection></section><section id="ID21bb88c280264d14b87a7e644ef8ff88"><enum>736.</enum><header>Margin</header><text display-inline="no-display-inline">Section 8a(7) of the Commodity Exchange Act
(7 U.S.C. 12a(7)) is amended—</text>
<paragraph id="id7EEAC04B1B5043188D447F88C7A72BAC"><enum>(1)</enum><text display-inline="yes-display-inline">in subparagraph (C), by striking <quote>,
excepting the setting of levels of margin</quote>;</text>
</paragraph><paragraph id="id6A04EEBF993C488E88FF047C4716A4BE"><enum>(2)</enum><text>by redesignating
subparagraphs (D) through (F) as subparagraphs (E) through (G), respectively;
and</text>
</paragraph><paragraph id="id6E19D3B75D124155A40D5869EBDEB424"><enum>(3)</enum><text>by inserting after
subparagraph (C) the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id593424365944436AB6A2387D6AD9563F" reported-display-style="italic" style="OLC">
<subparagraph id="IDd9ec91d661d8408a9b97e9d9e1b88354"><enum>(D)</enum><text>margin requirements,
provided that the rules, regulations, or orders shall—</text>
<clause id="IDc73e68b00e94466bad960d3e78472946"><enum>(i)</enum><text>be limited to protecting
the financial integrity of the derivatives clearing organization;</text>
</clause><clause id="ID1ae7c60ba68e466b96eb6c756f7ae71e"><enum>(ii)</enum><text>be designed for risk
management purposes to protect the financial integrity of transactions;
and</text>
</clause><clause id="IDa6375fbea3d94710b400a016672ae7f0"><enum>(iii)</enum><text>not set specific margin
amounts;</text>
</clause></subparagraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></section><section id="ID9ec7505269514347926cec34239f3b8c"><enum>737.</enum><header>Position
limits</header>
<subsection id="ID9b2cfb2e445744818a0997ea4125be15"><enum>(a)</enum><header>Aggregate position
limits</header><text>Section 4a(a) of the Commodity Exchange Act (7 U.S.C.
6a(a)) is amended—</text>
<paragraph id="IDe7217936e8b44b75975c2b75cdf0ce40"><enum>(1)</enum><text>by inserting after
<quote>(a)</quote> the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id8ACBD264E3C340DDB4F09B3BCDA73EAC" reported-display-style="italic" style="OLC">
<paragraph id="id7CCF6AED21DD41C19E08183CAC45D631"><enum>(1)</enum><header>In
general</header>
</paragraph><after-quoted-block>;</after-quoted-block></quoted-block>
</paragraph><paragraph id="ID15b981a9db9e445ea3fdd5fe45ff601f"><enum>(2)</enum><text>in the first sentence, by
striking <quote>on electronic trading facilities with respect to a significant
price discovery contract</quote> and inserting <quote>swaps that perform or
affect a significant price discovery function with respect to registered
entities</quote>;</text>
</paragraph><paragraph id="ID5e25fcca27a24f979e80fab58c80ccfc"><enum>(3)</enum><text>in the second
sentence—</text>
<subparagraph id="idF1E23E2890664EB6B2FDAEE61B40E137"><enum>(A)</enum><text>by inserting <quote>,
including any group or class of traders,</quote> after <quote>held by any
person</quote>; and</text>
</subparagraph><subparagraph id="IDe8f1d3c74b57476a89d066e041567ae8"><enum>(B)</enum><text>by striking <quote>on an
electronic trading facility with respect to a significant price discovery
contract,</quote> and inserting <quote>swaps traded on or subject to the rules
of an swaps execution facility, or swaps not traded on or subject to the rules
of an swaps execution facility that perform a significant price discovery
function with respect to a registered entity,</quote>; and</text>
</subparagraph></paragraph><paragraph id="IDe8fc9b0213e140708db4003dbcdbdd41"><enum>(4)</enum><text>by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id2BE936B89EEB4F99AFA127DFD927EB9C" reported-display-style="italic" style="OLC">
<paragraph id="IDf5cc3f0f75354c2886307c8b3d5fe2f8"><enum>(2)</enum><header>Aggregate position
limits</header><text>The Commission shall, by rule or regulation, establish
limits (including related hedge exemption provisions) on the aggregate number
or amount of positions in contracts based on the same underlying commodity (as
defined by the Commission) that may be held by any person, including any group
or class of traders, for each month across—</text>
<subparagraph id="ID305c8852a98b4c5fa7ca50710af5c181"><enum>(A)</enum><text>contracts listed by
designated contract markets;</text>
</subparagraph><subparagraph id="IDe6465ba627dc41f8beab8e05c66e3d48"><enum>(B)</enum><text>with respect to an
agreement, contract, or transaction that settles against, or in relation to,
any price (including the daily or final settlement price) of 1 or more
contracts listed for trading on a registered entity, contracts traded on a
foreign board of trade that provides members or other participants located in
the United States with direct access to the electronic trading and order
matching system of the foreign board of trade;</text>
</subparagraph><subparagraph id="ID14c571bbc53d4a11b36724071b7a0238"><enum>(C)</enum><text>swaps traded on or
subject to the rules of a swap execution facility; and</text>
</subparagraph><subparagraph id="ID3b28bac3f7c74761a977b49fdeb48044"><enum>(D)</enum><text>swaps not traded on or
subject to the rules of a swap execution facility that perform or affect a
significant price discovery function with respect to a registered
entity.</text>
</subparagraph></paragraph><paragraph id="ID2cd35138179e422ea3e3c99cded91b71"><enum>(3)</enum><header>Significant price
discovery function</header><text>In making a determination as to whether a swap
performs or affects a significant price discovery function with respect to
registered entities, the Commission shall consider, as appropriate, the
following factors:</text>
<subparagraph id="ID88231820b1514533ac47a62b7104aa5d"><enum>(A)</enum><header>Price
linkage</header><text>The extent to which the swap uses or otherwise relies on
a daily or final settlement price, or other major price parameter, of another
contract traded on a registered entity based on the same underlying commodity,
to value a position, transfer or convert a position, financially settle a
position, or close out a position.</text>
</subparagraph><subparagraph id="IDba97e36eebb043ebacb897fec9af0bc1"><enum>(B)</enum><header>Arbitrage</header><text>The
extent to which the price for the swap is sufficiently related to the price of
another contract traded on a registered entity based on the same underlying
commodity so as to permit market participants to effectively arbitrage between
the markets by simultaneously maintaining positions or executing trades in the
swaps on a frequent and recurring basis.</text>
</subparagraph><subparagraph id="IDcbc51d33a90249e9932c13115e3f8081"><enum>(C)</enum><header>Material price
reference</header><text>The extent to which, on a frequent and recurring basis,
bids, offers, or transactions in a contract traded on a registered entity are
directly based on, or are determined by referencing, the price generated by the
swap.</text>
</subparagraph><subparagraph id="ID34bea453f636486cb8f6cfa8174dc40f"><enum>(D)</enum><header>Material
liquidity</header><text>The extent to which the volume of swaps being traded in
the commodity is sufficient to have a material effect on another contract
traded on a registered entity.</text>
</subparagraph><subparagraph id="ID3639208a01124c6eaabcdd831965ff0f"><enum>(E)</enum><header>Other material
factors</header><text>Such other material factors as the Commission specifies
by rule or regulation as relevant to determine whether a swap serves a
significant price discovery function with respect to a regulated market.</text>
</subparagraph></paragraph><paragraph id="ID6b66a2a4e9094921b2e590e2c4748969"><enum>(4)</enum><header>Exemptions</header><text>The
Commission, by rule, regulation, or order, may exempt, conditionally or
unconditionally, any person or class of persons, any swap or class of swaps, or
any transaction or class of transactions from any requirement that the
Commission establishes under this section with respect to position
limits.</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="IDf846c0efaac944cdb88cd5252c3b9d4c"><enum>(b)</enum><header>Conforming
amendments</header><text>Section 4a(b) of the Commodity Exchange Act (7 U.S.C.
6a(b)) is amended—</text>
<paragraph id="ID05aa77efb628490496848819f0d61f5e"><enum>(1)</enum><text>in paragraph (1), by
striking <quote>or derivatives transaction execution facility or facilities or
electronic trading facility</quote> and inserting <quote>or swap execution
facility or facilities</quote>; and</text>
</paragraph><paragraph id="ID3181447dac8b43dc977a45e2942dca1b"><enum>(2)</enum><text>in paragraph (2), by
striking <quote>or derivatives transaction execution facility or facilities or
electronic trading facility</quote> and inserting <quote>or swap execution
facility</quote>.</text>
</paragraph></subsection></section><section id="idE0E64816A89D470EAFEB4D675E59AC1E"><enum>738.</enum><header>Foreign boards of
trade</header>
<subsection id="id197008530DE7488D9106251571617CE2"><enum>(a)</enum><header>In
general</header><text>Section 4(b) of the Commodity Exchange Act (7 U.S.C.
6(b)) is amended—</text>
<paragraph id="id95D3AFB675D448069672C17D77AD0EAF"><enum>(1)</enum><text>in the first sentence, by
striking <quote>The Commission</quote> and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id757548563EF64F5C9F80037FB02D262F" reported-display-style="italic" style="OLC">
<paragraph commented="no" display-inline="no-display-inline" id="idF7A4263F86584DCEA5AA9982520D5E13"><enum>(2)</enum><header display-inline="yes-display-inline">Persons located in the United
States</header>
<subparagraph commented="no" display-inline="no-display-inline" id="id3A5ADA9D38034C8AA8BEE65A925959E3"><enum>(A)</enum><header display-inline="yes-display-inline">In general</header><text>The
Commission</text>
</subparagraph></paragraph><after-quoted-block>;</after-quoted-block></quoted-block>
</paragraph><paragraph id="idEFEFD99318FA4F129B74B196426DF03B"><enum>(2)</enum><text>in the second sentence,
by striking <quote>Such rules and regulations</quote> and inserting the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idC58DA14F085E40CB979E217FD7DC4A27" reported-display-style="italic" style="OLC">
<subparagraph id="id5F55829F5DEA48D1BC1850D9BC9F5412"><enum>(B)</enum><header>Different
requirements</header><text>Rules and regulations described in subparagraph
(A)</text>
</subparagraph><after-quoted-block>;</after-quoted-block></quoted-block>
</paragraph><paragraph id="id262CA464C0AB42B6A9ABDA2C4FE031BE"><enum>(3)</enum><text>in the third
sentence—</text>
<subparagraph id="idB56C8F59D575434596F84A50FFAE3DFA"><enum>(A)</enum><text>by striking <quote>No
rule or regulation</quote> and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id5BE4E849BF8B47A995378E7B40B4B415" reported-display-style="italic" style="OLC">
<subparagraph id="idD4734F87363C41E8B1A42DFEF1D5E2B6"><enum>(C)</enum><header>Prohibition</header><text>Except
as provided in paragraphs (1) and (2), no rule or
regulation</text>
</subparagraph><after-quoted-block>;</after-quoted-block></quoted-block>
</subparagraph><subparagraph id="id5247A89FAA9D4917A7970AF1E3758F44"><enum>(B)</enum><text>by striking <quote>that
(1) requires</quote> and inserting the following: “that—</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id9B99E3D6D5B042C9B7205E2D3418EE00" reported-display-style="italic" style="OLC">
<clause id="id4DF1B54C65484CBF819DC4552FD898D1"><enum>(i)</enum><text>requires</text>
</clause><after-quoted-block>;
and</after-quoted-block></quoted-block>
</subparagraph><subparagraph id="id291C76F1775049478E6473F7442DC355"><enum>(C)</enum><text>by striking
<quote>market, or (2) governs</quote> and inserting the following: “market;
or</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idA6AB14BB96E84A0A88FACBAAF1EE9C31" reported-display-style="italic" style="OLC">
<clause id="id975E743BA2FF4B948D3AEEDB43175DE1"><enum>(ii)</enum><text>governs</text>
</clause><after-quoted-block>;
and</after-quoted-block></quoted-block>
</subparagraph></paragraph><paragraph id="id25F2939693E94762BAF7764DF91052B9"><enum>(4)</enum><text>by inserting before
paragraph (2) (as designated by paragraph (1)) the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idB2E17136AA4A4AA090B44F8A5F235340" reported-display-style="italic" style="OLC">
<paragraph id="idC2226092E4D14967838351E5C75B1CD6"><enum>(1)</enum><header>Foreign Boards of
trade</header>
<subparagraph id="idDC049851C50940F6B76A91850A8B2949"><enum>(A)</enum><header>In
general</header><text>It shall be unlawful for a foreign board of trade to
provide to the members of the foreign board of trade or other participants
located in the United States direct access to the electronic trading and
order-matching system of the foreign board of trade with respect to an
agreement, contract, or transaction that settles against any price (including
the daily or final settlement price) of 1 or more contracts listed for trading
on a registered entity, unless the Commission determines that—</text>
<clause id="idA6E3830773E043A2A590DCEB2CB1C766"><enum>(i)</enum><text>the foreign board of
trade makes public daily trading information regarding the agreement, contract,
or transaction that is comparable to the daily trading information published by
the registered entity for the 1 or more contracts against which the agreement,
contract, or transaction traded on the foreign board of trade settles;
and</text>
</clause><clause id="id26138586D9634DCCAD726882AE073735"><enum>(ii)</enum><text>the foreign board of
trade (or the foreign futures authority that oversees the foreign board of
trade)—</text>
<subclause id="id22A285A303E449B2BB6410CDA69F1751"><enum>(I)</enum><text>adopts position limits
(including related hedge exemption provisions) for the agreement, contract, or
transaction that are comparable to the position limits (including related hedge
exemption provisions) adopted by the registered entity for the 1 or more
contracts against which the agreement, contract, or transaction traded on the
foreign board of trade settles;</text>
</subclause><subclause id="idE6656D00072943BC81CFD384016228EB"><enum>(II)</enum><text>has the authority to
require or direct market participants to limit, reduce, or liquidate any
position the foreign board of trade (or the foreign futures authority that
oversees the foreign board of trade) determines to be necessary to prevent or
reduce the threat of price manipulation, excessive speculation as described in
section 4a, price distortion, or disruption of delivery or the cash settlement
process;</text>
</subclause><subclause id="idC23DD5B58F974D908EEE4D0D8EBF7DCA"><enum>(III)</enum><text>agrees to promptly
notify the Commission, with regard to the agreement, contract, or transaction
that settles against any price (including the daily or final settlement price)
of 1 or more contracts listed for trading on a registered entity, of any change
regarding—</text>
<item id="id88984842AE3249B997ED460D26D7F8CD"><enum>(aa)</enum><text>the information that the
foreign board of trade will make publicly available;</text>
</item><item id="id81B4364687D64675AB391C103975D871"><enum>(bb)</enum><text>the position limits that
the foreign board of trade or foreign futures authority will adopt and
enforce;</text>
</item><item id="id38DBA1B0212847F191AF843554F271AC"><enum>(cc)</enum><text>the position reductions
required to prevent manipulation, excessive speculation as described in section
4a, price distortion, or disruption of delivery or the cash settlement process;
and</text>
</item><item id="idE1A36DA93252410FB4B9E6DD9D542A0B"><enum>(dd)</enum><text>any other area of
interest expressed by the Commission to the foreign board of trade or foreign
futures authority;</text>
</item></subclause><subclause id="idC24FCE9F80FF443991F6F29ABFEC0201"><enum>(IV)</enum><text>provides information to
the Commission regarding large trader positions in the agreement, contract, or
transaction that is comparable to the large trader position information
collected by the Commission for the 1 or more contracts against which the
agreement, contract, or transaction traded on the foreign board of trade
settles; and</text>
</subclause><subclause id="id7F80BEA6699140F3A9BD91E10BC40758"><enum>(V)</enum><text>provides the Commission
such information as is necessary to publish reports on aggregate trader
positions for the agreement, contract, or transaction traded on the foreign
board of trade that are comparable to such reports on aggregate trader
positions for the 1 or more contracts against which the agreement, contract, or
transaction traded on the foreign board of trade settles.</text>
</subclause></clause></subparagraph><subparagraph id="idE7A1E0FC256545DD8B0C782CECE218CC"><enum>(B)</enum><header>Existing foreign boards
of trade</header><text>Subparagraph (A) shall not be effective with respect to
any foreign board of trade to which, prior to the date of enactment of this
paragraph, the Commission granted direct access permission until the date that
is 180 days after that date of
enactment.</text>
</subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="id25C0D1C19D9E44639F3FA7222E4DF9A2"><enum>(b)</enum><header>Liability of registered
persons trading on a foreign board of trade</header><text>Section 4 of the
Commodity Exchange Act (7 U.S.C. 6) is amended—</text>
<paragraph id="id96704F9FA87D4C62A75B637901B76325"><enum>(1)</enum><text>in subsection (a), in the
matter preceding paragraph (1), by inserting <quote>or by subsection
(e)</quote> after <quote>Unless exempted by the Commission pursuant to
subsection (c)</quote>; and</text>
</paragraph><paragraph commented="no" id="id9525D870418B42229A52EE88521B7E0D"><enum>(2)</enum><text>by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idA40788E2EF2F41369BE4494A1AABAF39" reported-display-style="italic" style="OLC">
<subsection id="idBDE9FB7AB40449489635C7A9DD9CCE10"><enum>(e)</enum><header>Liability of registered
persons trading on a foreign board of trade</header><text>A person registered
with the Commission, or exempt from registration by the Commission, under this
Act may not be found to have violated subsection (a) with respect to a
transaction in, or in connection with, a contract of sale of a commodity for
future delivery if the person has reason to believe that the transaction and
the contract is made on or subject to the rules of a foreign board of trade
that has complied with paragraphs (1) and (2) of subsection
(b).</text>
</subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="id5A9173AFDA4D46538B250D1761339195"><enum>(c)</enum><header>Contract enforcement
for foreign futures contracts</header><text>Section 22(a) of the Commodity
Exchange Act (7 U.S.C. 25(a)) (as amended by section 739) is amended by adding
at the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id5E0D89CB018D4FB4B9E718163C90910C" reported-display-style="italic" style="OLC">
<paragraph id="id24704478CEA34B22968379CFC8C554F8"><enum>(6)</enum><header>Contract enforcement
for foreign futures contracts</header><text>A contract of sale of a commodity
for future delivery traded or executed on or through the facilities of a board
of trade, exchange, or market located outside the United States for purposes of
section 4(a) shall not be void, voidable, or unenforceable, and a party to such
a contract shall not be entitled to rescind or recover any payment made with
respect to the contract, based on the failure of the foreign board of trade to
comply with any provision of this
Act.</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection></section><section id="IDf3cbd500924a45188a7f0226da000edf"><enum>739.</enum><header>Legal certainty for
swaps</header><text display-inline="no-display-inline">Section 22(a) of the
Commodity Exchange Act (7 U.S.C. 25(a)) is amended by striking paragraph (4)
and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idF11DEE2932E24D6AAB8BBD2E7247F8CD" reported-display-style="italic" style="OLC">
<paragraph id="ID29b9e3ce071b47b89986268a8d336fdf"><enum>(4)</enum><header>Contract enforcement
between eligible counterparties</header>
<subparagraph id="ID285eaac353c84b59b664117bc952fca9"><enum>(A)</enum><header>In
general</header><text>No hybrid instrument sold to any investor shall be void,
voidable, or unenforceable, and no party to a hybrid instrument shall be
entitled to rescind, or recover any payment made with respect to, the hybrid
instrument under this section or any other provision of Federal or State law,
based solely on the failure of the hybrid instrument to comply with the terms
or conditions of section 2(f) or regulations of the Commission.</text>
</subparagraph><subparagraph id="ID802315ce796c4fcd8ba3e07d1175a103"><enum>(B)</enum><header>Swaps</header><text>No
agreement, contract, or transaction between eligible contract participants or
persons reasonably believed to be eligible contract participants shall be void,
voidable, or unenforceable, and no party to an agreement, contract, or
transaction shall be entitled to rescind, or recover any payment made with
respect to, the agreement, contract, or transaction under this section or any
other provision of Federal or State law, based solely on the failure of the
agreement, contract, or transaction—</text>
<clause id="id7030923798814A2BB32E8289EA812B02"><enum>(i)</enum><text>to meet the definition of
a swap under section 1a; or</text>
</clause><clause id="id69271433282941079425A497B4385CB5"><enum>(ii)</enum><text>to be cleared in
accordance with section 2(h)(1).</text>
</clause></subparagraph></paragraph><paragraph id="ID4207a3755d7544dcaf79ccbaeed360fe"><enum>(5)</enum><header>Legal certainty for
long-term swaps entered into before the date of enactment of the Wall Street
Transparency and Accountability Act of 2010</header>
<subparagraph id="IDc8e9513ce5e94119b4612bec5507c618"><enum>(A)</enum><header>In
general</header><text>Any swap entered into before the date of enactment of the
<short-title>Wall Street Transparency and Accountability
Act of 2010</short-title>, the terms of which have not expired as of the date
of enactment, shall not be subject to the mandatory clearing requirements under
this Act.</text>
</subparagraph><subparagraph id="ID16d7cfde5a3b45a68f5b4771d4e0650b"><enum>(B)</enum><header>Effect on
swaps</header><text>Unless specifically reserved in the applicable bilateral
trading agreement, neither the enactment of the
<short-title>Wall Street Transparency and Accountability
Act of 2010</short-title>, nor any requirement under that Act or an amendment
made by that Act, shall constitute a termination event, force majeure,
illegality, increased costs, regulatory change, or similar event under a
bilateral trading agreement (including any related credit support arrangement)
that would permit a party to terminate, renegotiate, modify, amend, or
supplement 1 or more transactions under the bilateral trading agreement.</text>
</subparagraph><subparagraph id="id9BF57D95E7F6490AB0D9CAF4048F693B"><enum>(C)</enum><header>Position
limits</header><text>Any position limit established under the Wall Street
Transparency and Accountability Act of 2010 shall not apply to a position
acquired in good faith prior to the effective date of any rule, regulation, or
order under the Act that establishes the position limit; provided, however,
that such positions shall be attributed to the trader if the trader’s position
is increased after the effective date such position limit rule, regulation, or
order.</text>
</subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</section><section id="ID0b1b4488be744faea19fad6588e3641b"><enum>740.</enum><header>Multilateral clearing
organizations</header><text display-inline="no-display-inline">Sections 408 and
409 of the Federal Deposit Insurance Corporation Improvement Act of 1991 (12
U.S.C. 4421, 4422) are repealed.</text>
</section><section id="IDcc165f0b843a4e3fa1d307b94e1aea4e"><enum>741.</enum><header>Enforcement</header>
<subsection id="IDdc9065df67444f58996f3e6f21669165"><enum>(a)</enum><header>Enforcement
authority</header><text>The <act-name parsable-cite="COMEX">Commodity Exchange
Act</act-name> is amended by inserting after section 4b (7 U.S.C. 6b) the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id3C72E5A3275F40B9AF3BE7A6BAA4394A" reported-display-style="italic" style="OLC">
<section id="ID339d236a9eb6495ca128b2051c108394"><enum>4b–1.<?LEXA-Enum 4b–1.?></enum><header>Enforcement authority</header>
<subsection id="ID116d189c7b544ceb9be460572c50b0be"><enum>(a)</enum><header>Commission</header><text>Except
as provided in subsections (b), (c), and (d), the Commission shall have primary
authority to enforce the amendments made by the Wall Street Transparency and
Accountability Act of 2010 with respect to any person.</text>
</subsection><subsection id="ID0f99ce393d924925b4d23c12b59ed8a8"><enum>(b)</enum><header>Appropriate Federal
banking agencies</header><text>The appropriate Federal banking agency for swap
dealers or major swap participants that are depository institutions, as that
term is defined under section 3 of the Federal Deposit Insurance Act (12 U.S.C.
1813), shall have exclusive authority to enforce the provisions of section
4s(e) and other prudential requirements of this Act, with respect to depository
institutions that are swap dealers or major swap participants.</text>
</subsection><subsection id="ID08611a8b1db84606afc52a75738cc092"><enum>(c)</enum><header>Referrals</header>
<paragraph id="IDd08722db7633424fb81d8f85bc0a0803"><enum>(1)</enum><header>Prudential
regulators</header><text>If the prudential regulator for a swap dealer or major
swap participant has cause to believe that the swap dealer or major swap
participant, or any affiliate or division of the swap dealer or major swap
participant, may have engaged in conduct that constitutes a violation of the
nonprudential requirements of this Act (including section 4s or rules adopted
by the Commission under that section), the prudential regulator shall promptly
notify the Commission in a written report that includes—</text>
<subparagraph id="ID9e22b35fd21742a8b0e7d6b52a74fda3"><enum>(A)</enum><text>a request that the
Commission initiate an enforcement proceeding under this Act; and</text>
</subparagraph><subparagraph id="ID2b313a5814994d26a0bd0b4f8925fd5a"><enum>(B)</enum><text>an explanation of the
facts and circumstances that led to the preparation of the written
report.</text>
</subparagraph></paragraph><paragraph id="ID8f7d938a30e9478ab6ebc0d1978992fd"><enum>(2)</enum><header>Commission</header><text>If
the Commission has cause to believe that a swap dealer or major swap
participant that has a prudential regulator may have engaged in conduct that
constitutes a violation of any prudential requirement of section 4s or rules
adopted by the Commission under that section, the Commission may notify the
prudential regulator of the conduct in a written report that includes—</text>
<subparagraph id="ID033b127fbfab4d6383b8cc28cdf7e749"><enum>(A)</enum><text>a request that the
prudential regulator initiate an enforcement proceeding under this Act or any
other Federal law (including regulations); and</text>
</subparagraph><subparagraph id="IDbce19d0fc4d042e0a6d56c98d13238d8"><enum>(B)</enum><text>an explanation of the
concerns of the Commission, and a description of the facts and circumstances,
that led to the preparation of the written report.</text>
</subparagraph></paragraph></subsection><subsection id="IDdc9e3f9702bb4f99b8d24f3ec1a2f617"><enum>(d)</enum><header>Backstop enforcement
authority</header>
<paragraph id="idF67342C6D3264BBC81E8907959354214"><enum>(1)</enum><header>Initiation of
enforcement proceeding by prudential regulator</header><text>If the Commission
does not initiate an enforcement proceeding before the end of the 90-day period
beginning on the date on which the Commission receives a written report under
subsection (c)(1), the prudential regulator may initiate an enforcement
proceeding.</text>
</paragraph><paragraph id="id82AC68AE418640A2A527E6BA61136AA4"><enum>(2)</enum><header>Initiation of
enforcement proceeding by Commission</header><text>If the prudential regulator
does not initiate an enforcement proceeding before the end of the 90-day period
beginning on the date on which the prudential regulator receives a written
report under subsection (c)(2), the Commission may initiate an enforcement
proceeding.</text>
</paragraph></subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="IDbfc791e48f6340bd99dc24a88ac40126"><enum>(b)</enum><header>Conforming
amendments</header>
<paragraph id="ID551ba74c4ddf4e6ebdf451d844dd1f63"><enum>(1)</enum><text>Section 4b of the
Commodity Exchange Act (7 U.S.C. 6b) is amended—</text>
<subparagraph id="ID7eeb34bcd8f1478286fc8923d1e407b5"><enum>(A)</enum><text>in subsection (a)(2), by
striking <quote>or other agreement, contract, or transaction subject to
paragraphs (1) and (2) of section 5a(g),</quote> and inserting <quote>or
swap,</quote>;</text>
</subparagraph><subparagraph id="ID2fa783f3818e419aba7dc3b742ff3b41"><enum>(B)</enum><text>in subsection (b), by
striking <quote>or other agreement, contract or transaction subject to
paragraphs (1) and (2) of section 5a(g),</quote> and inserting <quote>or
swap,</quote>; and</text>
</subparagraph><subparagraph id="IDab958089e8d8421f8a5bbaa3032521b1"><enum>(C)</enum><text>by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idA94E09903F55477598BFCA840BBFC655" reported-display-style="italic" style="OLC">
<subsection id="IDb6f4433a0d5740eea8f79683c8236ef9"><enum>(e)</enum><text>It shall be unlawful for
any person, directly or indirectly, by the use of any means or instrumentality
of interstate commerce, or of the mails, or of any facility of any registered
entity, in or in connection with any order to make, or the making of, any
contract of sale of any commodity for future delivery (or option on such a
contract), or any swap, on a group or index of securities (or any interest
therein or based on the value thereof)—</text>
<paragraph id="ID43a838a0c983427581ce9e25058c0662"><enum>(1)</enum><text>to employ any device,
scheme, or artifice to defraud;</text>
</paragraph><paragraph id="IDa62dfe71451549969b7c25fd9d494e5c"><enum>(2)</enum><text>to make any untrue
statement of a material fact or to omit to state a material fact necessary in
order to make the statements made, in the light of the circumstances under
which they were made, not misleading; or</text>
</paragraph><paragraph id="ID787de3ad27454c6199a55ecde776ba66"><enum>(3)</enum><text>to engage in any act,
practice, or course of business which operates or would operate as a fraud or
deceit upon any
person.</text>
</paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subparagraph></paragraph><paragraph id="IDf775b5ad11ae44deba9140b6e2e4fcc5"><enum>(2)</enum><text>Section 4c(a)(1) of the
Commodity Exchange Act (7 U.S.C. 6c(a)(1)) is amended by inserting <quote>or
swap</quote> before <quote>if the transaction is used or may be
used</quote>.</text>
</paragraph><paragraph id="ID2c733451a0664633a49e22f7eb3baf74"><enum>(3)</enum><text>Section 6(c) of the
Commodity Exchange Act (7 U.S.C. 9) is amended in the first sentence by
inserting <quote>or of any swap,</quote> before <quote>or has willfully
made</quote>.</text>
</paragraph><paragraph id="ID0de57a77453d4b999d2cf4798db3b5cc"><enum>(4)</enum><text>Section 6(d) of the
Commodity Exchange Act (7 U.S.C. 13b) is amended in the first sentence, in the
matter preceding the proviso, by inserting <quote>or of any swap,</quote>
before <quote>or otherwise is violating</quote>.</text>
</paragraph><paragraph id="ID8921ef9076eb4343aabb02ba5e985d62"><enum>(5)</enum><text>Section 6c(a) of the
Commodity Exchange Act (7 U.S.C. 13a–1(a)) is amended in the matter preceding
the proviso by inserting <quote>or any swap</quote> after <quote>commodity for
future delivery</quote>.</text>
</paragraph><paragraph id="ID479ec0cad2c1495b9364809950bfdfe5"><enum>(6)</enum><text>Section 9 of the
Commodity Exchange Act (7 U.S.C. 13) is amended—</text>
<subparagraph id="ID1a054ce3aee8463fbacb55a71b1b99e4"><enum>(A)</enum><text>in subsection (a)—</text>
<clause id="IDbdd1351cc845484bb2c4fbc6bf5b2fbb"><enum>(i)</enum><text>in paragraph (2), by
inserting <quote>or of any swap,</quote> before <quote>or to corner</quote>;
and</text>
</clause><clause id="IDc286d2e244084944a2bbecdb937b8b17"><enum>(ii)</enum><text>in paragraph (4), by
inserting <quote>swap data repository,</quote> before <quote>or futures
association</quote> and</text>
</clause></subparagraph><subparagraph id="ID9ec7c566c2dd4c5fbd9acc50ce085069"><enum>(B)</enum><text>in subsection
(e)(1)—</text>
<clause id="IDa5e2906aede04066bb746c5659a573ef"><enum>(i)</enum><text>by inserting <quote>swap
data repository,</quote> before <quote>or registered futures
association</quote>; and</text>
</clause><clause id="ID32fab90734e84e969bd75e32378f0c7f"><enum>(ii)</enum><text>by inserting <quote>, or
swaps,</quote> before <quote>on the basis</quote>.</text>
</clause></subparagraph></paragraph><paragraph id="IDf309325c7cfc48389b24124fdc38d728"><enum>(7)</enum><text>Section 9(a) of the
Commodity Exchange Act (7 U.S.C. 13(a)) is amended by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id031B0781ED2E4D6BB04F31B0AAE7D58C" reported-display-style="italic" style="OLC">
<paragraph id="ID0eae44156348455f8e0882d2dec138eb"><enum>(6)</enum><text>Any person to abuse the
end user clearing exemption under section 2(h)(4), as determined by the
Commission.</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph><paragraph id="IDcd9a3a78e5ab42c0bde2268ae9a8d3d9"><enum>(8)</enum><text>Section 8(b) of the
Federal Deposit Insurance Act (12 U.S.C. 1818(b)) is amended by adding at the
end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id4D4467AD4E7E4B8287935A7C50E7EC2D" reported-display-style="italic" style="OLC">
<paragraph id="ID315726ba8a5441ed8694461fba119631"><enum>(11)</enum><header>Swaps</header>
<subparagraph id="id4F1809BFE61247AFA7E57C6E09074BE9"><enum>(A)</enum><header>In
general</header><text>Subject to subparagraph (B), this section shall apply to
any swap dealer, major swap participant, security-based swap dealer, major
security-based swap participant, derivatives clearing organization, swap data
repository, or swap execution facility, regardless of whether the dealer,
participant, organization, repository, or facility is an insured depository
institution, for which the Board, the Corporation, or the Office of the
Comptroller of the Currency is the appropriate Federal banking agency or
prudential regulator for purposes of the amendments made by the Wall Street
Transparency and Accountability Act of 2010.</text>
</subparagraph><subparagraph id="idFF8BD470B94F413ABFB4C33EF45EB4F2"><enum>(B)</enum><header>Limitation</header><text>The
authority described in subparagraph (A) shall be limited by, and exercised in
accordance with, section 4b–1 of the Commodity Exchange
Act.</text>
</subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph><paragraph id="IDeb771e78e77245abb69eecb99b96d5d0"><enum>(9)</enum><text>Section 2(c)(2)(B) of the
Commodity Exchange Act (7 U.S.C. 2(c)(2)(B)) is amended—</text>
<subparagraph id="id194AC2B6E016404B89AE5CF73F05754E"><enum>(A)</enum><text>by striking
<quote>(dd),</quote> each place it appears;</text>
</subparagraph><subparagraph id="idB7CD829D41D042158D6960ED6442F8E6"><enum>(B)</enum><text>in clause (iii), by
inserting <quote>, and accounts or pooled investment vehicles described in
clause (vi),</quote> before <quote>shall be subject to</quote>; and</text>
</subparagraph><subparagraph id="idBBEDA8C9ED22426080FDF294DB1FC51F"><enum>(C)</enum><text>by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idB097AB14BF374C4D9A3C48F0CE7C4019" reported-display-style="italic" style="OLC">
<clause id="ID51232a09dbda4c59aa980d995f97c846"><enum>(vi)</enum><text>This Act applies to, and
the Commission shall have jurisdiction over, an account or pooled investment
vehicle that is offered for the purpose of trading, or that trades, any
agreement, contract, or transaction in foreign currency described in clause
(i).</text>
</clause><after-quoted-block>.</after-quoted-block></quoted-block>
</subparagraph></paragraph><paragraph id="ID024f7f000c714661a7896803803c82b5"><enum>(10)</enum><text>Section 2(c)(2)(C) of
the Commodity Exchange Act (7 U.S.C. 2(c)(2)(C)) is amended—</text>
<subparagraph id="idBA079DB16FBD4BECA256C52CDCFCA272"><enum>(A)</enum><text>by striking
<quote>(dd),</quote> each place it appears;</text>
</subparagraph><subparagraph id="id55AE1FFD24EA4CE195EDB7171D5C40F4"><enum>(B)</enum><text>in clause (ii)(I), by
inserting <quote>, and accounts or pooled investment vehicles described in
clause (vii),</quote> before <quote>shall be subject to</quote>; and</text>
</subparagraph><subparagraph id="id1AE7C64C5CDA400683BC97B556CB3C32"><enum>(C)</enum><text>by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idE9D11B7F18014620B1E77A3698688910" reported-display-style="italic" style="OLC">
<clause id="ID0fdc7af3500745a0b4074ecfde3b272e"><enum>(vii)</enum><text>This Act applies to,
and the Commission shall have jurisdiction over, an account or pooled
investment vehicle that is offered for the purpose of trading, or that trades,
any agreement, contract, or transaction in foreign currency described in clause
(i).</text>
</clause><after-quoted-block>.</after-quoted-block></quoted-block>
</subparagraph></paragraph><paragraph id="IDfeb7bc7749b540febcc2eea699a87748"><enum>(11)</enum><text>Section
1a(19)(A)(iv)(II) of the Commodity Exchange Act (7 U.S.C. 1a(19)(A)(iv)(II))
(as redesignated by section 721(a)(1)) is amended by inserting before the
semicolon at the end the following: <quote>provided, however, that for purposes
of section 2(c)(2)(B)(vi) and section 2(c)(2)(C)(vii), the term <term>eligible
contract participant</term> shall not include a commodity pool in which any
participant is not otherwise an eligible contract participant</quote>.</text>
</paragraph></subsection></section><section id="idE63697F6644F42DBB70D0F6F820937BE"><enum>742.</enum><header>Retail commodity
transactions</header>
<subsection id="idCF4A3B9E546642E5BFBE85DDA0DEAA21"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">Section 2(c) of the
Commodity Exchange Act (7 U.S.C. 2(c)) is amended—</text>
<paragraph id="id38502D7FAABC400890D99F1EEC169215"><enum>(1)</enum><text>in paragraph (1), by
striking <quote>(to the extent provided in section 5a(g)), 5b, 5d, or
12(e)(2)(B))</quote> and inserting <quote>, 5b, or 12(e)(2)(B))</quote>;
and</text>
</paragraph><paragraph id="id1BD1935F7D834E759F994E2B1FA301E0"><enum>(2)</enum><text>in paragraph (2), by
adding at the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id064D8218C6FF45CA9F283BC100604888" reported-display-style="italic" style="OLC">
<subparagraph id="id7DACACA4455D4E64B0B86B042B66DC72"><enum>(D)</enum><header>Retail commodity
transactions</header>
<clause id="id9A55BE03C24B4A30808A03A8DEC8DD4A"><enum>(i)</enum><header>Applicability</header><text>Except
as provided in clause (ii), this subparagraph shall apply to any agreement,
contract, or transaction in any commodity that is—</text>
<subclause id="idE8FCB17F8C0840FBB69D2C132B95E222"><enum>(I)</enum><text>entered into with, or
offered to (even if not entered into with), a person that is not an eligible
contract participant or eligible commercial entity; and</text>
</subclause><subclause id="idCC97EA0FB00D44528BE776BC0FAA1C8C"><enum>(II)</enum><text>entered into, or offered
(even if not entered into), on a leveraged or margined basis, or financed by
the offeror, the counterparty, or a person acting in concert with the offeror
or counterparty on a similar basis.</text>
</subclause></clause><clause id="idA4715D64B2A84E17AF4AD88560B3CC2F"><enum>(ii)</enum><header>Exceptions</header><text>This
subparagraph shall not apply to—</text>
<subclause id="id9096702E894A4BB8A5C3D71E2F9380F4"><enum>(I)</enum><text>an agreement, contract,
or transaction described in paragraph (1) or subparagraphs (A), (B), or (C),
including any agreement, contract, or transaction specifically excluded from
subparagraph (A), (B), or (C);</text>
</subclause><subclause id="id983B66E212A542279E0CBA124CC3124A"><enum>(II)</enum><text>any security;</text>
</subclause><subclause id="idFE2156261C3E46FBB7FD5631AAF498BC"><enum>(III)</enum><text>a contract of sale
that—</text>
<item id="idFFEB3C77A21F4AA88520FE5D6AB6E8E7"><enum>(aa)</enum><text>results in actual
delivery within 28 days or such other period as the Commission may determine by
rule or regulation based upon the typical commercial practice in cash or spot
markets for the commodity involved; or</text>
</item><item id="idDC8291FE642A42F8B90A171AEFE2B731"><enum>(bb)</enum><text>creates an enforceable
obligation to deliver between a seller and a buyer that have the ability to
deliver and accept delivery, respectively, in connection with the line of
business of the seller and buyer; or</text>
</item></subclause><subclause id="id0E5DBA59727D4D18A3F4F84E81BD34EF"><enum>(IV)</enum><text>an agreement, contract,
or transaction that is listed on a national securities exchange registered
under section 6(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78f(a));
or</text>
</subclause><subclause id="IDc3573133f9b94f7abb15dc33409e90f7"><enum>(V)</enum><text>an identified banking
product, as defined in section 402(b) of the Legal Certainty for Bank Products
Act of 2000 (7 U.S.C.27(b)).</text>
</subclause></clause><clause id="idC2F1C51C9E8446CB85529E02A1B63045"><enum>(iii)</enum><header>Enforcement</header><text>Sections
4(a), 4(b), and 4b apply to any agreement, contract, or transaction described
in clause (i), as if the agreement, contract, or transaction was a contract of
sale of a commodity for future delivery.</text>
</clause><clause commented="no" display-inline="no-display-inline" id="id2F06C5D3A3934AE6BEDCEA2C304133C4"><enum>(iv)</enum><header>Eligible commercial
entity</header><text display-inline="yes-display-inline">For purposes of this
subparagraph, an agricultural producer, packer, or handler shall be considered
to be an eligible commercial entity for any agreement, contract, or transaction
for a commodity in connection with the line of business of the agricultural
producer, packer, or handler.</text>
</clause><clause id="id674232EB2972451E9782A53891AA6813"><enum>(v)</enum><header>Actual
delivery</header><text>For purposes of clause (ii)(III), the term <term>actual
delivery</term> does not include delivery to a third party in a financed
transaction in which the commodity is held as
collateral.</text>
</clause></subparagraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="IDaaf6f50bf58942cbb15f3b4b4fda2e2a"><enum>(b)</enum><header>Gramm-Leach-Bliley
Act</header><text>Section 206(a) of the Gramm-Leach-Bliley Act (Public Law
106–102; 15 U.S.C. 78c note) is amended, in the matter preceding paragraph (1),
by striking <quote>For purposes of</quote> and inserting <quote>Except as
provided in subsection (e), for purposes of</quote>.</text>
</subsection><subsection id="IDbdde78c359364b48a8a52ab1a2f3a43c"><enum>(c)</enum><header>Conforming amendments
relating to retail foreign exchange transactions</header>
<paragraph id="ID4a5dcc6953834285a2aa5fdf035cb96d"><enum>(1)</enum><text>Section 2(c)(2)(B)(i)(II)
of the Commodity Exchange Act (7 U.S.C. 2(c)(2)(B)(i)(II)) is amended—</text>
<subparagraph id="id708A24E7E98140A6844AD26EF58E1EB6"><enum>(A)</enum><text>in item (aa), by
inserting <quote>United States</quote> before <quote>financial
institution</quote>;</text>
</subparagraph><subparagraph id="id25F7EBECA149481591936A389BE5BB18"><enum>(B)</enum><text>by striking items (dd)
and (ff);</text>
</subparagraph><subparagraph id="id3E954846BF3541CCA71D178D73083CBA"><enum>(C)</enum><text>by redesignating items
(ee) and (gg) as items (dd) and (ff), respectively; and</text>
</subparagraph><subparagraph id="idE50363D0C6A146E6AAD175CF2844FE65"><enum>(D)</enum><text>in item (dd) (as so
redesignated), by striking the semicolon and inserting <quote>;
or</quote>.</text>
</subparagraph></paragraph><paragraph id="ID884163e758664150b903f531a81bb6cc"><enum>(2)</enum><text>Section 2(c)(2) of the
Commodity Exchange Act (7 U.S.C. 2(c)(2)) (as amended by subsection (a)(2)) is
amended by adding at the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idC95189DF84FE40D89BC42E5832CB64D6" reported-display-style="italic" style="OLC">
<subparagraph id="IDc0b2d96e36df42f7939d9430af56b5d6"><enum>(E)</enum><header>Prohibition</header>
<clause id="IDf396bbc9206e466e93f8a0abae2af1f9"><enum>(i)</enum><header>Definition of Federal
regulatory agency</header><text>In this subparagraph, the term <term>Federal
regulatory agency</term> means—</text>
<subclause id="ID30a6a574e06d414ca46bf9716d120d91"><enum>(I)</enum><text>the Commission;</text>
</subclause><subclause id="ID27f65ec273b24d9aa7d5e544d850afd7"><enum>(II)</enum><text>the Securities and
Exchange Commission;</text>
</subclause><subclause id="IDf90e8b2d71a141fa909b42d7f37dc2f4"><enum>(III)</enum><text>an appropriate Federal
banking agency;</text>
</subclause><subclause id="ID178ae9dfbf314881887864324c42cfba"><enum>(IV)</enum><text>the National Credit
Union Association; and</text>
</subclause><subclause id="ID63d188da675f4aca917145f55d4c3e25"><enum>(V)</enum><text>the Farm Credit
Administration.</text>
</subclause></clause><clause id="id7CEED7BE81504851875CF7F8FFA20DEC"><enum>(ii)</enum><header>Prohibition</header><text>A
person described in subparagraph (B)(i)(II) for which there is a Federal
regulatory agency shall not offer to, or enter into with, a person that is not
an eligible contract participant, any agreement, contract, or transaction in
foreign currency described in subparagraph (B)(i)(I) except pursuant to a rule
or regulation of a Federal regulatory agency allowing the agreement, contract,
or transaction under such terms and conditions as the Federal regulatory agency
shall prescribe.</text>
</clause><clause id="ID46404cb302874f6a9d6849a0c1c88780"><enum>(iii)</enum><header>Requirements of rules
and regulations</header>
<subclause id="idE59CA13CC9CD429BA0DF3E84EDDF9447"><enum>(I)</enum><header>In
general</header><text>The rules and regulations described in clause (ii) shall
prescribe appropriate requirements with respect to—</text>
<item id="ID3f7602bc649b4f479c21bac909c1e81b"><enum>(aa)</enum><text>disclosure;</text>
</item><item id="ID98ccc67f0e93409f88372b328e024d2f"><enum>(bb)</enum><text>recordkeeping;</text>
</item><item id="ID0b4de3e95adf4167afeb96e8a41835e7"><enum>(cc)</enum><text>capital and
margin;</text>
</item><item id="IDf2480857db31472b83c4a6644f588df8"><enum>(dd)</enum><text>reporting;</text>
</item><item id="IDfe9dffd105ff46ea81a19879f96a20eb"><enum>(ee)</enum><text>business conduct;</text>
</item><item id="ID333a3e6030d44fcc8f3d36475a6c0483"><enum>(ff)</enum><text>documentation;
and</text>
</item><item id="IDa87e809e73a648808d069c455e9d9b94"><enum>(gg)</enum><text>such other standards or
requirements as the Federal regulatory agency shall determine to be
necessary.</text>
</item></subclause><subclause id="ID196c256ef73c4b519fea9ce0b1ece95f"><enum>(II)</enum><header>Treatment</header><text>The
rules or regulations described in clause (ii) shall treat all agreements,
contracts, and transactions in foreign currency described in subparagraph
(B)(i)(I), and all agreements, contracts, and transactions in foreign currency
that are functionally or economically similar to agreements, contracts, or
transactions described in subparagraph (B)(i)(I),
similarly.</text>
</subclause></clause></subparagraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection></section><section id="IDb09ae8afc45e44a3a5d214ede878ef17"><enum>743.</enum><header>Other
authority</header><text display-inline="no-display-inline">Unless otherwise
provided by the amendments made by this subtitle, the amendments made by this
subtitle do not divest any appropriate Federal banking agency, the Commodity
Futures Trading Commission, the Securities and Exchange Commission, or other
Federal or State agency of any authority derived from any other applicable
law.</text>
</section><section id="id7FA8AD7A69DA4372B274F434B46CFF4D"><enum>744.</enum><header>Restitution
remedies</header><text display-inline="no-display-inline">Section 6c(d) of the
Commodity Exchange Act (7 U.S.C. 13a–1(d)) is amended by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id1793A4B2DFD54CEF97FED5344B6A1CEC" reported-display-style="italic" style="OLC">
<paragraph id="idBCD7013945724D7786FDE251821246A9"><enum>(3)</enum><header>Equitable
remedies</header><text>In any action brought under this section, the Commission
may seek, and the court shall have jurisdiction to impose, on a proper showing,
on any person found in the action to have committed any violation, equitable
remedies including—</text>
<subparagraph id="id5321F39CC18346AC96D3577B629D6C2A"><enum>(A)</enum><text>restitution to persons
who have sustained losses proximately caused by such violation (in the amount
of such losses); and</text>
</subparagraph><subparagraph id="id23892080F32E49ED98AFD86174928A64"><enum>(B)</enum><text>disgorgement of gains
received in connection with such
violation.</text>
</subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</section><section id="ID3e121d2098f14413b1c17bd28f73d41d"><enum>745.</enum><header>Enhanced compliance by
registered entities</header>
<subsection id="id4A857A164FA94318A827BF3189984390"><enum>(a)</enum><header>Core principles for
contract markets</header><text display-inline="yes-display-inline">Section 5(d)
of the Commodity Exchange Act (7 U.S.C. 7(d)) (as amended by section 735(b)) is
amended by striking paragraph (1) and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idD6C8386D5D954884AAB727020EDC39FB" reported-display-style="italic" style="OLC">
<paragraph id="ID71a427419fad4dd1a2886f115402b3fb"><enum>(1)</enum><header>Designation</header>
<subparagraph id="id5801EF5DA7814BCBA5284FC00BAE561F"><enum>(A)</enum><header>In
general</header><text>To be designated as, and to maintain the designation of,
a board of trade as a contract market, the board of trade shall comply
with—</text>
<clause id="id758831B04C14471689F8BF16705C62DB"><enum>(i)</enum><text>the core principles
described in this subsection; and</text>
</clause><clause id="id1FFF0D779C114F81BD41EF0ABD6D703E"><enum>(ii)</enum><text>any requirement that the
Commission may impose by rule or regulation pursuant to section 8a(5).</text>
</clause></subparagraph><subparagraph id="id77CFB8E6BF284317B4EE44F93F093198"><enum>(B)</enum><header>Discretion of board of
trade</header><text>Unless the Commission determines otherwise by rule or
regulation, the board of trade shall have reasonable discretion in establishing
the manner by which the board of trade complies with each core
principle.</text>
</subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="IDddbc8b0f7dbd4bac8cda83d0b151b0ed"><enum>(b)</enum><header>Core
principles</header><text>Section 5b(c)(2) of the Commodity Exchange Act (7
U.S.C. 7a–1(c)(2)) (as amended by section 725(c)) is amended by striking
subparagraph (A) and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id0B4544C445F341E8BDA9CA28EBA16CF1" reported-display-style="italic" style="OLC">
<subparagraph id="ID466c42a21aab478289d75ec070085c68"><enum>(A)</enum><header>Registration</header>
<clause id="idFFDCA6A35DCF48CD899A27A52812266A"><enum>(i)</enum><header>In
general</header><text>To be registered and to maintain registration as a
derivatives clearing organization, a derivatives clearing organization shall
comply with—</text>
<subclause id="idB4DF3F3E022D42F3A2C00CCAD11CB4BE"><enum>(I)</enum><text>the core principles
described in this paragraph; and</text>
</subclause><subclause id="idB1684F70557249CA9368499275D2D9CF"><enum>(II)</enum><text>any requirement that the
Commission may impose by rule or regulation pursuant to section 8a(5).</text>
</subclause></clause><clause id="id33081EAA763F4103BD9C470F8C40C8FD"><enum>(ii)</enum><header>Discretion of
Commission</header><text>Unless the Commission determines otherwise by rule or
regulation, a derivatives clearing organization shall have reasonable
discretion in establishing the manner by which the derivatives clearing
organization complies with each core
principle.</text>
</clause></subparagraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="ID0fa04f5f9e70445fba349993a4f5f9f7"><enum>(c)</enum><header>Effect of
interpretation</header><text>Section 5c(a) of the Commodity Exchange Act (7
U.S.C. 7a–2(a)) is amended by striking paragraph (2) and inserting the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idA6FFEADEFB5642419664FAFAAD6B7714" reported-display-style="italic" style="OLC">
<paragraph id="ID50b3823777c341d1a6991480384a3fe7"><enum>(2)</enum><header>Effect of
interpretation</header><text>An interpretation issued under paragraph (1) may
provide the exclusive means for complying with each section described in
paragraph
(1).</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection commented="no" id="IDdc99ecd725274552be21c295e41e63a1"><enum>(d)</enum><header>New contracts, new
rules, and rule amendments</header>
<paragraph commented="no" id="ID68330e640d084926bd6d4940c2b24833"><enum>(1)</enum><header>In
general</header><text>A registered entity may elect to list for trading or
accept for clearing any new contract, or other instrument, or may elect to
approve and implement any new rule or rule amendment, by providing to the
Commission (and the Secretary of the Treasury, in the case of a contract of
sale of a government security for future delivery (or option on such a
contract) or a rule or rule amendment specifically related to such a contract)
a written certification that the new contract or instrument or clearing of the
new contract or instrument, new rule, or rule amendment complies with this Act
(including regulations under this Act).</text>
</paragraph><paragraph commented="no" id="idA40BB77D53454DC390B0C7114634A04C"><enum>(2)</enum><header>Rule
review</header><text>The new rule or rule amendment described in paragraph (1)
shall become effective, pursuant to the certification of the registered entity,
on the date that is 10 business days after the date on which the Commission
receives the certification (or such shorter period as determined by the
Commission by rule or regulation) unless the Commission notifies the registered
entity within such time that it is staying the certification because there
exist novel or complex issues that require additional time to analyze, an
inadequate explanation by the submitting registered entity, or a potential
inconsistency with this Act (including regulations under this Act).</text>
</paragraph><paragraph commented="no" id="ID08d09a5bfc204c60a7c9a0b741c8a383"><enum>(3)</enum><header>Stay of certification
for rules</header>
<subparagraph commented="no" id="id84757F65317A45A08702DF22AFB62883"><enum>(A)</enum><text>A notification by the
Commission pursuant to paragraph (2) shall stay the certification of the new
rule or rule amendment for up to an additional 90 days from the date of the
notification.</text>
</subparagraph><subparagraph commented="no" id="idB4CF379FFA99401BAC952221EA3497A6"><enum>(B)</enum><text>A rule or rule amendment
subject to a stay pursuant to subparagraph (A) shall become effective, pursuant
to the certification of the registered entity, at the expiration of the period
described in subparagraph (A) unless the Commission—</text>
<clause commented="no" id="idD40FC147337F48A788C353838BBF052B"><enum>(i)</enum><text>withdraws the stay prior
to that time; or</text>
</clause><clause commented="no" id="id1B4E199C70574901B6878CE7B94F619F"><enum>(ii)</enum><text>notifies the registered
entity during such period that it objects to the proposed certification on the
grounds that it is inconsistent with this Act (including regulations under this
Act).</text>
</clause></subparagraph></paragraph><paragraph commented="no" id="ID03d19e8aaf01404593b338ac86baf18c"><enum>(4)</enum><header>Prior approval</header>
<subparagraph commented="no" id="ID74f9f59a87b64cee891e6eb66e504baf"><enum>(A)</enum><header>In
general</header><text>A registered entity may request that the Commission grant
prior approval to any new contract or other instrument, new rule, or rule
amendment.</text>
</subparagraph><subparagraph commented="no" id="ID7dd2cfb72768455cbbd7ca7cbc18cbf9"><enum>(B)</enum><header>Prior approval
required</header><text>Notwithstanding any other provision of this section, a
designated contract market shall submit to the Commission for prior approval
each rule amendment that materially changes the terms and conditions, as
determined by the Commission, in any contract of sale for future delivery of a
commodity specifically enumerated in section 1a(10) (or any option thereon)
traded through its facilities if the rule amendment applies to contracts and
delivery months which have already been listed for trading and have open
interest.</text>
</subparagraph><subparagraph commented="no" id="ID3f0ccca059a74e82a8fd87d71e546173"><enum>(C)</enum><header>Deadline</header><text>If
prior approval is requested under subparagraph (A), the Commission shall take
final action on the request not later than 90 days after submission of the
request, unless the person submitting the request agrees to an extension of the
time limitation established under this subparagraph.</text>
</subparagraph></paragraph><paragraph commented="no" id="ID3d148e18a7c34b15bbed37d1fcd1f589"><enum>(5)</enum><header>Approval</header>
<subparagraph commented="no" id="ID6fd48bd8b41c4c4898dc94fbc4643d14"><enum>(A)</enum><header>Rules</header><text>The
Commission shall approve a new rule, or rule amendment, of a registered entity
unless the Commission finds that the new rule, or rule amendment, is
inconsistent with this subtitle (including regulations).</text>
</subparagraph><subparagraph commented="no" id="ID7921e368bc334dcea78f6170b3fff152"><enum>(B)</enum><header>Contracts and
instruments</header><text>The Commission shall approve a new contract or other
instrument unless the Commission finds that the new contract or other
instrument would violate this subtitle (including regulations).</text>
</subparagraph><subparagraph commented="no" id="IDbd23d8763e23449a8a36f4066844f211"><enum>(C)</enum><header>Special rule for review
and approval of event contracts and swaps contracts</header>
<clause commented="no" id="IDb566a47361b0413fab91f5aec99de68d"><enum>(i)</enum><header>Event
contracts</header><text>In connection with the listing of agreements,
contracts, transactions, or swaps in excluded commodities that are based upon
the occurrence, extent of an occurrence, or contingency (other than a change in
the price, rate, value, or levels of a commodity described in section
1a(2)(i)), by a designated contract market or swap execution facility, the
Commission may determine that such agreements, contracts, or transactions are
contrary to the public interest if the agreements, contracts, or transactions
involve—</text>
<subclause commented="no" id="id76C4037493DA416D991D951C1A3E67C3"><enum>(I)</enum><text>activity that is unlawful
under any Federal or State law;</text>
</subclause><subclause commented="no" id="id0CCD1F6889394CADB2FB746ACE8E873D"><enum>(II)</enum><text>terrorism;</text>
</subclause><subclause commented="no" id="id9593F2A2ED7E46C8A2645541BC427C49"><enum>(III)</enum><text>assassination;</text>
</subclause><subclause commented="no" id="id8D886345FBBC44FFAD6390D4150321D8"><enum>(IV)</enum><text>war;</text>
</subclause><subclause commented="no" id="id9DD17461D981467294FA1501F5D37774"><enum>(V)</enum><text>gaming; or</text>
</subclause><subclause commented="no" id="id0CB5811845AC4BF6A5FE1A8C6457BDCA"><enum>(VI)</enum><text>other similar activity
determined by the Commission, by rule or regulation, to be contrary to the
public interest.</text>
</subclause></clause><clause commented="no" id="id3FBB8ACE249B46448F24723E953E5A17"><enum>(ii)</enum><header>Prohibition</header><text>No
agreement, contract, or transaction determined by the Commission to be contrary
to the public interest under clause (i) may be listed or made available for
clearing or trading on or through a registered entity.</text>
</clause><clause commented="no" id="ID69790f9629204e17841e23c66baa1106"><enum>(iii)</enum><header>Swaps
contracts</header>
<subclause commented="no" id="idBE95CE957BFC42778E2C4B4C7AC3C1C7"><enum>(I)</enum><header>In
general</header><text>In connection with the listing of a swap for clearing by
a derivatives clearing organization, the Commission shall determine, upon
request or on its own motion, the initial eligibility, or the continuing
qualification, of a derivatives clearing organization to clear such a swap
under those criteria, conditions, or rules that the Commission, in its
discretion, determines.</text>
</subclause><subclause id="ID06cceb8c51014ab9af3d28511cb091ee"><enum>(II)</enum><header>Requirements</header><text>Any
such criteria, conditions, or rules shall consider—</text>
<item id="ID22a742d43bf843baacf9f5e331f321ca"><enum>(aa)</enum><text>the financial integrity
of the derivatives clearing organization; and</text>
</item><item id="ID181eb562f53a454c89a71c39ec02a8af"><enum>(bb)</enum><text>any other factors which
the Commission determines may be appropriate.</text>
</item></subclause></clause><clause commented="no" id="IDfe3d1980671840738e50711ac5909779"><enum>(iv)</enum><header>Deadline</header><text>The
Commission shall take final action under clauses (i) and (ii) in not later than
90 days from the commencement of its review unless the party seeking to offer
the contract or swap agrees to an extension of this time limitation.</text>
</clause></subparagraph></paragraph></subsection><subsection id="IDf5dc1924ae444312bbd1a9878c96de6b"><enum>(e)</enum><header>Violation of core
principles</header><text>Section 5c of the Commodity Exchange Act (7 U.S.C.
7a–2) is amended by striking subsection (d).</text>
</subsection></section><section id="IDe3a7e9ab145b407abd7e01978e77aac0"><enum>746.</enum><header>Insider
trading</header><text display-inline="no-display-inline">Section 4c(a) of the
Commodity Exchange Act (7 U.S.C. 6c(a)) is amended by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id476B1B5BCD2F44F391BCFCEF213352C0" reported-display-style="italic" style="OLC">
<paragraph id="ID53a8d747fd0844d0b0ed59a3f30fd20e"><enum>(3)</enum><header>Contract of
sale</header><text>It shall be unlawful for any employee or agent of any
department or agency of the Federal Government who, by virtue of the employment
or position of the employee or agent, acquires information that may affect or
tend to affect the price of any commodity in interstate commerce, or for future
delivery, or any swap, and which information has not been disseminated by the
department or agency of the Federal Government holding or creating the
information in a manner which makes it generally available to the trading
public, or disclosed in a criminal, civil, or administrative hearing, or in a
congressional, administrative, or Government Accountability Office report,
hearing, audit, or investigation, to use the information in his personal
capacity and for personal gain to enter into, or offer to enter into—</text>
<subparagraph id="IDcc493354062a4b83ae6204472e80b31b"><enum>(A)</enum><text>a contract of sale of a
commodity for future delivery (or option on such a contract);</text>
</subparagraph><subparagraph id="ID0a9174f13daf484e9ce31f98738c2965"><enum>(B)</enum><text>an option (other than an
option executed or traded on a national securities exchange registered pursuant
to section 6(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78f(a));
or</text>
</subparagraph><subparagraph id="IDe3637b7397324be0a5ddce46b7a3d33a"><enum>(C)</enum><text>a swap.</text>
</subparagraph></paragraph><paragraph id="IDc49c944c3210493eaa662d9082f624e5"><enum>(4)</enum><header>Nonpublic
information</header>
<subparagraph id="IDf2bd2a2a5a934d728edb0928d0190cca"><enum>(A)</enum><header>Imparting of nonpublic
information</header><text>It shall be unlawful for any employee or agent of any
department or agency of the Federal Government who, by virtue of the employment
or position of the employee or agent, acquires information that may affect or
tend to affect the price of any commodity in interstate commerce, or for future
delivery, or any swap, and which information has not been disseminated by the
department or agency of the Federal Government holding or creating the
information in a manner which makes it generally available to the trading
public, or disclosed in a criminal, civil, or administrative hearing, or in a
congressional, administrative, or Government Accountability Office report,
hearing, audit, or investigation, to impart the information in his personal
capacity and for personal gain with intent to assist another person, directly
or indirectly, to use the information to enter into, or offer to enter
into—</text>
<clause id="ID19f750c9ea2e4ccfb7802c02ae8d1a76"><enum>(i)</enum><text>a contract of sale of a
commodity for future delivery (or option on such a contract);</text>
</clause><clause id="ID2e149eded64b478786e19b937e4c19bc"><enum>(ii)</enum><text>an option (other than an
option executed or traded on a national securities exchange registered pursuant
to section 6(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78f(a));
or</text>
</clause><clause id="ID66abb098d1bc417ea1d67736eef98d44"><enum>(iii)</enum><text>a swap.</text>
</clause></subparagraph><subparagraph id="id98A788CC9B1643C7B399B6864B60056F"><enum>(B)</enum><header>Knowing
use</header><text>It shall be unlawful for any person who receives information
imparted by any employee or agent of any department or agency of the Federal
Government as described in subparagraph (A) to knowingly use such information
to enter into, or offer to enter into—</text>
<clause id="idA950CDF1693549429A0E91CE1183BE48"><enum>(i)</enum><text>a contract of sale of a
commodity for future delivery (or option on such a contract);</text>
</clause><clause id="id553C1929ED254B109AB96EE4A9EAE2AE"><enum>(ii)</enum><text>an option (other than an
option executed or traded on a national securities exchange registered pursuant
to section 6(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78f(a));
or</text>
</clause><clause id="idF3BD6BA4B32342AC83063D252CD04A9C"><enum>(iii)</enum><text>a swap.</text>
</clause></subparagraph><subparagraph id="ID689a16ab1b9f4a499adfc0338dae6fa7"><enum>(C)</enum><header>Theft of nonpublic
information</header><text>It shall be unlawful for any person to steal,
convert, or misappropriate, by any means whatsoever, information held or
created by any department or agency of the Federal Government that may affect
or tend to affect the price of any commodity in interstate commerce, or for
future delivery, or any swap, where such person knows, or acts in reckless
disregard of the fact, that such information has not been disseminated by the
department or agency of the Federal Government holding or creating the
information in a manner which makes it generally available to the trading
public, or disclosed in a criminal, civil, or administrative hearing, or in a
congressional, administrative, or Government Accountability Office report,
hearing, audit, or investigation, and to use such information, or to impart
such information with the intent to assist another person, directly or
indirectly, to use such information to enter into, or offer to enter
into—</text>
<clause id="IDa08b27f772be485fae9e8731f3003a3a"><enum>(i)</enum><text>a contract of sale of a
commodity for future delivery (or option on such a contract);</text>
</clause><clause id="ID63e40cd50a124499b1aa4a4a476577c3"><enum>(ii)</enum><text>an option (other than an
option executed or traded on a national securities exchange registered pursuant
to section 6(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78f(a));
or</text>
</clause><clause id="IDb24b7573644b4d9180ebb8519f88dad5"><enum>(iii)</enum><text>a swap.</text>
<continuation-text continuation-text-level="clause"><italic>Provided</italic>, however, that
nothing in this subparagraph shall preclude a person that has provided
information concerning, or generated by, the person, its operations or
activities, to any employee or agent of any department or agency of the Federal
Government, voluntarily or as required by law, from using such information to
enter into, or offer to enter into, a contract of sale, option, or swap
described in clauses (i), (ii), or
(iii).</continuation-text></clause></subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</section><section id="idDAB6DE83DCA141779805D3035BB6BCF6"><enum>747.</enum><header>Antidisruptive
practices authority</header><text display-inline="no-display-inline">Section
4c(a) of the Commodity Exchange Act (7 U.S.C. 6c(a)) (as amended by section
746) is amended by adding at the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id6AF88946332D4452893DF0811B90F428" reported-display-style="italic" style="OLC">
<paragraph id="IDa52b4477917348f6ab2035e30c4d365b"><enum>(5)</enum><header>Disruptive
practices</header><text>It shall be unlawful for any person to engage in any
trading, practice, or conduct on or subject to the rules of a registered entity
that—</text>
<subparagraph id="ID0c4cf0524b024621a4bdce7798cb384b"><enum>(A)</enum><text>violates bids or
offers;</text>
</subparagraph><subparagraph id="IDb1765b92d6de486da6360e3da303ff02"><enum>(B)</enum><text>demonstrates intentional
or reckless disregard for the orderly execution of transactions during the
closing period; or</text>
</subparagraph><subparagraph id="ID2b6eb8b0e7bb4b3289dae71208c61615"><enum>(C)</enum><text>is, is of the character
of, or is commonly known to the trade as, <quote>spoofing</quote> (bidding or
offering with the intent to cancel the bid or offer before execution).</text>
</subparagraph></paragraph><paragraph id="ID2219cbc296204025a746c427d41fa651"><enum>(6)</enum><header>Rulemaking
authority</header><text>The Commission may make and promulgate such rules and
regulations as, in the judgment of the Commission, are reasonably necessary to
prohibit the trading practices described in paragraph (5) and any other trading
practice that is disruptive of fair and equitable trading.</text>
</paragraph><paragraph id="ID88164ea307bf46fb9b122931f8430afc"><enum>(7)</enum><header>Use of swaps to
defraud</header><text>It shall be unlawful for any person to enter into a swap
knowing, or acting in reckless disregard of the fact, that its counterparty
will use the swap as part of a device, scheme, or artifice to defraud any third
party.</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</section><section commented="no" id="IDa5de230f929a47758920b64a994b6ae2"><enum>748.</enum><header>Commodity
whistleblower incentives and protection</header><text display-inline="no-display-inline">The <act-name parsable-cite="COMEX">Commodity Exchange Act</act-name> (7 U.S.C. 1 et seq.) is
amended by adding at the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idC5057BDBE8FF41E980B36FDE57AEDF61" reported-display-style="italic" style="OLC">
<section commented="no" id="id4C74B449CF7F4D0E85CE59D7756AB056"><enum>23.</enum><header>Commodity whistleblower
incentives and protection</header>
<subsection id="ID9d1e00f9888242f3a79110cbecadcd1a"><enum>(a)</enum><header>Definitions</header><text>In
this section:</text>
<paragraph id="IDf68df9567bf64a02a57c464ba0fdc74c"><enum>(1)</enum><header>Covered judicial or
administrative action</header><text>The term <term>covered judicial or
administrative action</term> means any judicial or administrative action
brought by the Commission under this Act that results in monetary sanctions
exceeding $1,000,000.</text>
</paragraph><paragraph id="IDbdbf4d67e8eb4221965796ff0032fbd2"><enum>(2)</enum><header>Fund</header><text>The
term <term>Fund</term> means the Commodity Futures Trading Commission Customer
Protection Fund established under subsection (g).</text>
</paragraph><paragraph id="IDe9ad38e78d13406998ffb491ebbb23e3"><enum>(3)</enum><header>Monetary
sanctions</header><text>The term <term>monetary sanctions</term>, when used
with respect to any judicial or administrative action means—</text>
<subparagraph id="ID14b83f20dbd64b9584bf07c838dc04a5"><enum>(A)</enum><text>any monies, including
penalties, disgorgement, restitution, and interest ordered to be paid;
and</text>
</subparagraph><subparagraph id="IDe42e8363a6f64ac38338783795e73b07"><enum>(B)</enum><text>any monies deposited into
a disgorgement fund or other fund pursuant to section 308(b) of the
Sarbanes-Oxley Act of 2002 (15 U.S.C. 7246(b)), as a result of such action or
any settlement of such action.</text>
</subparagraph></paragraph><paragraph id="ID0c16d1047eff412bb87c3afc38c850bc"><enum>(4)</enum><header>Original
information</header><text>The term <term>original information</term> means
information that—</text>
<subparagraph id="ID1c8cf3da69334d04a384d889001b12b9"><enum>(A)</enum><text>is derived from the
independent knowledge or analysis of a whistleblower;</text>
</subparagraph><subparagraph id="ID0ff14f6d184644838c8c7131488604e3"><enum>(B)</enum><text>is not known to the
Commission from any other source, unless the whistleblower is the original
source of the information; and</text>
</subparagraph><subparagraph id="ID6955ada7d2ab4f0c8c848ac0bc6ae37a"><enum>(C)</enum><text>is not exclusively
derived from an allegation made in a judicial or administrative hearing, in a
governmental report, hearing, audit, or investigation, or from the news media,
unless the whistleblower is a source of the information.</text>
</subparagraph></paragraph><paragraph id="ID53daf223e11a479bad01c8c693c58e7d"><enum>(5)</enum><header>Related
action</header><text>The term <term>related action</term>, when used with
respect to any judicial or administrative action brought by the Commission
under this Act, means any judicial or administrative action brought by an
entity described in subclauses (i) through (vi) of subsection (g)(2)(B) that is
based upon the original information provided by a whistleblower pursuant to
subsection (a) that led to the successful enforcement of the Commission
action.</text>
</paragraph><paragraph id="ID49b20419e20f48abb284f5fdc9fa0548"><enum>(6)</enum><header>Successful
resolution</header><text>The term <term>successful resolution</term>, when used
with respect to any judicial or administrative action brought by the Commission
under this Act, includes any settlement of such action.</text>
</paragraph><paragraph id="IDd52e486c96564d639ced9b337266bf20"><enum>(7)</enum><header>Whistleblower</header><text>The
term <term>whistleblower</term> means any individual, or 2 or more individuals
acting jointly, who provides information relating to a violation of this Act to
the Commission, in a manner established by rule or regulation, by the
Commission.</text>
</paragraph></subsection><subsection id="IDdcc6ecb417d24b918112b44853e829e3"><enum>(b)</enum><header>Awards</header>
<paragraph id="ID28feb4aceda14f3b9bd5c8457730b96f"><enum>(1)</enum><header>In
general</header><text>In any covered judicial or administrative action, or
related action, the Commission, under regulations prescribed by the Commission
and subject to subsection (c), shall pay an award or awards to 1 or more
whistleblowers who voluntarily provided original information to the Commission
that led to the successful enforcement of the covered judicial or
administrative action, or related action, in an aggregate amount equal
to—</text>
<subparagraph id="IDaa2403a41fda4be5a3a8e94bd4b1ada4"><enum>(A)</enum><text>not less than 10 percent,
in total, of what has been collected of the monetary sanctions imposed in the
action or related actions; and</text>
</subparagraph><subparagraph id="ID14acfd6d7c2a401aa433577a9b4a8810"><enum>(B)</enum><text>not more than 30 percent,
in total, of what has been collected of the monetary sanctions imposed in the
action or related actions.</text>
</subparagraph></paragraph><paragraph id="IDd2994b09832b43f5a1879157e9890b75"><enum>(2)</enum><header>Payment of
awards</header><text>Any amount paid under paragraph (1) shall be paid from the
Fund.</text>
</paragraph></subsection><subsection id="IDb0f3e1ad5f65457fbd5d614c78150d50"><enum>(c)</enum><header>Determination of amount
of award; denial of award</header>
<paragraph id="ID493bc0882c294fd4a1768802dec81c1e"><enum>(1)</enum><header>Determination of amount
of award</header>
<subparagraph id="ID793eb2c466284dab92b00d383e16ac1f"><enum>(A)</enum><header>Discretion</header><text>The
determination of the amount of an award made under subsection (b) shall be in
the discretion of the Commission.</text>
</subparagraph><subparagraph id="ID4ea5c177f6b843e28f8ccfc0364d4f94"><enum>(B)</enum><header>Criteria</header><text>In
determining the amount of an award made under subsection (b), the Commission
shall take into account—</text>
<clause id="IDb317f3692b49487db820298011383ead"><enum>(i)</enum><text>the significance of the
information provided by the whistleblower to the success of the covered
judicial or administrative action;</text>
</clause><clause id="ID19c74f190b014a5fa3136340425a797e"><enum>(ii)</enum><text>the degree of assistance
provided by the whistleblower and any legal representative of the whistleblower
in a covered judicial or administrative action;</text>
</clause><clause id="ID0fa23ece6dd14156bfa5834b54191934"><enum>(iii)</enum><text>the programmatic
interest of the Commission in deterring violations of the Act (including
regulations under the Act) by making awards to whistleblowers who provide
information that leads to the successful enforcement of such laws; and</text>
</clause><clause id="IDbc21099f25af4c8cad2ba126b7e2a105"><enum>(iv)</enum><text>such additional relevant
factors as the Commission may establish by rule or regulation.</text>
</clause></subparagraph></paragraph><paragraph id="IDacc56f93a9d343518a5d121d2df2ab0f"><enum>(2)</enum><header>Denial of
award</header><text>No award under subsection (b) shall be made—</text>
<subparagraph id="IDb63a60aa60a74773998a3674149edaf7"><enum>(A)</enum><text>to any whistleblower who
is, or was at the time the whistleblower acquired the original information
submitted to the Commission, a member, officer, or employee of—</text>
<clause id="IDe13e38679f6b4737b0f9d7efa4df5637"><enum>(i)</enum><text>a appropriate regulatory
agency;</text>
</clause><clause id="IDf4829a2518b249fbbb44bc5e922e1647"><enum>(ii)</enum><text>the Department of
Justice;</text>
</clause><clause id="IDdb0e7bce895a49938dd420592d713fb9"><enum>(iii)</enum><text>a registered
entity;</text>
</clause><clause id="IDbb7797af59f34e5084eccebf32e371e6"><enum>(iv)</enum><text>a registered futures
association; or</text>
</clause><clause id="ID626ca2e4121b401abc71895a7cb959f2"><enum>(v)</enum><text>a self-regulatory
organization as defined in section 3(a) of the Securities Exchange Act of 1934
(15 U.S.C. 78c(a)); or</text>
</clause><clause id="IDb098185ae4ee450c975eee13f50f9ee1"><enum>(vi)</enum><text>a law enforcement
organization;</text>
</clause></subparagraph><subparagraph id="ID6c4694a00db44dd8acdef3bf71af04f9"><enum>(B)</enum><text>to any whistleblower who
is convicted of a criminal violation related to the judicial or administrative
action for which the whistleblower otherwise could receive an award under this
section;</text>
</subparagraph><subparagraph id="ID91fba354c63140eb92c248c2b69b609c"><enum>(C)</enum><text>to any whistleblower who
submits information to the Commission that is based on the facts underlying the
covered action submitted previously by another whistleblower;</text>
</subparagraph><subparagraph id="ID01a0121e31a0487181b4e5b8d7f1323b"><enum>(D)</enum><text>to any whistleblower who
fails to submit information to the Commission in such form as the Commission
may, by rule or regulation, require.</text>
</subparagraph></paragraph></subsection><subsection id="ID119e01c53e2c400e90663bd3eee9d205"><enum>(d)</enum><header>Representation</header>
<paragraph id="ID1fd782a27b3748b6898660ef470ccc5a"><enum>(1)</enum><header>Permitted
representation</header><text>Any whistleblower who makes a claim for an award
under subsection (b) may be represented by counsel.</text>
</paragraph><paragraph id="ID8b5b7317d4504f0491779fb668204f9d"><enum>(2)</enum><header>Required
representation</header>
<subparagraph id="IDfc75aededfee4e5481708232217e501c"><enum>(A)</enum><header>In
general</header><text>Any whistleblower who anonymously makes a claim for an
award under subsection (b) shall be represented by counsel if the whistleblower
submits the information upon which the claim is based.</text>
</subparagraph><subparagraph id="IDc352bb0d1dd34782833c47879b1d882e"><enum>(B)</enum><header>Disclosure of
identity</header><text>Prior to the payment of an award, a whistleblower shall
disclose the identity of the whistleblower and provide such other information
as the Commission may require, directly or through counsel for the
whistleblower.</text>
</subparagraph></paragraph></subsection><subsection id="ID966b261081cd4a9cba985997d8fc7aa4"><enum>(e)</enum><header>No contract
necessary</header><text>No contract with the Commission is necessary for any
whistleblower to receive an award under subsection (b), unless otherwise
required by the Commission, by rule or regulation.</text>
</subsection><subsection id="ID50c324b479134d049e32c2454ed5385c"><enum>(f)</enum><header>Appeals</header>
<paragraph id="id9B8522C0CEF44C93906893C9243CAC32"><enum>(1)</enum><header>In
general</header><text>Any determination made under this section, including
whether, to whom, or in what amount to make awards, shall be in the discretion
of the Commission.</text>
</paragraph><paragraph id="id0B168173ADE34C2B8FA0B3B3D8A2503A"><enum>(2)</enum><header>Appeals</header><text>Any
determination described in paragraph (1) may be appealed to the appropriate
court of appeals of the United States not more than 30 days after the
determination is issued by the Commission.</text>
</paragraph><paragraph id="idB38F55ED55F049CAB20E85E4EE747D99"><enum>(3)</enum><header>Review</header><text>The
court shall review the determination made by the Commission in accordance with
section 7064 of title 5, United States Code.</text>
</paragraph></subsection><subsection id="IDb68aa06d2f564b4189b9c408a669cf17"><enum>(g)</enum><header>Commodity futures
trading commission customer protection fund</header>
<paragraph id="ID46bb965d65c1425cb821c3340014fc3c"><enum>(1)</enum><header>Establishment</header><text>There
is established in the Treasury of the United States a revolving fund to be
known as the <term>Commodity Futures Trading Commission Customer Protection
Fund</term>.</text>
</paragraph><paragraph id="ID36557285a9b342a3b4ec670000926524"><enum>(2)</enum><header>Use of
fund</header><text>The Fund shall be available to the Commission, without
further appropriation or fiscal year limitation, for—</text>
<subparagraph id="ID509686e3b1284cd4b5350814944f524a"><enum>(A)</enum><text>the payment of awards to
whistleblowers as provided in subsection (a); and</text>
</subparagraph><subparagraph id="IDd04cd4a7350a484483ac0b1ba249e05f"><enum>(B)</enum><text>the funding of customer
education initiatives designed to help customers protect themselves against
fraud or other violations of this Act, or the rules and regulations
thereunder.</text>
</subparagraph></paragraph><paragraph id="IDcf4fddd1bf7748fbbc9066647887dcbb"><enum>(3)</enum><header>Deposits and
credits</header><text>There shall be deposited into or credited to the
Fund—</text>
<subparagraph id="IDecc641201c4f461b8c8cf7e76edb06f8"><enum>(A)</enum><text>any monetary judgment
collected by the Commission in any judicial or administrative action brought by
the Commission under this Act, that is not otherwise distributed to victims of
a violation of this Act or the rules and regulations thereunder underlying such
action, unless the balance of the Fund at the time the monetary judgment is
collected exceeds $100,000,000; and</text>
</subparagraph><subparagraph id="IDd078dea5e9874b288dcde4852e4ede2a"><enum>(B)</enum><text>all income from
investments made under paragraph (4).</text>
</subparagraph></paragraph><paragraph id="ID22010f4335f74576a7eec2116db9a59a"><enum>(4)</enum><header>Investments</header>
<subparagraph id="ID7c8b34933559497188dfaea8764ac2c2"><enum>(A)</enum><header>Amounts in fund may be
invested</header><text>The Commission may request the Secretary of the Treasury
to invest the portion of the Fund that is not, in the Commission’s judgment,
required to meet the current needs of the Fund.</text>
</subparagraph><subparagraph id="ID81a77690dcf64ba09622b7115c079640"><enum>(B)</enum><header>Eligible
investments</header><text>Investments shall be made by the Secretary of the
Treasury in obligations of the United States or obligations that are guaranteed
as to principal and interest by the United States, with maturities suitable to
the needs of the Fund as determined by the Commission.</text>
</subparagraph><subparagraph id="IDb5655f5f03f1444c86fcdaf6025963ab"><enum>(C)</enum><header>Interest and proceeds
credited</header><text>The interest on, and the proceeds from the sale or
redemption of, any obligations held in the Fund shall be credited to, and form
a part of, the Fund.</text>
</subparagraph></paragraph><paragraph id="IDbc8ca8b06dc44c4eba7bc87c33400987"><enum>(5)</enum><header>Reports to
congress</header><text>Not later than October 30 of each year, the Commission
shall transmit to the Committee on Agriculture, Nutrition, and Forestry of the
Senate, and the Committee on Agriculture of the House of Representatives a
report on—</text>
<subparagraph id="IDd9ff3e63c6c647c79e6136d3ea79fef0"><enum>(A)</enum><text>the Commission’s
whistleblower award program under this section, including a description of the
number of awards granted and the types of cases in which awards were granted
during the preceding fiscal year;</text>
</subparagraph><subparagraph id="ID47ddd966fe6b49d9afea42c411a92e4b"><enum>(B)</enum><text>customer education
initiatives described in paragraph (2)(B) that were funded by the Fund during
the preceding fiscal year;</text>
</subparagraph><subparagraph id="ID3c5a72cfeccb4b03977285f5034f327a"><enum>(C)</enum><text>the balance of the Fund
at the beginning of the preceding fiscal year;</text>
</subparagraph><subparagraph id="ID7ba5117400ed4f08a6be9aa81d2e5693"><enum>(D)</enum><text>the amounts deposited
into or credited to the Fund during the preceding fiscal year;</text>
</subparagraph><subparagraph id="ID66eaa5b29bf64e98a4d81afbd96f0bba"><enum>(E)</enum><text>the amount of earnings on
investments of amounts in the Fund during the preceding fiscal year;</text>
</subparagraph><subparagraph id="ID30879c1d839249c6a4bcd390329d607b"><enum>(F)</enum><text>the amount paid from the
Fund during the preceding fiscal year to whistleblowers pursuant to subsection
(b);</text>
</subparagraph><subparagraph id="ID971103eef2b245f3a7c8c2d3ed45c3cf"><enum>(G)</enum><text>the amount paid from the
Fund during the preceding fiscal year for customer education initiatives
described in paragraph (2)(B);</text>
</subparagraph><subparagraph id="IDf892d16f790b423cba5883797db722e3"><enum>(H)</enum><text>the balance of the Fund
at the end of the preceding fiscal year; and</text>
</subparagraph><subparagraph id="ID0c8f489e68da46b499262bd18c0bd2f9"><enum>(I)</enum><text>a complete set of audited
financial statements, including a balance sheet, income statement, and cash
flow analysis.</text>
</subparagraph></paragraph></subsection><subsection id="ID6f14bb9526ec48d69b80123338b15815"><enum>(h)</enum><header>Protection of
whistleblowers</header>
<paragraph id="ID9c5242a2fc2844bc8d619c6f6ce2e2d8"><enum>(1)</enum><header>Prohibition against
retaliation</header>
<subparagraph id="IDb3e56758d2514203bfea8758ac470d65"><enum>(A)</enum><header>In
general</header><text>No employer may discharge, demote, suspend, threaten,
harass, directly or indirectly, or in any other manner discriminate against, a
whistleblower in the terms and conditions of employment because of any lawful
act done by the whistleblower—</text>
<clause id="ID2b305d981aef46e5a0defd2c508c0dcb"><enum>(i)</enum><text>in providing information
to the Commission in accordance with subsection (b); or</text>
</clause><clause id="IDb2f3422c457241cead88795888e9ca0e"><enum>(ii)</enum><text>in assisting in any
investigation or judicial or administrative action of the Commission based upon
or related to such information.</text>
</clause></subparagraph><subparagraph id="ID3db66d17a1a2481d8421e35596d870cd"><enum>(B)</enum><header>Enforcement</header>
<clause id="ID7b20cf4480ea4b538d9d88c54cb29c1c"><enum>(i)</enum><header>Cause of
action</header><text>An individual who alleges discharge or other
discrimination in violation of subparagraph (A) may bring an action under this
subsection in the appropriate district court of the United States for the
relief provided in subparagraph (C), unless the individual who is alleging
discharge or other discrimination in violation of subparagraph (A) is an
employee of the federal government, in which case the individual shall only
bring an action under section 1221 of title 5 United States Code.</text>
</clause><clause id="IDafbea23988ef4c0c96dcdcb9a20861ff"><enum>(ii)</enum><header>Subpoenas</header><text>A
subpoena requiring the attendance of a witness at a trial or hearing conducted
under this subsection may be served at any place in the United States.</text>
</clause><clause id="IDadcea138ac3b47e29589bbe964e07df4"><enum>(iii)</enum><header>Statute of
limitations</header><text>An action under this subsection may not be brought
more than 2 years after the date on which the violation reported in
subparagraph (A) is committed.</text>
</clause></subparagraph><subparagraph id="IDae39dca3712343849694e95813ad0dee"><enum>(C)</enum><header>Relief</header><text>Relief
for an individual prevailing in an action brought under subparagraph (B) shall
include—</text>
<clause id="ID41b13eeaa0334480bc841dd3bb1ccb47"><enum>(i)</enum><text>reinstatement with the
same seniority status that the individual would have had, but for the
discrimination;</text>
</clause><clause id="ID5e1b6b18c7fe44f5b258463ae906d21c"><enum>(ii)</enum><text>the amount of back pay
otherwise owed to the individual, with interest; and</text>
</clause><clause id="ID07a8e29470cc4473b40745d4a14aa3bf"><enum>(iii)</enum><text>compensation for any
special damages sustained as a result of the discharge or discrimination,
including litigation costs, expert witness fees, and reasonable attorney’s
fees.</text>
</clause></subparagraph></paragraph><paragraph id="ID5c3fe95e9e9f4a0fb0bc3dcb622d4222"><enum>(2)</enum><header>Confidentiality</header>
<subparagraph id="ID3aa9d7c4845d4a67b051c40bd478ae3e"><enum>(A)</enum><header>Information
provided</header>
<clause id="IDb9db3d17e4324adaa72cb986e0d1eb5c"><enum>(i)</enum><header>In
general</header><text>Except as provided in subparagraph (B), all information
provided to the Commission by a whistleblower shall be confidential and
privileged as an evidentiary matter (and shall not be subject to civil
discovery or other legal process) in any proceeding in any Federal or State
court or administrative agency, and shall be exempt from disclosure, in the
hands of a department or agency of the Federal Government, under section 552 of
title 5, United States Code (commonly known as the <quote>Freedom of
Information Act</quote>) or otherwise, unless and until required to be
disclosed to a defendant or respondent in connection with a public proceeding
instituted by the Commission or any entity described in subparagraph
(B).</text>
</clause><clause id="IDcf696b92d2a64a12842d50f4104dd2cb"><enum>(ii)</enum><header>Construction</header><text>For
purposes of section 552 of title 5, United States Code, this paragraph shall be
considered to be a statute described in subsection (b)(3)(B) of that
section.</text>
</clause><clause id="IDa7f5a2f41c734b3b8ad3870595522bf1"><enum>(iii)</enum><header>Effect</header><text>Nothing
in this paragraph is intended to limit the ability of the Attorney General to
present such evidence to a grand jury or to share such evidence with potential
witnesses or defendants in the course of an ongoing criminal
investigation.</text>
</clause></subparagraph><subparagraph id="ID46d0f8b00e0646eca61d49568336f01f"><enum>(B)</enum><header>Availability to
government agencies</header>
<clause id="id2897CE012A9A4D6D85D8660C8E100C75"><enum>(i)</enum><header>In
general</header><text>Without the loss of its status as confidential and
privileged in the hands of the Commission, all information referred to in
subparagraph (A) may, in the discretion of the Commission, when determined by
the Commission to be necessary or appropriate to accomplish the purposes of
this Act and protect customers and in accordance with clause (ii), be made
available to—</text>
<subclause id="ID178dd643418242a88af135ed0ddd8447"><enum>(I)</enum><text>the Department of
Justice;</text>
</subclause><subclause id="IDc1be68b6f0874fbe8a1abe8f1d80ef15"><enum>(II)</enum><text>an appropriate
department or agency of the Federal Government, acting within the scope of its
jurisdiction;</text>
</subclause><subclause id="ID47238a856bf14baaa6cf6e1eafe8cb4d"><enum>(III)</enum><text>a registered entity,
registered futures association, or self-regulatory organization as defined in
section 3(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78c(a));</text>
</subclause><subclause id="ID22e41b0b765a4c019c7e17252761f5e9"><enum>(IV)</enum><text>a State attorney general
in connection with any criminal investigation;</text>
</subclause><subclause id="ID4d68c279b6c64c739602b0938e8d0673"><enum>(V)</enum><text>an appropriate department
or agency of any State, acting within the scope of its jurisdiction; and</text>
</subclause><subclause id="ID55f49483084147deb4b3648af40ee86f"><enum>(VI)</enum><text>a foreign futures
authority.</text>
</subclause></clause><clause id="ID9f8235edc26a434c8cc30605efe43311"><enum>(ii)</enum><header>Maintenance of
information</header><text>Each of the entities, agencies, or persons described
in clause (i) shall maintain information described in that clause as
confidential and privileged, in accordance with the requirements in
subparagraph (A).</text>
</clause></subparagraph></paragraph><paragraph id="ID3bcb975144244f6785fc0d56d66c0a22"><enum>(3)</enum><header>Rights
retained</header><text>Nothing in this section shall be deemed to diminish the
rights, privileges, or remedies of any whistleblower under any Federal or State
law, or under any collective bargaining agreement.</text>
</paragraph></subsection><subsection id="ID09d4e88ded634bd4b22676b0274f2b68"><enum>(i)</enum><header>Rulemaking
authority</header><text>The Commission shall have the authority to issue such
rules and regulations as may be necessary or appropriate to implement the
provisions of this section consistent with the purposes of this section.</text>
</subsection><subsection id="IDac7ef247d0d34201bdb5871759c0ec17"><enum>(j)</enum><header>Implementing
rules</header><text>The Commission shall issue final rules or regulations
implementing the provisions of this section not later than 270 days after the
date of enactment of the <short-title>Wall Street
Transparency and Accountability Act of 2010</short-title>.</text>
</subsection><subsection id="ID648c5947e2ab4f04aac05ff6c48e9f43"><enum>(k)</enum><header>Original
information</header><text>Information submitted to the Commission by a
whistleblower in accordance with rules or regulations implementing this section
shall not lose its status as original information solely because the
whistleblower submitted such information prior to the effective date of such
rules or regulations, provided such information was submitted after the date of
enactment of the <short-title>Wall Street Transparency and
Accountability Act of 2010</short-title>.</text>
</subsection><subsection id="IDa2e0fa94f16c44cda36d88b95ad85d58"><enum>(l)</enum><header>Awards</header><text>A
whistleblower may receive an award pursuant to this section regardless of
whether any violation of a provision of this Act, or a rule or regulation
thereunder, underlying the judicial or administrative action upon which the
award is based occurred prior to the date of enactment of the
<short-title>Wall Street Transparency and Accountability
Act of 2010</short-title>.</text>
</subsection><subsection id="IDdd83a92442214f2ea9d09fbc6c3126d3"><enum>(m)</enum><header>Provision of false
information</header><text>A whistleblower who knowingly and willfully makes any
false, fictitious, or fraudulent statement or representation, or who makes or
uses any false writing or document knowing the same to contain any false,
fictitious, or fraudulent statement or entry, shall not be entitled to an award
under this section and shall be subject to prosecution under section 1001 of
title 18, United States
Code.</text>
</subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</section><section id="idB2FD3BE108644BA286AFC9386EA708E0"><enum>749.</enum><header>Conforming
amendments</header>
<subsection id="id20B59E3D59E9458EB27021647F2EE37C"><enum>(a)</enum><text>Section 2(c)(1) of the
Commodity Exchange Act (7 U.S.C. 2(c)(1)) is amended, in the matter preceding
subparagraph (A), by striking <quote>5a (to the extent provided in section
5a(g)),</quote>.</text>
</subsection><subsection id="id6BC49662B58344589E60ECE419D1D32F"><enum>(b)</enum><text display-inline="yes-display-inline">Section 4d of the Commodity Exchange Act (7
U.S.C. 6d) (as amended by section 724) is amended—</text>
<paragraph id="IDb513c315e1c74a6e9d7ab66a85bb7902"><enum>(1)</enum><text>in subsection (a)—</text>
<subparagraph id="id0D2A12E53F4B4F969A86E79F42CDD809"><enum>(A)</enum><text>in the matter preceding
paragraph (1)—</text>
<clause id="idB31F1D7F5A0B4BB6B0690A0DEDAA51C8"><enum>(i)</enum><text>by striking <quote>engage
as</quote> and inserting <quote>be a</quote>; and</text>
</clause><clause id="idEA2ECF0DA9E24888B0908279BA3A0DFD"><enum>(ii)</enum><text>by striking <quote>or
introducing broker</quote> and all that follows through <quote>or derivatives
transaction execution facility</quote>;</text>
</clause></subparagraph><subparagraph id="ID1b44fc6aef36497cb49c3dffccf59026"><enum>(B)</enum><text>in paragraph (1), by
striking <quote>or introducing broker</quote>; and</text>
</subparagraph><subparagraph id="IDea3ba37425424a3c80c5db58758e9466"><enum>(C)</enum><text>in paragraph (2), by
striking <quote>if a futures commission merchant,</quote>; and</text>
</subparagraph></paragraph><paragraph id="ID59e0a3a46ef34031af767ebe2093dbe4"><enum>(2)</enum><text>by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id8659898B23ED4005BB51768DF3758C7C" reported-display-style="italic" style="OLC">
<subsection id="id82C3831E318F4A74B7AF77C0666660E5"><enum>(g)</enum><text>It shall be unlawful for
any person to be an introducing broker unless such person shall have registered
under this Act with the Commission as an introducing broker and such
registration shall not have expired nor been suspended nor
revoked.</text>
</subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="IDa101e5ce1ed04e1ea798fd3c3ef31ccd"><enum>(c)</enum><text>Section 4m(3) of the
Commodity Exchange Act (7 U.S.C. 6m(3)) is amended—</text>
<paragraph id="id980E6E5414044948A0D8D39B4C443334"><enum>(1)</enum><text>by striking <quote>(3)
Subsection (1) of this section</quote> and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idF45C6F75AF2D45058BBC83BC37A99948" reported-display-style="italic" style="OLC">
<paragraph id="idD3601330617541368772F91DEA28F167"><enum>(3)</enum><header>Exception</header>
<subparagraph id="id0B1850E4E62846CB8E4E3799A7588D9F"><enum>(A)</enum><header>In
general</header><text>Paragraph (1)</text>
</subparagraph></paragraph><after-quoted-block>;
and</after-quoted-block></quoted-block>
</paragraph><paragraph id="id73712482CB384EA284D070DF97386DC1"><enum>(2)</enum><text>by striking <quote>to any
investment trust</quote> and all that follows through the period at the end and
inserting the following: “to any commodity pool that is engaged primarily in
trading commodity interests.</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id3AB170320988452D8833595B1474F3B9" reported-display-style="italic" style="OLC">
<subparagraph id="id873345AEFA1A42739BC38A991FDEC97A"><enum>(B)</enum><header>Engaged
primarily</header><text>For purposes of subparagraph (A), a commodity trading
advisor or a commodity pool shall be considered to be <quote>engaged
primarily</quote> in the business of being a commodity trading advisor or
commodity pool if it is or holds itself out to the public as being engaged
primarily, or proposes to engage primarily, in the business of advising on
commodity interests or investing, reinvesting, owning, holding, or trading in
commodity interests, respectively.</text>
</subparagraph><subparagraph id="id16F59169A58148CC9E920F4E0290763A"><enum>(C)</enum><header>Commodity
interests</header><text>For purposes of this paragraph, commodity interests
shall include contracts of sale of a commodity for future delivery, options on
such contracts, security futures, swaps, leverage contracts, foreign exchange,
spot and forward contracts on physical commodities, and any monies held in an
account used for trading commodity
interests.</text>
</subparagraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="id69DBA48E49C643B194B5813EF7122199"><enum>(d)</enum><text>Section 5c of the
Commodity Exchange Act (7 U.S.C. 7a–2) is amended—</text>
<paragraph id="idB5E38289C28D44A685392EBB58A34761"><enum>(1)</enum><text>in subsection
(a)(1)—</text>
<subparagraph id="id1755562F4EE548D9861668ECFE615C6B"><enum>(A)</enum><text>by striking <quote>,
5a(d),</quote>; and</text>
</subparagraph><subparagraph id="idCEFA60DE236842528787597EECCCC649"><enum>(B)</enum><text>by striking <quote>and
section (2)(h)(7) with respect to significant price discovery
contracts,</quote>; and</text>
</subparagraph></paragraph><paragraph id="id5775131668BA47EC9CB3DC34995954F9"><enum>(2)</enum><text>in subsection (f)(1), by
striking <quote>section 4d(c) of this Act</quote> and inserting <quote>section
4d(e)</quote>.</text>
</paragraph></subsection><subsection id="id15528E68A4B34932ADC4F59FF6FCA5FF"><enum>(e)</enum><text>Section 5e of the
Commodity Exchange Act (7 U.S.C. 7b) is amended by striking <quote>or
revocation of the right of an electronic trading facility to rely on the
exemption set forth in section 2(h)(3) with respect to a significant price
discovery contract,</quote>.</text>
</subsection><subsection id="id215BCA3467614B83951C523C9F5853E4"><enum>(f)</enum><text>Section 6(b) of the
Commodity Exchange Act (7 U.S.C. 8(b)) is amended in the first sentence by
striking <quote>, or to revoke the right of an electronic trading facility to
rely on the exemption set forth in section 2(h)(3) with respect to a
significant price discovery contract,</quote>.</text>
</subsection><subsection id="id9AFEEBC749B64D74815B3BE05025A4EB"><enum>(g)</enum><text>Section 12(e)(2)(B) of
the Commodity Exchange Act (7 U.S.C. 16(e)(2)(B)) is amended—</text>
<paragraph id="idF3FC06C9C49246559155414AB5D0E95B"><enum>(1)</enum><text>by striking
<quote>section 2(c), 2(d), 2(f), or 2(g) of this Act</quote> and inserting
<quote>section 2(c), 2(f), or 2(i) of this Act</quote>; and</text>
</paragraph><paragraph id="idBB1C2115306446ED9DD1AE9466DA025D"><enum>(2)</enum><text>by striking <quote>2(h)
or</quote>.</text>
</paragraph></subsection><subsection id="id1C26927FFB394122B6B5A1BB1BF505F4"><enum>(h)</enum><text>Section 17(r)(1) of the
Commodity Exchange Act (7 U.S.C. 21(r)(1)) is amended by striking
<quote>section 4d(c) of this Act</quote> and inserting <quote>section
4d(e)</quote>.</text>
</subsection><subsection id="id99123E8A56984F4C9A1FD5B6E9A5C087"><enum>(i)</enum><text>Section 22(b)(1)(A) of
the Commodity Exchange Act (7 U.S.C. 25(b)(1)(A)) is amended by striking
<quote>section 2(h)(7) or</quote>.</text>
</subsection><subsection id="id9759DF07FD224EAFB08D73A31C6A7ABE"><enum>(j)</enum><text>Section 408(2)(C) of the
Federal Deposit Insurance Corporation Improvement Act of 1991 (12 U.S.C.
4421(2)(C)) is amended—</text>
<paragraph id="id022913E8092C4DCD88675843603F3815"><enum>(1)</enum><text>by striking
<quote>section 2(c), 2(d), 2(f), or (2)(g) of such Act</quote> and inserting
<quote>section 2(c), 2(f), or 2(i) of that Act</quote>; and</text>
</paragraph><paragraph id="id61B95A678CB242EAA383C3B4D04869BE"><enum>(2)</enum><text>by striking <quote>2(h)
or</quote>.</text>
</paragraph></subsection></section><section id="idA43EDF1CA27E4F87A273173A477D1AC5"><enum>750.</enum><header>Study on oversight of
carbon markets</header>
<subsection id="idF58420DD8D784F0A99282B2D37318144"><enum>(a)</enum><header>Interagency working
group</header><text display-inline="yes-display-inline">There is established to
carry out this section an interagency working group (referred to in this
section as the <quote>interagency group</quote>) composed of the following
members or designees:</text>
<paragraph id="id3A70CE666B8049AFA309DF3CB8DAE6C6"><enum>(1)</enum><text display-inline="yes-display-inline">The Chairman of the Commodity Futures
Trading Commission (referred to in this section as the
<quote>Commission</quote>), who shall serve as Chairman of the interagency
group.</text>
</paragraph><paragraph id="id2F111846390E4E4F82F03870DCC25E65"><enum>(2)</enum><text display-inline="yes-display-inline">The Secretary of Agriculture.</text>
</paragraph><paragraph id="id30DAEDB4EADD4A02A2CD1D53C46D7EDD"><enum>(3)</enum><text display-inline="yes-display-inline">The Secretary of the Treasury.</text>
</paragraph><paragraph id="idA14F0C17A25441CE8DBABCC07E142945"><enum>(4)</enum><text display-inline="yes-display-inline">The Chairman of the Securities and Exchange
Commission.</text>
</paragraph><paragraph id="id8540FE32A39D4AE8BF0920FB71E49E3E"><enum>(5)</enum><text display-inline="yes-display-inline">The Administrator of the Environmental
Protection Agency.</text>
</paragraph><paragraph id="id6573CB1498E24E999A151808DD2EF625"><enum>(6)</enum><text display-inline="yes-display-inline">The Chairman of the Federal Energy
Regulatory Commission.</text>
</paragraph><paragraph id="id3806A9EDCB9D472EAA0C4D9F160AD704"><enum>(7)</enum><text>The Commissioner of the
Federal Trade Commission.</text>
</paragraph><paragraph id="id873B065B86074E89AC77B460846F8320"><enum>(8)</enum><text>The Administrator of the
Energy Information Administration.</text>
</paragraph></subsection><subsection id="id0540682E37F644B8A8CA2CFA29F66607"><enum>(b)</enum><header>Administrative
support</header><text>The Commission shall provide the interagency group such
administrative support services as are necessary to enable the interagency
group to carry out the functions of the interagency group under this
section.</text>
</subsection><subsection id="id9448031F33A44D04A267217DD54D9B2D"><enum>(c)</enum><header>Consultation</header><text>In
carrying out this section, the interagency group shall consult with
representatives of exchanges, clearinghouses, self-regulatory bodies, major
carbon market participants, consumers, and the general public, as the
interagency group determines to be appropriate.</text>
</subsection><subsection id="idA32A0DC4F9FC4A189385D4C010E4270A"><enum>(d)</enum><header>Study</header><text display-inline="yes-display-inline">The interagency group shall conduct a study
on the oversight of existing and prospective carbon markets to ensure an
efficient, secure, and transparent carbon market, including oversight of spot
markets and derivative markets.</text>
</subsection><subsection id="id303E2E243BFF4BFA9C94E15F35BC50AC"><enum>(e)</enum><header>Report</header><text>Not
later than 180 days after the date of enactment of this Act, the interagency
group shall submit to Congress a report on the results of the study conducted
under subsection (b), including recommendations for the oversight of existing
and prospective carbon markets to ensure an efficient, secure, and transparent
carbon market, including oversight of spot markets and derivative
markets.</text>
</subsection></section><section id="ID67c22423ba0744a8a234597cd35a39a3"><enum>751.</enum><header>Energy and
environmental markets advisory committee</header><text display-inline="no-display-inline">Section 2(a) of the Commodity Exchange Act
(7 U.S.C. 2(a)) (as amended by section 727) is amended by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idAD65E62E97EA4E3182F5176E6A3BD8ED" reported-display-style="italic" style="OLC">
<paragraph id="IDe949d463ea2f454f90031707de76b48f"><enum>(15)</enum><header>Energy and
environmental markets advisory committee</header>
<subparagraph id="idF96C0177E96248DB85F483CCB4081580"><enum>(A)</enum><header>Establishment</header>
<clause id="ID8be88593188e4de589fc19d722f1961a"><enum>(i)</enum><header>In
general</header><text>An Energy and Environmental Markets Advisory Committee is
hereby established.</text>
</clause><clause id="idF7ABC59988004BA597E494018D7BB7CD"><enum>(ii)</enum><header>Membership</header><text>The
Committee shall have 9 members.</text>
</clause><clause id="id2F4738862B9443F0AE68B589FB06B373"><enum>(iii)</enum><header>Activities</header><text>The
Committee’s objectives and scope of activities shall be—</text>
<subclause id="id5B4278C8D26E437F9524208313EE04AC"><enum>(I)</enum><text>to conduct public
meetings;</text>
</subclause><subclause id="idDF44CC00B97247D691450C154CB912B6"><enum>(II)</enum><text>to submit reports and
recommendations to the Commission (including dissenting or minority views, if
any); and</text>
</subclause><subclause id="id21C0DD5EF320471DB1C51CBBD4709BF8"><enum>(III)</enum><text>otherwise to serve as a
vehicle for discussion and communication on matters of concern to exchanges,
firms, end users, and regulators regarding energy and environmental markets and
their regulation by the Commission.</text>
</subclause></clause></subparagraph><subparagraph id="ID2938767db64746ff943a01ff0dd99e36"><enum>(B)</enum><header>Requirements</header>
<clause id="id61D6C9EC8CB142A7B4DA32D595910D54"><enum>(i)</enum><header>In
general</header><text>The Committee shall hold public meetings at such
intervals as are necessary to carry out the functions of the Committee, but not
less frequently than 2 times per year.</text>
</clause><clause id="id201FFAB19E434071B6B372A1ADA69A60"><enum>(ii)</enum><header>Members</header><text>Members
shall be appointed to 3-year terms, but may be removed for cause by vote of the
Commission.</text>
</clause></subparagraph><subparagraph id="ID0359ca7635f546eb8f52b236f4aa368a"><enum>(C)</enum><header>Appointment</header><text>The
Commission shall appoint members with a wide diversity of opinion and who
represent a broad spectrum of interests, including hedgers and
consumers.</text>
</subparagraph><subparagraph id="ID6841e507c6f04b318a9f1741a844e05a"><enum>(D)</enum><header>Reimbursement</header><text>Members
shall be entitled to per diem and travel expense reimbursement by the
Commission.</text>
</subparagraph><subparagraph id="ID53d385f437774010934273c599db34a2"><enum>(E)</enum><header>FACA</header><text>The
Committee shall not be subject to the <act-name parsable-cite="FACA">Federal
Advisory Committee Act</act-name> (5 U.S.C.
App.).</text>
</subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</section><section id="IDe59bf9e6514444f4a5e6c96ef4ed7030"><enum>752.</enum><header>International
harmonization</header><text display-inline="no-display-inline">In order to
promote effective and consistent global regulation of swaps and security-based
swaps, the Securities and Exchange Commission, the Commodity Futures Trading
Commission, the Financial Stability Oversight Council, and the Treasury
Department—</text>
<paragraph id="IDffcb65af04d64af4902e4d432a3cb07f"><enum>(1)</enum><text>shall, both individually
and collectively, consult and coordinate with foreign regulatory authorities on
the establishment of consistent international standards with respect to the
regulation of such swaps; and</text>
</paragraph><paragraph id="IDe33cf14d90774f47906cd001582e0c6a"><enum>(2)</enum><text>may, both individually
and collectively, agree to such information-sharing arrangements as may be
deemed to be necessary or appropriate in the public interest or for the
protection of investors and swap counterparties.</text>
</paragraph></section><section id="IDb92e1397e81d4983a75f53896c234093"><enum>753.</enum><header>Antimarket
manipulation authority</header>
<subsection id="ID473209765217421286b5a31fc8e64f02"><enum>(a)</enum><header>Prohibition regarding
manipulation and false information</header><text>Subsection (c) of section 6 of
the Commodity Exchange Act (7 U.S.C. 9, 15) is amended to read as
follows:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id435788A002C24D1C8823DCBD67A20833" reported-display-style="italic" style="OLC">
<subsection id="IDf4ef87a238294e7a86f0b1b0b00bb899"><enum>(c)</enum><header>Prohibition regarding
manipulation and false information</header>
<paragraph id="ID3d7cf442538848d89e3f6cf1c23c7d28"><enum>(1)</enum><header>Prohibition against
manipulation</header><text>It shall be unlawful for any person, directly or
indirectly, to use or employ, or attempt to use or employ, in connection with
any swap, or a contract of sale of any commodity in interstate commerce, or for
future delivery on or subject to the rules of any registered entity, any
manipulative or deceptive device or contrivance, in contravention of such rules
and regulations as the Commission shall promulgate by not later than 1 year
after the date of enactment of the Restoring American Financial Stability Act
of 2010.</text>
<subparagraph id="IDdf8fd40b59c249408f4f4c8e8be1df62"><enum>(A)</enum><header>Special provision for
manipulation by false reporting</header><text>Unlawful manipulation for
purposes of this paragraph shall include, but not be limited to, delivering, or
causing to be delivered for transmission through the mails or interstate
commerce, by any means of communication whatsoever, a false or misleading or
inaccurate report concerning crop or market information or conditions that
affect or tend to affect the price of any commodity in interstate commerce,
knowing, or acting in reckless disregard of the fact, that such report is
false, misleading or inaccurate.</text>
</subparagraph><subparagraph id="ID223ab0a0630c475683f34ec87199d5a0"><enum>(B)</enum><header>Effect on other
law</header><text>Nothing in this paragraph shall affect, or be construed to
affect, the applicability of section 9(a)(2).</text>
</subparagraph></paragraph><paragraph id="ID19756b59edcc48048636c5799e388fad"><enum>(2)</enum><header>Prohibition regarding
false information</header><text>It shall be unlawful for any person to make any
false or misleading statement of a material fact to the Commission, including
in any registration application or any report filed with the Commission under
this Act, or any other information relating to a swap, or a contract of sale of
a commodity, in interstate commerce, or for future delivery on or subject to
the rules of any registered entity, or to omit to state in any such statement
any material fact that is necessary to make any statement of a material fact
made not misleading in any material respect, if the person knew, or reasonably
should have known, the statement to be false or misleading.</text>
</paragraph><paragraph id="ID838756f209cd48ea89a99269c9ca55e1"><enum>(3)</enum><header>Other
manipulation</header><text>In addition to the prohibition in paragraph (1), it
shall be unlawful for any person, directly or indirectly, to manipulate or
attempt to manipulate the price of any swap, or of any commodity in interstate
commerce, or for future delivery on or subject to the rules of any registered
entity.</text>
</paragraph><paragraph id="ID1eb4405c66cb4a49a2795784fb88578d"><enum>(4)</enum><header>Enforcement</header>
<subparagraph id="ID377ee4139c7041d3be6817675dcc5ac1"><enum>(A)</enum><header>Authority of
commission</header><text>If the Commission has reason to believe that any
person (other than a registered entity) is violating or has violated this
subsection, or any other provision of this Act (including any rule, regulation,
or order of the Commission promulgated in accordance with this subsection or
any other provision of this Act), the Commission may serve upon the person a
complaint.</text>
</subparagraph><subparagraph id="ID40dcea0a9e1f40548d5a1d95868203a7"><enum>(B)</enum><header>Contents of
complaint</header><text>A complaint under subparagraph (A) shall—</text>
<clause id="ID1f8d2a1ee10d46b5a5058c55ec661db0"><enum>(i)</enum><text>contain a description of
the charges against the person that is the subject of the complaint; and</text>
</clause><clause id="ID879490f2239d401cbd301bce60b8f623"><enum>(ii)</enum><text>have attached or contain
a notice of hearing that specifies the date and location of the hearing
regarding the complaint.</text>
</clause></subparagraph><subparagraph id="IDe91336ccb45e486485df8daba4859a67"><enum>(C)</enum><header>Hearing</header><text>A
hearing described in subparagraph (B)(ii)—</text>
<clause id="IDbe7b065fdece40a9a499ef5c5c799ab5"><enum>(i)</enum><text>shall be held not later
than 3 days after service of the complaint described in subparagraph
(A);</text>
</clause><clause id="ID2cd4de14e7924a9f9d314fa5114996d4"><enum>(ii)</enum><text>shall require the person
to show cause regarding why—</text>
<subclause id="IDaf5f559556eb4e43b6707d27d4c5a786"><enum>(I)</enum><text>an order should not be
made—</text>
<item id="IDc587145968a74249b01dd6969b0e4e74"><enum>(aa)</enum><text>to prohibit the person
from trading on, or subject to the rules of, any registered entity; and</text>
</item><item id="ID17bff907a02b43639505b8a0bfa16c84"><enum>(bb)</enum><text>to direct all registered
entities to refuse all privileges to the person until further notice of the
Commission; and</text>
</item></subclause><subclause id="ID822bc25b6fe149fab507c56cce8df88c"><enum>(II)</enum><text>the registration of the
person, if registered with the Commission in any capacity, should not be
suspended or revoked; and</text>
</subclause></clause><clause id="ID256348f06931469e86a40f90b243860e"><enum>(iii)</enum><text>may be held
before—</text>
<subclause id="IDf9a4fa29ab3448ac9dfa9b5e895bf960"><enum>(I)</enum><text>the Commission; or</text>
</subclause><subclause id="IDf3258f7cb33c4aeebbf7c830cc62c403"><enum>(II)</enum><text>an administrative law
judge designated by the Commission, under which the administrative law judge
shall ensure that all evidence is recorded in written form and submitted to the
Commission.</text>
</subclause></clause></subparagraph></paragraph><paragraph id="ID39367cf934e44592be74a32ada16e1bb"><enum>(5)</enum><header>Subpoena</header><text>For
the purpose of securing effective enforcement of the provisions of this Act,
for the purpose of any investigation or proceeding under this Act, and for the
purpose of any action taken under section 12(f) of this Act, any member of the
Commission or any Administrative Law Judge or other officer designated by the
Commission (except as provided in paragraph (7)) may administer oaths and
affirmations, subpoena witnesses, compel their attendance, take evidence, and
require the production of any books, papers, correspondence, memoranda, or
other records that the Commission deems relevant or material to the
inquiry.</text>
</paragraph><paragraph id="ID0a013e6cb5d444e4af56ead662f353c1"><enum>(6)</enum><header>Witnesses</header><text>The
attendance of witnesses and the production of any such records may be required
from any place in the United States, any State, or any foreign country or
jurisdiction at any designated place of hearing.</text>
</paragraph><paragraph id="ID0f4f980a65cc472b9634db2b3169523d"><enum>(7)</enum><header>Service</header><text>A
subpoena issued under this section may be served upon any person who is not to
be found within the territorial jurisdiction of any court of the United States
in such manner as the Federal Rules of Civil Procedure prescribe for service of
process in a foreign country, except that a subpoena to be served on a person
who is not to be found within the territorial jurisdiction of any court of the
United States may be issued only on the prior approval of the
Commission.</text>
</paragraph><paragraph id="IDf58ee6cd9f50433f896d605b2204e4e8"><enum>(8)</enum><header>Refusal to
obey</header><text>In case of contumacy by, or refusal to obey a subpoena
issued to, any person, the Commission may invoke the aid of any court of the
United States within the jurisdiction in which the investigation or proceeding
is conducted, or where such person resides or transacts business, in requiring
the attendance and testimony of witnesses and the production of books, papers,
correspondence, memoranda, and other records. Such court may issue an order
requiring such person to appear before the Commission or member or
Administrative Law Judge or other officer designated by the Commission, there
to produce records, if so ordered, or to give testimony touching the matter
under investigation or in question.</text>
</paragraph><paragraph id="ID86a393ab67ba4b01bd42d26c58cbb302"><enum>(9)</enum><header>Failure to
obey</header><text>Any failure to obey such order of the court may be punished
by the court as a contempt thereof. All process in any such case may be served
in the judicial district wherein such person is an inhabitant or transacts
business or wherever such person may be found.</text>
</paragraph><paragraph id="ID84bad65e051f4f63be92742e775e434e"><enum>(10)</enum><header>Evidence</header><text>On
the receipt of evidence under paragraph (4)(C)(iii), the Commission may—</text>
<subparagraph id="ID646cbd12bbc24cf38ed15d46e8a0ba1a"><enum>(A)</enum><text>prohibit the person that
is the subject of the hearing from trading on, or subject to the rules of, any
registered entity and require all registered entities to refuse the person all
privileges on the registered entities for such period as the Commission may
require in the order;</text>
</subparagraph><subparagraph id="IDedfdd75005b74572b1a0402f34b1bbbc"><enum>(B)</enum><text>if the person is
registered with the Commission in any capacity, suspend, for a period not to
exceed 180 days, or revoke, the registration of the person;</text>
</subparagraph><subparagraph id="IDfa24d6ae4f8e40cab9cf8bd81e7e8a1c"><enum>(C)</enum><text>assess such
person—</text>
<clause id="ID1048e88a7c8645f0b594154ce2653aac"><enum>(i)</enum><text>a civil penalty of not
more than an amount equal to the greater of—</text>
<subclause id="ID6a87b276058e4353934767092164dd7c"><enum>(I)</enum><text>$140,000; or</text>
</subclause><subclause id="IDd5549cf09633449fad76270954488002"><enum>(II)</enum><text>triple the monetary gain
to such person for each such violation; or</text>
</subclause></clause><clause id="ID9e51c224bc25422d8065f7e1ebab0b9b"><enum>(ii)</enum><text>in any case of
manipulation or attempted manipulation in violation of this subsection or
section 9(a)(2), a civil penalty of not more than an amount equal to the
greater of—</text>
<subclause id="ID4cf57a195ca043448caff9839e4f26da"><enum>(I)</enum><text>$1,000,000; or</text>
</subclause><subclause id="IDd228d8c6e82149c68cc03bc78d6e62e4"><enum>(II)</enum><text>triple the monetary gain
to the person for each such violation; and</text>
</subclause></clause></subparagraph><subparagraph id="ID95366c88b1ff4a04914cb867faaf8df5"><enum>(D)</enum><text>require restitution to
customers of damages proximately caused by violations of the person.</text>
</subparagraph></paragraph><paragraph id="ID6f80da4447954d38977ce7dd8f089487"><enum>(11)</enum><header>Orders</header>
<subparagraph id="IDbed36db79de34002a5eb3aabdf3823bf"><enum>(A)</enum><header>Notice</header><text>The
Commission shall provide to a person described in paragraph (10) and the
appropriate governing board of the registered entity notice of the order
described in paragraph (10) by—</text>
<clause id="ID5f39ed8d55c5441ea5e4f88107cc541b"><enum>(i)</enum><text>registered mail;</text>
</clause><clause id="IDabe71525a9d343ef87a67ee0818278de"><enum>(ii)</enum><text>certified mail;
or</text>
</clause><clause id="ID1ae94b5e485f4d99b0b09d2225ab2f41"><enum>(iii)</enum><text>personal
delivery.</text>
</clause></subparagraph><subparagraph id="ID88b630a59d3749bc92b6a256f7bab734"><enum>(B)</enum><header>Review</header>
<clause id="ID8b8f282f84fe4030881c95c0cbb09c25"><enum>(i)</enum><header>In
general</header><text>A person described in paragraph (10) may obtain a review
of the order or such other equitable relief as determined to be appropriate by
a court described in clause (ii).</text>
</clause><clause id="ID082c8ea91eec4eefb62bf97fabb4ea02"><enum>(ii)</enum><header>Petition</header><text>To
obtain a review or other relief under clause (i), a person may, not later than
15 days after notice is given to the person under clause (i), file a written
petition to set aside the order with the United States Court of Appeals—</text>
<subclause id="ID1205fb5b41e1485497df9c0cfa19aa8a"><enum>(I)</enum><text>for the circuit in which
the petitioner carries out the business of the petitioner; or</text>
</subclause><subclause id="IDdb3fc1a0a8c94b1786a93c84f68913cf"><enum>(II)</enum><text>in the case of an order
denying registration, the circuit in which the principal place of business of
the petitioner is located, as listed on the application for registration of the
petitioner.</text>
</subclause></clause></subparagraph><subparagraph id="IDb82c1bfc2f004b48a620f1ce4dc4ed98"><enum>(C)</enum><header>Procedure</header>
<clause id="ID920a3174823e419ebf1f0c11e55e1411"><enum>(i)</enum><header>Duty of clerk of
appropriate court</header><text>The clerk of the appropriate court under
subparagraph (B)(ii) shall transmit to the Commission a copy of a petition
filed under subparagraph (B)(ii).</text>
</clause><clause id="IDd0905329f2474e0d8333971630b128e1"><enum>(ii)</enum><header>Duty of
commission</header><text>In accordance with section 2112 of title 28, United
States Code, the Commission shall file in the appropriate court described in
subparagraph (B)(ii) the record theretofore made.</text>
</clause><clause id="ID0262c50bcacc4cbeafe818a99e631227"><enum>(iii)</enum><header>Jurisdiction of
appropriate court</header><text>Upon the filing of a petition under
subparagraph (B)(ii), the appropriate court described in subparagraph (B)(ii)
shall have jurisdiction to affirm, set aside, or modify the order of the
Commission, and the findings of the Commission as to the facts, if supported by
the weight of evidence, shall in like manner be
conclusive.</text>
</clause></subparagraph></paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="IDae7d3c5ddd54494c914ea3e8a98ef160"><enum>(b)</enum><header>Cease and desist
orders, fines</header><text>Section 6(d) of the Commodity Exchange Act (7
U.S.C. 13b) is amended to read as follows:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idAC72861DA36046DD848122AB758EB0D1" reported-display-style="italic" style="OLC">
<subsection id="ID17494aa24eb54e4886da1a48f90cd4fd"><enum>(d)</enum><text>If any person (other than
a registered entity), is violating or has violated subsection (c) or any other
provisions of this Act or of the rules, regulations, or orders of the
Commission thereunder, the Commission may, upon notice and hearing, and subject
to appeal as in other cases provided for in subsection (c), make and enter an
order directing that such person shall cease and desist therefrom and, if such
person thereafter and after the lapse of the period allowed for appeal of such
order or after the affirmance of such order, shall fail or refuse to obey or
comply with such order, such person shall be guilty of a misdemeanor and, upon
conviction thereof, shall be fined not more than the higher of $140,000 or
triple the monetary gain to such person, or imprisoned for not less than six
months nor more than one year, or both, except that if such failure or refusal
to obey or comply with such order involves any offense within subsection (a) or
(b) of section 9 of this Act, such person shall be guilty of a felony and, upon
conviction thereof, shall be subject to the penalties of said subsection (a) or
(b): Provided, That any such cease and desist order under this subsection
against any respondent in any case of manipulation shall be issued only in
conjunction with an order issued against such respondent under subsection (c).
Each day during which such failure or refusal to obey or comply with such order
continues shall be deemed a separate
offense.</text>
</subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="ID49d8447d6c5d46a890347cc7a154932d"><enum>(c)</enum><header>Manipulations; private
rights of action</header><text>Section 22(a)(1) of the Commodity Exchange Act
(7 U.S.C. 25(a)(1)) is amended by striking subparagraph (D) and inserting the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id3F4327CCC0AC4DD8A11F9FF6E2488163" reported-display-style="italic" style="OLC">
<subparagraph id="IDaad1bb3a50ce46b6aa79f55e99f49ecb"><enum>(D)</enum><text>who purchased or sold a
contract referred to in subparagraph (B) hereof or swap if the violation
constitutes—</text>
<clause id="idE81D8134C2164EB2A8F551D9346A3B74"><enum>(i)</enum><text>the use or employment of,
or an attempt to use or employ, in connection with a swap, or a contract of
sale of a commodity, in interstate commerce, or for future delivery on or
subject to the rules of any registered entity, any manipulative device or
contrivance in contravention of such rules and regulations as the Commission
shall promulgate by not later than 1 year after the date of enactment of the
Restoring American Financial Stability Act of 2010; or</text>
</clause><clause id="ID664c660d997347229aab1d3524138dd8"><enum>(ii)</enum><text>a manipulation of the
price of any such contract or swap or the price of the commodity underlying
such contract or
swap.</text>
</clause></subparagraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="ID93ce8385162148cea4269c00b3cc7a24"><enum>(d)</enum><header>Effective date</header>
<paragraph id="id63D0C5A66DDC4B60B0C8FF967688E032"><enum>(1)</enum><text>The amendments made by
this section shall take effect on the date on which the final rule promulgated
by the Commodity Futures Trading Commission pursuant to this Act takes
effect.</text>
</paragraph><paragraph id="ID05e0e01af367423c85cadc7a84e47410"><enum>(2)</enum><text>Paragraph (1) shall not
preclude the Commission from undertaking prior to the effective date any
rulemaking necessary to implement the amendments contained in this
section.</text>
</paragraph></subsection></section><section id="id0313F110BFCA4A6A8EFF43088A620ECE"><enum>754.</enum><header>Effective
date</header><text display-inline="no-display-inline">Unless otherwise provided
in this title, this subtitle shall take effect on the date that is 180 days
after the date of enactment of this Act.</text>
</section></part></subtitle><subtitle id="H59FD1F324C664AF59E0EBDEF8BB8D250"><enum>B</enum><header>Regulation of
Security-Based Swap Markets</header>
<section id="HF2F11766A476400B802108128FE3756A"><enum>761.</enum><header>Definitions under the
Securities Exchange Act of 1934</header>
<subsection id="H6611479C9C6A458BA145A11FA0A7EFE4"><enum>(a)</enum><header>Definitions</header><text display-inline="yes-display-inline">Section 3(a) of the Securities Exchange Act
of 1934 (15 U.S.C. 78c(a)) is amended—</text>
<paragraph id="H547A4E15F96B40FCB62620E41AE256E0"><enum>(1)</enum><text>in subparagraphs (A) and
(B) of paragraph (5), by inserting <quote>(not including security-based swaps,
other than security-based swaps with or for persons that are not eligible
contract participants)</quote> after <quote>securities</quote> each place that
term appears;</text>
</paragraph><paragraph id="HF18DD3BDA49B46C6B4CEEB2F0FA3CBFD"><enum>(2)</enum><text>in paragraph (10), by
inserting <quote>security-based swap,</quote> after <quote>security
future,</quote>;</text>
</paragraph><paragraph id="H6BB6174F01CC4671B0CF62C089CF25D7"><enum>(3)</enum><text>in paragraph (13), by
adding at the end the following: <quote>For security-based swaps, such terms
include the execution, termination (prior to its scheduled maturity date),
assignment, exchange, or similar transfer or conveyance of, or extinguishing of
rights or obligations under, a security-based swap, as the context may
require.</quote>;</text>
</paragraph><paragraph id="H605EABFECAD84E4888BFEA4F81723AB5"><enum>(4)</enum><text>in paragraph (14), by
adding at the end the following: <quote>For security-based swaps, such terms
include the execution, termination (prior to its scheduled maturity date),
assignment, exchange, or similar transfer or conveyance of, or extinguishing of
rights or obligations under, a security-based swap, as the context may
require.</quote>;</text>
</paragraph><paragraph id="HCD2E7A87BD024FFE84E661F811E1294E"><enum>(5)</enum><text>in paragraph (39)—</text>
<subparagraph id="H4307E0700BA84FF1819E5C102EA6B88B"><enum>(A)</enum><text>in subparagraph
(B)(i)—</text>
<clause id="idCD7436A3F1924DEA96C33CA3BD5617D4"><enum>(i)</enum><text>in subclause (I), by
striking <quote>or government securities dealer</quote> and inserting
<quote>government securities dealer, security-based swap dealer, or major
security-based swap participant</quote>; and</text>
</clause><clause id="H7BC76DEF2073460B8C44E0EB6DFF568D"><enum>(ii)</enum><text>in subclause (II), by
inserting <quote>security-based swap dealer, major security-based swap
participant,</quote> after <quote>government securities dealer,</quote>;</text>
</clause></subparagraph><subparagraph id="H559CC1FA7BFB42C988DF78EA83EC62A3"><enum>(B)</enum><text>in subparagraph (C), by
striking <quote>or government securities dealer</quote> and inserting
<quote>government securities dealer, security-based swap dealer, or major
security-based swap participant</quote>; and</text>
</subparagraph><subparagraph id="HD3B1D397567C4A3B82EEC8B905C0DCF0"><enum>(C)</enum><text>in subparagraph (D), by
inserting <quote>security-based swap dealer, major security-based swap
participant,</quote> after <quote>government securities dealer,</quote>;
and</text>
</subparagraph></paragraph><paragraph id="H2F1C78001B7B42FDBB7FD4E4AEA29985"><enum>(6)</enum><text>by adding at the end the
following:</text>
<quoted-block changed="added" id="HB5E387BCC14841F2A7ECCE92C9EDA6E8" reported-display-style="italic" style="OLC">
<paragraph id="H51B0EA0C4FE447EE998F835FA76D79A7"><enum>(65)</enum><header>Eligible contract
participant</header><text>The term <term>eligible contract participant</term>
has the same meaning as in section 1a of the Commodity Exchange Act (7 U.S.C.
1a).</text>
</paragraph><paragraph id="H0CAB5B8DFDEB41E1891A5E742B5D8CB0"><enum>(66)</enum><header>Major swap
participant</header><text>The term <term>major swap participant</term> has the
same meaning as in section 1a of the Commodity Exchange Act (7 U.S.C.
1a).</text>
</paragraph><paragraph id="IDa0acb2ce230649e1a3170e514fe409cc"><enum>(67)</enum><header>Major security-based
swap participant</header>
<subparagraph id="id1E5F9094636B45E8B7BAEB6E968A1D8A"><enum>(A)</enum><header>In
general</header><text>The term <term>major security-based swap
participant</term> means any person—</text>
<clause id="idB0946F9603D04203960ABA701E2763FD"><enum>(i)</enum><text>who is not a
security-based swap dealer; and</text>
</clause><clause id="id5323A637F905409696F030210BCF0782"><enum>(ii)</enum><subclause commented="no" display-inline="yes-display-inline" id="id109E110E3E67455097558FF2899E148D"><enum>(I)</enum><text>who maintains a
substantial position in security-based swaps for any of the major
security-based swap categories, as such categories are determined by the
Commission, excluding—</text>
<item changed="added" id="id5F2CAE99736E421AA0A5A60DF1762734" indent="up1" reported-display-style="italic"><enum>(aa)</enum><text>positions held for
hedging or mitigating commercial risk; and</text>
</item><item changed="added" id="id3416074C2DE84BB7845AFA493D3F923C" indent="up1" reported-display-style="italic"><enum>(bb)</enum><text>positions maintained by
any employee benefit plan (or any contract held by such a plan), as that term
is defined in paragraphs (3) and (32) of section 3 of the Employee Retirement
Income Security Act of 1974 (29 U.S.C. 1002), for the primary purpose of
hedging or mitigating any risk directly associated with the operation of the
plan;</text>
</item></subclause><subclause changed="added" id="id448A4E4D7B6E410CAA169A4AA1DA2FB0" indent="up1" reported-display-style="italic"><enum>(II)</enum><text>whose outstanding
security-based swaps create substantial counterparty exposure that could have
serious adverse effects on the financial stability of the United States banking
system or financial markets; or</text>
</subclause><subclause changed="added" id="id31577326D99841B1AC4670F969673899" indent="up1" reported-display-style="italic"><enum>(III)</enum><text>that is a financial
entity that—</text>
<item id="idCB245A76FC364B7ABB010B6F248B0006"><enum>(aa)</enum><text>is
highly leveraged relative to the amount of capital such entity holds;
and</text>
</item><item id="id31E9B80DD93A425E9B626638ED614A26"><enum>(bb)</enum><text>maintains a substantial
position in outstanding security-based swaps in any major security-based swap
category, as such categories are determined by the Commission.</text>
</item></subclause></clause></subparagraph><subparagraph id="id4C090CC0783A49F888DA7ADAE5D29AE3"><enum>(B)</enum><header>Definition of
substantial position</header><text>For purposes of subparagraph (A), the
Commission shall define, by rule or regulation, the term <term>substantial
position</term> at the threshold that the Commission determines to be prudent
for the effective monitoring, management, and oversight of entities that are
systemically important or can significantly impact the financial system of the
United States.</text>
</subparagraph><subparagraph id="id9D12F8AE9EA8424FAE67D35A83ECB76E"><enum>(C)</enum><header>Scope of
designation</header><text>For purposes of subparagraph (A), a person may be
designated as a major security-based swap participant for 1 or more categories
of security-based swaps without being classified as a major security-based swap
participant for all classes of security-based swaps.</text>
</subparagraph><subparagraph id="idBB75C237C30E488EBF9FC8FFD307DFD8"><enum>(D)</enum><header>Capital</header><text>In
setting capital requirements for a person that is designated as a major
security-based swap participant for a single type or single class or category
of security-based swap or activities, the prudential regulator and the
Commission shall take into account the risks associated with other types of
security-based swaps or classes of security-based swaps or categories of
security-based swaps engaged in and the other activities conducted by that
person that are not otherwise subject to regulation applicable to that person
by virtue of the status of the person as a major security-based swap
participant.</text>
</subparagraph></paragraph><paragraph id="H4BD539FBD5C347ADA07D03DACE23E925"><enum>(68)</enum><header>Security-based
swap</header>
<subparagraph id="HCFFA9FD249FA4AD28F934EA9CA866088"><enum>(A)</enum><header>In
general</header><text>Except as provided in subparagraph (B), the term
<term>security-based swap</term> means any agreement, contract, or transaction
that—</text>
<clause id="idCD558386112240DDA541630CD2EAD9E0"><enum>(i)</enum><text>is a swap, as that term
is defined under section 1a of the Commodity Exchange Act; and</text>
</clause><clause id="id2924B5269A784560A0E02CF90CBA41BB"><enum>(ii)</enum><text>is based on—</text>
<subclause id="H728B4CAC00E24F868822C3BFCCB0697B"><enum>(I)</enum><text>an index that is a
narrow-based security index, including any interest therein or on the value
thereof;</text>
</subclause><subclause id="HE9F431645E304E0E8D23759963E57D31"><enum>(II)</enum><text>a single security or
loan, including any interest therein or on the value thereof; or</text>
</subclause><subclause id="H5CABC0A09FB94DF181BEA69D2AA815DB"><enum>(III)</enum><text>the occurrence,
nonoccurrence, or extent of the occurrence of an event relating to a single
issuer of a security or the issuers of securities in a narrow-based security
index, provided that such event directly affects the financial statements,
financial condition, or financial obligations of the issuer.</text>
</subclause></clause></subparagraph><subparagraph id="H85E73B8A06B04B43814CB701CB61C039"><enum>(B)</enum><header>Rule of construction
regarding master agreements</header><text>The term <term>security-based
swap</term> shall be construed to include a master agreement that provides for
an agreement, contract, or transaction that is a security-based swap pursuant
to subparagraph (A), together with all supplements to any such master
agreement, without regard to whether the master agreement contains an
agreement, contract, or transaction that is not a security-based swap pursuant
to subparagraph (A), except that the master agreement shall be considered to be
a security-based swap only with respect to each agreement, contract, or
transaction under the master agreement that is a security-based swap pursuant
to subparagraph (A).</text>
</subparagraph><subparagraph id="H609BBF22FC624AA5BEF792FACB0BB915"><enum>(C)</enum><header>Exclusions</header><text display-inline="yes-display-inline">The term <term>security-based swap</term>
does not include any agreement, contract, or transaction that meets the
definition of a security-based swap only because such agreement, contract, or
transaction references, is based upon, or settles through the transfer,
delivery, or receipt of an exempted security under paragraph (12), as in effect
on the date of enactment of the Futures Trading Act of 1982 (other than any
municipal security as defined in paragraph (29) as in effect on the date of
enactment of the Futures Trading Act of 1982), unless such agreement, contract,
or transaction is of the character of, or is commonly known in the trade as, a
put, call, or other option.</text>
</subparagraph><subparagraph id="ID3d431a7fc1764d60b01c8d3c4c82a7ad"><enum>(D)</enum><header>Mixed
swap</header><text>The term <quote>security-based swap</quote> includes any
agreement, contract, or transaction that is as described in subparagraph (A)
and also is based on the value of 1 or more interest or other rates,
currencies, commodities, instruments of indebtedness, indices, quantitative
measures, other financial or economic interest or property of any kind (other
than a single security or a narrow-based security index), or the occurrence,
non-occurrence, or the extent of the occurrence of an event or contingency
associated with a potential financial, economic, or commercial consequence
(other than an event described in subparagraph (A)(ii)(III)).</text>
</subparagraph></paragraph><paragraph id="HD6E4E884FBD440A984B2FC425A42BC4A"><enum>(69)</enum><header>Swap</header><text>The
term <term>swap</term> has the same meaning as in section 1a of the Commodity
Exchange Act (7 U.S.C. 1a).</text>
</paragraph><paragraph id="HB9B80F677C7D4BD1B61B01B296D40ACE"><enum>(70)</enum><header>Person associated with
a security-based swap dealer or major security-based swap participant</header>
<subparagraph id="id2130C000CDBA4960B0B57A01B5D04A9A"><enum>(A)</enum><header>In
general</header><text>The term <term>person associated with a security-based
swap dealer or major security-based swap participant</term> or <term>associated
person of a security-based swap dealer or major security-based swap
participant</term> means—</text>
<clause id="idC201D537C08F4EA1AEDBBDBFD1D824BF"><enum>(i)</enum><text>any partner, officer,
director, or branch manager of such security-based swap dealer or major
security-based swap participant (or any person occupying a similar status or
performing similar functions);</text>
</clause><clause id="idCD7AB24548AC4B0291DC1DBA425165D3"><enum>(ii)</enum><text>any person directly or
indirectly controlling, controlled by, or under common control with such
security-based swap dealer or major security-based swap participant; or</text>
</clause><clause id="id7EF1392511C0499494DB495CEDC6EF16"><enum>(iii)</enum><text>any employee of such
security-based swap dealer or major security-based swap participant.</text>
</clause></subparagraph><subparagraph id="id01E083CB678F435F9B16A15008FED301"><enum>(B)</enum><header>Exclusion</header><text>Other
than for purposes of section 15F(l)(2), the term <term>person associated with a
security-based swap dealer or major security-based swap participant</term> or
<term>associated person of a security-based swap dealer or major security-based
swap participant</term> does not include any person associated with a
security-based swap dealer or major security-based swap participant whose
functions are solely clerical or ministerial.</text>
</subparagraph></paragraph><paragraph id="H8D292561388A49969085FE75D22EF76E"><enum>(71)</enum><header>Security-based swap
dealer</header>
<subparagraph id="H55DE039115224B8A9E33428D6ED4D0F2"><enum>(A)</enum><header>In
general</header><text>The term <term>security-based swap dealer</term> means
any person who—</text>
<clause id="H2C613EEFDD444C8E8F8AA525F14F81BD"><enum>(i)</enum><text display-inline="yes-display-inline">holds themself out as a dealer in
security-based swaps;</text>
</clause><clause id="H3D37202B88554A308B4B0DFC7533D7C9"><enum>(ii)</enum><text>makes a market in
security-based swaps;</text>
</clause><clause id="HE0DAE846806340A7BFE7101B4CADA4D4"><enum>(iii)</enum><text>regularly engages in
the purchase and sale of security-based swaps in the ordinary course of a
business; or</text>
</clause><clause id="H878765FAC0BD4AD6819860EE180041E3"><enum>(iv)</enum><text>engages in any activity
causing it to be commonly known in the trade as a dealer or market maker in
security-based swaps.</text>
</clause></subparagraph><subparagraph id="id6AD1168503914138B8C01219E07A0B80"><enum>(B)</enum><header>Designation by type or
class</header><text>A person may be designated as a security-based swap dealer
for a single type or single class or category of security-based swap or
activities and considered not to be a security-based swap dealer for other
types, classes, or categories of security-based swaps or activities.</text>
</subparagraph><subparagraph id="id3E94687ED5CF42A4AC2A10356F5CDC0E"><enum>(C)</enum><header>Capital</header><text>In
setting capital requirements for a person that is designated as a
security-based swap dealer for a single type or single class or category of
security-based swap or activities, the prudential regulator and the Commission
shall take into account the risks associated with other types of security-based
swaps or classes of security-based swaps or categories of security-based swaps
engaged in and the other activities conducted by that person that are not
otherwise subject to regulation applicable to that person by virtue of the
status of the person as a security-based swap dealer.</text>
</subparagraph></paragraph><paragraph id="HB0BDEC4A1BD6407F906424825D37D189"><enum>(72)</enum><header>Appropriate Federal
banking agency</header><text>The term <term>appropriate Federal banking
agency</term> has the same meaning as in section 3(q) of the Federal Deposit
Insurance Act (12 U.S.C. 1813(q)).</text>
</paragraph><paragraph id="H11E1112951F14F20BDF146B478D20CB6"><enum>(73)</enum><header>Board</header><text>The
term <term>Board</term> means the Board of Governors of the Federal Reserve
System.</text>
</paragraph><paragraph id="HE74F9C3FED064B72AB36BB9B8FD23986"><enum>(74)</enum><header>Prudential
regulator</header><text>The term <term>prudential regulator</term> has the same
meaning as in section 1a of the Commodity Exchange Act (7 U.S.C. 1a).</text>
</paragraph><paragraph id="H01CF8DC850B34481809F38C04B985029"><enum>(75)</enum><header>Security-based swap
data repository</header><text display-inline="yes-display-inline">The term
<term>security-based swap data repository</term> means any person that
collects, calculates, prepares, or maintains information or records with
respect to transactions or positions in, or the terms and conditions of,
security-based swaps entered into by third parties.</text>
</paragraph><paragraph id="HC2EA2DB7F6CD4730A5E2FFD6EFDCA25F"><enum>(76)</enum><header>Swap
dealer</header><text>The term <term>swap dealer</term> has the same meaning as
in section 1a of the Commodity Exchange Act (7 U.S.C. 1a).</text>
</paragraph><paragraph id="HE3CF4FFE44B140649347860E0517AF3D"><enum>(77)</enum><header>Swap execution
facility</header><text>The term <term>swap execution facility</term> means a
facility in which multiple participants have the ability to execute or trade
security-based swaps by accepting bids and offers made by other participants
that are open to multiple participants in the facility or system, or
confirmation facility, that—</text>
<subparagraph id="id2356536F3A1645BDA0F6B7DB7D3345C2"><enum>(A)</enum><text>facilitates the execution
of security-based swaps between persons; and</text>
</subparagraph><subparagraph id="id77823DC794274BB3BD0AE24DE490267D"><enum>(B)</enum><text>is not a designated
contract market.</text>
</subparagraph></paragraph><paragraph id="id177280FFBEE04457B6233BE3F9EEB73F"><enum>(78)</enum><header>Security-based swap
agreement</header>
<subparagraph id="id9937D515D1494C0AB6F79E77FFB337F9"><enum>(A)</enum><header>In
general</header><text>For purposes of sections 9, 10, 16, 20, and 21A of this
Act, and section 17 of the Securities Act of 1933 (15 U.S.C. 77q), the term
<quote>security-based swap agreement</quote> means a swap agreement as defined
in section 206A of the Gramm-Leach-Bliley Act (15 U.S.C. 78c note) of which a
material term is based on the price, yield, value, or volatility of any
security or any group or index of securities, or any interest therein.</text>
</subparagraph><subparagraph id="idC9D3F187460B4172890D16CF838B3377"><enum>(B)</enum><header>Exclusions</header><text>The
term <quote>security-based swap agreement</quote> does not include any
security-based
swap.</text>
</subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="H6031E36A1214448F898C75085F834EFE"><enum>(b)</enum><header>Authority To further
define terms</header><text display-inline="yes-display-inline">The Securities
and Exchange Commission may, by rule, further define the terms
<term>security-based swap</term>, <term>security-based swap dealer</term>,
<term>major security-based swap participant</term>, and <term>eligible contract
participant</term> with regard to security-based swaps (as such terms are
defined in the amendments made by subsection (a)) for the purpose of including
transactions and entities that have been structured to evade this subtitle or
the amendments made by this subtitle.</text>
</subsection><subsection id="id9496ECCA22474A46876E8B216302EE01"><enum>(c)</enum><header>Other incorporated
definitions</header><text display-inline="yes-display-inline">Except as the
context otherwise requires, in this subtitle, the terms <term>prudential
regulator</term>, <term>swap</term>, <term>swap dealer</term>, <term>major swap
participant</term>, <term>swap data repository</term>, <term>associated person
of a swap dealer or major swap participant</term>, <term>eligible contract
participant</term>, <term>swap execution facility</term>, <term>security-based
swap</term>, <term>security-based swap dealer</term>, <term>major
security-based swap participant</term>, <term>security-based swap data
repository</term>, and <term>associated person of a security-based swap dealer
or major security-based swap participant</term> have the same meanings as in
section 1a of the Commodity Exchange Act (7 U.S.C. 1a), as amended by this
Act.</text>
</subsection></section><section id="IDa05df65b935940baabd00ee35e35c726"><enum>762.</enum><header>Repeal of prohibition
on regulation of security-based swap agreements</header>
<subsection id="IDf1ed6ee0813946c38e9450cde074e7fe"><enum>(a)</enum><header>Repeal</header><text>Sections
206B and 206C of the Gramm-Leach-Bliley Act (Public Law 106–102; 15 U.S.C. 78c
note) are repealed.</text>
</subsection><subsection id="IDe8b31c97d5514620981cd1333f9c5166"><enum>(b)</enum><header>Conforming amendments
to the Securities Act of 1933</header>
<paragraph id="ID2fe676b6389640b7bb91a970d48256e0"><enum>(1)</enum><text>Section 2A of the
Securities Act of 1933 (15 U.S.C. 77b–1) is amended—</text>
<subparagraph id="ID2fc1800b79d44abaad9a8b2ea59940f9"><enum>(A)</enum><text>by striking subsection
(a) and reserving that subsection; and</text>
</subparagraph><subparagraph id="ID3096e32f963e4a8b86691c4decf453ba"><enum>(B)</enum><text>by striking <quote>(as
defined in section 206B of the Gramm-Leach-Bliley Act)</quote> each place that
such term appears and inserting <quote>(as defined in section 3(a)(78) of the
Securities Exchange Act of 1934)</quote>.</text>
</subparagraph></paragraph><paragraph id="ID74783dc6dc9848db99ddbddd4cfb3ab9"><enum>(2)</enum><text>Section 17 of the
Securities Act of 1933 (15 U.S.C. 77q) is amended—</text>
<subparagraph id="ID7d2b23896fc640ceb5007a86c2c54ada"><enum>(A)</enum><text>in subsection (a)—</text>
<clause id="IDd140fa88423b47168d03f21d95f302fb"><enum>(i)</enum><text>by inserting
<quote>(including security-based swaps)</quote> after
<quote>securities</quote>; and</text>
</clause><clause id="ID5e7182e3b90b455c90fe8e4f7c9e90e5"><enum>(ii)</enum><text>by striking <quote>(as
defined in section 206B of the Gramm-Leach-Bliley Act)</quote> and inserting
<quote>(as defined in section 3(a)(78) of the Securities Exchange Act)</quote>;
and</text>
</clause></subparagraph><subparagraph id="ID12dc74e5467848d1a27614e71b7b6936"><enum>(B)</enum><text>in subsection (d), by
striking “206B of the Gramm-Leach-Bliley Act” and inserting <quote>3(a)(78) of
the Securities Exchange Act of 1934</quote>.</text>
</subparagraph></paragraph></subsection><subsection id="ID3029a1ea51154858bacf6d80502081ce"><enum>(c)</enum><header>Conforming amendments
to the Securities Exchange Act of 1934</header><text>The Securities Exchange
Act of 1934 (15 U.S.C. 78a et seq.) is amended—</text>
<paragraph id="IDe979a619939f4048aaf227820e310a52"><enum>(1)</enum><text>in section 3A (15 U.S.C.
78c–1)—</text>
<subparagraph id="ID64d5ea9bf076400c8624458be4085233"><enum>(A)</enum><text>by striking subsection
(a) and reserving that subsection; and</text>
</subparagraph><subparagraph id="ID9eb89066ee1a4ff8b22db5b29ec25de0"><enum>(B)</enum><text>by striking “(as defined
in section 206B of the Gramm-Leach-Bliley Act)” each place that the term
appears;</text>
</subparagraph></paragraph><paragraph id="H8AD5502B5ED64CE9A7931699140DE5EB"><enum>(2)</enum><text>in section 9 (15 U.S.C.
78i)—</text>
<subparagraph id="id76405B6DF0D644B09FCAFA5E812D98F1"><enum>(A)</enum><text>in subsection (a), by
striking paragraphs (2) through (5) and inserting the following:</text>
<quoted-block changed="added" id="H846161F65CA249AA91B684F443F20E7E" reported-display-style="italic" style="OLC">
<paragraph id="H9CDBB2B528B94DCDA14AD29101ACB0E5" indent="up1"><enum>(2)</enum><text>To
effect, alone or with 1 or more other persons, a series of transactions in any
security registered on a national securities exchange, any security not so
registered, or in connection with any security-based swap or security-based
swap agreement with respect to such security creating actual or apparent active
trading in such security, or raising or depressing the price of such security,
for the purpose of inducing the purchase or sale of such security by
others.</text>
</paragraph><paragraph id="HE514A2ECF33C43FF9384013228E858BC" indent="up1"><enum>(3)</enum><text>If a
dealer, broker, security-based swap dealer, major security-based swap
participant, or other person selling or offering for sale or purchasing or
offering to purchase the security, a security-based swap, or a security-based
swap agreement with respect to such security, to induce the purchase or sale of
any security registered on a national securities exchange, any security not so
registered, any security-based swap, or any security-based swap agreement with
respect to such security by the circulation or dissemination in the ordinary
course of business of information to the effect that the price of any such
security will or is likely to rise or fall because of market operations of any
1 or more persons conducted for the purpose of raising or depressing the price
of such security.</text>
</paragraph><paragraph id="H8BB3DF9F5D984EB1B61569EC6B832789" indent="up1"><enum>(4)</enum><text>If a
dealer, broker, security-based swap dealer, major security-based swap
participant, or other person selling or offering for sale or purchasing or
offering to purchase the security, a security-based swap, or security-based
swap agreement with respect to such security, to make, regarding any security
registered on a national securities exchange, any security not so registered,
any security-based swap, or any security-based swap agreement with respect to
such security, for the purpose of inducing the purchase or sale of such
security, such security-based swap, or such security-based swap agreement any
statement which was at the time and in the light of the circumstances under
which it was made, false or misleading with respect to any material fact, and
which that person knew or had reasonable ground to believe was so false or
misleading.</text>
</paragraph><paragraph id="H79A6BF8C6481442ABC525561BACD9065" indent="up1"><enum>(5)</enum><text>For a
consideration, received directly or indirectly from a broker, dealer,
security-based swap dealer, major security-based swap participant, or other
person selling or offering for sale or purchasing or offering to purchase the
security, a security-based swap, or security-based swap agreement with respect
to such security, to induce the purchase of any security registered on a
national securities exchange, any security not so registered, any
security-based swap, or any security-based swap agreement with respect to such
security by the circulation or dissemination of information to the effect that
the price of any such security will or is likely to rise or fall because of the
market operations of any 1 or more persons conducted for the purpose of raising
or depressing the price of such
security.</text>
</paragraph><after-quoted-block>;
and</after-quoted-block></quoted-block>
</subparagraph><subparagraph id="ID6df43d6f3daa499c8501af23bab55f81"><enum>(B)</enum><text>in subsection (i), by
striking <quote>(as defined in section 206B of the Gramm-Leach-Bliley
Act)</quote>;</text>
</subparagraph></paragraph><paragraph id="IDd856076831894936bb96109deef20ff0"><enum>(3)</enum><text>in section 10 (15 U.S.C.
78j)—</text>
<subparagraph id="idD8AC91C293314705822DF6CC40629832"><enum>(A)</enum><text>in subsection (b), by
striking <quote>(as defined in section 206B of the Gramm-Leach-Bliley
Act),</quote> each place that term appears; and</text>
</subparagraph><subparagraph id="id0BDB61BCBEC84711A3E460D697CB8657"><enum>(B)</enum><text>in the matter following
subsection (b), by striking <quote>(as defined in section 206B of the
Gramm-Leach-Bliley Act)</quote>;</text>
</subparagraph></paragraph><paragraph id="IDfbf04f19af0e47b0be0caff8dcc292bf"><enum>(4)</enum><text>in section 15 (15 U.S.C.
78o)—</text>
<subparagraph id="IDafb7213f3eb04342918f5514566d2602"><enum>(A)</enum><text>in subsection (c)(1)(A),
by striking <quote>(as defined in section 206B of the Gramm-Leach-Bliley
Act),</quote>;</text>
</subparagraph><subparagraph id="IDc0f84613506642a899cfc54be0957419"><enum>(B)</enum><text>in subparagraphs (B) and
(C) of subsection (c)(1), by striking <quote>(as defined in section 206B of the
Gramm-Leach-Bliley Act)</quote> each place that term appears;</text>
</subparagraph><subparagraph id="ID5de05be9dd5a4aaebd7ea74a7e7b482e"><enum>(C)</enum><text>by redesignating
subsection (i), as added by section 303(f) of the Commodity Futures
Modernization Act of 2000 (Public Law 106–554; 114 Stat. 2763A–455)), as
subsection (j); and</text>
</subparagraph><subparagraph id="ID1fc27433beb642dca89f1521346a9117"><enum>(D)</enum><text>in subsection (j), as
redesignated by subparagraph (C), by striking <quote>(as defined in section
206B of the Gramm-Leach-Bliley Act)</quote>;</text>
</subparagraph></paragraph><paragraph id="ID988d6778d7da48d1a29dc9464ad7fdd6"><enum>(5)</enum><text>in section 16 (15 U.S.C.
78p)—</text>
<subparagraph id="ID4c8fdb05e21b4613b649ddf5e349487d"><enum>(A)</enum><text>in subsection (a)(2)(C),
by striking <quote>(as defined in section 206(b) of the Gramm-Leach-Bliley Act
(15 U.S.C. 78c note))</quote>;</text>
</subparagraph><subparagraph id="IDd10587f8e4bd4765bf5ca42949989fb0"><enum>(B)</enum><text>in subsection (a)(3)(B),
by inserting <quote>or security-based swaps</quote> after <quote>security-based
swap agreement</quote>;</text>
</subparagraph><subparagraph id="IDa2b4260151804508949c128fea452e2f"><enum>(C)</enum><text>in the first sentence of
subsection (b), by striking <quote>(as defined in section 206B of the
Gramm-Leach-Bliley Act)</quote>;</text>
</subparagraph><subparagraph id="ID25c2bd5978e14b69ae14248ee886be97"><enum>(D)</enum><text>in the third sentence of
subsection (b), by striking <quote>(as defined in section 206B of the
Gramm-Leach Bliley Act)</quote> and inserting <quote>or a security-based
swap</quote>; and</text>
</subparagraph><subparagraph id="ID9c4f65ec88a745b7be9a99ebd6d11840"><enum>(E)</enum><text>in subsection (g), by
striking <quote>(as defined in section 206B of the Gramm-Leach-Bliley
Act)</quote>;</text>
</subparagraph></paragraph><paragraph id="ID134157cb267a46e98ef85cfe39df547f"><enum>(6)</enum><text>in section 20 (15 U.S.C.
78t),</text>
<subparagraph id="ID4944f6782a21458db58c4c53084e990c"><enum>(A)</enum><text>in subsection (d), by
striking <quote>(as defined in section 206B of the Gramm-Leach-Bliley
Act)</quote>; and</text>
</subparagraph><subparagraph id="IDf90f791b8ebc47328ef2fba7f8bd05b9"><enum>(B)</enum><text>in subsection (f), by
striking <quote>(as defined in section 206B of the Gramm-Leach-Bliley
Act)</quote>;</text>
</subparagraph></paragraph><paragraph id="ID6490d151768e4832b43873cc06020812"><enum>(7)</enum><text>in section 21A (15 U.S.C.
78u–1)—</text>
<subparagraph id="IDed8bba6550e642fb8a7c0881bde80ba3"><enum>(A)</enum><text>in subsection (a)(1), by
striking <quote>(as defined in section 206B of the Gramm-Leach-Bliley
Act)</quote>; and</text>
</subparagraph><subparagraph id="ID6fee7ea9e7ad486fac486e573eb9e392"><enum>(B)</enum><text>in subsection (g), by
striking <quote>(as defined in section 206B of the Gramm-Leach-Bliley
Act)</quote>.</text>
</subparagraph></paragraph></subsection></section><section id="HD123621C0F794AE18156C6C902F54F9D"><enum>763.</enum><header>Amendments to the
Securities Exchange Act of 1934</header>
<subsection id="H80062058AE954F46B16B4E4FC34E4CEC"><enum>(a)</enum><header>Clearing for
security-based swaps</header><text>The Securities Exchange Act of 1934 (15
U.S.C. 78a et seq.) is amended by inserting after section 3B (as added by
section 717 of this Act):</text>
<quoted-block changed="added" display-inline="no-display-inline" id="H46818561C6C7480290A96EF53C7EF92E" reported-display-style="italic" style="OLC">
<section id="H84D9CEC23C564872B9E6D9D42AC9A105"><enum>3C.</enum><header>Clearing for
security-based swaps</header>
<subsection id="id8F459919108541EDBA96F731380D89D3"><enum>(a)</enum><header>Clearing
requirement</header>
<paragraph id="idA80323C6B9B94C238603AA8FB5687233"><enum>(1)</enum><header>Submission</header>
<subparagraph id="id7351E97547614FABB1104AAECE43AADC"><enum>(A)</enum><header>In
general</header><text>Except as provided in paragraphs (9) and (10), any person
who is a party to a security-based swap shall submit such security-based swap
for clearing to a clearing agency registered under section 17A of this
title.</text>
</subparagraph><subparagraph id="id99C2882B0D3E4AFFA81D0B64CE278E0F"><enum>(B)</enum><header>Open
access</header><text>The rules of a registered clearing agency shall—</text>
<clause id="ID4aff9de7658d4dcb8234b4bffc8fd657"><enum>(i)</enum><text>prescribe that all
security-based swaps with the same terms and conditions are economically
equivalent and may be offset with each other within the clearing agency;
and</text>
</clause><clause id="IDfa786eb700ba416e826d6493c56dbe50"><enum>(ii)</enum><text>provide for
nondiscriminatory clearing of a security-based swap executed bilaterally or on
or through the rules of an unaffiliated national securities exchange or swap
execution facility, subject to the requirements of section 5(b).</text>
</clause></subparagraph></paragraph><paragraph id="idC5A0043B9EDD4662B707DB69531AC9D4"><enum>(2)</enum><header>Commission
approval</header>
<subparagraph id="IDa4c6bc4dcd8946779d8485caf863a4b6"><enum>(A)</enum><header>In
general</header><text>A clearing agency shall submit to the Commission for
prior approval any group, category, type, or class of security-based swaps that
the clearing agency seeks to accept for clearing, which submission the
Commission shall make available to the public.</text>
</subparagraph><subparagraph id="ID3dab54e2887f45e68c6400875949698d"><enum>(B)</enum><header>Deadline</header><text>The
Commission shall take final action on a request submitted pursuant to
subparagraph (A) not later than 90 days after submission of the request, unless
the clearing agency submitting the request agrees to an extension of the time
limitation established under this subparagraph.</text>
</subparagraph><subparagraph id="ID8a73b117c3ba4017b84d06e0cec823f8"><enum>(C)</enum><header>Approval</header><text>The
Commission shall approve, unconditionally or subject to such terms and
conditions as the Commission determines to be appropriate, any request
submitted pursuant to subparagraph (A) if the Commission finds that the request
is consistent with the requirements of section 17A. The Commission shall not
approve any such request if the Commission does not make such finding.</text>
</subparagraph><subparagraph id="IDd4c8f8bb5fb24dcfa98974c134762783"><enum>(D)</enum><header>Rules</header><text>The
Commission shall adopt rules for a clearing agency’s submission for approval,
pursuant to this paragraph, of any group, category, type, or class of
security-based swaps that the clearing agency seeks to accept for
clearing.</text>
</subparagraph></paragraph><paragraph id="IDb457e52134de4f9d8edc04828eefe469"><enum>(3)</enum><header>Stay of clearing
requirement</header><text>At any time after issuance of an approval pursuant to
paragraph (2):</text>
<subparagraph id="ID280dcfe66c8a4146b918e6d294d47c46"><enum>(A)</enum><header>Review
process</header><text>The Commission, on application of a counterparty to a
security-based swap or on its own initiative, may stay the clearing requirement
of paragraph (1) until the Commission completes a review of the terms of the
security-based swap, or the group, category, type, or class of security-based
swaps, and the clearing arrangement.</text>
</subparagraph><subparagraph id="ID134a8461ba614765a501a9281d5a4223"><enum>(B)</enum><header>Deadline</header><text>The
Commission shall complete a review undertaken pursuant to subparagraph (A) not
later than 90 days after issuance of the stay, unless the clearing agency that
clears the security-based swap, or the group, category, type, or class of
security-based swaps, agrees to an extension of the time limitation established
under this subparagraph.</text>
</subparagraph><subparagraph id="ID49210f7986c5457bb1b8157d2010374b"><enum>(C)</enum><header>Determination</header><text>Upon
completion of the review undertaken pursuant to subparagraph (A)—</text>
<clause id="ID6ebda42f3e6847e9b5ed6d7b77384e8a"><enum>(i)</enum><text>the Commission may
determine, unconditionally or subject to such terms and conditions as the
Commission determines to be appropriate, that the security-based swap, or the
group, category, type, or class of security-based swaps, must be cleared
pursuant to this subsection if the Commission finds that such clearing—</text>
<subclause id="ID17ee941f8b4f4878b201b568a158f410"><enum>(I)</enum><text>is consistent with the
requirements of section 17A; and</text>
</subclause><subclause id="ID03a0840553cc4ad9875b0583b0d8bf1e"><enum>(II)</enum><text>is otherwise in the
public interest, for the protection of investors, and consistent with the
purposes of this title;</text>
</subclause></clause><clause id="ID00d5e36b091f4fe982fd1948d7a54ae0"><enum>(ii)</enum><text>the Commission may
determine that the clearing requirement of paragraph (1) shall not apply to the
security-based swap, or the group, category, type, or class of security-based
swaps; or</text>
</clause><clause id="ID22eddab0dea4459ca56bd854ca6c5282"><enum>(iii)</enum><text>if a determination is
made that the clearing requirement of paragraph (1) shall no longer apply, then
the Commission may still permit such security-based swap, or the group,
category, type, or class of security-based swaps to be cleared.</text>
</clause></subparagraph><subparagraph id="IDcd7c65d2429943f59ac55d41f49f5fd6"><enum>(D)</enum><header>Rules</header><text>The
Commission shall adopt rules for reviewing, pursuant to this paragraph, a
clearing agency’s clearing of a security-based swap, or a group, category,
type, or class of security-based swaps that the Commission has accepted for
clearing.</text>
</subparagraph></paragraph><paragraph id="ID27c8a7ef2bf047efad7deac3a3b83836"><enum>(4)</enum><header>Security-based swaps
required to be accepted for clearing</header>
<subparagraph id="ID8d1aa7fad2fa4c96a5d0542b9bb5c5f2"><enum>(A)</enum><header>Rulemaking</header><text>The
Commission shall adopt rules to further identify any group, category, type, or
class of security-based swaps not submitted for approval under paragraph (2)
that the Commission deems should be accepted for clearing. In adopting such
rules, the Commission shall take into account the following factors:</text>
<clause id="ID6bc28fdb86e44d6c8fe7c244710169b5"><enum>(i)</enum><text>The extent to which any
of the terms of the group, category, type, or class of security-based swaps,
including price, are disseminated to third parties or are referenced in other
agreements, contracts, or transactions.</text>
</clause><clause id="ID6782eec8d63645e5ae66809b9b5dbdaa"><enum>(ii)</enum><text>The volume of
transactions in the group, category, type, or class of security-based
swaps.</text>
</clause><clause id="IDf1c5041a65324318818e68f12b038dae"><enum>(iii)</enum><text>The extent to which the
terms of the group, category, type, or class of security-based swaps are
similar to the terms of other agreements, contracts, or transactions that are
cleared.</text>
</clause><clause id="IDf35e078b780a41f98e45a975804676f3"><enum>(iv)</enum><text>Whether any differences
in the terms of the group, category, type, or class of security-based swaps,
compared to other agreements, contracts, or transactions that are cleared, are
of economic significance.</text>
</clause><clause id="IDac519b3a27ce4b6d9aab440f632ce711"><enum>(v)</enum><text>Whether a clearing agency
is prepared to clear the group, category, type, or class of security-based
swaps and such clearing agency has in place effective risk management
systems.</text>
</clause><clause id="ID2719887952074f05ab5736c1e7c0f0df"><enum>(vi)</enum><text>Any other factor the
Commission determines to be appropriate.</text>
</clause></subparagraph><subparagraph id="ID312d05b7d6fa4a2f887591bdf31c9e6f"><enum>(B)</enum><header>Other
designations</header><text>At any time after the adoption of the rules required
under subparagraph (A), the Commission may separately designate a particular
security-based swap or class of security-based swaps as subject to the clearing
requirement of paragraph (1), taking into account the factors established in
clauses (i) through (vi) of subparagraph (A) and the rules adopted in such
subparagraph.</text>
</subparagraph><subparagraph id="IDc838b181591e46faa3b069f1fbfe41e4"><enum>(C)</enum><header>In
general</header><text>In accordance with subparagraph (A), the Commission
shall, consistent with the public interest, adopt rules under the expedited
process described in subparagraph (D) to establish criteria for determining
that a swap, or any group, category, type, or class of swap is required to be
cleared.</text>
</subparagraph><subparagraph id="IDa86c2264bcd84caba97e7458e456239a"><enum>(D)</enum><header>Expedited rulemaking
authority</header>
<clause id="ID96a7656d279a43dcbfe515b16d3eae6e"><enum>(i)</enum><header>Procedure</header><text>The
promulgation of regulations under subparagraph (A) may be made without regard
to—</text>
<subclause id="ID6b8b8f30c87c4685a5057266c4d9e7f1"><enum>(I)</enum><text>the notice and comment
provisions of section 553 of title 5, United States Code; and</text>
</subclause><subclause id="IDbd47d1882d94409f88b8dba3d06fdc87"><enum>(II)</enum><text>chapter 35 of title 44,
United States Code (commonly known as the <quote>Paperwork Reduction
Act</quote>).</text>
</subclause></clause><clause id="ID7066f5656bf84396b7ec6ef7a828e735"><enum>(ii)</enum><header>Agency
rulemaking</header><text>In carrying out subparagraph (A), the Commission shall
use the authority provided under section 808 of title 5, United States
Code.</text>
</clause></subparagraph></paragraph><paragraph id="id9B1A296987D64C428B4768962E54B00E"><enum>(5)</enum><header>Prevention of
evasion</header>
<subparagraph id="idEEEA5410A66C485AAC868C939EE07393"><enum>(A)</enum><header>In
general</header><text>The Commission shall have authority to prescribe rules
under this section, or issue interpretations of such rules, as necessary to
prevent evasions of this section.</text>
</subparagraph><subparagraph id="id2FBC6FEFE4674F9394AE19402E396A37"><enum>(B)</enum><header>Duty of Commission to
investigate and take certain actions</header><text>To the extent the Commission
finds that a particular security-based swap or any group, category, type, or
class of security-based swaps that would otherwise be subject to mandatory
clearing but no clearing agency has listed the security-based swap or the
group, category, type, or class of security-based swaps for clearing, the
Commission shall—</text>
<clause id="ID446f465ce2bb406bb13c2fd5e5722a92"><enum>(i)</enum><text>investigate the relevant
facts and circumstances;</text>
</clause><clause id="ID5e97b814994c4958a785f23a0b803b6a"><enum>(ii)</enum><text>within 30 days issue a
public report containing the results of the investigation; and</text>
</clause><clause id="IDc8d4ab59a3a145dbbec9b0e78eb547f7"><enum>(iii)</enum><text>take such actions as
the Commission determines to be necessary and in the public interest, which may
include requiring the retaining of adequate margin or capital by parties to the
security-based swap or the group, category, type, or class of security-based
swaps.</text>
</clause></subparagraph><subparagraph id="id368A9C29C00D4612AC6EB6C440F38368"><enum>(C)</enum><header>Effect on
authority</header><text>Nothing in this paragraph—</text>
<clause id="ID3c158383196548faba9573328611f8fd"><enum>(i)</enum><text>authorize the Commission
to require a clearing agency to list for clearing a security-based swap or any
group, category, type, or class of security-based swaps if the clearing of the
security-based swap or the group, category, type, or class of security-based
swaps would adversely affect the business operations of the clearing agency,
threaten the financial integrity of the clearing agency, or pose a systemic
risk to the clearing agency; and</text>
</clause><clause id="IDf8b9093ab9544f04bb871242d6092b1f"><enum>(ii)</enum><text>affect the authority of
the Commission to enforce the open access provisions of paragraph (1) with
respect to a security-based swap or the group, category, type, or class of
security-based swaps that is listed for clearing by a clearing agency.</text>
</clause></subparagraph></paragraph><paragraph id="id83E58E5B8EDF402C8C2FEE2FD863404D"><enum>(6)</enum><header>Required
reporting</header>
<subparagraph id="id2D21364336BC4428A050AFAE86A59680"><enum>(A)</enum><header>Both
counterparties</header><text>Both counterparties to a security-based swap that
is not cleared by any clearing agency shall report such a security-based swap
either to a registered security-based swap repository described in section
13(n) or, if there is no repository that would accept the security-based swap,
to the Commission pursuant to section 13A.</text>
</subparagraph><subparagraph id="IDc9f9e2fb06c9403482c5c0c6e790f380"><enum>(B)</enum><header>Timing</header><text>Counterparties
to a security-based swap shall submit the reports required under subparagraph
(A) not later than such time period as the Commission may by rule or regulation
prescribe.</text>
</subparagraph></paragraph><paragraph id="idCF009C1FA58043E5BFE9DAD623BB7576"><enum>(7)</enum><header>Transition
rules</header>
<subparagraph id="idAEE9A53DB8B54C3783D229B6F4DABCA0"><enum>(A)</enum><header>Reporting transition
rules</header><text>Rules adopted by the Commission under this section shall
provide for the reporting of data, as follows:</text>
<clause id="ID40ce8aa2423e4dd7b2640535b287ae69"><enum>(i)</enum><text>Security-based swaps
entered into before the date of the enactment of this section shall be reported
to a registered security-based swap repository or the Commission not later than
180 days after the effective date of this section.</text>
</clause><clause id="ID7a87867f80544801add1d91e8889b77d"><enum>(ii)</enum><text>Security-based swaps
entered into on or after such date of enactment shall be reported to a
registered security-based swap repository or the Commission not later than the
later of—</text>
<subclause id="ID3f3285bf3de045c29dd0d9671af9bb63"><enum>(I)</enum><text>90 days after such
effective date; or</text>
</subclause><subclause id="IDe92f6bcbf5814bc79288fe47fa35e4b2"><enum>(II)</enum><text>such other time after
entering into the security-based swap as the Commission may prescribe by rule
or regulation.</text>
</subclause></clause></subparagraph><subparagraph id="id0DD962F5A32443DDBEFF4A6D6184A7CB"><enum>(B)</enum><header>Clearing transition
rules</header>
<clause id="idE1B903A75BA249B3B69F098D54B19EE2"><enum>(i)</enum><text>Security-based swaps
entered into before the date of the enactment of this section are exempt from
the clearing requirements of this subsection if reported pursuant to
subparagraph (A)(i).</text>
</clause><clause id="ID7f5f88774d6a47fe901d8c93ae807bd8"><enum>(ii)</enum><text>Security-based swaps
entered into before application of the clearing requirement pursuant to this
section are exempt from the clearing requirements of this section if reported
pursuant to subparagraph (A)(ii).</text>
</clause></subparagraph></paragraph><paragraph id="id1E95C0C894A347CAAC9A0015CFD28AEE"><enum>(8)</enum><header>Trade
execution</header>
<subparagraph id="id730E522439C744FCBCA30768E4A8A620"><enum>(A)</enum><header>In
general</header><text>With respect to transactions involving security-based
swaps subject to the clearing requirement of paragraph (1), counterparties
shall—</text>
<clause id="IDd7f0e80647914a38b2e3e8a2319a6cdc"><enum>(i)</enum><text>execute the transaction
on an exchange; or</text>
</clause><clause id="ID8fdd01f4e7184b70a1822d8c56998530"><enum>(ii)</enum><text>execute the transaction
on a swap execution facility registered under section 3D or a swap execution
facility that is exempt from registration under section 3D(e).</text>
</clause></subparagraph><subparagraph id="ID3d5344eea93b4d3f89f1f98f4cfde9dd"><enum>(B)</enum><header>Exception</header><text>The
requirements of clauses (i) and (ii) of subparagraph (A) shall not
apply—</text>
<clause id="idCD5CE3930169412EB45BED321A4C95BB"><enum>(i)</enum><text>if no national securities
exchange or security-based swap execution facility makes the security-based
swap available to trade; or</text>
</clause><clause id="idD50684975AFE4C278F0A8AC8A05EED7E"><enum>(ii)</enum><text>to swap transactions
where a commercial end user opts to use the clearing exemption under paragraph
(10).</text>
</clause></subparagraph></paragraph><paragraph id="IDec21acf048654870b89b6260df8763aa"><enum>(9)</enum><header>Required
exemption</header><text>Subject to paragraph (4), the Commission shall exempt a
security-based swap from the requirements of paragraphs (1) and (8) and any
rules issued under this subsection, if no clearing agency registered under this
Act will accept the security-based swap from clearing.</text>
</paragraph><paragraph id="ID6bb35ca17f48420bbe5ec244bc2a16ef"><enum>(10)</enum><header>End user clearing
exemption</header>
<subparagraph id="idD9A783B92A814E07A07CCDCD765B260D"><enum>(A)</enum><header>Definition of
commercial end user</header>
<clause id="id61AE6F613A8245BE943AE1CC60A68D98"><enum>(i)</enum><header>In
general</header><text>In this paragraph, the term <term>commercial end
user</term> means any person other than a financial entity described in clause
(ii) who, as its primary business activity, owns, uses, produces, processes,
manufactures, distributes, merchandises, or markets services or commodities
(which shall include coal, natural gas, electricity, ethanol, crude oil,
distillates, and other hydrocarbons) either individually or in a fiduciary
capacity.</text>
</clause><clause id="idE5886949002043A0AF60CF411B168D40"><enum>(ii)</enum><header>Financial
entity</header><text>The term <term>financial entity</term> means—</text>
<subclause id="idF44BACB7874346EDA8FB1DF001516D99"><enum>(I)</enum><text>a swap dealer, major swap
participant, security-based swap dealer, or major security-based swap
participant;</text>
</subclause><subclause id="id792161ADD2A145C4B36EDCE4D151363C"><enum>(II)</enum><text>a person predominantly
engaged in activities that are in the business of banking or financial in
nature, as defined in Section 4(k) of the Bank Holding Company Act of
1956;</text>
</subclause><subclause id="id14386A9DBF92439C9F16101AB451CA9E"><enum>(III)</enum><text>a person predominantly
engaged in activities that are financial in nature;</text>
</subclause><subclause id="idF0638E93DE6444C89EFECAAD4D232BEC"><enum>(IV)</enum><text>a private fund as
defined in section 202(a) of the Investment Advisers Act of 1940 (15 U.S.C.
80b–2(a)) or a commodity pool as defined in section 1a of the Commodity
Exchange Act (7 U.S.C. 1a); or</text>
</subclause><subclause id="idA9F0B91A529D4175984A7A3E881C8674"><enum>(V)</enum><text>a person that is
registered or required to be registered with the Commission, but does not
include a public company which registers its securities with the
Commission.</text>
</subclause></clause></subparagraph><subparagraph id="IDbcd58f5716a44321909a2a322a00fbbc"><enum>(B)</enum><header>End user clearing
exemption</header>
<clause id="id689A0C32AE9D4F8CBD9582D18DCA5AF7"><enum>(i)</enum><header>In
general</header><text>Subject to clause (ii), in the event that a
security-based swap is subject to the mandatory clearing requirement under
paragraph (1), and 1 of the counterparties to the security-based swap is a
commercial end user that counterparty—</text>
<subclause id="ID824a19b9899f4d14b191e77b8b290807"><enum>(I)</enum><item commented="no" display-inline="yes-display-inline" id="id37127E0BF626400B8A51A2394BD8AE46"><enum>(aa)</enum><text>may elect not to clear
the security-based swap, as required under paragraph (1); or</text>
</item><item changed="added" id="id8BB564486FE84070B5D0BE0137FC61C5" indent="up1" reported-display-style="italic"><enum>(bb)</enum><text>may
elect to require clearing of the security-based swap; and</text>
</item></subclause><subclause id="ID9ab43ef7b73e4c5497b3c656b420ea5c"><enum>(II)</enum><text>if the end user makes an
election under subclause (I)(bb), shall have the sole right to select the
clearing agency at which the security-based swap will be cleared.</text>
</subclause></clause><clause id="id60803040C2F54A15AC8441A0C608C6D2"><enum>(ii)</enum><header>Limitation</header><text>A
commercial end user may only make an election under clause (i) if the end user
is using the security-based swap to hedge its own commercial risk.</text>
</clause></subparagraph><subparagraph id="ID2f159cd9d8d243048da188ca53667c5b"><enum>(C)</enum><header>Treatment of
affiliates</header>
<clause id="IDc1a43d2003ac4a56969859e53865e149"><enum>(i)</enum><header>In
general</header><text>An affiliate of a commercial end user (including
affiliate entities predominantly engaged in providing financing for the
purchase of the merchandise or manufactured goods of the commercial end user)
may make an election under subparagraph (B)(i) only if the affiliate, acting on
behalf of the commercial end user and as an agent, uses the security-based swap
to hedge or mitigate the commercial risk of the commercial end user parent or
other affiliates of the commercial end user that is not a financial
entity.</text>
</clause><clause id="IDde4a519a9b5f494891c8bf5881678bd8"><enum>(ii)</enum><header>Prohibition relating
to certain affiliates</header><text>An affiliate of a commercial end user shall
not use the exemption under subparagraph (B) if the affiliate is—</text>
<subclause id="ID1227e0f9d99946939c9ec93559f429d1"><enum>(I)</enum><text>a security-based swap
dealer;</text>
</subclause><subclause id="IDe90986b5a1854494a9080ed1fd9f733a"><enum>(II)</enum><text>a security-based
security-based swap dealer;</text>
</subclause><subclause id="ID81f5370eec644161ab32e6d3f9a814dc"><enum>(III)</enum><text>a major security-based
swap participant;</text>
</subclause><subclause id="ID861302523b674fcc87d0e6352b1ae326"><enum>(IV)</enum><text>a major security-based
security-based swap participant;</text>
</subclause><subclause id="IDe054947d285c4af0bf1b1f80a702585c"><enum>(V)</enum><text>an issuer that would be
an investment company, as defined in section 3 of the Investment Company Act of
1940 (15 U.S.C. 80a–3), but for paragraph (1) or (7) of subsection (c) of that
section 3 (15 U.S.C. 80a–3(c));</text>
</subclause><subclause id="ID975b27b84a0f4aa28336c40a339fcaf8"><enum>(VI)</enum><text>a commodity pool;</text>
</subclause><subclause id="id95714803484B40F9ACADBCA3B7D1A69F"><enum>(VII)</enum><text>a bank holding company
with over $50,000,000,000 in consolidated assets; or</text>
</subclause><subclause id="ID499dd89955e34b4bb12bf8db48d309fc"><enum>(VIII)</enum><text>an affiliate of any
entity described in subclauses (I) through (VII).</text>
</subclause></clause><clause id="IDfc902d95ea2942b8a885ebc2305afbd1"><enum>(iii)</enum><header>Abuse of
exemption</header><text>The Commission may prescribe such rules, or issue
interpretations of the rules, as the Commission determines to be necessary to
prevent abuse of the exemption described in subparagraph (B).</text>
</clause></subparagraph><subparagraph id="id61FE5283DCC54BD3A0DABF7D56A7E448"><enum>(D)</enum><header>Option to
clear</header>
<clause id="id2DAC371E531A4DC993FEDEAC0291EF9E"><enum>(i)</enum><header>Security-based swaps
required to be cleared entered into with a financial entity</header><text>With
respect to any securities-based swap that is required to be cleared by a
clearing agency and entered into by a securities-based swap dealer or a major
securities-based swap participant with a financial entity, the financial entity
shall have the sole right to select the clearing agency at which the
securities-based swap will be cleared.</text>
</clause><clause id="id32E99ACB41724425AFD7F6BB903248BF"><enum>(ii)</enum><header>Security-based swaps
not required to be cleared entered into with a financial entity or commercial
end user</header><text>With respect to any securities-based swap that is not
required to be cleared by a clearing agency and entered into by a
securities-based swap dealer or a major securities-based swap participant with
a financial entity or commercial end user, the financial entity or commercial
end user—</text>
<subclause id="ID9f22a83fc3954275808128aacd067f74"><enum>(I)</enum><text>may elect to require
clearing of the securities-based swap; and</text>
</subclause><subclause id="IDf5f3c489794644dcaf92acd23df9a3af"><enum>(II)</enum><text>shall have the sole
right to select the clearing agency at which the securities-based swap will be
cleared.</text>
</subclause></clause></subparagraph></paragraph></subsection><subsection commented="no" display-inline="no-display-inline" id="ID4bbf06a7a626438caef10cf2813d7768"><enum>(b)</enum><header display-inline="yes-display-inline">Audit committee approval</header><text display-inline="yes-display-inline">Exemptions from the requirements of this
section to clear or trade a security-based swap through a national securities
exchange or security-based swap execution facility shall be available to a
counterparty that is an issuer of securities that are registered under section
12 or that is required to file reports pursuant to section 15(d), only if the
issuer’s audit committee has reviewed and approved the issuer's decision to
enter into security-based swaps that are subject to such exemptions.</text>
</subsection><subsection id="ID601122e3999e431f9c7e0a3a2a5d5db1"><enum>(c)</enum><header>Public availability of
security-based swap transaction data</header>
<paragraph id="idF5F40988DB764008841023417AA36395"><enum>(1)</enum><header>In general</header>
<subparagraph id="ID424f3740968b481f957511a22b0681cc"><enum>(A)</enum><header>Definition of real-time
public reporting</header><text>In this paragraph, the term <term>real-time
public reporting</term> means to report data relating to a security-based swap
transaction as soon as technologically practicable after the time at which the
security-based swap transaction has been executed.</text>
</subparagraph><subparagraph id="id333C11C88C0C49559A44F2876F20FC1B"><enum>(B)</enum><header>Purpose</header><text>The
purpose of this section is to authorize the Commission to make security-based
swap transaction and pricing data available to the public in such form and at
such times as the Commission determines appropriate to enhance price
discovery.</text>
</subparagraph><subparagraph id="ID5d53557280414ec984f01c8405f2b60d"><enum>(C)</enum><header>General
rule</header><text>The Commission is authorized to provide by rule for the
public availability of security-based swap transaction and pricing data as
follows:</text>
<clause id="IDeb108c82d849469ea2d204f5d40f7fbd"><enum>(i)</enum><text>With respect to those
security-based swaps that are subject to the mandatory clearing requirement
described in subsection (a)(1) (including those security-based swaps that are
exempted from those requirements), the Commission shall require real-time
public reporting for such transactions.</text>
</clause><clause id="IDc476feac3f7c4589bc9c3457d8cda1cc"><enum>(ii)</enum><text>With respect to those
security-based swaps that are not subject to the mandatory clearing requirement
described in subsection (a)(1), but are cleared at a registered clearing
agency, the Commission shall require real-time public reporting for such
transactions.</text>
</clause><clause id="ID129b07fd0cba407692e3adc09e737b43"><enum>(iii)</enum><text>With respect to
security-based swaps that are not cleared at a registered clearing agency and
which are reported to a security-based swap data repository or the Commission
under subsection (a), the Commission shall make available to the public, in a
manner that does not disclose the business transactions and market positions of
any person, aggregate data on such security-based swap trading volumes and
positions.</text>
</clause><clause id="id9B4B8518D3154E9E8BC9C6065B077027"><enum>(iv)</enum><text>With respect to
security-based swaps that are exempt from the requirements of subsection
(a)(1), but are subject to the requirements of subsection (a)(8), the
Commission shall require real-time public reporting for such
transactions.</text>
</clause></subparagraph><subparagraph id="IDf224faeb69474bdebb74bf9c143c8988"><enum>(D)</enum><header>Registered entities and
public reporting</header><text>The Commission may require registered entities
to publicly disseminate the security-based swap transaction and pricing data
required to be reported under this paragraph.</text>
</subparagraph><subparagraph id="ID9e09c3939d5141d687bfd8b17689779a"><enum>(E)</enum><header>Rulemaking
required</header><text>With respect to the rule providing for the public
availability of transaction and pricing data for security-based swaps described
in clauses (i) and (ii) of subparagraph (C), the rule promulgated by the
Commission shall contain provisions—</text>
<clause id="IDbb9ca5fe57614c8c8e23eb17458f9ab9"><enum>(i)</enum><text>to ensure such
information does not identify the participants;</text>
</clause><clause id="IDc4943b3218f04bb496e09de0590bd8cd"><enum>(ii)</enum><text>to specify the criteria
for determining what constitutes a large notional security-based swap
transaction (block trade) for particular markets and contracts;</text>
</clause><clause id="ID63499e425a634f538dc786e3f27c3eaa"><enum>(iii)</enum><text>to specify the
appropriate time delay for reporting large notional security-based swap
transactions (block trades) to the public; and</text>
</clause><clause id="IDf7e23a0157c440f5a2f2bfe3c25d8078"><enum>(iv)</enum><text>that take into account
whether the public disclosure will materially reduce market liquidity.</text>
</clause></subparagraph><subparagraph id="ID3ee55c5f23f04e99a4bff539bb389bdc"><enum>(F)</enum><header>Timeliness of
reporting</header><text>Parties to a security-based swap (including agents of
the parties to a security-based swap) shall be responsible for reporting
security-based swap transaction information to the appropriate registered
entity in a timely manner as may be prescribed by the Commission.</text>
</subparagraph></paragraph><paragraph commented="no" id="H2788D110504341C08ED2071D5E889B36"><enum>(2)</enum><header>Semiannual and annual
public reporting of aggregate security-based swap data</header>
<subparagraph commented="no" id="id905AEBA25B8A49AD90E14632824D0DD8"><enum>(A)</enum><header>In
general</header><text>In accordance with subparagraph (B), the Commission shall
issue a written report on a semiannual and annual basis to make available to
the public information relating to—</text>
<clause commented="no" id="id4A8FC05688A8475887B9D3CB5EE01744"><enum>(i)</enum><text>the trading and clearing
in the major security-based swap categories; and</text>
</clause><clause commented="no" id="idD92CC5E7B071473C8D8A8B8A107CB420"><enum>(ii)</enum><text>the market participants
and developments in new products.</text>
</clause></subparagraph><subparagraph commented="no" id="idA070ED873E744ACF8DF20DBFCC724965"><enum>(B)</enum><header>Use;
consultation</header><text>In preparing a report under subparagraph (A), the
Commission shall—</text>
<clause commented="no" id="idC349DC13882748C68985934224BB8361"><enum>(i)</enum><text>use information from
security-based swap data repositories and clearing agencies; and</text>
</clause><clause commented="no" id="id5FF6C93F38444DFEBCE20133BDC49597"><enum>(ii)</enum><text>consult with the Office
of the Comptroller of the Currency, the Bank for International Settlements, and
such other regulatory bodies as may be necessary.</text>
</clause></subparagraph><subparagraph id="IDfec61cd9b6e141d9ae577fb9e0ac21d6"><enum>(C)</enum><header>Transition rule for
preenactment security-based swaps</header>
<clause id="ID2a01163ec1ad4efe93ae398975572f89"><enum>(i)</enum><header>Security-based swaps
entered into before the date of enactment of the Wall Street Transparency and
Accountability Act of 2010</header><text>Each security-based swap entered into
before the date of enactment of the <short-title>Wall
Street Transparency and Accountability Act of 2010</short-title>, the terms of
which have not expired as of the date of enactment of that Act, shall be
reported to a registered security-based swap data repository or the Commission
by a date that is not later than—</text>
<subclause id="ID1d01347268c94b82af8417edc8316999"><enum>(I)</enum><text>30 days after the date of
issuance of the interim final rule; or</text>
</subclause><subclause id="ID5287aaf14706410cb808f476cdd0c898"><enum>(II)</enum><text>such other period as the
Commission determines to be appropriate.</text>
</subclause></clause><clause id="IDa4ece656bec547c48dce788acee90126"><enum>(ii)</enum><header>Commission
rulemaking</header><text>The Commission shall promulgate an interim final rule
within 90 days of the date of enactment of this section providing for the
reporting of each security-based swap entered into before the date of enactment
as referenced in clause (i).</text>
</clause></subparagraph><subparagraph id="ID9caeda589f554297bfcf4126df3750e5"><enum>(D)</enum><header>Effective
date</header><text>The reporting provisions described in this paragraph shall
be effective upon the date of enactment of this section.</text>
</subparagraph></paragraph></subsection><subsection id="HA515E9802BA7426FAE37F21A76B496F9"><enum>(d)</enum><header>Designation of chief
compliance officer</header>
<paragraph id="H5DCD2165655141FEBBDA20A2D4EC9557"><enum>(1)</enum><header>In
general</header><text>Each registered clearing agency shall designate an
individual to serve as a chief compliance officer.</text>
</paragraph><paragraph id="HB59FF51CB446454DBA4753B6F7D38AB1"><enum>(2)</enum><header>Duties</header><text>The
chief compliance officer shall—</text>
<subparagraph id="HF35A2C071B6B4FF883180080A72B8BBF"><enum>(A)</enum><text>report directly to the
board or to the senior officer of the clearing agency;</text>
</subparagraph><subparagraph id="H178BD50DA092400CAC9D9A9DBDDB6FA8"><enum>(B)</enum><text>in consultation with its
board, a body performing a function similar thereto, or the senior officer of
the registered clearing agency, resolve any conflicts of interest that may
arise;</text>
</subparagraph><subparagraph id="H345D3990F3984CC785AB313D0E9B9D33"><enum>(C)</enum><text>be responsible for
administering each policy and procedure that is required to be established
pursuant to this section;</text>
</subparagraph><subparagraph id="HED0A78C2F51546D480DE2BF6C50DE56E"><enum>(D)</enum><text>ensure compliance with
this title (including regulations issued under this title) relating to
agreements, contracts, or transactions, including each rule prescribed by the
Commission under this section;</text>
</subparagraph><subparagraph id="ID390a832c086345b9b980dcd65e7c8839"><enum>(E)</enum><text>establish procedures for
the remediation of noncompliance issues identified by the compliance officer
through any—</text>
<clause id="IDdc0592c8171948308b257c5dade3fa46"><enum>(i)</enum><text>compliance office
review;</text>
</clause><clause id="ID68be3cf42c164dc5a2c29bdebc1b29d5"><enum>(ii)</enum><text>look-back;</text>
</clause><clause id="ID6f180d83fd764e80a0012834e558109c"><enum>(iii)</enum><text>internal or external
audit finding;</text>
</clause><clause id="IDf21040f03d9e4ec9bfea7cb9bb602695"><enum>(iv)</enum><text>self-reported error;
or</text>
</clause><clause id="IDf5c3896d984f4dce9f2a097d8b0331f5"><enum>(v)</enum><text>validated complaint;
and</text>
</clause></subparagraph><subparagraph id="ID6d3d53646a4744d59df58d04cc4031fb"><enum>(F)</enum><text>establish and follow
appropriate procedures for the handling, management response, remediation,
retesting, and closing of noncompliance issues.</text>
</subparagraph></paragraph><paragraph id="ID7fcc4e7d7b46440cbb4d659f4db7899a"><enum>(3)</enum><header>Annual reports</header>
<subparagraph id="ID5203b1039a9a4235a0a7e19adf5ecd45"><enum>(A)</enum><header>In
general</header><text>In accordance with rules prescribed by the Commission,
the chief compliance officer shall annually prepare and sign a report that
contains a description of—</text>
<clause id="ID90a5745b527f4b69a33c1236432545d5"><enum>(i)</enum><text>the compliance of the
registered clearing agency or security-based swap execution facility of the
compliance officer with respect to this title (including regulations under this
title); and</text>
</clause><clause id="ID5e86146ec70a452396702415389f48d7"><enum>(ii)</enum><text>each policy and
procedure of the registered clearing agency of the compliance officer
(including the code of ethics and conflict of interest policies of the
registered clearing agency).</text>
</clause></subparagraph><subparagraph id="IDdd868aa79ec44f17abc2bc37fd73e6d8"><enum>(B)</enum><header>Requirements</header><text>A
compliance report under subparagraph (A) shall—</text>
<clause id="ID70e270ad391142ee8c10276795ad8598"><enum>(i)</enum><text>accompany each
appropriate financial report of the registered clearing agency that is required
to be furnished to the Commission pursuant to this section; and</text>
</clause><clause id="ID89ad39afb4ee4222bc4965bdf289ebe0"><enum>(ii)</enum><text>include a certification
that, under penalty of law, the compliance report is accurate and
complete.</text>
</clause></subparagraph></paragraph></subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection commented="no" id="HEAFA45F6CA60490085AB5F70DC8A575A"><enum>(b)</enum><header>Clearing agency
requirements</header><text>Section 17A of the Securities Exchange Act of 1934
(15 U.S.C. 78q–1) is amended by adding at the end the following:</text>
<quoted-block changed="added" id="H52023D5D82844FDAA8A7F7A076A43D6A" reported-display-style="italic" style="OLC">
<subsection commented="no" id="HD8F305F7C89C4B17A43BB237D270C9CF"><enum>(g)</enum><header>Registration
requirement</header><text>It shall be unlawful for a clearing agency, unless
registered with the Commission, directly or indirectly to make use of the mails
or any means or instrumentality of interstate commerce to perform the functions
of a clearing agency with respect to a security-based swap.</text>
</subsection><subsection commented="no" id="HF0C8020037AE4A7D846D4E8B7CA224C7"><enum>(h)</enum><header>Voluntary
registration</header><text>A person that clears agreements, contracts, or
transactions that are not required to be cleared under this title may register
with the Commission as a clearing agency.</text>
</subsection><subsection display-inline="no-display-inline" id="HE42CACFC3A784AE6850EBC4894F89081"><enum>(i)</enum><header>Standards for clearing
agencies clearing security-based swap transactions</header><text display-inline="yes-display-inline">To
be registered and to maintain registration as a clearing agency that clears
security-based swap transactions, a clearing agency shall comply with such
standards as the Commission may establish by rule. In establishing any such
standards, and in the exercise of its oversight of such a clearing agency
pursuant to this title, the Commission may conform such standards or oversight
to reflect evolving United States and international standards. Except where the
Commission determines otherwise by rule or regulation, a clearing agency shall
have reasonable discretion in establishing the manner in which it complies with
any such standards.</text>
</subsection><subsection commented="no" id="H45E2E25EB3D34E5CBE65D0B56F0C575A"><enum>(j)</enum><header>Rules</header><text display-inline="yes-display-inline">The Commission shall adopt rules governing
persons that are registered as clearing agencies for security-based swaps under
this title.</text>
</subsection><subsection id="idA2A044029CAB4311B8CBAECF4F14CA95"><enum>(k)</enum><header>Exemptions</header>
<paragraph id="idB05EA0DA1A794910BAB8B14C0703B669"><enum>(1)</enum><header>In
general</header><text>The Commission may exempt, conditionally or
unconditionally, a clearing agency from registration under this section for the
clearing of security-based swaps if the Commission determines that the clearing
agency is subject to comparable, comprehensive supervision and regulation by
the Commodity Futures Trading Commission or the appropriate government
authorities in the home country of the agency. Such conditions may include, but
are not limited to, requiring that the clearing agency be available for
inspection by the Commission and make available all information requested by
the Commission.</text>
</paragraph><paragraph commented="no" id="H7988A01C79E347CAAD5831465A162C0E"><enum>(2)</enum><header>Derivatives clearing
organizations</header><text display-inline="yes-display-inline">A person that
is required to be registered as a derivatives clearing organization under the
Commodity Exchange Act, whose principal business is clearing commodity futures
and options on commodity futures transactions and swaps and which is a
derivatives clearing organization registered with the Commodity Futures Trading
Commission under the Commodity Exchange Act (7 U.S.C. 1 et seq.), shall be
unconditionally exempt from registration under this section solely for the
purpose of clearing security-based swaps, unless the Commission finds that such
derivatives clearing organization is not subject to comparable, comprehensive
supervision and regulation by the Commodity Futures Trading Commission.</text>
</paragraph></subsection><subsection commented="no" id="id99B388065D774C808BAFC63CB78842F5"><enum>(l)</enum><header>Modification of core
principles</header><text>The Commission may conform the core principles
established in this section to reflect evolving United States and international
standards.</text>
</subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="HFF1DBD8492A44FFBB0041EA70F618F0C"><enum>(c)</enum><header>Security-based swap
execution facilities</header><text>The Securities Exchange Act of 1934 (15
U.S.C. 78a et seq.) is amended by inserting after section 3C (as added by
subsection (a) of this section) the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="HABBD003673E34E23B993103C1B4D363F" reported-display-style="italic" style="OLC">
<section id="H5B12A95EE79E4FD78E73F98B4254A117"><enum>3D.</enum><header>Security-based swap
execution facilities</header>
<subsection id="IDc1b102a2db1a4051a79053fd76948b75"><enum>(a)</enum><header>Registration</header>
<paragraph id="IDc1254c2714ed454a940c3a4bae020437"><enum>(1)</enum><header>In
general</header><text>No person may operate a facility for the trading or
processing of security-based swaps, unless the facility is registered as a
security-based swap execution facility or as a national securities exchange
under this section.</text>
</paragraph><paragraph id="ID3124794e119349fe89252dad09c0fef6"><enum>(2)</enum><header>Dual
registration</header><text>Any person that is registered as a security-based
swap execution facility under this section shall register with the Commission
regardless of whether the person also is registered with the Commodity Futures
Trading Commission as a swap execution facility.</text>
</paragraph></subsection><subsection id="ID52b48f1ef75c4275b75de7c6a3b0cd01"><enum>(b)</enum><header>Trading and trade
processing</header><text>A security-based swap execution facility that is
registered under subsection (a) may—</text>
<paragraph id="idF519EBDA79E44436BC86171FEA7C56B9"><enum>(1)</enum><text>make available for
trading any security-based swap; and</text>
</paragraph><paragraph id="idFC2E1691C130428E8A72DE850744C710"><enum>(2)</enum><text>facilitate trade
processing of any security-based swap.</text>
</paragraph></subsection><subsection commented="no" id="ID997f5945ecda428b9dccf7cbb9647827"><enum>(c)</enum><header>Identification of
facility used To trade security-based swaps by national securities
exchanges</header><text>A national securities exchange shall, to the extent
that the exchange also operates a security-based swap execution facility and
uses the same electronic trade execution system for listing and executing
trades of security-based swaps on or through the exchange and the facility,
identify whether electronic trading of such security-based swaps is taking
place on or through the national securities exchange or the security-based swap
execution facility.</text>
</subsection><subsection id="ID9cafef2277ca4ca19964d3c11c880bae"><enum>(d)</enum><header>Core principles for
security-based swap execution facilities</header>
<paragraph id="IDcac2a5607a46450e8b84e6abd65b9f8a"><enum>(1)</enum><header>Compliance with core
principles</header>
<subparagraph id="idC285C02E83994679A6C588B01882AE8D"><enum>(A)</enum><header>In
general</header><text>To be registered, and maintain registration, as a
security-based swap execution facility, the security-based swap execution
facility shall comply with—</text>
<clause id="idCC6FAED60F084B16990530FD3CE888DC"><enum>(i)</enum><text>the core principles
described in this subsection; and</text>
</clause><clause id="idD01B943D2F684B368A570BC262C10052"><enum>(ii)</enum><text>any requirement that the
Commission may impose by rule or regulation.</text>
</clause></subparagraph><subparagraph id="id12A8700A208A4B55B9D67814084B1EF0"><enum>(B)</enum><header>Reasonable discretion
of security-based swap execution facility</header><text>Unless otherwise
determined by the Commission, by rule or regulation, a security-based swap
execution facility described in subparagraph (A) shall have reasonable
discretion in establishing the manner in which it complies with the core
principles described in this subsection.</text>
</subparagraph></paragraph><paragraph id="ID48c686497fd34d59912a15aabeb1b4c7"><enum>(2)</enum><header>Compliance with
rules</header><text>A security-based swap execution facility shall—</text>
<subparagraph id="IDf862e6fe092745cb9d0cae2f713eb617"><enum>(A)</enum><text>monitor and enforce
compliance with any rule established by such security-based swap execution
facility, including—</text>
<clause id="idB89E32D2A2D9468583AB2CA13507FD00"><enum>(i)</enum><text>the terms and conditions
of the security-based swaps traded or processed on or through the facility;
and</text>
</clause><clause id="id58F0F2C7FC46486EB0FF4828DA3B5542"><enum>(ii)</enum><text>any limitation on access
to the facility;</text>
</clause></subparagraph><subparagraph id="ID90e5416579b14e86b492da608b6d76f6"><enum>(B)</enum><text>establish and enforce
trading, trade processing, and participation rules that will deter abuses and
have the capacity to detect, investigate, and enforce those rules, including
means—</text>
<clause id="IDd0d8296906434c7dbf6a58e409f92170"><enum>(i)</enum><text>to provide market
participants with impartial access to the market; and</text>
</clause><clause id="ID036904c64b65475faa503364de648500"><enum>(ii)</enum><text>to capture information
that may be used in establishing whether rule violations have occurred;
and</text>
</clause></subparagraph><subparagraph id="id746C7C726F1F4409850E77B6E7662278"><enum>(C)</enum><text>establish rules governing
the operation of the facility, including rules specifying trading procedures to
be used in entering and executing orders traded or posted on the facility,
including block trades.</text>
</subparagraph></paragraph><paragraph id="IDa85de0592f5a4a3da9de0e5f3df6fb8d"><enum>(3)</enum><header>Security-based swaps
not readily susceptible to manipulation</header><text>The security-based swap
execution facility shall permit trading only in security-based swaps that are
not readily susceptible to manipulation.</text>
</paragraph><paragraph id="ID3f6ab590e081484dbb59aa1b349fce21"><enum>(4)</enum><header>Monitoring of trading
and trade processing</header><text>The security-based swap execution facility
shall—</text>
<subparagraph id="ID2b69bec9141a47d5b1971da04ae24bb9"><enum>(A)</enum><text>establish and enforce
rules or terms and conditions defining, or specifications detailing—</text>
<clause id="idD32CAF2E368E482D8D6E3AA2B1D60C33"><enum>(i)</enum><text>trading procedures to be
used in entering and executing orders traded on or through the facilities of
the security-based swap execution facility; and</text>
</clause><clause id="idED7D8CE99DE648C09B363A1D0AC58FFE"><enum>(ii)</enum><text>procedures for trade
processing of security-based swaps on or through the facilities of the
security-based swap execution facility; and</text>
</clause></subparagraph><subparagraph id="ID19b7f382c1c94bc18a9e58d68664684e"><enum>(B)</enum><text>monitor trading in
security-based swaps to prevent manipulation, price distortion, and disruptions
of the delivery or cash settlement process through surveillance, compliance,
and disciplinary practices and procedures, including methods for conducting
real-time monitoring of trading and comprehensive and accurate trade
reconstructions.</text>
</subparagraph></paragraph><paragraph id="IDa311da37f7b34704993d8ee664992ebf"><enum>(5)</enum><header>Ability to obtain
information</header><text>The security-based swap execution facility
shall—</text>
<subparagraph id="IDd6e255a44dfb4fe5aad22d196f5ddc88"><enum>(A)</enum><text>establish and enforce
rules that will allow the facility to obtain any necessary information to
perform any of the functions described in this subsection;</text>
</subparagraph><subparagraph id="IDc78a732be8074115b75c53665f528997"><enum>(B)</enum><text>provide the information
to the Commission on request; and</text>
</subparagraph><subparagraph id="IDa9ea82969d8742be944516e1e339a152"><enum>(C)</enum><text>have the capacity to
carry out such international information-sharing agreements as the Commission
may require.</text>
</subparagraph></paragraph><paragraph id="ID5d81955f7fe642789108c2c0e3d00880"><enum>(6)</enum><header>Position limits or
accountability</header>
<subparagraph id="ID8207244d69b94e47b166e6fb780f9da3"><enum>(A)</enum><header>In
general</header><text>To reduce the potential threat of market manipulation or
congestion, especially during trading in the delivery month, a security-based
swap execution facility that is a trading facility shall adopt for each of the
contracts of the facility, as is necessary and appropriate, position
limitations or position accountability for speculators.</text>
</subparagraph><subparagraph id="IDaada682c786c482f8a1d88200f88113a"><enum>(B)</enum><header>Position
limits</header><text>For any contract or agreement that is subject to a
position limitation established by the Commission pursuant to section 10B, the
security-based swap execution facility shall set its position limitation at a
level no higher than the limitation established by the Commission.</text>
</subparagraph><subparagraph id="IDe320579d2a54418f930a5249dd30d9de"><enum>(C)</enum><header>Position
enforcement</header><text>For any contract or agreement that is subject to a
position limitation established by the Commission pursuant to section 10B, a
security-based swap execution facility shall reject any proposed security-based
swap transaction if, based on information readily available to a security-based
swap execution facility, any proposed security-based swap transaction would
cause a security-based swap execution facility customer that would be a party
to such swap transaction to exceed such position limitation.</text>
</subparagraph></paragraph><paragraph id="IDd02f78ad7c22468e9dfb5fb35fd7aa33"><enum>(7)</enum><header>Financial integrity of
transactions</header><text>The security-based swap execution facility shall
establish and enforce rules and procedures for ensuring the financial integrity
of security-based swaps entered on or through the facilities of the
security-based swap execution facility, including the clearance and settlement
of security-based swaps pursuant to section 3C(a)(1).</text>
</paragraph><paragraph id="IDa554c83ac73342169d945aef855b7248"><enum>(8)</enum><header>Emergency
authority</header><text>The security-based swap execution facility shall adopt
rules to provide for the exercise of emergency authority, in consultation or
cooperation with the Commission, as is necessary and appropriate, including the
authority to liquidate or transfer open positions in any security-based swap or
to suspend or curtail trading in a security-based swap.</text>
</paragraph><paragraph id="ID03a29750b4dc4c9fa3e199bd2c8ddb04"><enum>(9)</enum><header>Timely publication of
trading information</header>
<subparagraph id="id415B6A293DB44875B06EFF64ED158CC5"><enum>(A)</enum><header>In
general</header><text>The security-based swap execution facility shall make
public timely information on price, trading volume, and other trading data on
security-based swaps to the extent prescribed by the Commission.</text>
</subparagraph><subparagraph id="IDea61dedba8ca453eafd397d585ec8cce"><enum>(B)</enum><header>Capacity of
security-based swap execution facility</header><text>The security-based swap
execution facility shall be required to have the capacity to electronically
capture trade information with respect to transactions executed on the
facility.</text>
</subparagraph></paragraph><paragraph id="ID491151fe363b4b00b454dbd8b867aaca"><enum>(10)</enum><header>Recordkeeping and
reporting</header>
<subparagraph id="idF3F6A3765377455B9F0E2E3A887787F4"><enum>(A)</enum><header>In
general</header><text>A security-based swap execution facility shall—</text>
<clause id="id1C32C2201FFA412A930D7541145838EB"><enum>(i)</enum><text>maintain records of all
activities relating to the business of the facility, including a complete audit
trail, in a form and manner acceptable to the Commission for a period of 5
years; and</text>
</clause><clause id="idA8DA062FA1794B4E8035FEEC6FD161A2"><enum>(ii)</enum><text>report to the
Commission, in a form and manner acceptable to the Commission, such information
as the Commission determines to be necessary or appropriate for the Commission
to perform the duties of the Commission under this title.</text>
</clause></subparagraph><subparagraph id="id934C982F05CA42838A46699C8EBCF67E"><enum>(B)</enum><header>Requirements</header><text>The
Commission shall adopt data collection and reporting requirements for
security-based swap execution facilities that are comparable to corresponding
requirements for clearing agencies and security-based swap data
repositories.</text>
</subparagraph></paragraph><paragraph id="ID1c4f4b38a4c8460c95e41230df40a634"><enum>(11)</enum><header>Antitrust
considerations</header><text>Unless necessary or appropriate to achieve the
purposes of this title, the security-based swap execution facility shall
not—</text>
<subparagraph id="ID55bd223e4fea40628e1f7599006630ff"><enum>(A)</enum><text>adopt any rules or taking
any actions that result in any unreasonable restraint of trade; or</text>
</subparagraph><subparagraph id="ID988f58f8700d4dc48d48e3815f855b28"><enum>(B)</enum><text>impose any material
anticompetitive burden on trading or clearing.</text>
</subparagraph></paragraph><paragraph id="ID229fbead7c364a319a1cdef0c1bc0877"><enum>(12)</enum><header>Conflicts of
interest</header><text>The security-based swap execution facility shall—</text>
<subparagraph id="IDcc12024a16f349ba95f4c6514564b78f"><enum>(A)</enum><text>establish and enforce
rules to minimize conflicts of interest in its decision-making process;
and</text>
</subparagraph><subparagraph id="ID6a4d6eea4507404eb6d6248812515551"><enum>(B)</enum><text>establish a process for
resolving the conflicts of interest.</text>
</subparagraph></paragraph><paragraph id="ID992bbf737b3e4e5fa2b0a03e8c677e52"><enum>(13)</enum><header>Financial
resources</header>
<subparagraph id="ID95378ae878c34dfe89a1dbb046fc9240"><enum>(A)</enum><header>In
general</header><text>The security-based swap execution facility shall have
adequate financial, operational, and managerial resources to discharge each
responsibility of the security-based swap execution facility, as determined by
the Commission.</text>
</subparagraph><subparagraph id="ID8f9b915e66d14642b10bdf136b149b91"><enum>(B)</enum><header>Determination of
resource adequacy</header><text>The financial resources of a security-based
swap execution facility shall be considered to be adequate if the value of the
financial resources—</text>
<clause id="id34619CC994264ADEB9111E68A45F0571"><enum>(i)</enum><text>enables the organization
to meet its financial obligations to its members and participants
notwithstanding a default by the member or participant creating the largest
financial exposure for that organization in extreme but plausible market
conditions; and</text>
</clause><clause id="id9D4B159038044B65BD13ED2216473A92"><enum>(ii)</enum><text>exceeds the total amount
that would enable the security-based swap execution facility to cover the
operating costs of the security-based swap execution facility for a 1-year
period, as calculated on a rolling basis.</text>
</clause></subparagraph></paragraph><paragraph id="ID069484dc114d4e848fbc02761563702f"><enum>(14)</enum><header>System
safeguards</header><text>The security-based swap execution facility
shall—</text>
<subparagraph id="IDc992151bab23467a8069682d7f49d39d"><enum>(A)</enum><text>establish and maintain a
program of risk analysis and oversight to identify and minimize sources of
operational risk, through the development of appropriate controls and
procedures, and automated systems, that—</text>
<clause id="id13CEB8CFD8A843AB88376A301A09C817"><enum>(i)</enum><text>are reliable and secure;
and</text>
</clause><clause id="id2CA8C92BD2694C04ADE9370C8A1F8D3F"><enum>(ii)</enum><text>have adequate scalable
capacity;</text>
</clause></subparagraph><subparagraph id="ID088fded78c9a4499a99576f7ed7b0a1a"><enum>(B)</enum><text>establish and maintain
emergency procedures, backup facilities, and a plan for disaster recovery that
are designed to allow for—</text>
<clause id="id5A8F6A4BF40649D6BC48A8C137835177"><enum>(i)</enum><text>the timely recovery and
resumption of operations; and</text>
</clause><clause id="idE73A14CA98A7481EB38A8A7788FBECCD"><enum>(ii)</enum><text>the fulfillment of the
responsibilities and obligation of the security-based swap execution facility;
and</text>
</clause></subparagraph><subparagraph id="ID1f86611649044299b88ef3501576e068"><enum>(C)</enum><text>periodically conduct
tests to verify that the backup resources of the security-based swap execution
facility are sufficient to ensure continued—</text>
<clause id="id25F28C66CF2943D4866FF028D932996B"><enum>(i)</enum><text>order processing and
trade matching;</text>
</clause><clause id="idFFF9B19015E54E1EBFBFEAC5785EB611"><enum>(ii)</enum><text>price reporting;</text>
</clause><clause id="id61B0EB6F146A4036BA30953E32E16F5E"><enum>(iii)</enum><text>market surveillance;
and</text>
</clause><clause id="idFE6B8DD213FE4F638A93B562076D3433"><enum>(iv)</enum><text>maintenance of a
comprehensive and accurate audit trail.</text>
</clause></subparagraph></paragraph><paragraph id="ID926e9ed01ed041e6ae33a7833e3958ae"><enum>(15)</enum><header>Designation of chief
compliance officer</header>
<subparagraph id="ID116aece0465c4a52a7a1bc6b6f9dc9e0"><enum>(A)</enum><header>In
general</header><text>Each security-based swap execution facility shall
designate an individual to serve as a chief compliance officer.</text>
</subparagraph><subparagraph id="IDe49928c8fbba44de89373ab9a6d46442"><enum>(B)</enum><header>Duties</header><text>The
chief compliance officer shall—</text>
<clause id="IDdc1bfdbf08ba447f8278e14097ad0ed7"><enum>(i)</enum><text>report directly to the
board or to the senior officer of the facility;</text>
</clause><clause id="idC0522AEB48354576BCC2CF12ACA2D2D0"><enum>(ii)</enum><text>review compliance with
the core principles in this subsection;</text>
</clause><clause id="IDed062bfcb46d420ba2c171fb0c5d9b2d"><enum>(iii)</enum><text>in consultation with
the board of the facility, a body performing a function similar to that of a
board, or the senior officer of the facility, resolve any conflicts of interest
that may arise;</text>
</clause><clause id="ID27b930f6fa0a4e49af632f65a39b9585"><enum>(iv)</enum><text>be responsible for
establishing and administering the policies and procedures required to be
established pursuant to this section;</text>
</clause><clause id="ID6eb9396471bc44fc8c604f2c9de03786"><enum>(v)</enum><text>ensure compliance with
this title and the rules and regulations issued under this title, including
rules prescribed by the Commission pursuant to this section;</text>
</clause><clause id="ID6ed3b8920b274288af2492ee015d783c"><enum>(vi)</enum><text>establish procedures for
the remediation of noncompliance issues found during—</text>
<subclause id="id3DEF568AF74444FBBF0FA325077D0D8A"><enum>(I)</enum><text>compliance office
reviews;</text>
</subclause><subclause id="id0EAC8BC5ACBC494895CD0F83478021EC"><enum>(II)</enum><text>look backs;</text>
</subclause><subclause id="id88557A4D32964B80B3FE05DFA7579F28"><enum>(III)</enum><text>internal or external
audit findings;</text>
</subclause><subclause id="id042500B6BF27419296CD394634E0FE1E"><enum>(IV)</enum><text>self-reported errors;
or</text>
</subclause><subclause id="id854B0EA89D67403AB16B096E22C2C252"><enum>(V)</enum><text>through validated
complaints; and</text>
</subclause></clause><clause id="idDEF3DEDE14744CA4A0BF8B7FE4E7F994"><enum>(vii)</enum><text>establish and follow
appropriate procedures for the handling, management response, remediation,
retesting, and closing of noncompliance issues.</text>
</clause></subparagraph><subparagraph id="IDc810848b32244745baf4fc0a1de6aa8f"><enum>(C)</enum><header>Annual reports</header>
<clause id="idCBF045F99A5B4A81BA13B3EE824E3D78"><enum>(i)</enum><header>In
general</header><text>In accordance with rules prescribed by the Commission,
the chief compliance officer shall annually prepare and sign a report that
contains a description of—</text>
<subclause id="id2DEA3EAE2A414C4A909C128EE7162B5C"><enum>(I)</enum><text>the compliance of the
security-based swap execution facility with this title; and</text>
</subclause><subclause id="id46B5290DCB33483BACA9DF2A39D2E102"><enum>(II)</enum><text>the policies and
procedures, including the code of ethics and conflict of interest policies, of
the security-based security-based swap execution facility.</text>
</subclause></clause><clause id="id3E5FA8A87CFF4937914EBFB0DF88F807"><enum>(ii)</enum><header>Requirements</header><text>The
chief compliance officer shall—</text>
<subclause id="id2069FCCB98A44307BFDB118343AB3CAC"><enum>(I)</enum><text>submit each report
described in clause (i) with the appropriate financial report of the
security-based swap execution facility that is required to be submitted to the
Commission pursuant to this section; and</text>
</subclause><subclause id="id6AD6CFA83D8242DEACE8F45121B0F5C2"><enum>(II)</enum><text>include in the report a
certification that, under penalty of law, the report is accurate and
complete.</text>
</subclause></clause></subparagraph></paragraph></subsection><subsection id="ID5bcb2eb0a1b345049d0534bcf13e29b3"><enum>(e)</enum><header>Exemptions</header><text>The
Commission may exempt, conditionally or unconditionally, a security-based swap
execution facility from registration under this section if the Commission finds
that the facility is subject to comparable, comprehensive supervision and
regulation on a consolidated basis by the Commodity Futures Trading
Commission.</text>
</subsection><subsection id="IDc8e7a464e11d4a6eaafe64e421b064db"><enum>(f)</enum><header>Rules</header><text>The
Commission shall prescribe rules governing the regulation of security-based
swap execution facilities under this
section.</text>
</subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection commented="no" display-inline="no-display-inline" id="HEC96E6E9390145A395857DE20C231554"><enum>(d)</enum><header>Segregation of assets
held as collateral in security-based swap transactions</header><text display-inline="yes-display-inline">The Securities Exchange Act of 1934 (15
U.S.C. 78a et seq.) is amended by inserting after section 3D (as added by
subsection (b)) the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="HC03C03BB15E44B53AC45DDF18BE6A7E6" reported-display-style="italic" style="OLC">
<section commented="no" id="H619375BECED24E83934793D786E4C677"><enum>3E.</enum><header>Segregation of assets
held as collateral in security-based swap transactions</header>
<subsection id="IDccff9aaddf2e4355b12404ae7f27646e"><enum>(a)</enum><header>Registration
requirement</header><text>It shall be unlawful for any person to accept any
money, securities, or property (or to extend any credit in lieu of money,
securities, or property) from, for, or on behalf of a security-based swaps
customer or to margin, guarantee, or secure a security-based swap cleared by or
through a clearing agency (including money, securities, or property accruing to
the customer as the result of such a security-based swap), unless the person
shall have registered under this title with the Commission as a broker, dealer,
or security-based swap dealer, and the registration shall not have expired nor
been suspended nor revoked.</text>
</subsection><subsection id="ID83203aa9a0db45218c46e85fbf09f1a8"><enum>(b)</enum><header>Cleared security-based
swaps</header>
<paragraph id="ID2155a997fd3b491c9fe89e0d53db73a2"><enum>(1)</enum><header>Segregation
required</header><text>A broker, dealer, or security-based swap dealer shall
treat and deal with all money, securities, and property of any security-based
swaps customer received to margin, guarantee, or secure a security-based swap
cleared by or though a clearing agency (including money, securities, or
property accruing to the security-based swaps customer as the result of such a
security-based swap) as belonging to the security-based swaps customer.</text>
</paragraph><paragraph id="IDaecb8f113bc74bd49b55b8f3d6382be5"><enum>(2)</enum><header>Commingling
prohibited</header><text>Money, securities, and property of a security-based
swaps customer described in paragraph (1) shall be separately accounted for and
shall not be commingled with the funds of the broker, dealer, or security-based
swap dealer or be used to margin, secure, or guarantee any trades or contracts
of any security-based swaps customer or person other than the person for whom
the same are held.</text>
</paragraph></subsection><subsection id="IDa1be247118504e6baecd820979a0932b"><enum>(c)</enum><header>Exceptions</header>
<paragraph id="ID6ae51d95204a48f9a60279a27059bf41"><enum>(1)</enum><header>Use of funds</header>
<subparagraph id="ID0e2ad0d16e4d4389840ad6ad26c8714d"><enum>(A)</enum><header>In
general</header><text>Notwithstanding subsection (b), money, securities, and
property of a security-based swaps customer of a broker, dealer, or
security-based swap dealer described in subsection (b) may, for convenience, be
commingled and deposited in the same 1 or more accounts with any bank or trust
company or with a clearing agency.</text>
</subparagraph><subparagraph id="ID644d12e63be6489cb152a79f86729030"><enum>(B)</enum><header>Withdrawal</header><text>Notwithstanding
subsection (b), such share of the money, securities, and property described in
subparagraph (A) as in the normal course of business shall be necessary to
margin, guarantee, secure, transfer, adjust, or settle a cleared security-based
swap with a clearing agency, or with any member of the clearing agency, may be
withdrawn and applied to such purposes, including the payment of commissions,
brokerage, interest, taxes, storage, and other charges, lawfully accruing in
connection with the cleared security-based swap.</text>
</subparagraph></paragraph><paragraph id="ID306b94a0c38f4646b455c8e367288c2a"><enum>(2)</enum><header>Commission
action</header><text>Notwithstanding subsection (b), in accordance with such
terms and conditions as the Commission may prescribe by rule, regulation, or
order, any money, securities, or property of the security-based swaps customer
of a broker, dealer, or security-based swap dealer described in subsection (b)
may be commingled and deposited as provided in this section with any other
money, securities, or property received by the broker, dealer, or
security-based swap dealer and required by the Commission to be separately
accounted for and treated and dealt with as belonging to the security-based
swaps customer of the broker, dealer, or security-based swap dealer.</text>
</paragraph></subsection><subsection id="ID29e729df6094490390fdc760f844149d"><enum>(d)</enum><header>Permitted
investments</header><text>Money described in subsection (b) may be invested in
obligations of the United States, in general obligations of any State or of any
political subdivision of a State, and in obligations fully guaranteed as to
principal and interest by the United States, or in any other investment that
the Commission may by rule or regulation prescribe, and such investments shall
be made in accordance with such rules and regulations and subject to such
conditions as the Commission may prescribe.</text>
</subsection><subsection id="ID48eb8b9188144538a183daedcf85e21c"><enum>(e)</enum><header>Prohibition</header><text>It
shall be unlawful for any person, including any clearing agency and any
depository institution, that has received any money, securities, or property
for deposit in a separate account or accounts as provided in subsection (b) to
hold, dispose of, or use any such money, securities, or property as belonging
to the depositing broker, dealer, or security-based swap dealer or any person
other than the swaps customer of the broker, dealer, or security-based swap
dealer.</text>
</subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="HE5C0510E8F824B0F92570F63D3735BC3"><enum>(e)</enum><header>Trading in
security-based swaps</header><text>Section 6 of the Securities Exchange Act of
1934 (15 U.S.C. 78f) is amended by adding at the end the following:</text>
<quoted-block changed="added" id="HA07A08B166464A63A6A10A69ECEA3821" reported-display-style="italic" style="OLC">
<subsection id="H402BED558D7B482297FE05EBB9127B72"><enum>(l)</enum><header>Security-based
swaps</header><text>It shall be unlawful for any person to effect a transaction
in a security-based swap with or for a person that is not an eligible contract
participant, unless such transaction is effected on a national securities
exchange registered pursuant to subsection
(b).</text>
</subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="HA50600979A43476785017671A54FB409"><enum>(f)</enum><header>Additions of
security-based swaps to certain enforcement provisions</header><text>Section
9(b) of the Securities Exchange Act of 1934 (15 U.S.C. 78i(b)) is amended by
striking paragraphs (1) through (3) and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="H13B840BF75484D57B8C7DFF71E02FD8E" reported-display-style="italic" style="OLC">
<paragraph id="HF9C2272489384D748657BBB7537F87CB"><enum>(1)</enum><text>any transaction in
connection with any security whereby any party to such transaction
acquires—</text>
<subparagraph id="id415F5E78146F4CD2AB739F4B6649E625"><enum>(A)</enum><text>any put, call, straddle,
or other option or privilege of buying the security from or selling the
security to another without being bound to do so;</text>
</subparagraph><subparagraph id="id4AD78ABB43C048D4B84537B469360A2B"><enum>(B)</enum><text>any security futures
product on the security; or</text>
</subparagraph><subparagraph id="id925F76A893BD4D4A89FD0550C9D66B64"><enum>(C)</enum><text>any security-based swap
involving the security or the issuer of the security;</text>
</subparagraph></paragraph><paragraph id="H30B16869EC8D495BA02B745CAFCFBC68"><enum>(2)</enum><text>any transaction in
connection with any security with relation to which such person has, directly
or indirectly, any interest in any—</text>
<subparagraph id="idB8CEC155E37D4D82893A39AD627B5E74"><enum>(A)</enum><text>such put, call, straddle,
option, or privilege;</text>
</subparagraph><subparagraph id="id7989FE4C84A9435F893FC25A55A4F824"><enum>(B)</enum><text>such security futures
product; or</text>
</subparagraph><subparagraph id="id7E6AB035C9BB468A86F7C70B4D43E975"><enum>(C)</enum><text>such security-based swap;
or</text>
</subparagraph></paragraph><paragraph id="HEC312E5193084E8F96647675B8CF5E7E"><enum>(3)</enum><text>any transaction in any
security for the account of any person who such person has reason to believe
has, and who actually has, directly or indirectly, any interest in any—</text>
<subparagraph id="id592A5A4B88E444B694C2BDA4F0EC9487"><enum>(A)</enum><text>such put, call, straddle,
option, or privilege;</text>
</subparagraph><subparagraph id="id86322DC1340A4872B68EFD380591067B"><enum>(B)</enum><text>such security futures
product with relation to such security; or</text>
</subparagraph><subparagraph id="id5A1F63A6F1FE4A1A83C8B72CE52B9621"><enum>(C)</enum><text>any security-based swap
involving such security or the issuer of such
security.</text>
</subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="HF94A8EBC47CD458493EA3B25DF4DAC01"><enum>(g)</enum><header>Rulemaking authority To
prevent fraud, manipulation and deceptive conduct in security-based
swaps</header><text>Section 9 of the Securities Exchange Act of 1934 (15 U.S.C.
78i) is amended by adding at the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="H80D4B7A01A9D4D8394A3054D3092FBC8" reported-display-style="italic" style="OLC">
<subsection id="H408AFA1E9FE148EEA9B3EE5905C58FAA"><enum>(j)</enum><text>It shall be unlawful for
any person, directly or indirectly, by the use of any means or instrumentality
of interstate commerce or of the mails, or of any facility of any national
securities exchange, to effect any transaction in, or to induce or attempt to
induce the purchase or sale of, any security-based swap, in connection with
which such person engages in any fraudulent, deceptive, or manipulative act or
practice, makes any fictitious quotation, or engages in any transaction,
practice, or course of business which operates as a fraud or deceit upon any
person. The Commission shall, for the purposes of this subsection, by rules and
regulations define, and prescribe means reasonably designed to prevent, such
transactions, acts, practices, and courses of business as are fraudulent,
deceptive, or manipulative, and such quotations as are
fictitious.</text>
</subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="H5F3CFE882805400BB6BF799EF27F6C68"><enum>(h)</enum><header>Position limits and
position accountability for security-based swaps</header><text>The Securities
Exchange Act of 1934 is amended by inserting after section 10A (15 U.S.C.
78j–1) the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="H2BC80AAA2B4B4EF7A329482A1329E020" reported-display-style="italic" style="OLC">
<section id="H5EE47277D9DA4D639966E51A44D3B177"><enum>10B.</enum><header>Position limits and
position accountability for security-based swaps and large trader
reporting</header>
<subsection id="H2C899F76187848D69F9866376EF4E599"><enum>(a)</enum><header>Position
limits</header><text display-inline="yes-display-inline">As a means reasonably
designed to prevent fraud and manipulation, the Commission shall, by rule or
regulation, as necessary or appropriate in the public interest or for the
protection of investors, establish limits (including related hedge exemption
provisions) on the size of positions in any security-based swap that may be
held by any person. In establishing such limits, the Commission may require any
person to aggregate positions in—</text>
<paragraph id="HCEC1A6C80AE2480FA1B08944939DD8BF"><enum>(1)</enum><text>any security-based swap
and any security or loan or group of securities or loans on which such
security-based swap is based, which such security-based swap references, or to
which such security-based swap is related as described in paragraph (68) of
section 3(a), and any other instrument relating to such security or loan or
group or index of securities or loans; or</text>
</paragraph><paragraph id="H849603974AAB4965852288A9A05872CF"><enum>(2)</enum><text>any security-based swap
and—</text>
<subparagraph id="id22B19B2B70A7416D835D9333EE9A4E58"><enum>(A)</enum><text>any security or group or
index of securities, the price, yield, value, or volatility of which, or of
which any interest therein, is the basis for a material term of such
security-based swap as described in paragraph (68) of section 3(a); and</text>
</subparagraph><subparagraph id="idECCD70F035724C6F8BE52BFEFA441D9B"><enum>(B)</enum><text>any other instrument
relating to the same security or group or index of securities described under
subparagraph (A).</text>
</subparagraph></paragraph></subsection><subsection id="H44BD4BFA77854906B50B8E0B9822125D"><enum>(b)</enum><header>Exemptions</header><text>The
Commission, by rule, regulation, or order, may conditionally or unconditionally
exempt any person or class of persons, any security-based swap or class of
security-based swaps, or any transaction or class of transactions from any
requirement the Commission may establish under this section with respect to
position limits.</text>
</subsection><subsection id="H6DDD8DB00D0A4ECFAA2BDD83F39A3F25"><enum>(c)</enum><header>SRO Rules</header>
<paragraph id="H637BCE3BBA204EA78E23C0E7FD5B8649"><enum>(1)</enum><header>In
general</header><text>As a means reasonably designed to prevent fraud or
manipulation, the Commission, by rule, regulation, or order, as necessary or
appropriate in the public interest, for the protection of investors, or
otherwise in furtherance of the purposes of this title, may direct a
self-regulatory organization—</text>
<subparagraph id="H649E9FA8248C45E98260EF36946A087C"><enum>(A)</enum><text>to adopt rules regarding
the size of positions in any security-based swap that may be held by—</text>
<clause id="HA44CC2C0AEA5418594ABD5C013D1BD9A"><enum>(i)</enum><text>any member of such
self-regulatory organization; or</text>
</clause><clause id="HEB84820001864CACBDBDD90988FE6D13"><enum>(ii)</enum><text>any person for whom a
member of such self-regulatory organization effects transactions in such
security-based swap; and</text>
</clause></subparagraph><subparagraph id="HC77C714F9F794B1BAED419385E59480F"><enum>(B)</enum><text>to adopt rules reasonably
designed to ensure compliance with requirements prescribed by the Commission
under this subsection.</text>
</subparagraph></paragraph><paragraph id="H3BAC00CBBA234897BF9611379D608E07"><enum>(2)</enum><header>Requirement to
aggregate positions</header><text>In establishing the limits under paragraph
(1), the self-regulatory organization may require such member or person to
aggregate positions in—</text>
<subparagraph id="H84E990C9B1614245AA3E4D94802EC3FC"><enum>(A)</enum><text>any security-based swap
and any security or loan or group or narrow-based security narrow-based
security index of securities or loans on which such security-based swap is
based, which such security-based swap references, or to which such
security-based swap is related as described in section 3(a)(68), and any other
instrument relating to such security or loan or group or narrow-based security
index of securities or loans; or</text>
</subparagraph><subparagraph id="H8C58BC9521CE4C16B1ADBC015C6F2259"><enum>(B)</enum><clause commented="no" display-inline="yes-display-inline" id="H5B0D24DA6A2940958F8703A926FFFE5A"><enum>(i)</enum><text>any security-based swap;
and</text>
</clause><clause changed="added" id="HA1AFB37D290D4210A3A15607495E797F" indent="up1" reported-display-style="italic"><enum>(ii)</enum><text>any security-based swap
and any other instrument relating to the same security or group or narrow-based
security index of securities.</text>
</clause></subparagraph></paragraph></subsection><subsection id="HDB7F1BABE6484937846C3575A23F3A5E"><enum>(d)</enum><header>Large trader
reporting</header><text display-inline="yes-display-inline">The Commission, by
rule or regulation, may require any person that effects transactions for such
person’s own account or the account of others in any securities-based swap or
uncleared security-based swap and any security or loan or group or narrow-based
security index of securities or loans as set forth in paragraphs (1) and (2) of
subsection (a) under this section to report such information as the Commission
may prescribe regarding any position or positions in any security-based swap or
uncleared security-based swap and any security or loan or group or narrow-based
security index of securities or loans and any other instrument relating to such
security or loan or group or narrow-based security index of securities or loans
as set forth in paragraphs (1) and (2) of subsection (a) under this
section.</text>
</subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="HB5A399D6B69048F4BAB067BFF200DF77"><enum>(i)</enum><header>Public reporting and
repositories for security-based swaps</header><text>Section 13 of the
Securities Exchange Act of 1934 (15 U.S.C. 78m) is amended by adding at the end
the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id637C1C5D083B490AB08B0EC78E0C3FCE" reported-display-style="italic" style="OLC">
<subsection id="idA1306F522C8F4756A8D060E3BA8901C0"><enum>(m)</enum><header>Public availability of
security-based swap transaction data</header>
<paragraph id="id4E3A76236EE64EB1996E4331C3ED2FCF"><enum>(1)</enum><header>In general</header>
<subparagraph id="idF7D3A66E19424197AD763BBF7AFD25AE"><enum>(A)</enum><header>Definition of real-time
public reporting</header><text>In this paragraph, the term <term>real-time
public reporting</term> means to report data relating to a security-based swap
transaction as soon as technologically practicable after the time at which the
security-based swap transaction has been executed.</text>
</subparagraph><subparagraph id="id133DB2BFA09342D5AA0F749EB5B81435"><enum>(B)</enum><header>Purpose</header><text>The
purpose of this section is to authorize the Commission to make security-based
swap transaction and pricing data available to the public in such form and at
such times as the Commission determines appropriate to enhance price
discovery.</text>
</subparagraph><subparagraph id="id757439017B4F4620B5AFF07F6302D7A6"><enum>(C)</enum><header>General
rule</header><text>The Commission is authorized to provide by rule for the
public availability of security-based swap transaction and pricing data as
follows:</text>
<clause id="idE7A6010303E34B649DE0F4C8E9E73756"><enum>(i)</enum><text>With respect to those
security-based swaps that are subject to the mandatory clearing requirement
described in section 3C(a)(1) (including those security-based swaps that are
exempted from the requirement pursuant to section 3C(a)(10)), the Commission
shall require real-time public reporting for such transactions.</text>
</clause><clause id="id338147CC5A8B46EC822B376FBDD2AFEB"><enum>(ii)</enum><text>With respect to those
security-based swaps that are not subject to the mandatory clearing requirement
described in subsection section 3C(a)(1), but are cleared at a registered
clearing agency, the Commission shall require real-time public reporting for
such transactions.</text>
</clause><clause id="idEC7D70B784CC4CB5AE47B28A1A1277C7"><enum>(iii)</enum><text>With respect to
security-based swaps that are not cleared at a registered clearing agency and
which are reported to a security-based swap data repository or the Commission
under section 3C(a), the Commission shall make available to the public, in a
manner that does not disclose the business transactions and market positions of
any person, aggregate data on such security-based swap trading volumes and
positions.</text>
</clause><clause id="id131431B0B27F43F780EA2086E80E514B"><enum>(iv)</enum><text>With respect to
security-based swaps that are exempt from the requirements of section 3C(a)(1),
but are subject to the requirements of section 3C(a)(8), the Commission shall
require real-time public reporting for such transactions.</text>
</clause></subparagraph><subparagraph id="idB5E80DFE0E3A4B77B5B03CB030D81C2D"><enum>(D)</enum><header>Registered entities and
public reporting</header><text>The Commission may require registered entities
to publicly disseminate the security-based swap transaction and pricing data
required to be reported under this paragraph.</text>
</subparagraph><subparagraph id="idBFC552AC3B80411EB6E30164C8B010AF"><enum>(E)</enum><header>Rulemaking
required</header><text>With respect to the rule providing for the public
availability of transaction and pricing data for security-based swaps described
in clauses (i) and (ii) of subparagraph (C), the rule promulgated by the
Commission shall contain provisions—</text>
<clause id="id3E89839C8D9C4990837C73DA0A9B87D5"><enum>(i)</enum><text>to ensure such
information does not identify the participants;</text>
</clause><clause id="id838769A483AE44E59E396DC02C6B07C0"><enum>(ii)</enum><text>to specify the criteria
for determining what constitutes a large notional security-based swap
transaction (block trade) for particular markets and contracts;</text>
</clause><clause id="idCECEE89D754D48F19E8E7C48555ADDB3"><enum>(iii)</enum><text>to specify the
appropriate time delay for reporting large notional security-based swap
transactions (block trades) to the public; and</text>
</clause><clause id="id0E124732E92042C8B067FBCAD683CAA4"><enum>(iv)</enum><text>that take into account
whether the public disclosure will materially reduce market liquidity.</text>
</clause></subparagraph><subparagraph id="id859FF4C6186C4096A3283D0FE81DB953"><enum>(F)</enum><header>Timeliness of
reporting</header><text>Parties to a security-based swap (including agents of
the parties to a security-based swap) shall be responsible for reporting
security-based swap transaction information to the appropriate registered
entity in a timely manner as may be prescribed by the Commission.</text>
</subparagraph></paragraph><paragraph commented="no" id="id1EA3DF96331342F8B925240D8192BD69"><enum>(2)</enum><header>Semiannual and annual
public reporting of aggregate security-based swap data</header>
<subparagraph commented="no" id="id0A46D9B0CDF4411E9E3BF9FA1F4034F3"><enum>(A)</enum><header>In
general</header><text>In accordance with subparagraph (B), the Commission shall
issue a written report on a semiannual and annual basis to make available to
the public information relating to—</text>
<clause commented="no" id="idEA6A8990F8784FBB849E0BE6A4885541"><enum>(i)</enum><text>the trading and clearing
in the major security-based swap categories; and</text>
</clause><clause commented="no" id="id65623D04D6FF45C8AAF0A2FAE811BD60"><enum>(ii)</enum><text>the market participants
and developments in new products.</text>
</clause></subparagraph><subparagraph commented="no" id="id74F6B2E6BB1A44E489898B0EB2815B11"><enum>(B)</enum><header>Use;
consultation</header><text>In preparing a report under subparagraph (A), the
Commission shall—</text>
<clause commented="no" id="id7D7D7B5B206641DDB0D4DDBD72BA4C1D"><enum>(i)</enum><text>use information from
security-based swap data repositories and derivatives clearing organizations;
and</text>
</clause><clause commented="no" id="idD9D6A8B171984355B2D557B81BC1EB0E"><enum>(ii)</enum><text>consult with the Office
of the Comptroller of the Currency, the Bank for International Settlements, and
such other regulatory bodies as may be necessary.</text>
</clause></subparagraph></paragraph></subsection><subsection id="H74E93339ACFF4DCEBFF71BA15D40E1EA"><enum>(n)</enum><header>Security-based swap
data repositories</header>
<paragraph id="H6082C31EE4804264983362338FA609F1"><enum>(1)</enum><header>Registration
requirement</header><text>It shall be unlawful for any person, unless
registered with the Commission, directly or indirectly, to make use of the
mails or any means or instrumentality of interstate commerce to perform the
functions of a security-based swap data repository.</text>
</paragraph><paragraph id="H086A96BC691C4F2F95013A4656A28596"><enum>(2)</enum><header>Inspection and
examination</header><text>Each registered security-based swap data repository
shall be subject to inspection and examination by any representative of the
Commission.</text>
</paragraph><paragraph id="IDb9ad352845424fbf80108e5129d08fe4"><enum>(3)</enum><header>Compliance with core
principles</header>
<subparagraph id="ID8cbe020159ce48028074efdb42b2e2b4"><enum>(A)</enum><header>In
general</header><text>To be registered, and maintain registration, as a
security-based swap data repository, the security-based swap data repository
shall comply with—</text>
<clause id="ID4622e83d02f94deeb841a535c0c7e900"><enum>(i)</enum><text>the core principles
described in this subsection; and</text>
</clause><clause id="ID7cbc78a3b84e429aa2cd931126b2f5c4"><enum>(ii)</enum><text>any requirement that the
Commission may impose by rule or regulation.</text>
</clause></subparagraph><subparagraph id="ID1c3c369c5b784acb92b66ea20596c3ca"><enum>(B)</enum><header>Reasonable discretion
of security-based swap data repository</header><text>Unless otherwise
determined by the Commission, by rule or regulation, a security-based swap data
repository described in subparagraph (A) shall have reasonable discretion in
establishing the manner in which the security-based swap data repository
complies with the core principles described in this subsection.</text>
</subparagraph></paragraph><paragraph id="HD5BB07F756784B93BAB5DF28271ACC22"><enum>(4)</enum><header>Standard
setting</header>
<subparagraph id="H72B5A088E7DD479E8A2F9E53AF87F209"><enum>(A)</enum><header>Data
identification</header><text>The Commission shall prescribe standards that
specify the data elements for each security-based swap that shall be collected
and maintained by each registered security-based swap data repository.</text>
</subparagraph><subparagraph id="H4CAF5BF8DF214F10A2B0AFF3B4D64B57"><enum>(B)</enum><header>Data collection and
maintenance</header><text>The Commission shall prescribe data collection and
data maintenance standards for security-based swap data repositories.</text>
</subparagraph><subparagraph id="HDEDD421DDFEF43AB9C6D7A761351D55E"><enum>(C)</enum><header>Comparability</header><text>The
standards prescribed by the Commission under this subsection shall be
comparable to the data standards imposed by the Commission on clearing agencies
in connection with their clearing of security-based swaps.</text>
</subparagraph></paragraph><paragraph id="H7830946196664AFBBC61269E52F475FF"><enum>(5)</enum><header>Duties</header><text>A
security-based swap data repository shall—</text>
<subparagraph id="ID78e2457a7ff14f13aba2c332e1d35feb"><enum>(A)</enum><text>accept data prescribed by
the Commission for each security-based swap under subsection (b);</text>
</subparagraph><subparagraph id="ID07787cba0f3a4cc28a4cfd877718f5bd"><enum>(B)</enum><text>confirm with both
counterparties to the security-based swap the accuracy of the data that was
submitted;</text>
</subparagraph><subparagraph id="IDfe4d8755232e4b75952d8fc5288cf474"><enum>(C)</enum><text>maintain the data
described in subparagraph (A) in such form, in such manner, and for such period
as may be required by the Commission;</text>
</subparagraph><subparagraph id="ID5630bbd0c79e424c897f26197548e5f1"><enum>(D)</enum><clause commented="no" display-inline="yes-display-inline" id="id768DC14A1DA044B3B14D36D0E2210698"><enum>(i)</enum><text>provide direct
electronic access to the Commission (or any designee of the Commission,
including another registered entity); and</text>
</clause><clause changed="added" id="idFA0C200C619049C5A6BB9F348BF53321" indent="up1" reported-display-style="italic"><enum>(ii)</enum><text>provide the information
described in subparagraph (A) in such form and at such frequency as the
Commission may require to comply with the public reporting requirements set
forth in subsection (m);</text>
</clause></subparagraph><subparagraph id="ID4e81816ca71f44d88dfe16819988375e"><enum>(E)</enum><text>at the direction of the
Commission, establish automated systems for monitoring, screening, and
analyzing security-based swap data;</text>
</subparagraph><subparagraph id="id4E6450ABB02F420DA585EB5940567D72"><enum>(F)</enum><text>maintain the privacy of
any and all security-based swap transaction information that the security-based
swap data repository receives from a security-based swap dealer, counterparty,
or any other registered entity; and</text>
</subparagraph><subparagraph id="ID822a2206438841b8aaf78c284de9ebcd"><enum>(G)</enum><text>on a confidential basis
pursuant to section 24, upon request, and after notifying the Commission of the
request, make available all data obtained by the security-based swap data
repository, including individual counterparty trade and position data,
to—</text>
<clause id="IDf19f16c202ab4f9ca1601710bddf9c0a"><enum>(i)</enum><text>each appropriate
prudential regulator;</text>
</clause><clause id="IDb4e0366f141e48958d341341dfbc0bda"><enum>(ii)</enum><text>the Financial Stability
Oversight Council;</text>
</clause><clause id="id9E719C017B014A67BEA3E36FDDA9CCBE"><enum>(iii)</enum><text>the Commodity Futures
Trading Commission;</text>
</clause><clause id="IDfb6549b8f3df426aad5dce7c717ac1d6"><enum>(iv)</enum><text>the Department of
Justice; and</text>
</clause><clause id="ID3978041b42314619b69b83d1545c0dc7"><enum>(v)</enum><text>any other person that the
Commission determines to be appropriate, including—</text>
<subclause id="IDdbd555c246754d63be6293074660d2e4"><enum>(I)</enum><text>foreign financial
supervisors (including foreign futures authorities);</text>
</subclause><subclause id="ID65be954fb88641c2947b472b15bcfa12"><enum>(II)</enum><text>foreign central banks;
and</text>
</subclause><subclause id="ID3aca427c3ff146c48b7476a20c8dd4af"><enum>(III)</enum><text>foreign
ministries.</text>
</subclause></clause></subparagraph><subparagraph id="ID020d0e5cc3634152b25b364f6d630366"><enum>(H)</enum><header>Confidentiality and
indemnification agreement</header><text>Before the security-based swap data
repository may share information with any entity described in subparagraph
(G)—</text>
<clause id="id287D85B28D5C410590DAAD4082EEA474"><enum>(i)</enum><text>the security-based swap
data repository shall receive a written agreement from each entity stating that
the entity shall abide by the confidentiality requirements described in section
24 relating to the information on security-based swap transactions that is
provided; and</text>
</clause><clause id="id0983AAA7512E4DF6A46279588579267F"><enum>(ii)</enum><text>each entity shall agree
to indemnify the security-based swap data repository and the Commission for any
expenses arising from litigation relating to the information provided under
section 24.</text>
</clause></subparagraph></paragraph><paragraph id="IDaf17f06215b54f6588d56d6b6efdab81"><enum>(6)</enum><header>Designation of chief
compliance officer</header>
<subparagraph id="ID67cbce8820a4459c88592692a55059aa"><enum>(A)</enum><header>In
general</header><text>Each security-based swap data repository shall designate
an individual to serve as a chief compliance officer.</text>
</subparagraph><subparagraph id="ID5d8a9760fe634652baafd7556663721d"><enum>(B)</enum><header>Duties</header><text>The
chief compliance officer shall—</text>
<clause id="ID63a6efc619cf4533b3ba52bcee20173b"><enum>(i)</enum><text>report directly to the
board or to the senior officer of the security-based swap data
repository;</text>
</clause><clause id="ID5fbd14075e81427d84b85d67f284ef1d"><enum>(ii)</enum><text>review the compliance of
the security-based swap data repository with respect to the core principles
described in paragraph (7);</text>
</clause><clause id="ID2848a36fbf3a4ca19f6413b26eab064f"><enum>(iii)</enum><text>in consultation with
the board of the security-based swap data repository, a body performing a
function similar to the board of the security-based swap data repository, or
the senior officer of the security-based swap data repository, resolve any
conflicts of interest that may arise;</text>
</clause><clause id="ID9723c079b6484822b8376365c40a0598"><enum>(iv)</enum><text>be responsible for
administering each policy and procedure that is required to be established
pursuant to this section;</text>
</clause><clause id="ID1f7c5c6712464f2aae83f1e3b42eea6c"><enum>(v)</enum><text>ensure compliance with
this title (including regulations) relating to agreements, contracts, or
transactions, including each rule prescribed by the Commission under this
section;</text>
</clause><clause id="ID9e8aac02204e4ccb9b22fb73306d5735"><enum>(vi)</enum><text>establish procedures for
the remediation of noncompliance issues identified by the chief compliance
officer through any—</text>
<subclause id="IDae49ecb662e44bf2ae1e4d5c2e297595"><enum>(I)</enum><text>compliance office
review;</text>
</subclause><subclause id="ID32d37c0c3c9c4f4e947e66a033acd6de"><enum>(II)</enum><text>look-back;</text>
</subclause><subclause id="ID2799fc7919f54bd884e20efa2bc1dff8"><enum>(III)</enum><text>internal or external
audit finding;</text>
</subclause><subclause id="IDeff8881b32334b5d82d5e8b87c9cf830"><enum>(IV)</enum><text>self-reported error;
or</text>
</subclause><subclause id="ID1a7176bc82d74e778fbb0b69f043505a"><enum>(V)</enum><text>validated complaint;
and</text>
</subclause></clause><clause id="IDcb225527946c42e4861f2ea4395c9981"><enum>(vii)</enum><text>establish and follow
appropriate procedures for the handling, management response, remediation,
retesting, and closing of noncompliance issues.</text>
</clause></subparagraph><subparagraph id="IDe83ef5860d084d15bfac717fbec95ca6"><enum>(C)</enum><header>Annual reports</header>
<clause id="ID732dc28c2cbc48149feb6da548aa53d3"><enum>(i)</enum><header>In
general</header><text>In accordance with rules prescribed by the Commission,
the chief compliance officer shall annually prepare and sign a report that
contains a description of—</text>
<subclause id="idB52C1BDCBD62491984E96B68469660E6"><enum>(I)</enum><text>the compliance of the
security-based swap data repository of the chief compliance officer with
respect to this title (including regulations); and</text>
</subclause><subclause id="ID02550be98f5c46a885df87ef842dd7aa"><enum>(II)</enum><text>each policy and
procedure of the security-based swap data repository of the chief compliance
officer (including the code of ethics and conflict of interest policies of the
security-based swap data repository).</text>
</subclause></clause><clause id="ID0ea3708e0d254ba59784023b22be1e97"><enum>(ii)</enum><header>Requirements</header><text>A
compliance report under clause (i) shall—</text>
<subclause id="ID6a9f4445e45a4e95ab7731e3c551ba1f"><enum>(I)</enum><text>accompany each
appropriate financial report of the security-based swap data repository that is
required to be furnished to the Commission pursuant to this section; and</text>
</subclause><subclause id="ID22f82b63be6f4578b86d6169e29989f3"><enum>(II)</enum><text>include a certification
that, under penalty of law, the compliance report is accurate and
complete.</text>
</subclause></clause></subparagraph></paragraph><paragraph id="id46BB54663F0E4EB9829E306B24F6E29D"><enum>(7)</enum><header>Core principles
applicable to security-based swap data repositories</header>
<subparagraph commented="no" id="IDfa8a15eba7464bfd819e636ea15f5a8b"><enum>(A)</enum><header>Antitrust
considerations</header><text>Unless necessary or appropriate to achieve the
purposes of this title, the swap data repository shall not—</text>
<clause commented="no" id="IDdc16fdc9142c4b1ea22b34a04a3464f9"><enum>(i)</enum><text>adopt any rule or take
any action that results in any unreasonable restraint of trade; or</text>
</clause><clause commented="no" id="ID02c9a534356447fb95327d2bad2d4261"><enum>(ii)</enum><text>impose any material
anticompetitive burden on the trading, clearing, or reporting of
transactions.</text>
</clause></subparagraph><subparagraph commented="no" id="ID475d69c136bc492cbd6836a3898e3ea2"><enum>(B)</enum><header>Governance
arrangements</header><text>Each security-based swap data repository shall
establish governance arrangements that are transparent—</text>
<clause commented="no" id="IDaec39c6e2cec4bd785c06c2a28bb572c"><enum>(i)</enum><text>to fulfill public
interest requirements; and</text>
</clause><clause commented="no" id="IDb0ff2b05b0f84dcdb47d911dda43fc8a"><enum>(ii)</enum><text>to support the
objectives of the Federal Government, owners, and participants.</text>
</clause></subparagraph><subparagraph commented="no" id="ID9380340e79974538a339025fd5c21bec"><enum>(C)</enum><header>Conflicts of
interest</header><text>Each security-based swap data repository shall—</text>
<clause commented="no" id="ID09202272384f4a78a43a2503dc14826d"><enum>(i)</enum><text>establish and enforce
rules to minimize conflicts of interest in the decision-making process of the
security-based swap data repository; and</text>
</clause><clause commented="no" id="ID59fa3b07e414443f8623af71c895592b"><enum>(ii)</enum><text>establish a process for
resolving any conflicts of interest described in clause (i).</text>
</clause></subparagraph></paragraph><paragraph id="idC44F2CBB51524698B6A7479417B88C93"><enum>(8)</enum><header>Required registration
for security-based swap data repositories</header><text display-inline="yes-display-inline">Any person that is required to be
registered as a security-based swap data repository under this subsection shall
register with the Commission, regardless of whether that person is also
licensed under the Commodity Exchange Act as a swap data repository.</text>
</paragraph><paragraph id="IDd29bec368fef48d18dbd1b4e59a5b59f"><enum>(9)</enum><header>Rules</header><text display-inline="yes-display-inline">The Commission shall adopt rules governing
persons that are registered under this
subsection.</text>
</paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection></section><section id="HD89B676A7009400DB12D3C9BF5456464"><enum>764.</enum><header>Registration and
regulation of security-based swap dealers and major security-based swap
participants</header><text display-inline="no-display-inline">The Securities
Exchange Act of 1934 (15 U.S.C. 78a et seq.) is amended by inserting after
section 15E (15 U.S.C. 78o–7) the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="HD830FFF35E8F4A8A88FCAB4D1BDA2255" reported-display-style="italic" style="OLC">
<section id="HB7315DA81EBA49B4BDE5EF046F542CC9"><enum>15F.</enum><header>Registration and
regulation of security-based swap dealers and major security-based swap
participants</header>
<subsection id="IDb6a70b2930d24567a45a6a4641edf483"><enum>(a)</enum><header>Registration</header>
<paragraph id="IDb00d1da27f1b4245850921f266da31e5"><enum>(1)</enum><header>security-based swap
dealers</header><text>It shall be unlawful for any person to act as a
security-based swap dealer unless the person is registered as a security-based
swap dealer with the Commission.</text>
</paragraph><paragraph id="IDfaffb12f597d4c1d903e69d4f2caf951"><enum>(2)</enum><header>Major security-based
swap participants</header><text>It shall be unlawful for any person to act as a
major security-based swap participant unless the person is registered as a
major security-based swap participant with the Commission.</text>
</paragraph></subsection><subsection id="IDda80cbf4afed4315aa9f7c18e205c3ca"><enum>(b)</enum><header>Requirements</header>
<paragraph id="IDb7eddae710dc4800929d8bfd81b7e087"><enum>(1)</enum><header>In
general</header><text>A person shall register as a security-based swap dealer
or major security-based swap participant by filing a registration application
with the Commission.</text>
</paragraph><paragraph id="IDbe70a6e1e694454da9bc386aa273fab5"><enum>(2)</enum><header>Contents</header>
<subparagraph id="id8D963B08B605454981ED738E9A585EE5"><enum>(A)</enum><header>In
general</header><text>The application shall be made in such form and manner as
prescribed by the Commission, and shall contain such information, as the
Commission considers necessary concerning the business in which the applicant
is or will be engaged.</text>
</subparagraph><subparagraph id="id028AF38CF64641FDAC6B274238C15656"><enum>(B)</enum><header>Continual
reporting</header><text>A person that is registered as a security-based swap
dealer or major security-based swap participant shall continue to submit to the
Commission reports that contain such information pertaining to the business of
the person as the Commission may require.</text>
</subparagraph></paragraph><paragraph id="ID3dd8e59e9e034e89952b3193ed49fe6b"><enum>(3)</enum><header>Expiration</header><text>Each
registration under this section shall expire at such time as the Commission may
prescribe by rule or regulation.</text>
</paragraph><paragraph id="IDbc95414114d446f798ad6a0202d35246"><enum>(4)</enum><header>Rules</header><text>Except
as provided in subsections (c), (e), and (f), the Commission may prescribe
rules applicable to security-based swap dealers and major security-based swap
participants, including rules that limit the activities of non-bank
security-based swap dealers and non-bank major security-based swap
participants.</text>
</paragraph><paragraph id="IDfcd02f088ac1431f89df7c3054d03c53"><enum>(5)</enum><header>Transition</header><text>Not
later than 1 year after the date of enactment of the
<short-title>Wall Street Transparency and Accountability
Act of 2010</short-title>, the Commission shall issue rules under this section
to provide for the registration of security-based swap dealers and major
security-based swap participants.</text>
</paragraph><paragraph id="ID1419cd5b31d04f56bc5a30bfd92dcfb1"><enum>(6)</enum><header>Statutory
disqualification</header><text>Except to the extent otherwise specifically
provided by rule, regulation, or order of the Commission, it shall be unlawful
for a security-based swap dealer or a major security-based swap participant to
permit any person associated with a security-based swap dealer or a major
security-based swap participant who is subject to a statutory disqualification
to effect or be involved in effecting security-based swaps on behalf of the
security-based swap dealer or major security-based swap participant, if the
security-based swap dealer or major security-based swap participant knew, or in
the exercise of reasonable care should have known, of the statutory
disqualification.</text>
</paragraph></subsection><subsection id="ID9c88c34954e14cd2b09933fa18b28bdb"><enum>(c)</enum><header>Dual
registration</header>
<paragraph id="ID26eab166f03f47b58a7f4c42d290af27"><enum>(1)</enum><header>Security-based swap
dealer</header><text>Any person that is required to be registered as a
security-based swap dealer under this section shall register with the
Commission, regardless of whether the person also is registered with the
Commodity Futures Trading Commission as a swap dealer.</text>
</paragraph><paragraph id="ID23061bb2e9a7422a92486cb3e9cd7f6b"><enum>(2)</enum><header>Major security-based
swap participant</header><text>Any person that is required to be registered as
a major security-based swap participant under this section shall register with
the Commission, regardless of whether the person also is registered with the
Commodity Futures Trading Commission as a major swap participant.</text>
</paragraph></subsection><subsection id="ID448d4172ad1d499dbb0a270627120431"><enum>(d)</enum><header>Rulemaking</header>
<paragraph id="ID5970181b769c448fac1b56ea9eb18736"><enum>(1)</enum><header>In
general</header><text>The Commission shall adopt rules for persons that are
registered as security-based swap dealers or major security-based swap
participants under this section.</text>
</paragraph><paragraph id="ID623682ddf664417985de7a5dfdfde1fd"><enum>(2)</enum><header>Exception for
prudential requirements</header>
<subparagraph id="idFA08A099AF3643409C4A98B0D86711AF"><enum>(A)</enum><header>In
general</header><text>The Commission may not prescribe rules imposing
prudential requirements on security-based swap dealers or major security-based
swap participants that are depository institutions, as that term is defined in
section 3 of the Federal Deposit Insurance Act (12 U.S.C. 1813).</text>
</subparagraph><subparagraph id="id078785CE8E36487AA76AC2C568D6E28A"><enum>(B)</enum><header>Applicability</header><text>Subparagraph
(A) does not limit the authority of the Commission to prescribe appropriate
business conduct, reporting, and recordkeeping requirements on security-based
swap dealers or major security-based swap participants that are depository
institutions to protect investors.</text>
</subparagraph></paragraph></subsection><subsection id="ID28bd87c5bebd43a5ab4fd6f9e70e9e6a"><enum>(e)</enum><header>Capital and margin
requirements</header>
<paragraph id="IDc0ba4cc2481249dc8c7727e2ed9b0c81"><enum>(1)</enum><header>In general</header>
<subparagraph id="ID2267720d5e274176aa003a602c34ab9d"><enum>(A)</enum><header>Security-based swap
dealers and major security-based swap participants that are depository
institutions</header><text>Each registered security-based swap dealer and major
security-based swap participant that is a depository institution, as that term
is defined in section 3 of the Federal Deposit Insurance Act (12 U.S.C. 1813),
shall meet such minimum capital requirements and minimum initial and variation
margin requirements as the appropriate Federal banking agency shall by rule or
regulation prescribe under paragraph (2)(A) to help ensure the safety and
soundness of the security-based swap dealer or major security-based swap
participant.</text>
</subparagraph><subparagraph id="ID504bafef791b4fc0990365291c573df1"><enum>(B)</enum><header>Security-based swap
dealers and major security-based swap participants that are not depository
institutions</header><text>Each registered security-based swap dealer and major
security-based swap participant that is not a depository institution, as that
term is defined in section 3 of the Federal Deposit Insurance Act (12 U.S.C.
1813), shall meet such minimum capital requirements and minimum initial and
variation margin requirements as the Commission shall by rule or regulation
prescribe under paragraph (2)(B) to help ensure the safety and soundness of the
security-based swap dealer or major security-based swap participant.</text>
</subparagraph></paragraph><paragraph id="id2F0002B02CF44B108B54A48A32625793"><enum>(2)</enum><header>Rules</header>
<subparagraph id="id374021E8BFAA405DAF981F36BC5CCF03"><enum>(A)</enum><header>Security-based swap
dealers and major security-based swap participants that are depository
institutions</header><text>The appropriate Federal banking agencies, in
consultation with the Commission and the Commodity Futures Trading Commission,
shall adopt rules imposing capital and margin requirements under this
subsection for security-based swap dealers and major security-based swap
participants that are depository institutions, as that term is defined in
section 3 of the Federal Deposit Insurance Act (12 U.S.C. 1813).</text>
</subparagraph><subparagraph id="id1BA6735E8F8A4CA0A9EBDDBF524D3D4B"><enum>(B)</enum><header>Security-based swap
dealers and major security-based swap participants that are not depository
institutions</header><text>The Commission shall adopt rules imposing capital
and margin requirements under this subsection for security-based swap dealers
and major security-based swap participants that are not depository
institutions, as that term is defined in section 3 of the Federal Deposit
Insurance Act (12 U.S.C. 1813).</text>
</subparagraph></paragraph><paragraph id="id47C33746F6BE41FE8FA2D68B6553E790"><enum>(3)</enum><header>Capital</header>
<subparagraph id="id9D1966FFD9614D7C94871823F6746BA1"><enum>(A)</enum><header>Security-based swap
dealers and major security-based swap participants that are depository
institutions</header><text>The capital requirements prescribed under paragraph
(2)(A) for security-based swap dealers and major security-based swap
participants that are depository institutions shall contain—</text>
<clause id="ID7ead37eea95c4c609e8664272540d5bb"><enum>(i)</enum><text>a capital requirement
that is greater than zero for security-based swaps that are cleared by a
clearing agency; and</text>
</clause><clause id="IDa218c56234a44f7f91d35627b90e2902"><enum>(ii)</enum><text>to offset the greater
risk to the security-based swap dealer or major security-based swap participant
and to the financial system arising from the use of security-based swaps that
are not cleared, substantially higher capital requirements for security-based
swaps that are not cleared by a clearing agency than for security-based swaps
that are cleared.</text>
</clause></subparagraph><subparagraph id="IDc524495d97bb4e749a1c41993d231bce"><enum>(B)</enum><header>Security-based swap
dealers and major security-based swap participants that are not depository
institutions</header><text>The capital requirements prescribed under paragraph
(2)(B) for security-based swap dealers and major security-based swap
participants that are not depository institutions shall be as strict as or
stricter than the capital requirements prescribed for security-based swap
dealers and major security-based swap participants that are depository
institutions under paragraph (2)(A).</text>
</subparagraph><subparagraph id="id1A212C9BCB374115888EB06E76CDC9EB"><enum>(C)</enum><header>Rule of
construction</header>
<clause id="idBC307C7F95AB49CEAEBD8E0EC585359D"><enum>(i)</enum><header>In
general</header><text>Nothing in this section shall limit, or be construed to
limit, the authority—</text>
<subclause id="ID082cc12c03294d2e907501b9dd38e49b"><enum>(I)</enum><text>of the Commission to set
financial responsibility rules for a broker or dealer registered pursuant to
section 15(b) (except for section 15(b)(11) thereof) in accordance with section
15(c)(3); or</text>
</subclause><subclause id="ID503f421927954104a6384d5fb7927af0"><enum>(II)</enum><text>of the Commodity Futures
Trading Commission to set financial responsibility rules for a futures
commission merchant or introducing broker registered pursuant to section 4f(a)
of the Commodity Exchange Act (except for section 4f(a)(3) thereof) in
accordance with section 4f(b) of the Commodity Exchange Act.</text>
</subclause></clause><clause id="id65AEBC3A7BE6437FBE196ABCC211E13D"><enum>(ii)</enum><header>Futures commission
merchants and other dealers</header><text>A futures commission merchant,
introducing broker, broker, or dealer shall maintain sufficient capital to
comply with the stricter of any applicable capital requirements to which such
futures commission merchant, introducing broker, broker, or dealer is subject
to under this title or the Commodity Exchange Act.</text>
</clause></subparagraph></paragraph><paragraph id="ID02fe3b285aba4917b5f28641258069d3"><enum>(4)</enum><header>Margin</header>
<subparagraph id="IDcd77935a54be4f03b03f28e24e8e5a6f"><enum>(A)</enum><header>Security-based swap
dealers and major security-based swap participants that are depository
institutions</header><text>The appropriate Federal banking agency for
security-based swap dealers and major security-based swap participants that are
depository institutions shall impose both initial and variation margin
requirements in accordance with paragraph (2)(A) on all security-based swaps
that are not cleared by a clearing agency.</text>
</subparagraph><subparagraph id="ID0fcd94b8e24a42aca5243f722d2a57f8"><enum>(B)</enum><header>Security-based swap
dealers and major security-based swap participants that are not depository
institutions</header><text>The Commission shall impose both initial and
variation margin requirements in accordance with paragraph (2)(B) for
security-based swap dealers and major security-based swap participants that are
not depository institutions on all security-based swaps that are not cleared by
a clearing agency. Any such initial and variation margin requirements shall be
as strict as or stricter than the margin requirements prescribed under
paragraph (4)(A).</text>
</subparagraph></paragraph><paragraph id="IDd7adcc7ce09344708000fe0f069c9fef"><enum>(5)</enum><header>Margin
requirements</header><text>In prescribing margin requirements under this
subsection, the appropriate Federal banking agency with respect to
security-based swap dealers and major security-based swap participants that are
depository institutions, and the Commission with respect to security-based swap
dealers and major security-based swap participants that are not depository
institutions may permit the use of noncash collateral, as the agency or the
Commission determines to be consistent with—</text>
<subparagraph id="IDec7cd9faea1b44a989fe154f84dde7e4"><enum>(A)</enum><text>preserving the financial
integrity of markets trading security-based swaps; and</text>
</subparagraph><subparagraph id="IDbb94d1c482c4479198984cf5937bfa63"><enum>(B)</enum><text>preserving the stability
of the United States financial system.</text>
</subparagraph></paragraph><paragraph id="ID686f07523a1f4d908dcbbdf1469a7195"><enum>(6)</enum><header>Comparability of
capital and margin requirements</header>
<subparagraph id="ID105593285c904b8aba9687300306e674"><enum>(A)</enum><header>In
general</header><text>The appropriate Federal banking agencies, the Commission,
and the Securities and Exchange Commission shall periodically (but not less
frequently than annually) consult on minimum capital requirements and minimum
initial and variation margin requirements.</text>
</subparagraph><subparagraph id="ID6501a23727f44262b7aa723ee80641d8"><enum>(B)</enum><header>Comparability</header><text>The
entities described in subparagraph (A) shall, to the maximum extent
practicable, establish and maintain comparable minimum capital requirements and
minimum initial and variation margin requirements, including the use of noncash
collateral, for—</text>
<clause id="IDdbb5164e9e2949e9b1983bcfd05fd6ee"><enum>(i)</enum><text>security-based swap
dealers; and</text>
</clause><clause id="ID7bb76bb6f40544c4b0c88369660d25c1"><enum>(ii)</enum><text>major security-based
swap participants.</text>
</clause></subparagraph></paragraph><paragraph id="ID9e1d03129f1e4b158dafc2fb8c4790f5"><enum>(7)</enum><header>Requested
margin</header><text>If any party to a security-based swap that is exempt from
the margin requirements of paragraph (4)(A) or paragraph (4)(B) requests that
such security-based swap be margined, then—</text>
<subparagraph id="ID146b7151ed7a454fa8b78049ccd5b847"><enum>(A)</enum><text>the exemption shall not
apply; and</text>
</subparagraph><subparagraph id="ID79ca913b71814a82963848d14057ba6b"><enum>(B)</enum><text>the counterparty to such
security-based swap shall provide the requested margin.</text>
</subparagraph></paragraph><paragraph id="IDf26da780ecfc4f4caf4c9de4bf4fe069"><enum>(8)</enum><header>Applicability with
respect to counterparties</header><text>Paragraphs (4) and (5) shall not apply
to initial and variation margin for security-based swaps in which 1 of the
counterparties is not—</text>
<subparagraph id="ID8f51ca6b39444659a101754992b7e4bc"><enum>(A)</enum><text>a security-based swap
dealer;</text>
</subparagraph><subparagraph id="ID43b62e5c9f6948729f9d7d021d8e892f"><enum>(B)</enum><text>a major security-based
swap participant; or</text>
</subparagraph><subparagraph id="IDf22a2f22f0af4c8cbbd31785f438bae1"><enum>(C)</enum><text>a financial entity as
described in section 3C(a)(10)(A)(ii), and such counterparty is eligible for
and utilizing the commercial end user clearing exemption under section
3C(a)(10).</text>
</subparagraph></paragraph></subsection><subsection id="IDf2caf81dcc334dcea3024eef17b7e9bc"><enum>(f)</enum><header>Reporting and
recordkeeping</header>
<paragraph id="IDa003be06e0934139b81e60421722fb08"><enum>(1)</enum><header>In
general</header><text>Each registered security-based swap dealer and major
security-based swap participant—</text>
<subparagraph id="IDcee3e1b01f2b4c7bb6f221eaab0c5bb1"><enum>(A)</enum><text>shall make such reports
as are required by the Commission, by rule or regulation, regarding the
transactions and positions and financial condition of the registered
security-based swap dealer or major security-based swap participant;</text>
</subparagraph><subparagraph id="ID040b13a103784117bdf451d7237ea526"><enum>(B)</enum><clause commented="no" display-inline="yes-display-inline" id="idED1442CC1FAF4F52B4B2808B230E270A"><enum>(i)</enum><text>for which there is a
prudential regulator, shall keep books and records of all activities related to
the business as a security-based swap dealer or major security-based swap
participant in such form and manner and for such period as may be prescribed by
the Commission by rule or regulation; and</text>
</clause><clause changed="added" id="id7EA53CE0B03A44028EE043406E47C261" indent="up1" reported-display-style="italic"><enum>(ii)</enum><text>for which there is no
prudential regulator, shall keep books and records in such form and manner and
for such period as may be prescribed by the Commission by rule or regulation;
and</text>
</clause></subparagraph><subparagraph id="ID2f6262363b6747488cc895bf67e934d3"><enum>(C)</enum><text>shall keep books and
records described in subparagraph (B) open to inspection and examination by any
representative of the Commission.</text>
</subparagraph></paragraph><paragraph id="IDb14026014b05408b847b0221b1e7a84d"><enum>(2)</enum><header>Rules</header><text>The
Commission shall adopt rules governing reporting and recordkeeping for
security-based swap dealers and major security-based swap participants.</text>
</paragraph></subsection><subsection id="IDfc5391bbef2448458e449da065168a3e"><enum>(g)</enum><header>Daily trading
records</header>
<paragraph id="ID0e10254eea984093a2180581afe29e20"><enum>(1)</enum><header>In
general</header><text>Each registered security-based swap dealer and major
security-based swap participant shall maintain daily trading records of the
security-based swaps of the registered security-based swap dealer and major
security-based swap participant and all related records (including related cash
or forward transactions) and recorded communications, including electronic
mail, instant messages, and recordings of telephone calls, for such period as
may be required by the Commission by rule or regulation.</text>
</paragraph><paragraph id="ID7135bf49976b42a4bfbed915a741db18"><enum>(2)</enum><header>Information
requirements</header><text>The daily trading records shall include such
information as the Commission shall require by rule or regulation.</text>
</paragraph><paragraph id="ID85790579965e42e3b43d54311820208e"><enum>(3)</enum><header>Customer
records</header><text>Each registered security-based swap dealer and major
security-based swap participant shall maintain daily trading records for each
customer or counterparty in a manner and form that is identifiable with each
security-based swap transaction.</text>
</paragraph><paragraph id="ID36cef253037148b7b1ed4ad4759a68bc"><enum>(4)</enum><header>Audit
trail</header><text>Each registered security-based swap dealer and major
security-based swap participant shall maintain a complete audit trail for
conducting comprehensive and accurate trade reconstructions.</text>
</paragraph><paragraph id="ID92e492ce7d784ba18b222515e0fcdf41"><enum>(5)</enum><header>Rules</header><text>The
Commission shall adopt rules governing daily trading records for security-based
swap dealers and major security-based swap participants.</text>
</paragraph></subsection><subsection id="ID719a2defb625478dbc415c2b02e42baa"><enum>(h)</enum><header>Business conduct
standards</header>
<paragraph id="ID5362d941b5e94766b3796c9571977a42"><enum>(1)</enum><header>In
general</header><text>Each registered security-based swap dealer and major
security-based swap participant shall conform with such business conduct
standards as may be prescribed by the Commission, by rule or regulation, that
relate to—</text>
<subparagraph id="ID16bd48a5a2fb4646b1d295ebe4072043"><enum>(A)</enum><text>fraud, manipulation, and
other abusive practices involving security-based swaps (including
security-based swaps that are offered but not entered into);</text>
</subparagraph><subparagraph id="IDd40145bf28d642a6bbbfadca869b6f97"><enum>(B)</enum><text>diligent supervision of
the business of the registered security-based swap dealer and major
security-based swap participant;</text>
</subparagraph><subparagraph id="IDba34abe1b4ea42b3aedd6660ef9e3219"><enum>(C)</enum><text>adherence to all
applicable position limits; and</text>
</subparagraph><subparagraph id="ID4dbc477c0be6408c99c257d4f375ac25"><enum>(D)</enum><text>such other matters as the
Commission determines to be appropriate.</text>
</subparagraph></paragraph><paragraph id="IDdc5a73bf53b04284a1015b2f7fd49686"><enum>(2)</enum><header>Special rule; fiduciary
duties to certain entities</header>
<subparagraph id="ID36775b81b5614e23be413971a927788c"><enum>(A)</enum><header>Governmental
entities</header><text>A security-based swap dealer that provides advice
regarding, or offers to enter into, or enters into a security-based swap with a
State, State agency, city, county, municipality, or other political subdivision
of a State, or a Federal agency shall have a fiduciary duty to the State, State
agency, city, county, municipality, or other political subdivision of the
State, or the Federal agency, as appropriate.</text>
</subparagraph><subparagraph id="IDaa24ff86a2a843cb90bbd5cccab37a2f"><enum>(B)</enum><header>Pension plans;
endowments; retirement plans</header><text>A security-based swap dealer that
provides advice regarding, or offers to enter into, or enters into a
security-based swap with a pension plan, endowment, or retirement plan shall
have a fiduciary duty to the pension plan, endowment, or retirement plan, as
appropriate.</text>
</subparagraph></paragraph><paragraph id="IDcbcb85712e5e42e69407219f57ae0704"><enum>(3)</enum><header>Business conduct
requirements</header><text>Business conduct requirements adopted by the
Commission under this subsection shall—</text>
<subparagraph id="IDa66b5b5febd5493ba66ea64f70404077"><enum>(A)</enum><text>establish the standard of
care for a security-based swap dealer or major security-based swap participant
to verify that any counterparty meets the eligibility standards for an eligible
contract participant;</text>
</subparagraph><subparagraph id="ID3c02977e96d445d7a0464c7043ef45bb"><enum>(B)</enum><text>require disclosure by the
security-based swap dealer or major security-based swap participant to any
counterparty to the transaction (other than a security-based swap dealer or a
major security-based swap participant) of—</text>
<clause id="ID4ae272af003f47448e00b1ac66193990"><enum>(i)</enum><text>information about the
material risks and characteristics of the security-based swap;</text>
</clause><clause id="IDc43d82ef75a145b2a80b2dcd35fa9cd9"><enum>(ii)</enum><text>the source and amount of
any fees or other material remuneration that the security-based swap dealer or
major security-based swap participant would directly or indirectly expect to
receive in connection with the security-based swap;</text>
</clause><clause id="ID167b14a6703d40198b379e0351c218ca"><enum>(iii)</enum><text>any other material
incentives or conflicts of interest that the security-based swap dealer or
major security-based swap participant may have in connection with the
security-based swap; and</text>
</clause><clause id="ID779472111ba742288aece827110de10b"><enum>(iv)</enum><subclause commented="no" display-inline="yes-display-inline" id="id7BF06D00CAEC4B29988991D3C39EE751"><enum>(I)</enum><text>for cleared
security-based swaps, upon the request of the counterparty, the daily mark from
the appropriate clearing agency; and</text>
</subclause><subclause changed="added" id="idE504521F12A14522A5A4532F45EABA07" indent="up1" reported-display-style="italic"><enum>(II)</enum><text>for uncleared
security-based swaps, the daily mark of the security-based swap dealer or the
major security-based swap participant;</text>
</subclause></clause></subparagraph><subparagraph id="ID4c860c19915548c8ae45d43cc8a0c825"><enum>(C)</enum><text>establish a standard of
conduct for a security-based swap dealer or major security-based swap
participant to communicate in a fair and balanced manner based on principles of
fair dealing and good faith;</text>
</subparagraph><subparagraph id="ID6da59a60c1a14028a87bc4c0f8085229"><enum>(D)</enum><text>establish a standard of
conduct for a security-based swap dealer or major security-based swap
participant, with respect to a counterparty that is an eligible contract
participant within the meaning of subclause (I) or (II) of clause (vii) of
section 1a(18) of the Commodity Exchange Act, to have a reasonable basis to
believe that the counterparty has an independent representative that—</text>
<clause id="ID81c577331ee64c47b47df3faf258e229"><enum>(i)</enum><text>has sufficient knowledge
to evaluate the transaction and risks;</text>
</clause><clause id="ID1a1ced143f084464af86b0782fd1cde4"><enum>(ii)</enum><text>is not subject to a
statutory disqualification;</text>
</clause><clause id="IDcd734a788a6e43cc90d4dce400351a26"><enum>(iii)</enum><text>is independent of the
security-based swap dealer or major security-based swap participant;</text>
</clause><clause id="ID4c4aa2bd215a47c7bf616f89a54d4a53"><enum>(iv)</enum><text>undertakes a duty to act
in the best interests of the counterparty it represents;</text>
</clause><clause id="ID68cc081fd32b44f181a149949ca04ed7"><enum>(v)</enum><text>makes appropriate
disclosures; and</text>
</clause><clause id="ID275e29edff9b4ee9b89c76f8f699077c"><enum>(vi)</enum><text>will provide written
representations to the eligible contract participant regarding fair pricing and
the appropriateness of the transaction; and</text>
</clause></subparagraph><subparagraph id="ID84e4a2c4e0f84b57a23d7e0834867e77"><enum>(E)</enum><text>establish such other
standards and requirements as the Commission may determine are appropriate in
the public interest, for the protection of investors, or otherwise in
furtherance of the purposes of this title.</text>
</subparagraph></paragraph><paragraph id="IDeca2e3d496334efeb77729925929b192"><enum>(4)</enum><header>Rules</header><text>The
Commission shall prescribe rules under this subsection governing business
conduct standards for security-based swap dealers and major security-based swap
participants.</text>
</paragraph></subsection><subsection id="ID39c26f3496074b65a7ab6ed8af9adc1f"><enum>(i)</enum><header>Documentation and back
office standards</header>
<paragraph id="ID82a29cabfe7042eba09f10bdf65fee3e"><enum>(1)</enum><header>In
general</header><text>Each registered security-based swap dealer and major
security-based swap participant shall conform with such standards as may be
prescribed by the Commission, by rule or regulation, that relate to timely and
accurate confirmation, processing, netting, documentation, and valuation of all
security-based swaps.</text>
</paragraph><paragraph id="IDe45230c776bd4ea0ad9f077749920fd6"><enum>(2)</enum><header>Rules</header><text>The
Commission shall adopt rules governing documentation and back office standards
for security-based swap dealers and major security-based swap
participants.</text>
</paragraph></subsection><subsection id="ID0917ed21b5f7464a823c89a85fe74c37"><enum>(j)</enum><header>Duties</header><text display-inline="yes-display-inline">Each registered security-based swap dealer
and major security-based swap participant shall, at all times, comply with the
following requirements:</text>
<paragraph id="ID16ec8b329df44e828413f0a4a9bcf6f5"><enum>(1)</enum><header>Monitoring of
trading</header><text>The security-based swap dealer or major security-based
swap participant shall monitor its trading in security-based swaps to prevent
violations of applicable position limits.</text>
</paragraph><paragraph id="IDda34f7579afc40cab9156fed4f1623b7"><enum>(2)</enum><header>Risk management
procedures</header><text>The security-based swap dealer or major security-based
swap participant shall establish robust and professional risk management
systems adequate for managing the day-to-day business of the security-based
swap dealer or major security-based swap participant.</text>
</paragraph><paragraph id="IDb96b3f1af14c44b2b864fa8af8cc5177"><enum>(3)</enum><header>Disclosure of general
information</header><text>The security-based swap dealer or major
security-based swap participant shall disclose to the Commission and to the
prudential regulator for the security-based swap dealer or major security-based
swap participant, as applicable, information concerning—</text>
<subparagraph id="ID5a224af6122c43c588a958fc2c0ff90a"><enum>(A)</enum><text>terms and conditions of
its security-based swaps;</text>
</subparagraph><subparagraph id="IDba588ca4f88f4042b32e300e7365b044"><enum>(B)</enum><text>security-based swap
trading operations, mechanisms, and practices;</text>
</subparagraph><subparagraph id="ID9b3f759e95ab4ccf9b6ca9a245bc8829"><enum>(C)</enum><text>financial integrity
protections relating to security-based swaps; and</text>
</subparagraph><subparagraph id="ID09421cf433214a8ab766a30dd6e2d211"><enum>(D)</enum><text>other information
relevant to its trading in security-based swaps.</text>
</subparagraph></paragraph><paragraph id="IDad52796223a94bed919dba201d46dd5d"><enum>(4)</enum><header>Ability to obtain
information</header><text>The security-based swap dealer or major
security-based swap participant shall—</text>
<subparagraph id="IDedf21678405d481d88d7026fb904d087"><enum>(A)</enum><text>establish and enforce
internal systems and procedures to obtain any necessary information to perform
any of the functions described in this section; and</text>
</subparagraph><subparagraph id="ID8a743272fdbc4c299cc87fad7486eaf3"><enum>(B)</enum><text>provide the information
to the Commission and to the prudential regulator for the security-based swap
dealer or major security-based swap participant, as applicable, on
request.</text>
</subparagraph></paragraph><paragraph id="ID0a5c97db72684ab6a7ad08fd44334b35"><enum>(5)</enum><header>Conflicts of
interest</header><text>The security-based swap dealer and major security-based
swap participant shall implement conflict-of-interest systems and procedures
that—</text>
<subparagraph id="ID64cbdbfbe7be486e80890ff6c5c68337"><enum>(A)</enum><text>establish structural and
institutional safeguards to ensure that the activities of any person within the
firm relating to research or analysis of the price or market for any
security-based swap or acting in a role of providing clearing activities or
making determinations as to accepting clearing customers are separated by
appropriate informational partitions within the firm from the review, pressure,
or oversight of persons whose involvement in pricing, trading, or clearing
activities might potentially bias their judgment or supervision and contravene
the core principles of open access and the business conduct standards described
in this title; and</text>
</subparagraph><subparagraph id="ID0599662dee344309a56ea7e1aaae2a4f"><enum>(B)</enum><text>address such other issues
as the Commission determines to be appropriate.</text>
</subparagraph></paragraph><paragraph id="id2BAF0CCD20E34AFDAA8031EDEBCD878B"><enum>(6)</enum><header>Antitrust
considerations</header><text>Unless necessary or appropriate to achieve the
purposes of this title, the security-based swap dealer or major security-based
swap participant shall not—</text>
<subparagraph id="id200BF14EE48E4A86B38BC695372D10E4"><enum>(A)</enum><text>adopt any process or take
any action that results in any unreasonable restraint of trade; or</text>
</subparagraph><subparagraph id="id409B67E77B57455BB9A39F529F069410"><enum>(B)</enum><text>impose any material
anticompetitive burden on trading or clearing.</text>
</subparagraph></paragraph></subsection><subsection id="ID74fe21da423d4ce3ac061c5b35e66d85"><enum>(k)</enum><header>Designation of Chief
Compliance Officer</header>
<paragraph id="ID2b441a5190b7459c828c0ab2e5cfded7"><enum>(1)</enum><header>In
general</header><text>Each security-based swap dealer and major security-based
swap participant shall designate an individual to serve as a chief compliance
officer.</text>
</paragraph><paragraph id="IDa350604ff7394862b19c92726fa3a6e2"><enum>(2)</enum><header>Duties</header><text>The
chief compliance officer shall—</text>
<subparagraph id="ID72f06dcf6b2c4b55ae27ee7cf52817d2"><enum>(A)</enum><text>report directly to the
board or to the senior officer of the security-based swap dealer or major
security-based swap participant;</text>
</subparagraph><subparagraph id="ID46c4249abd494605a93032cbb5f4de9f"><enum>(B)</enum><text>review the compliance of
the security-based swap dealer or major security-based swap participant with
respect to the security-based swap dealer and major security-based swap
participant requirements described in this section;</text>
</subparagraph><subparagraph id="ID3475cf913c1a41ae9b23140021f4f96f"><enum>(C)</enum><text>in consultation with the
board of directors, a body performing a function similar to the board, or the
senior officer of the organization, resolve any conflicts of interest that may
arise;</text>
</subparagraph><subparagraph id="IDd9707747487d497ea5e77429e8be0803"><enum>(D)</enum><text>be responsible for
administering each policy and procedure that is required to be established
pursuant to this section;</text>
</subparagraph><subparagraph id="ID0de7e4b65145400d970eb4f0bf9e6648"><enum>(E)</enum><text>ensure compliance with
this title (including regulations) relating to security-based swaps, including
each rule prescribed by the Commission under this section;</text>
</subparagraph><subparagraph id="IDa129073514424e51bc9b0846929c7932"><enum>(F)</enum><text>establish procedures for
the remediation of noncompliance issues identified by the chief compliance
officer through any—</text>
<clause id="ID54a2596e5c5442218ec258fd68941db1"><enum>(i)</enum><text>compliance office
review;</text>
</clause><clause id="IDf51d584a3e5f4631a83c895a78d57550"><enum>(ii)</enum><text>look-back;</text>
</clause><clause id="IDf72864d62912406694b9b4583bc980f5"><enum>(iii)</enum><text>internal or external
audit finding;</text>
</clause><clause id="ID457a29daac864181adeffd6001e0c0ea"><enum>(iv)</enum><text>self-reported error;
or</text>
</clause><clause id="ID2dfefb8d52d84ad688c4b9b05d8ebd2d"><enum>(v)</enum><text>validated complaint;
and</text>
</clause></subparagraph><subparagraph id="ID07c501fcd60f4a20af813a64db3eb34d"><enum>(G)</enum><text>establish and follow
appropriate procedures for the handling, management response, remediation,
retesting, and closing of noncompliance issues.</text>
</subparagraph></paragraph><paragraph id="ID1cfd4dffdd1740d3a4effba3f480458a"><enum>(3)</enum><header>Annual reports</header>
<subparagraph id="IDd7333c57fdf546dcb6c31b28074ee162"><enum>(A)</enum><header>In
general</header><text>In accordance with rules prescribed by the Commission,
the chief compliance officer shall annually prepare and sign a report that
contains a description of—</text>
<clause id="IDcd70598fa4d2491291cb153d6bdd6187"><enum>(i)</enum><text>the compliance of the
security-based swap dealer or major swap participant with respect to this title
(including regulations); and</text>
</clause><clause id="ID53ae5c5010814f149bc9973473dd1ce7"><enum>(ii)</enum><text>each policy and
procedure of the security-based swap dealer or major security-based swap
participant of the chief compliance officer (including the code of ethics and
conflict of interest policies).</text>
</clause></subparagraph><subparagraph id="ID132ced33621445b998d2b77285997f7c"><enum>(B)</enum><header>Requirements</header><text>A
compliance report under subparagraph (A) shall—</text>
<clause id="ID671aafd11f614f8f92b5481eac4648eb"><enum>(i)</enum><text>accompany each
appropriate financial report of the security-based swap dealer or major
security-based swap participant that is required to be furnished to the
Commission pursuant to this section; and</text>
</clause><clause id="ID83b790c9f67246fabc5b2bfbf6f4a5f8"><enum>(ii)</enum><text>include a certification
that, under penalty of law, the compliance report is accurate and
complete.</text>
</clause></subparagraph></paragraph></subsection><subsection id="H7D296911EDF346708020BEA6861D5B48"><enum>(l)</enum><header>Enforcement and
administrative proceeding authority</header>
<paragraph id="H1F25A2752999429E8F2351F8F07BD8C5"><enum>(1)</enum><header>Primary enforcement
authority</header>
<subparagraph id="H8164C0EF1319475AB84BB8D13A9E83D1"><enum>(A)</enum><header>Securities and Exchange
Commission</header><text>Except as provided in subparagraph (B), the Commission
shall have primary authority to enforce subtitle B, and the amendments made by
subtitle B of the Wall Street Transparency and Accountability Act of 2010, with
respect to any person.</text>
</subparagraph><subparagraph id="H3E84FDDB73044F76A60B9A4BEC6756B5"><enum>(B)</enum><header>Appropriate Federal
banking agencies</header><text>The appropriate Federal banking agency for
security-based swap dealers or major security-based swap participants that are
depository institutions, as that term is defined under section 3 of the Federal
Deposit Insurance Act (12 U.S.C. 1813), shall have exclusive authority to
enforce the provisions of subsection (e) and other prudential requirements of
this title, with respect to depository institutions that are security-based
swap dealers or major security-based swap participants.</text>
</subparagraph><subparagraph id="HB1709E81EF6E4BE8AB360B3EF8CB62F2"><enum>(C)</enum><header>Referral</header>
<clause id="H4CEDE1EE6E1C4C33A0ACA7D486B17BFA"><enum>(i)</enum><header>Violations of
nonprudential requirements</header><text>If the appropriate Federal banking
agency for security-based swap dealers or major security-based swap
participants that are depository institutions has cause to believe that such
security-based swap dealer or major security-based swap participant may have
engaged in conduct that constitutes a violation of the nonprudential
requirements of this section or rules adopted by the Commission thereunder, the
agency may recommend in writing to the Commission that the Commission initiate
an enforcement proceeding as authorized under this title. The recommendation
shall be accompanied by a written explanation of the concerns giving rise to
the recommendation.</text>
</clause><clause id="H349ADBA4D0DC4E6C9B5A04626F835A59"><enum>(ii)</enum><header>Violations of
prudential requirements</header><text display-inline="yes-display-inline">If
the Commission has cause to believe that a securities-based swap dealer or
major securities-based swap participant that has a prudential regulator may
have engaged in conduct that constitute a violation of the prudential
requirements of subsection (e) or rules adopted thereunder, the Commission may
recommend in writing to the prudential regulator that the prudential regulator
initiate an enforcement proceeding as authorized under this title. The
recommendation shall be accompanied by a written explanation of the concerns
giving rise to the recommendation.</text>
</clause></subparagraph></paragraph><paragraph id="HA8A7AC18FFA946C69A31EB05322753F5"><enum>(2)</enum><header>Censure, denial,
suspension; notice and hearing</header><text>The Commission, by order, shall
censure, place limitations on the activities, functions, or operations of, or
revoke the registration of any security-based swap dealer or major
security-based swap participant that has registered with the Commission
pursuant to subsection (b) if the Commission finds, on the record after notice
and opportunity for hearing, that such censure, placing of limitations, or
revocation is in the public interest and that such security-based swap dealer
or major security-based swap participant, or any person associated with such
security-based swap dealer or major security-based swap participant effecting
or involved in effecting transactions in security-based swaps on behalf of such
security-based swap dealer or major security-based swap participant, whether
prior or subsequent to becoming so associated—</text>
<subparagraph id="H3661E473E8634DD6894D9BB164F43134"><enum>(A)</enum><text>has committed or omitted
any act, or is subject to an order or finding, enumerated in subparagraph (A),
(D), or (E) of paragraph (4) of section 15(b);</text>
</subparagraph><subparagraph id="H8EE3FC4657BB40F3BCB873BFFD236E4F"><enum>(B)</enum><text>has been convicted of any
offense specified in subparagraph (B) of such paragraph (4) within 10 years of
the commencement of the proceedings under this subsection;</text>
</subparagraph><subparagraph id="HB8BABD87B8E14714A41F3F5E8AE2E6F2"><enum>(C)</enum><text>is enjoined from any
action, conduct, or practice specified in subparagraph (C) of such paragraph
(4);</text>
</subparagraph><subparagraph id="H10009EE63D634453B5B46747C812DD1E"><enum>(D)</enum><text>is subject to an order or
a final order specified in subparagraph (F) or (H), respectively, of such
paragraph (4); or</text>
</subparagraph><subparagraph id="H25F6E5540A1041D6BDA2E5E2380ECC76"><enum>(E)</enum><text>has been found by a
foreign financial regulatory authority to have committed or omitted any act, or
violated any foreign statute or regulation, enumerated in subparagraph (G) of
such paragraph (4).</text>
</subparagraph></paragraph><paragraph id="HDDE1846D8A7346D3A83F60E6856E3B27"><enum>(3)</enum><header>Associated
persons</header><text>With respect to any person who is associated, who is
seeking to become associated, or, at the time of the alleged misconduct, who
was associated or was seeking to become associated with a security-based swap
dealer or major security-based swap participant for the purpose of effecting or
being involved in effecting security-based swaps on behalf of such
security-based swap dealer or major security-based swap participant, the
Commission, by order, shall censure, place limitations on the activities or
functions of such person, or suspend for a period not exceeding 12 months, or
bar such person from being associated with a security-based swap dealer or
major security-based swap participant, if the Commission finds, on the record
after notice and opportunity for a hearing, that such censure, placing of
limitations, suspension, or bar is in the public interest and that such
person—</text>
<subparagraph id="H46058A188360477498224BE95E542008"><enum>(A)</enum><text>has committed or omitted
any act, or is subject to an order or finding, enumerated in subparagraph (A),
(D), or (E) of paragraph (4) of section 15(b);</text>
</subparagraph><subparagraph id="H4E771CFDA8284B95849490E6C3FDC855"><enum>(B)</enum><text>has been convicted of any
offense specified in subparagraph (B) of such paragraph (4) within 10 years of
the commencement of the proceedings under this subsection;</text>
</subparagraph><subparagraph id="H4536A58506BA4C5CB570F40D3E494F56"><enum>(C)</enum><text>is enjoined from any
action, conduct, or practice specified in subparagraph (C) of such paragraph
(4);</text>
</subparagraph><subparagraph id="H45415736144E4ACEA7B3378BBBC8F2DB"><enum>(D)</enum><text>is subject to an order or
a final order specified in subparagraph (F) or (H), respectively, of such
paragraph (4); or</text>
</subparagraph><subparagraph id="H61D905EA96A543E7B3101C245823C36E"><enum>(E)</enum><text>has been found by a
foreign financial regulatory authority to have committed or omitted any act, or
violated any foreign statute or regulation, enumerated in subparagraph (G) of
such paragraph (4).</text>
</subparagraph></paragraph><paragraph id="H3C8EFC0725384C83A57871E368478D57"><enum>(4)</enum><header>Unlawful
conduct</header><text>It shall be unlawful—</text>
<subparagraph id="H2A4BAEB45BB94DFABBC76512E15BA707"><enum>(A)</enum><text>for any person as to whom
an order under paragraph (3) is in effect, without the consent of the
Commission, willfully to become, or to be, associated with a security-based
swap dealer or major security-based swap participant in contravention of such
order; or</text>
</subparagraph><subparagraph id="H7F5BADFC34804BBFB398BE2F8519D7B4"><enum>(B)</enum><text>for any security-based
swap dealer or major security-based swap participant to permit such a person,
without the consent of the Commission, to become or remain a person associated
with the security-based swap dealer or major security-based swap participant in
contravention of such order, if such security-based swap dealer or major
security-based swap participant knew, or in the exercise of reasonable care
should have known, of such
order.</text>
</subparagraph></paragraph></subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</section><section id="id12B4F9389B6641F29A85B730EFFBDAA6"><enum>765.</enum><header>Rulemaking on conflict
of interest</header>
<subsection id="ID13251b49905f49438b44fb0494da20bf"><enum>(a)</enum><header>In
general</header><text>Not later than 180 days after the date of enactment of
the Wall Street Transparency and Accountability Act of 2010, the Securities and
Exchange Commission shall determine whether to adopt rules to establish limits
on the control of any clearing agency that clears security-based swaps, or on
the control of any security-based swap execution facility or national
securities exchange that posts or makes available for trading security-based
swaps, by a bank holding company (as defined in section 2 of the Bank Holding
Company Act of 1956 (12 U.S.C. 1841)) with total consolidated assets of
$50,000,000,000 or more, a nonbank financial company (as defined in section
102) supervised by the Board of Governors of the Federal Reserve System,
affiliate of such a bank holding company or nonbank financial company, a
security-based swap dealer, major security-based swap participant, or person
associated with a security-based swap dealer or major security-based swap
participant.</text>
</subsection><subsection id="ID611505000aa8486693303b576f993376"><enum>(b)</enum><header>Purposes</header><text>The
Commission shall adopt rules if the Commission determines, after the review
described in subsection (a), that such rules are necessary or appropriate to
improve the governance of, or to mitigate systemic risk, promote competition,
or mitigate conflicts of interest in connection with a security-based swap
dealer or major security-based swap participant’s conduct of business with, a
clearing agency, national securities exchange, or security-based swap execution
facility that clears, posts, or makes available for trading security-based
swaps and in which such security-based swap dealer or major security-based swap
participant has a material debt or equity investment.</text>
</subsection></section><section id="HA63FBC564FF8401A9112F9C73D96031A"><enum>766.</enum><header>Reporting and
recordkeeping</header>
<subsection id="HE7341666A7A74C3590D40D637AAA9FC9"><enum>(a)</enum><header>In
general</header><text>The Securities Exchange Act of 1934 (15 U.S.C. 78a et
seq.) is amended by inserting after section 13 the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idC04FBA0AC2E843ABB9C7744CE9174238" reported-display-style="italic" style="OLC">
<section id="HAB77BE429DB74B548E371FF0C819CD7A"><enum>13A.</enum><header>Reporting and
recordkeeping for certain security-based swaps</header>
<subsection id="id1CB7A518159D485C8FDAC58713105F9A"><enum>(a)</enum><header>Required reporting of
security-based swaps not accepted by any clearing agency or derivatives
clearing organization</header>
<paragraph id="id572E9FC05927458CBB999709DCB1E9A7"><enum>(1)</enum><header>In
general</header><text>Each security-based swap that is not accepted for
clearing by any clearing agency or derivatives clearing organization shall be
reported to—</text>
<subparagraph id="idD998F718F4AD46C994128A3E94F41A6C"><enum>(A)</enum><text>a security-based swap
data repository described in section 10B(n); or</text>
</subparagraph><subparagraph id="idC22D5323C9154C56A905803CDA78E225"><enum>(B)</enum><text>in the case in which
there is no security-based swap data repository that would accept the
security-based swap, to the Commission pursuant to this section within such
time period as the Commission may by rule or regulation prescribe.</text>
</subparagraph></paragraph><paragraph id="idB1B64FA02DA941F38FF66D9E4102884D"><enum>(2)</enum><header>Transition rule for
preenactment security-based swaps</header>
<subparagraph id="idE7DBEE92596D47E890E0AA2DB8454960"><enum>(A)</enum><header>Security-based swaps
entered into before the date of enactment of the Wall Street Transparency and
Accountability Act of 2010</header><text>Each security-based swap entered into
before the date of enactment of the <short-title>Wall
Street Transparency and Accountability Act of 2010</short-title>, the terms of
which have not expired as of the date of enactment of that Act, shall be
reported to a registered security-based swap data repository or the Commission
by a date that is not later than—</text>
<clause id="id9143864215D94ED1980EDD8936FDB101"><enum>(i)</enum><text>30 days after issuance of
the interim final rule; or</text>
</clause><clause id="id1D80D0CFB4194792AD11B15D9926DEE8"><enum>(ii)</enum><text>such other period as the
Commission determines to be appropriate.</text>
</clause></subparagraph><subparagraph id="id023C1D369AB842AFADFFCD88F3123C36"><enum>(B)</enum><header>Commission
rulemaking</header><text>The Commission shall promulgate an interim final rule
within 90 days of the date of enactment of this section providing for the
reporting of each security-based swap entered into before the date of enactment
as referenced in subparagraph (A).</text>
</subparagraph><subparagraph id="id98C61FC105BD4B7CBEAEB747355B9695"><enum>(C)</enum><header>Effective
date</header><text>The reporting provisions described in this section shall be
effective upon the date of the enactment of this section.</text>
</subparagraph></paragraph><paragraph id="IDcaca26cebf1845eba4eb9513534a235d"><enum>(3)</enum><header>Reporting
obligations</header>
<subparagraph id="ID9528d02fdf8f4a16a31ad53f6844eb71"><enum>(A)</enum><header>Security-based swaps in
which only 1 counterparty is a security-based swap dealer or major
security-based swap participant</header><text>With respect to a security-based
swap in which only 1 counterparty is a security-based swap dealer or major
security-based swap participant, the security-based swap dealer or major
security-based swap participant shall report the security-based swap as
required under paragraphs (1) and (2).</text>
</subparagraph><subparagraph id="ID8895d61d7f7a4908830240e8fc002243"><enum>(B)</enum><header>Security-based swaps in
which 1 counterparty is a security-based swap dealer and the other a major
security-based swap participant</header><text>With respect to a security-based
swap in which 1 counterparty is a security-based swap dealer and the other a
major security-based swap participant, the security-based swap dealer shall
report the security-based swap as required under paragraphs (1) and (2).</text>
</subparagraph><subparagraph id="IDfc2460a8391a4e37a7f4857e7d344bac"><enum>(C)</enum><header>Other security-based
swaps</header><text>With respect to any other security-based swap not described
in subparagraph (A) or (B), the counterparties to the security-based swap shall
select a counterparty to report the security-based swap as required under
paragraphs (1) and (2).</text>
</subparagraph></paragraph></subsection><subsection id="idFEB267E9CA014AB1980CCEC114C25452"><enum>(b)</enum><header>Duties of certain
individuals</header><text>Any individual or entity that enters into a
security-based swap shall meet each requirement described in subsection (c) if
the individual or entity did not—</text>
<paragraph id="id5984DD6BCFD945C381941394683DD201"><enum>(1)</enum><text>clear the security-based
swap in accordance with section 3C(a)(1); or</text>
</paragraph><paragraph id="id4BA287509D224916839C75E4CE523D08"><enum>(2)</enum><text>have the data regarding
the security-based swap accepted by a security-based swap data repository in
accordance with rules (including timeframes) adopted by the Commission under
this title.</text>
</paragraph></subsection><subsection id="id99F2E27417E648B7A378D561C817C8D8"><enum>(c)</enum><header>Requirements</header><text>An
individual or entity described in subsection (b) shall—</text>
<paragraph id="id9A8B6DE8E6334BAF9833AE9F16A241C6"><enum>(1)</enum><text>upon written request from
the Commission, provide reports regarding the security-based swaps held by the
individual or entity to the Commission in such form and in such manner as the
Commission may request; and</text>
</paragraph><paragraph id="id031411AD21384B3C833B794C0C7CCE21"><enum>(2)</enum><text>maintain books and
records pertaining to the security-based swaps held by the individual or entity
in such form, in such manner, and for such period as the Commission may
require, which shall be open to inspection by—</text>
<subparagraph id="id077C0D0948FB44349D2E61934CFBA19E"><enum>(A)</enum><text>any representative of the
Commission;</text>
</subparagraph><subparagraph id="id888AF8AF3ACB4D798F32CE603F3A7545"><enum>(B)</enum><text>an appropriate prudential
regulator;</text>
</subparagraph><subparagraph id="id4C8DC7D43E104D53A63FFAFBD187C8D8"><enum>(C)</enum><text>the Commodity Futures
Trading Commission;</text>
</subparagraph><subparagraph id="idB3704E2EE6CA44ADBDC2613FE1510F06"><enum>(D)</enum><text>the Financial Stability
Oversight Council; and</text>
</subparagraph><subparagraph id="id615A0AB3C0F34C6CAA3FB4512FBB2151"><enum>(E)</enum><text>the Department of
Justice.</text>
</subparagraph></paragraph></subsection><subsection id="id559ABD2B45E54A898FF95F3D05F95F32"><enum>(d)</enum><header>Identical
data</header><text>In prescribing rules under this section, the Commission
shall require individuals and entities described in subsection (b) to submit to
the Commission a report that contains data that is not less comprehensive than
the data required to be collected by security-based swap data repositories
under this
title.</text>
</subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="H0B5C9B95C66844DDA81D88EB4A4C763F"><enum>(b)</enum><header>Beneficial ownership
reporting</header><text>Section 13 of the Securities Exchange Act of 1934 (15
U.S.C. 78m) is amended—</text>
<paragraph id="id429511F3A225479A816A3DC39DCEEB7D"><enum>(1)</enum><text>in subsection (d)(1), by
inserting <quote>or otherwise becomes or is deemed to become a beneficial owner
of any of the foregoing upon the purchase or sale of a security-based swap that
the Commission may define by rule, and</quote> after <quote>Alaska Native
Claims Settlement Act,</quote>; and</text>
</paragraph><paragraph id="H781E7E248553402DA74CBF4B0DAFF978"><enum>(2)</enum><text>in subsection (g)(1), by
inserting <quote>or otherwise becomes or is deemed to become a beneficial owner
of any security of a class described in subsection (d)(1) upon the purchase or
sale of a security-based swap that the Commission may define by rule</quote>
after <quote>subsection (d)(1) of this section</quote>.</text>
</paragraph></subsection><subsection id="H723DC9856E3C4970B948902C22244EE6"><enum>(c)</enum><header>Reports by
institutional investment managers</header><text>Section 13(f)(1) of the
Securities Exchange Act of 1934 (15 U.S.C. 78m(f)(1)) is amended by inserting
<quote>or otherwise becomes or is deemed to become a beneficial owner of any
security of a class described in subsection (d)(1) upon the purchase or sale of
a security-based swap that the Commission may define by rule,</quote> after
<quote>subsection (d)(1) of this section</quote>.</text>
</subsection><subsection id="H0EFEEDBD58164740B84F31AE0E7F9DDE"><enum>(d)</enum><header>Administrative
proceeding authority</header><text>Section 15(b)(4) of the Securities Exchange
Act of 1934 (15 U.S.C. 78o(b)(4)) is amended—</text>
<paragraph id="HAA77E275EBF24FA2A8630A62E766B84F"><enum>(1)</enum><text>in subparagraph (C), by
inserting <quote>security-based swap dealer, major security-based swap
participant,</quote> after <quote>government securities dealer,</quote>;
and</text>
</paragraph><paragraph id="H5269F1A6CFA74479A11E0DD784E9890B"><enum>(2)</enum><text>in subparagraph (F), by
striking <quote>broker or dealer</quote> and inserting <quote>broker, dealer,
security-based swap dealer, or a major security-based swap
participant</quote>.</text>
</paragraph></subsection><subsection display-inline="no-display-inline" id="H014E19843CF84866AB5FC7B4F9A4D87E"><enum>(e)</enum><header>Security-based swap
beneficial ownership</header><text>Section 13 of the Securities Exchange Act of
1934 (15 U.S.C. 78m) is amended by adding at the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="HA821DE0D8B4F411190072CC4BB718457" reported-display-style="italic" style="OLC">
<subsection id="H8102853007734B47B86C52AFA8EB9AB2"><enum>(o)</enum><header>Beneficial
ownership</header><text display-inline="yes-display-inline">For purposes of
this section and section 16, a person shall be deemed to acquire beneficial
ownership of an equity security based on the purchase or sale of a
security-based swap, only to the extent that the Commission, by rule,
determines after consultation with the prudential regulators and the Secretary
of the Treasury, that the purchase or sale of the security-based swap, or class
of security-based swap, provides incidents of ownership comparable to direct
ownership of the equity security, and that it is necessary to achieve the
purposes of this section that the purchase or sale of the security-based swaps,
or class of security-based swap, be deemed the acquisition of beneficial
ownership of the equity
security.</text>
</subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection></section><section id="H49955960E99E47E2B4C769D878544335"><enum>767.</enum><header>State gaming and
bucket shop laws</header><text display-inline="no-display-inline">Section 28(a)
of the Securities Exchange Act of 1934 (15 U.S.C. 78bb(a)) is amended to read
as follows:</text>
<quoted-block changed="added" id="H0AE47BE429CF4D46AFA36FB868B5D9BD" reported-display-style="italic" style="OLC">
<subsection id="H068215C64B5C4BEB869070914C28E2D4"><enum>(a)</enum><header>Limitation on
judgments</header>
<paragraph id="idB9BFBD3F38AE4B0BAA9084EE32FEE824"><enum>(1)</enum><header>In
general</header><text>No person permitted to maintain a suit for damages under
the provisions of this title shall recover, through satisfaction of judgment in
1 or more actions, a total amount in excess of the actual damages to that
person on account of the act complained of. Except as otherwise specifically
provided in this title, nothing in this title shall affect the jurisdiction of
the securities commission (or any agency or officer performing like functions)
of any State over any security or any person insofar as it does not conflict
with the provisions of this title or the rules and regulations under this
title.</text>
</paragraph><paragraph id="id2A8EEE8291B448399C73409D46980473"><enum>(2)</enum><header>Rule of
construction</header><text>Except as provided in subsection (f), the rights and
remedies provided by this title shall be in addition to any and all other
rights and remedies that may exist at law or in equity.</text>
</paragraph><paragraph id="idCAF6C32A3BA948D7B4A62EAA98686380"><enum>(3)</enum><header>State Bucket shop
laws</header><text>No State law which prohibits or regulates the making or
promoting of wagering or gaming contracts, or the operation of <quote>bucket
shops</quote> or other similar or related activities, shall invalidate—</text>
<subparagraph id="idB181D5BD469C43A19597402E0AAAB010"><enum>(A)</enum><text>any put, call, straddle,
option, privilege, or other security subject to this title (except any security
that has a pari-mutuel payout or otherwise is determined by the Commission,
acting by rule, regulation, or order, to be appropriately subject to such
laws), or apply to any activity which is incidental or related to the offer,
purchase, sale, exercise, settlement, or closeout of any such security;</text>
</subparagraph><subparagraph id="idCCA35FFAD771455B9FE62BF5A2DB5B2F"><enum>(B)</enum><text>any security-based swap
between eligible contract participants; or</text>
</subparagraph><subparagraph id="id347AB59AAA7349A1A06CA81E94F8D171"><enum>(C)</enum><text>any security-based swap
effected on a national securities exchange registered pursuant to section
6(b).</text>
</subparagraph></paragraph><paragraph id="id9AA2B84F950D49A186C036492B92D425"><enum>(4)</enum><header>Other State
provisions</header><text>No provision of State law regarding the offer, sale,
or distribution of securities shall apply to any transaction in a
security-based swap or a security futures product, except that this paragraph
may not be construed as limiting any State antifraud law of general
applicability. A security-based swap may not be regulated as an insurance
contract under any provision of State
law.</text>
</paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</section><section id="HDA38AA2945FA4E2A81F11B0FA692F2B7"><enum>768.</enum><header>Amendments to the
Securities Act of 1933; treatment of security-based swaps</header>
<subsection id="H5B91A141F6B046119E0B3929970197A6"><enum>(a)</enum><header>Definitions</header><text>Section
2(a) of the Securities Act of 1933 (15 U.S.C. 77b(a)) is amended—</text>
<paragraph id="HB368EC2FF832472D912C04D6E3468F07"><enum>(1)</enum><text>in paragraph (1), by
inserting <quote>security-based swap,</quote> after <quote>security
future,</quote>;</text>
</paragraph><paragraph id="H00C01CB2C11E4D42B535BC34F16C13C4"><enum>(2)</enum><text>in paragraph (3), by
adding at the end the following: <quote>Any offer or sale of a security-based
swap by or on behalf of the issuer of the securities upon which such
security-based swap is based or is referenced, an affiliate of the issuer, or
an underwriter, shall constitute a contract for sale of, sale of, offer for
sale, or offer to sell such securities.</quote>; and</text>
</paragraph><paragraph id="H23C25BA56939494DB6CF67B607D77BF4"><enum>(3)</enum><text>by adding at the end the
following:</text>
<quoted-block changed="added" id="HA964B9B7377D41BFB718988197B4B634" reported-display-style="italic" style="OLC">
<paragraph id="H7D199B5D3DEB4CD891A1D9C3C19B5B83"><enum>(17)</enum><text>The terms
<term>swap</term> and <term>security-based swap</term> have the same meanings
as in section 1a of the Commodity Exchange Act (7 U.S.C. 1a).</text>
</paragraph><paragraph id="H568F23DA391342138AA2DB62BBA6077F"><enum>(18)</enum><text>The terms
<term>purchase</term> or <term>sale</term> of a security-based swap shall be
deemed to mean the execution, termination (prior to its scheduled maturity
date), assignment, exchange, or similar transfer or conveyance of, or
extinguishing of rights or obligations under, a security-based swap, as the
context may
require.</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="H3B107B73265749979C971C3BB633C618"><enum>(b)</enum><header>Registration of
security-based swaps</header><text>Section 5 of the Securities Act of 1933 (15
U.S.C. 77e) is amended by adding at the end the following:</text>
<quoted-block changed="added" id="H8708916B41EF427DB58A168D471301E3" reported-display-style="italic" style="OLC">
<subsection id="H1A349022717D487F83CB241511C71F1F"><enum>(d)</enum><text>Notwithstanding the
provisions of section 3 or 4, unless a registration statement meeting the
requirements of section 10(a) is in effect as to a security-based swap, it
shall be unlawful for any person, directly or indirectly, to make use of any
means or instruments of transportation or communication in interstate commerce
or of the mails to offer to sell, offer to buy or purchase or sell a
security-based swap to any person who is not an eligible contract participant
as defined in section 1a(18) of the Commodity Exchange Act (7 U.S.C.
1a(18)).</text>
</subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection></section><section id="H7F37A7C57592401D930B5000FD0B6528"><enum>769.</enum><header>Definitions under the
Investment Company Act of 1940</header><text display-inline="no-display-inline">Section 2(a) of the Investment Company Act
of 1940 (15 U.S.C. 80a–2) is amended by adding at the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idB98DEC2CA6CE428F9A9ECC0FF32E63AF" reported-display-style="italic" style="OLC">
<paragraph id="ID5ca3080b48f145e7a6affa75d372ab5c"><enum>(54)</enum><text>The terms
<term>commodity pool</term>, <quote>commodity pool operator</quote>,
<quote>commodity trading advisor</quote>, <term>major swap participant</term>,
<term>swap</term>, <term>swap dealer</term>, and <term>swap execution
facility</term> have the same meanings as in section 1a of the Commodity
Exchange Act (7 U.S.C.
1a).</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</section><section id="id25FA5ED38E904E2789BCE18471DF8ED1"><enum>770.</enum><header>Definitions under the
Investment Advisors Act of 1940</header><text display-inline="no-display-inline">Section 202(a) of the Investment Advisers
Act of 1940 (15 U.S.C. 80b–2) is amended by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id7649E2B5740D454EA2748EA55D39058C" reported-display-style="italic" style="OLC">
<paragraph id="IDfce5eab08e054f4da03e3cc9b745bacd"><enum>(29)</enum><text>The terms
<term>commodity pool</term>, <term>commodity pool operator</term>,
<term>commodity trading advisor</term>, <term>major swap participant</term>,
<term>swap</term>, <term>swap dealer</term>, and <term>swap execution
facility</term> have the same meanings as in section 1a of the Commodity
Exchange Act (7 U.S.C.
1a).</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</section><section id="idA40AE09871F04AA5B38FCC4F0B0D57A7"><enum>771.</enum><header>Other
authority</header><text display-inline="no-display-inline">Unless otherwise
provided by its terms, this subtitle does not divest any appropriate Federal
banking agency, the Securities and Exchange Commission, the Commodity Futures
Trading Commission, or any other Federal or State agency, of any authority
derived from any other provision of applicable law.</text>
</section><section id="H8ADDB42DF9644DB7A86429F43069D878"><enum>772.</enum><header>Jurisdiction</header>
<subsection id="H72D0ED8F8E2F4342899BFCC1E5D579F7"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">Section 36 of the
Securities Exchange Act of 1934 (15 U.S.C. 78mm) is amended by adding at the
end the following:</text>
<quoted-block changed="added" id="HF047E1949E6D4E98BE33DCAEFB09B89B" reported-display-style="italic" style="OLC">
<subsection id="HCCBC916D3C5A4A6B958EDB1FD6C9E026"><enum>(c)</enum><header>Derivatives</header><text>The
Commission shall not grant exemptions from the security-based swap provisions
of the <short-title>Wall Street Transparency and
Accountability Act of 2010</short-title> or the amendments made by that Act,
except as expressly authorized under the provisions of that
Act.</text>
</subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="H20F3DE4518B848E2A1486A77ED96788F"><enum>(b)</enum><header>Rule of
construction</header><text display-inline="yes-display-inline">Section 30 of
the Securities Exchange Act of 1934 (15 U.S.C. 78dd) is amended by adding at
the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="H0596C1F2902C4EC0840D84F821E0B5AE" reported-display-style="italic" style="OLC">
<subsection commented="no" id="H2EE30716471C4E75BBA40F66EC1D6230"><enum>(c)</enum><header>Rule of
construction</header><text display-inline="yes-display-inline">No provision of
this title that was added by the Wall Street Transparency and Accountability
Act of 2010, or any rule or regulation thereunder, shall apply to any person
insofar as such person transacts a business in security-based swaps without the
jurisdiction of the United States, unless such person transacts such business
in contravention of such rules and regulations as the Commission may prescribe
as necessary or appropriate to prevent the evasion of any provision of this
title that was added by the Wall Street Transparency and Accountability Act of
2010. This subsection shall not be construed to limit the jurisdiction of the
Commission under any provision of this title, as in effect prior to the date of
enactment of the Wall Street Transparency and Accountability Act of
2010.</text>
</subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection></section><section id="H716AA1959F824355B4EF14F19E157F2B"><enum>773.</enum><header>Effective
date</header><text display-inline="no-display-inline">Unless otherwise
specifically provided in this subtitle, this subtitle, the provisions of this
subtitle, and the amendments made by this subtitle shall become effective 180
days after the date of enactment of this Act.</text>
</section></subtitle><enum>VIII</enum><header>Payment, clearing, and
settlement supervision</header>
<section id="ID8373f3ce74864302aeb0ba0eb9a8710c"><enum>801.</enum><header>Short
title</header><text display-inline="no-display-inline">This title may be cited
as the <quote><short-title>Payment, Clearing, and
Settlement Supervision Act of 2010</short-title></quote>.</text>
</section><section id="ID8a65052290384c929e4fa2881d6797d6"><enum>802.</enum><header>Findings and
purposes</header>
<subsection id="ID6ca18a5c95854c90a02d4fbb103b6b10"><enum>(a)</enum><header>Findings</header><text>Congress
finds the following:</text>
<paragraph id="ID9643702fbbef4f85b470913ee0f5b11b"><enum>(1)</enum><text>The proper functioning of
the financial markets is dependent upon safe and efficient arrangements for the
clearing and settlement of payment, securities, and other financial
transactions.</text>
</paragraph><paragraph id="ID7507f0799d504d148aeb719b123a1017"><enum>(2)</enum><text>Financial market
utilities that conduct or support multilateral payment, clearing, or settlement
activities may reduce risks for their participants and the broader financial
system, but such utilities may also concentrate and create new risks and thus
must be well designed and operated in a safe and sound manner.</text>
</paragraph><paragraph id="IDea708b8f67dc46b29fd1b6d4de1bf691"><enum>(3)</enum><text>Payment, clearing, and
settlement activities conducted by financial institutions also present
important risks to the participating financial institutions and to the
financial system.</text>
</paragraph><paragraph id="IDf146865b48d643c98844c9fa816a47cb"><enum>(4)</enum><text>Enhancements to the
regulation and supervision of systemically important financial market utilities
and the conduct of systemically important payment, clearing, and settlement
activities by financial institutions are necessary—</text>
<subparagraph id="idA867A7808F7F4473AABC08439A377AFC"><enum>(A)</enum><text>to provide
consistency;</text>
</subparagraph><subparagraph id="idE10F9BF8762E4ED38A0E803073CDA954"><enum>(B)</enum><text>to promote robust risk
management and safety and soundness;</text>
</subparagraph><subparagraph id="idA7312F3C29C84310A18FD15A4B80D33B"><enum>(C)</enum><text>to reduce systemic risks;
and</text>
</subparagraph><subparagraph id="idAC43222D880146E2A67DFF4F3B628422"><enum>(D)</enum><text>to support the stability
of the broader financial system.</text>
</subparagraph></paragraph></subsection><subsection id="IDeff39b84e9154ef1aa2c2352ce4f665c"><enum>(b)</enum><header>Purpose</header><text>The
purpose of this title is to mitigate systemic risk in the financial system and
promote financial stability by—</text>
<paragraph id="IDb8afd3e392fc4b2c9ef21cf7e7696614"><enum>(1)</enum><text>authorizing the Board of
Governors to prescribe uniform standards for the—</text>
<subparagraph id="id0090B169FA874180A90C71F7363156DA"><enum>(A)</enum><text>management of risks by
systemically important financial market utilities; and</text>
</subparagraph><subparagraph id="idBF93A780EA23409892E6ED48D9B650B9"><enum>(B)</enum><text>conduct of systemically
important payment, clearing, and settlement activities by financial
institutions;</text>
</subparagraph></paragraph><paragraph id="ID783d923fa9b34e10ad3b09ef0e20c3bb"><enum>(2)</enum><text>providing the Board of
Governors an enhanced role in the supervision of risk management standards for
systemically important financial market utilities;</text>
</paragraph><paragraph id="ID049c7e92034640e2a2d88634d0b3c4a3"><enum>(3)</enum><text>strengthening the
liquidity of systemically important financial market utilities; and</text>
</paragraph><paragraph id="ID77c8aec894c14e3f85f34c249a2e1c15"><enum>(4)</enum><text>providing the Board of
Governors an enhanced role in the supervision of risk management standards for
systemically important payment, clearing, and settlement activities by
financial institutions.</text>
</paragraph></subsection></section><section id="ID9f1fd09eead4486d88b1625e69169ea8"><enum>803.</enum><header>Definitions</header><text display-inline="no-display-inline">In this title, the following definitions
shall apply:</text>
<paragraph id="idD823A574638940B6962CD6F8C2B41F94"><enum>(1)</enum><header>Appropriate financial
regulator</header><text>The term <quote>appropriate financial regulator</quote>
means—</text>
<subparagraph id="ID1fcedcb5e54c4070a756219364e9f8da"><enum>(A)</enum><text>the primary financial
regulatory agency, as defined in section 2 of this Act;</text>
</subparagraph><subparagraph id="ID7ccb030b38c5474f9f80e141e30fa084"><enum>(B)</enum><text>the National Credit Union
Administration, with respect to any insured credit union under the Federal
Credit Union Act (12 U.S.C. 1751 et seq.); and</text>
</subparagraph><subparagraph id="IDc3f1c5883dfb4d0c9a4b3990c216c024"><enum>(C)</enum><text>the Board of Governors,
with respect to organizations operating under section 25A of the Federal
Reserve Act (12 U.S.C. 611), and any other financial institution engaged in a
designated activity.</text>
</subparagraph></paragraph><paragraph id="ID6a2a0f971f0742c28a5ff64374d203e8"><enum>(2)</enum><header>Designated
activity</header><text>The term <term>designated activity</term> means a
payment, clearing, or settlement activity that the Council has designated as
systemically important under section 804.</text>
</paragraph><paragraph id="IDc4c14d9a59bc4d33af86677aaf3bfe92"><enum>(3)</enum><header>Designated financial
market utility</header><text>The term <term>designated financial market
utility</term> means a financial market utility that the Council has designated
as systemically important under section 804.</text>
</paragraph><paragraph id="ID727e72566a734ab29771549cb3a0474e"><enum>(4)</enum><header>Financial
institution</header><text>The term <term>financial institution</term>
means—</text>
<subparagraph id="ID08ceb45b59394e84865f72325780e73b"><enum>(A)</enum><text>a depository institution,
as defined in section 3 of the Federal Deposit Insurance Act (12 U.S.C.
1813);</text>
</subparagraph><subparagraph id="ID66ea6b9d3d7f4c3ea1642a305625c8b9"><enum>(B)</enum><text>a branch or agency of a
foreign bank, as defined in section 1(b) of the International Banking Act of
1978 (12 U.S.C. 3101);</text>
</subparagraph><subparagraph id="ID4bad93bf5a794b8f96eb254f43608449"><enum>(C)</enum><text>an organization operating
under section 25 or 25A of the Federal Reserve Act (12 U.S.C. 601–604a and 611
through 631);</text>
</subparagraph><subparagraph id="ID2edfc2dd6481430a80766b620e8f0aa3"><enum>(D)</enum><text>a credit union, as
defined in section 101 of the Federal Credit Union Act (12 U.S.C. 1752);</text>
</subparagraph><subparagraph id="ID09d1a89c11584f55838aaf00a3f9d1ff"><enum>(E)</enum><text>a broker or dealer, as
defined in section 3 of the Securities Exchange Act of 1934 (15 U.S.C.
78c);</text>
</subparagraph><subparagraph id="ID9ab1ba1b4cd94661a1e6f5e2adcbcd87"><enum>(F)</enum><text>an investment company, as
defined in section 3 of the Investment Company Act of 1940 (15 U.S.C.
80a–3);</text>
</subparagraph><subparagraph id="ID96057d6ef1db4dc988e00d215720f4fa"><enum>(G)</enum><text>an insurance company, as
defined in section 2 of the Investment Company Act of 1940 (15 U.S.C.
80a–2);</text>
</subparagraph><subparagraph id="ID07e2fbef61594bfeaf32fcdd3a22142e"><enum>(H)</enum><text>an investment adviser, as
defined in section 202 of the Investment Advisers Act of 1940 (15 U.S.C.
80b–2);</text>
</subparagraph><subparagraph id="ID0bce430e051a4afaad4189dbbd7bc537"><enum>(I)</enum><text>a futures commission
merchant, commodity trading advisor, or commodity pool operator, as defined in
section 1a of the Commodity Exchange Act (7 U.S.C. 1a); and</text>
</subparagraph><subparagraph id="ID6681b7f9ba834ba580f4ffca4bb1f87a"><enum>(J)</enum><text>any company engaged in
activities that are financial in nature or incidental to a financial activity,
as described in section 4 of the Bank Holding Company Act of 1956 (12 U.S.C.
1843(k)).</text>
</subparagraph></paragraph><paragraph id="IDdb521a437ef24822a604294dd5fc5e41"><enum>(5)</enum><header>Financial market
utility</header><text>The term <term>financial market utility</term> means any
person that manages or operates a multilateral system for the purpose of
transferring, clearing, or settling payments, securities, or other financial
transactions among financial institutions or between financial institutions and
the person.</text>
</paragraph><paragraph id="IDb6b7f7c2fdf44a01b69821c123ba2c59"><enum>(6)</enum><header>Payment, clearing, or
settlement activity</header>
<subparagraph id="idAFFD4DA6FE9B4CA5BA9D21059C04D39B"><enum>(A)</enum><header>In
general</header><text>The term <term>payment, clearing, or settlement
activity</term> means an activity carried out by 1 or more financial
institutions to facilitate the completion of financial transactions.</text>
</subparagraph><subparagraph id="idF2753EDF516B4B209809AD0EFEC2E171"><enum>(B)</enum><header>Financial
transaction</header><text>For the purposes of subparagraph (A), the term
<quote>financial transaction</quote> includes—</text>
<clause id="id8ECD57AA859A46519B4BFE91B87A4C28"><enum>(i)</enum><text>funds transfers;</text>
</clause><clause id="id68F27AD8F37E48869EEB3B01D16CEF9C"><enum>(ii)</enum><text>securities
contracts;</text>
</clause><clause id="id00782AAA19484C4CB6870D4D7313A810"><enum>(iii)</enum><text>contracts of sale of a
commodity for future delivery;</text>
</clause><clause id="idED3AC1596AC347D2B3F68669FA5532AF"><enum>(iv)</enum><text>forward
contracts;</text>
</clause><clause id="id6F8590A5459E45958F9BE21A0CD9D785"><enum>(v)</enum><text>repurchase
agreements;</text>
</clause><clause id="id894C20F69E97474B95240E18B79ED2A3"><enum>(vi)</enum><text>swaps;</text>
</clause><clause id="id759CFEC45E444248BA4F0303E589F278"><enum>(vii)</enum><text>security-based
swaps;</text>
</clause><clause id="id6A06C2EEA374429BBC5D3DA1775E5E87"><enum>(viii)</enum><text>swap
agreements;</text>
</clause><clause id="id9D0F3FCD4B284EDCB02D2B0D4683FAB7"><enum>(ix)</enum><text>security-based swap
agreements;</text>
</clause><clause id="idA2384A78AE7C49BB8DFA2508DA8B4837"><enum>(x)</enum><text>foreign exchange
contracts;</text>
</clause><clause id="idA3CA5C58A7DB4E86829C9D8E5C125F6E"><enum>(xi)</enum><text>financial derivatives
contracts; and</text>
</clause><clause id="id4C2DD966E4DE4F65B498D78621E3C9FC"><enum>(xii)</enum><text>any similar transaction
that the Council determines to be a financial transaction for purposes of this
title.</text>
</clause></subparagraph><subparagraph id="idCF64BC5CB6C74E8B855E82EA9F0AA774"><enum>(C)</enum><header>Included
activities</header><text>When conducted with respect to a financial
transaction, payment, clearing, and settlement activities may include—</text>
<clause id="id1A38699385B24DE68B21E8F82C661845"><enum>(i)</enum><text>the calculation and
communication of unsettled financial transactions between
counterparties;</text>
</clause><clause id="id351A1E01F71142ABAC5C58AC73620A63"><enum>(ii)</enum><text>the netting of
transactions;</text>
</clause><clause id="idC63E95B781A542B689906D95AF66E7D4"><enum>(iii)</enum><text>provision and
maintenance of trade, contract, or instrument information;</text>
</clause><clause id="idF0BBDBEF5B1D4B05808BF85F741EB848"><enum>(iv)</enum><text>the management of risks
and activities associated with continuing financial transactions;</text>
</clause><clause id="id34CBAA2A4A8148DCA064D02A77C77E2F"><enum>(v)</enum><text>transmittal and storage
of payment instructions;</text>
</clause><clause id="id0C699138D05146D993FBA5EA1EE14D62"><enum>(vi)</enum><text>the movement of
funds;</text>
</clause><clause id="idE27A0C751E0C4CD5971702453386490E"><enum>(vii)</enum><text>the final settlement of
financial transactions; and</text>
</clause><clause id="idD942792231B74DD8875A8AEC6113FD85"><enum>(viii)</enum><text>other similar
functions that the Council may determine.</text>
</clause></subparagraph></paragraph><paragraph commented="no" id="IDf52b4bb87b6e4088b19c3da7f4ec3a25"><enum>(7)</enum><header>Supervisory
agency</header>
<subparagraph commented="no" id="idED7838A467384D9B8F6512D21C0B8125"><enum>(A)</enum><header>In
general</header><text>The term <term>Supervisory Agency</term> means the
Federal agency that has primary jurisdiction over a designated financial market
utility under Federal banking, securities, or commodity futures laws, as
follows:</text>
<clause commented="no" id="IDc0485caba41d414baf61888ab73d886c"><enum>(i)</enum><text>The Securities and
Exchange Commission, with respect to a designated financial market utility that
is a clearing agency registered with the Securities and Exchange
Commission.</text>
</clause><clause commented="no" id="ID15fb30d9a64d4b58abfa4375ecf85d2f"><enum>(ii)</enum><text>The Commodity Futures
Trading Commission, with respect to a designated financial market utility that
is a derivatives clearing organization registered with the Commodity Futures
Trading Commission.</text>
</clause><clause commented="no" id="ID8159d8f668764bb296fad20edf9f68d7"><enum>(iii)</enum><text>The appropriate Federal
banking agency, with respect to a designated financial market utility that is
an institution described in section 3(q) of the Federal Deposit Insurance
Act.</text>
</clause><clause commented="no" id="id009D83A8D0C541519A9914CADD6F2FD3"><enum>(iv)</enum><text>The Board of Governors,
with respect to a designated financial market utility that is otherwise not
subject to the jurisdiction of any agency listed in clauses (i), (ii), and
(iii).</text>
</clause></subparagraph><subparagraph commented="no" id="id68BC538A89054209A12029AB7C8E0232"><enum>(B)</enum><header>Multiple agency
jurisdiction</header><text>If a designated financial market utility is subject
to the jurisdictional supervision of more than 1 agency listed in subparagraph
(A), then such agencies should agree on 1 agency to act as the Supervisory
Agency, and if such agencies cannot agree on which agency has primary
jurisdiction, the Council shall decide which agency is the Supervisory Agency
for purposes of this title.</text>
</subparagraph></paragraph><paragraph id="ID3de924a14e79461581cb5d4af5e80ed8"><enum>(8)</enum><header>Systemically important
and systemic importance</header><text>The terms <term>systemically
important</term> and <term>systemic importance</term> mean a situation where
the failure of or a disruption to the functioning of a financial market utility
or the conduct of a payment, clearing, or settlement activity could create, or
increase, the risk of significant liquidity or credit problems spreading among
financial institutions or markets and thereby threaten the stability of the
financial system.</text>
</paragraph></section><section id="ID9a34137721634e529ee12aa3412a7e75"><enum>804.</enum><header>Designation of
systemic importance</header>
<subsection id="ID5a4ffa18388e421bbbaf6d8c23dd51de"><enum>(a)</enum><header>Designation</header>
<paragraph id="ID06a5b6a3b2a64bfda6a6ad0dd4ec0209"><enum>(1)</enum><header>Financial Stability
Oversight Council</header><text>The Council, on a nondelegable basis and by a
vote of not fewer than <fraction>2/3</fraction> of members then serving,
including an affirmative vote by the Chairperson of the Council, shall
designate those financial market utilities or payment, clearing, or settlement
activities that the Council determines are, or are likely to become,
systemically important.</text>
</paragraph><paragraph id="ID44e67bc3ef554a208dbe99fad957de5c"><enum>(2)</enum><header>Considerations</header><text>In
determining whether a financial market utility or payment, clearing, or
settlement activity is, or is likely to become, systemically important, the
Council shall take into consideration the following:</text>
<subparagraph id="ID128e1a7452e845128c54ef173b18990e"><enum>(A)</enum><text>The aggregate monetary
value of transactions processed by the financial market utility or carried out
through the payment, clearing, or settlement activity.</text>
</subparagraph><subparagraph id="idD104F6ED9F674681A9E1F43E497696E4"><enum>(B)</enum><text>The aggregate exposure of
the financial market utility or a financial institution engaged in payment,
clearing, or settlement activities to its counterparties.</text>
</subparagraph><subparagraph id="IDfe45c6dda4c9484d8b961a072f734d80"><enum>(C)</enum><text>The relationship,
interdependencies, or other interactions of the financial market utility or
payment, clearing, or settlement activity with other financial market utilities
or payment, clearing, or settlement activities.</text>
</subparagraph><subparagraph id="ID13e49406c4d048d8af932e6333c732ca"><enum>(D)</enum><text>The effect that the
failure of or a disruption to the financial market utility or payment,
clearing, or settlement activity would have on critical markets, financial
institutions, or the broader financial system.</text>
</subparagraph><subparagraph id="IDa0ec1d5b8ec241d8845c7b3d0aa32c19"><enum>(E)</enum><text>Any other factors that
the Council deems appropriate.</text>
</subparagraph></paragraph></subsection><subsection id="IDd996177cdbf74667b6efd483477d240e"><enum>(b)</enum><header>Rescission of
designation</header>
<paragraph id="id9F0D4AF689F94671A6563D3C00D8C3CB"><enum>(1)</enum><header>In
general</header><text>The Council, on a nondelegable basis and by a vote of not
fewer than <fraction>2/3</fraction> of members then serving, including an
affirmative vote by the Chairperson of the Council, shall rescind a designation
of systemic importance for a designated financial market utility or designated
activity if the Council determines that the utility or activity no longer meets
the standards for systemic importance.</text>
</paragraph><paragraph id="id3535E965F3BA4419859E5EB2292EDA30"><enum>(2)</enum><header>Effect of
rescission</header><text>Upon rescission, the financial market utility or
financial institutions conducting the activity will no longer be subject to the
provisions of this title or any rules or orders prescribed by the Council under
this title.</text>
</paragraph></subsection><subsection id="ID23c1fa3705d34249b63bd3bc312e64ca"><enum>(c)</enum><header>Consultation and notice
and opportunity for hearing</header>
<paragraph id="ID6f6b17d268574d559089e3b3dc678d6b"><enum>(1)</enum><header>Consultation</header><text>Before
making any determination under subsection (a) or (b), the Council shall consult
with the relevant Supervisory Agency and the Board of Governors.</text>
</paragraph><paragraph id="ID805c4b738e2f41cf8162d0d66a91947a"><enum>(2)</enum><header>Advance notice and
opportunity for hearing</header>
<subparagraph id="IDd81e9ade73fc4ebdbd8cb4c7744437ab"><enum>(A)</enum><header>In
general</header><text>Before making any determination under subsection (a) or
(b), the Council shall provide the financial market utility or, in the case of
a payment, clearing, or settlement activity, financial institutions with
advance notice of the proposed determination of the Council.</text>
</subparagraph><subparagraph id="IDcbfad3cf6a3a4e368f12713606c163b1"><enum>(B)</enum><header>Notice in Federal
register</header><text>The Council shall provide such advance notice to
financial institutions by publishing a notice in the Federal Register.</text>
</subparagraph><subparagraph id="IDfbb20dd0b6ab4705ac6c07354908ebf6"><enum>(C)</enum><header>Requests for
hearing</header><text>Within 30 days from the date of any notice of the
proposed determination of the Council, the financial market utility or, in the
case of a payment, clearing, or settlement activity, a financial institution
engaged in the designated activity may request, in writing, an opportunity for
a written or oral hearing before the Council to demonstrate that the proposed
designation or rescission of designation is not supported by substantial
evidence.</text>
</subparagraph><subparagraph id="IDe6a9c414753242b9a74d38e4bb20f553"><enum>(D)</enum><header>Written
submissions</header><text>Upon receipt of a timely request, the Council shall
fix a time, not more than 30 days after receipt of the request, unless extended
at the request of the financial market utility or financial institution, and
place at which the financial market utility or financial institution may
appear, personally or through counsel, to submit written materials, or, at the
sole discretion of the Council, oral testimony or oral argument.</text>
</subparagraph></paragraph><paragraph id="ID857c77aa534b46a78ebd51d0f14cd68a"><enum>(3)</enum><header>Emergency
exception</header>
<subparagraph id="ID858d39a1265241939981f4a505aaa07b"><enum>(A)</enum><header>Waiver or modification
by vote of the Council</header><text>The Council may waive or modify the
requirements of paragraph (2) if the Council determines, by an affirmative vote
of not less than <fraction>2/3</fraction> of all members then serving,
including an affirmative vote by the Chairperson of the Council, that the
waiver or modification is necessary to prevent or mitigate an immediate threat
to the financial system posed by the financial market utility or the payment,
clearing, or settlement activity.</text>
</subparagraph><subparagraph id="IDa32a23cb0b214d2b94988559306593d7"><enum>(B)</enum><header>Notice of waiver or
modification</header><text>The Council shall provide notice of the waiver or
modification to the financial market utility concerned or, in the case of a
payment, clearing, or settlement activity, to financial institutions, as soon
as practicable, which shall be no later than 24 hours after the waiver or
modification in the case of a financial market utility and 3 business days in
the case of financial institutions. The Council shall provide the notice to
financial institutions by posting a notice on the website of the Council and by
publishing a notice in the Federal Register.</text>
</subparagraph></paragraph></subsection><subsection id="IDd72a7794ef9a4e69abe4328353e57b6d"><enum>(d)</enum><header>Notification of final
determination</header>
<paragraph id="ID6a2f502e18a54fde8c61fda35cc7ac3b"><enum>(1)</enum><header>After
hearing</header><text>Within 60 days of any hearing under subsection (c)(3),
the Council shall notify the financial market utility or financial institutions
of the final determination of the Council in writing, which shall include
findings of fact upon which the determination of the Council is based.</text>
</paragraph><paragraph id="ID7e79d34dda2f4eada8466f7fe3d9937b"><enum>(2)</enum><header>When no hearing
requested</header><text>If the Council does not receive a timely request for a
hearing under subsection (c)(3), the Council shall notify the financial market
utility or financial institutions of the final determination of the Council in
writing not later than 30 days after the expiration of the date by which a
financial market utility or a financial institution could have requested a
hearing. All notices to financial institutions under this subsection shall be
published in the Federal Register.</text>
</paragraph></subsection><subsection id="id2898ACEDD4FD491F88896EDF6848832E"><enum>(e)</enum><header>Extension of time
periods</header><text>The Council may extend the time periods established in
subsections (c) and (d) as the Council determines to be necessary or
appropriate.</text>
</subsection></section><section id="ID378816429e954d6e869531ce46dd38d4"><enum>805.</enum><header>Standards for
systemically important financial market utilities and payment, clearing, or
settlement activities</header>
<subsection id="IDecbea6caadb446fab33e7fd4a6131cd3"><enum>(a)</enum><header>Authority To prescribe
standards</header><text>The Board, by rule or order, and in consultation with
the Council and the Supervisory Agencies, shall prescribe risk management
standards, taking into consideration relevant international standards and
existing prudential requirements, governing—</text>
<paragraph id="idACD5C350D8054D24928A1F0179450EA3"><enum>(1)</enum><text>the operations related to
the payment, clearing, and settlement activities of designated financial market
utilities; and</text>
</paragraph><paragraph id="id30C84EE0777B4AED8DFC4AA34E40A74E"><enum>(2)</enum><text>the conduct of designated
activities by financial institutions.</text>
</paragraph></subsection><subsection id="ID9d6d0156864340a19a4413c837cb1f34"><enum>(b)</enum><header>Objectives and
principles</header><text>The objectives and principles for the risk management
standards prescribed under subsection (a) shall be to—</text>
<paragraph id="ID8882a02e387c42f8a3e086a55be2935a"><enum>(1)</enum><text>promote robust risk
management;</text>
</paragraph><paragraph id="IDce84bf457b0249d29f9b62b98266858b"><enum>(2)</enum><text>promote safety and
soundness;</text>
</paragraph><paragraph id="ID1e3e16b684ce4c6b97e06121d0294819"><enum>(3)</enum><text>reduce systemic risks;
and</text>
</paragraph><paragraph id="ID7c7e5e51d60e42a288cc8768263ea2fe"><enum>(4)</enum><text>support the stability of
the broader financial system.</text>
</paragraph></subsection><subsection id="IDac4cf2a321594133a952883796821329"><enum>(c)</enum><header>Scope</header><text>The
standards prescribed under subsection (a) may address areas such as—</text>
<paragraph id="id8F4A414FA58A41D08AE42968E9C80631"><enum>(1)</enum><text>risk management policies
and procedures;</text>
</paragraph><paragraph id="id681F65D51A4D42D3B3FD417EA341B817"><enum>(2)</enum><text>margin and collateral
requirements;</text>
</paragraph><paragraph id="IDe9656dbf70564119875cf415402d55d0"><enum>(3)</enum><text>participant or
counterparty default policies and procedures;</text>
</paragraph><paragraph id="idD647FB4780AF416FB07B9713281B0243"><enum>(4)</enum><text>the ability to complete
timely clearing and settlement of financial transactions;</text>
</paragraph><paragraph id="idA329E06996E446AEA0785E483F50B000"><enum>(5)</enum><text>capital and financial
resource requirements for designated financial market utilities; and</text>
</paragraph><paragraph id="idA56E01D1FEA34B29A6A06893CF6A9D8C"><enum>(6)</enum><text>other areas that the
Board determines are necessary to achieve the objectives and principles in
subsection (b).</text>
</paragraph></subsection><subsection id="id0C005293186D4F8A98E2C82DA9099B35"><enum>(d)</enum><header>Threshold
level</header><text>The standards prescribed under subsection (a) governing the
conduct of designated activities by financial institutions shall, where
appropriate, establish a threshold as to the level or significance of
engagement in the activity at which a financial institution will become subject
to the standards with respect to that activity.</text>
</subsection><subsection id="ID2721f1c5ebfa4570b9aa9520aaa019d0"><enum>(e)</enum><header>Compliance
required</header><text>Designated financial market utilities and financial
institutions subject to the standards prescribed by the Board of Governors for
a designated activity shall conduct their operations in compliance with the
applicable risk management standards prescribed by the Board of
Governors.</text>
</subsection></section><section id="ID8b973f95ccce4cc2a2c964ceefd76603"><enum>806.</enum><header>Operations of
designated financial market utilities</header>
<subsection id="ID8051aefb14ac4188b5b5bf9206f34a62"><enum>(a)</enum><header>Federal reserve account
and services</header><text>The Board of Governors may authorize a Federal
Reserve Bank to establish and maintain an account for a designated financial
market utility and provide services to the designated financial market utility
that the Federal Reserve Bank is authorized under the Federal Reserve Act to
provide to a depository institution, subject to any applicable rules, orders,
standards, or guidelines prescribed by the Board of Governors.</text>
</subsection><subsection id="IDd6d530049568469796af0b3917b64e32"><enum>(b)</enum><header>Advances</header><text>The
Board of Governors may authorize a Federal Reserve Bank to provide to a
designated financial market utility the same discount and borrowing privileges
as the Federal Reserve Bank may provide to a depository institution under the
Federal Reserve Act, subject to any applicable rules, orders, standards, or
guidelines prescribed by the Board of Governors.</text>
</subsection><subsection id="IDa16bdc92b8f944c99265ca7251aae71e"><enum>(c)</enum><header>Earnings on Federal
reserve balances</header><text>A Federal Reserve Bank may pay earnings on
balances maintained by or on behalf of a designated financial market utility in
the same manner and to the same extent as the Federal Reserve Bank may pay
earnings to a depository institution under the Federal Reserve Act, subject to
any applicable rules, orders, standards, or guidelines prescribed by the Board
of Governors.</text>
</subsection><subsection id="ID4a6b700ab7e34769ba7fdfd66bca154a"><enum>(d)</enum><header>Reserve
requirements</header><text>The Board of Governors may exempt a designated
financial market utility from, or modify any, reserve requirements under
section 19 of the Federal Reserve Act (12 U.S.C. 461) applicable to a
designated financial market utility.</text>
</subsection><subsection id="IDfb7200d4e50d4c0e8b96afe8afe8db8d"><enum>(e)</enum><header>Changes to rules,
procedures, or operations</header>
<paragraph id="ID2473ab16833149f5a951d2085b30f60f"><enum>(1)</enum><header>Advance notice</header>
<subparagraph id="ID91726ee0a7f7468f86616a213c4e78a9"><enum>(A)</enum><header>Advance notice of
proposed changes required</header><text>A designated financial market utility
shall provide notice 60 days in advance advance notice to its Supervisory
Agency and the Board of Governors of any proposed change to its rules,
procedures, or operations that could, as defined in rules of the Board of
Governors, materially affect, the nature or level of risks presented by the
designated financial market utility.</text>
</subparagraph><subparagraph id="idA6127C5BA9A94AFAAC9BE48132DEA069"><enum>(B)</enum><header>Terms and standards
prescribed by the Board of Governors</header><text>The Board of Governors shall
prescribe regulations that define and describe the standards for determining
when notice is required to be provided under subparagraph (A).</text>
</subparagraph><subparagraph id="ID0e2d15d6fb5c4b76a5c7eea4fbd3ce2d"><enum>(C)</enum><header>Contents of
notice</header><text>The notice of a proposed change shall describe—</text>
<clause id="id279654BA539449869FCAA2B7AF48777D"><enum>(i)</enum><text>the nature of the change
and expected effects on risks to the designated financial market utility, its
participants, or the market; and</text>
</clause><clause id="idBE882DE9A60C49CD807E4627178D77F3"><enum>(ii)</enum><text>how the designated
financial market utility plans to manage any identified risks.</text>
</clause></subparagraph><subparagraph id="ID890d8069850e4f23bbaf565e5c6463f6"><enum>(D)</enum><header>Additional
information</header><text>The Supervisory Agency or the Board of Governors may
require a designated financial market utility to provide any information
necessary to assess the effect the proposed change would have on the nature or
level of risks associated with the designated financial market utility's
payment, clearing, or settlement activities and the sufficiency of any proposed
risk management techniques.</text>
</subparagraph><subparagraph id="IDcf6833ad3718486fbed8d57220cd802b"><enum>(E)</enum><header>Notice of
objection</header><text>The Supervisory Agency or the Board of Governors shall
notify the designated financial market utility of any objection regarding the
proposed change within 60 days from the later of—</text>
<clause id="IDa2dae6149bd74979a6ba71bc33aed5fd"><enum>(i)</enum><text>the date that the notice
of the proposed change is received; or</text>
</clause><clause id="ID7f9449e13e3c4511befbc9e9beb38e51"><enum>(ii)</enum><text>the date any further
information requested for consideration of the notice is received.</text>
</clause></subparagraph><subparagraph id="ID08a809b942e24d18b32c81e22d8239df"><enum>(F)</enum><header>Change not allowed if
objection</header><text>A designated financial market utility shall not
implement a change to which the Board of Governors or the Supervisory Agency
has an objection.</text>
</subparagraph><subparagraph id="ID874a7a8678c14c598f905592262a38df"><enum>(G)</enum><header>Change allowed if no
objection within 60 days</header><text>A designated financial market utility
may implement a change if it has not received an objection to the proposed
change within 60 days of the later of—</text>
<clause id="IDa054c46b3a8449c2947f0b0f2d0f55e1"><enum>(i)</enum><text>the date that the
Supervisory Agency or the Board of Governors receives the notice of proposed
change; or</text>
</clause><clause id="ID5029587fa2544c3191723182a81c6c27"><enum>(ii)</enum><text>the date the Supervisory
Agency or the Board of Governors receives any further information it requests
for consideration of the notice.</text>
</clause></subparagraph><subparagraph id="IDa2175ec9375f46be8cc15fa2f421181c"><enum>(H)</enum><header>Review extension for
novel or complex issues</header><text>The Supervisory Agency or the Board of
Governors may, during the 60-day review period, extend the review period for an
additional 60 days for proposed changes that raise novel or complex issues,
subject to the Supervisory Agency or the Board of Governors providing the
designated financial market utility with prompt written notice of the
extension. Any extension under this subparagraph will extend the time periods
under subparagraphs (D) and (F).</text>
</subparagraph><subparagraph id="ID445ef40f68414298af05a1462574dbf1"><enum>(I)</enum><header>Change allowed earlier
if notified of no objection</header><text>A designated financial market utility
may implement a change in less than 60 days from the date of receipt of the
notice of proposed change by the Supervisory Agency or the Board of Governors,
or the date the Supervisory Agency or the Board of Governors receives any
further information it requested, if the Supervisory Agency or the Board of
Governors notifies the designated financial market utility in writing that it
does not object to the proposed change and authorizes the designated financial
market utility to implement the change on an earlier date, subject to any
conditions imposed by the Supervisory Agency or the Board of Governors.</text>
</subparagraph></paragraph><paragraph id="ID645a087878ca42d58825617e7f5e2049"><enum>(2)</enum><header>Emergency
changes</header>
<subparagraph id="ID62ca23ff889640b3b93fd16c06e47e06"><enum>(A)</enum><header>In
general</header><text>A designated financial market utility may implement a
change that would otherwise require advance notice under this subsection if it
determines that—</text>
<clause id="IDbadf5db4b9df4f7d85c765d04c56438b"><enum>(i)</enum><text>an emergency exists;
and</text>
</clause><clause id="IDf407a9d8c93442d593c86b6e155f943e"><enum>(ii)</enum><text>immediate implementation
of the change is necessary for the designated financial market utility to
continue to provide its services in a safe and sound manner.</text>
</clause></subparagraph><subparagraph id="ID9339610dd2bc419584d656123cae1c4f"><enum>(B)</enum><header>Notice required within
24 hours</header><text>The designated financial market utility shall provide
notice of any such emergency change to its Supervisory Agency and the Board of
Governors, as soon as practicable, which shall be no later than 24 hours after
implementation of the change.</text>
</subparagraph><subparagraph id="ID9421a8b1cda840f5b71c83b251d84a67"><enum>(C)</enum><header>Contents of emergency
notice</header><text>In addition to the information required for changes
requiring advance notice, the notice of an emergency change shall
describe—</text>
<clause id="IDa33abe9de03e4241820e9a0ea5ca5110"><enum>(i)</enum><text>the nature of the
emergency; and</text>
</clause><clause id="IDd0b9f5fb5e6643c986abc3ba75f4cc9a"><enum>(ii)</enum><text>the reason the change
was necessary for the designated financial market utility to continue to
provide its services in a safe and sound manner.</text>
</clause></subparagraph><subparagraph id="ID91ddf60ac27746f79a8bed3f0af8381b"><enum>(D)</enum><header>Modification or
rescission of change may be required</header><text>The Supervisory Agency or
the Board of Governors may require modification or rescission of the change if
it finds that the change is not consistent with the purposes of this Act or any
rules, orders, or standards prescribed by the Board of Governors
hereunder.</text>
</subparagraph></paragraph><paragraph id="IDfed4efc3465849888b2f591d8a1a8d9c"><enum>(3)</enum><header>Copying the Board of
Governors</header><text>The Supervisory Agency shall provide the Board of
Governors concurrently with a complete copy of any notice, request, or other
information it issues, submits, or receives under this subsection.</text>
</paragraph><paragraph id="ID1e3fe4a7d23e4594b215090c38f50db0"><enum>(4)</enum><header>Consultation with Board
of Governors</header><text>Before taking any action on, or completing its
review of, a change proposed by a designated financial market utility, the
Supervisory Agency shall consult with the Board of Governors.</text>
</paragraph></subsection></section><section id="ID1aec493114184f1593bc6649df6eca68"><enum>807.</enum><header>Examination of and
enforcement actions against designated financial market utilities</header>
<subsection id="IDe799667ed2c74e31ad756671e606227a"><enum>(a)</enum><header>Examination</header><text>Notwithstanding
any other provision of law and subject to subsection (d), the Supervisory
Agency shall conduct examinations of a designated financial market utility at
least once annually in order to determine the following:</text>
<paragraph id="ID043b38230f8349f8b07b9f4c3b67381e"><enum>(1)</enum><text>The nature of the
operations of, and the risks borne by, the designated financial market
utility.</text>
</paragraph><paragraph id="ID5a94f346c75740ce8551f0b2f62d5f98"><enum>(2)</enum><text>The financial and
operational risks presented by the designated financial market utility to
financial institutions, critical markets, or the broader financial
system.</text>
</paragraph><paragraph id="ID72a0d1ec0ed748d98de77b293bb8db9b"><enum>(3)</enum><text>The resources and
capabilities of the designated financial market utility to monitor and control
such risks.</text>
</paragraph><paragraph id="IDbe3d93c8f91444ddbc4a6270a7892d73"><enum>(4)</enum><text>The safety and soundness
of the designated financial market utility.</text>
</paragraph><paragraph id="ID7ccee1cf4d1b4801988322b4191b6343"><enum>(5)</enum><text>The designated financial
market utility’s compliance with—</text>
<subparagraph id="idFD01E6B7EC544F469644C35AB3DEB446"><enum>(A)</enum><text>this title; and</text>
</subparagraph><subparagraph id="idD854D2965C8444B99F886479A7F9A701"><enum>(B)</enum><text>the rules and orders
prescribed by the Board of Governors under this title.</text>
</subparagraph></paragraph></subsection><subsection id="ID35a4d0cab2d24b0ebf1c0f55378ba957"><enum>(b)</enum><header>Service
providers</header><text>Whenever a service integral to the operation of a
designated financial market utility is performed for the designated financial
market utility by another entity, whether an affiliate or non-affiliate and
whether on or off the premises of the designated financial market utility, the
Supervisory Agency may examine whether the provision of that service is in
compliance with applicable law, rules, orders, and standards to the same extent
as if the designated financial market utility were performing the service on
its own premises.</text>
</subsection><subsection id="ID0ac290a479c5440083009cd53a146ec9"><enum>(c)</enum><header>Enforcement</header><text>For
purposes of enforcing the provisions of this section, a designated financial
market utility shall be subject to, and the appropriate Supervisory Agency
shall have authority under the provisions of subsections (b) through (n) of
section 8 of the Federal Deposit Insurance Act (12 U.S.C. 1818) in the same
manner and to the same extent as if the designated financial market utility was
an insured depository institution and the Supervisory Agency was the
appropriate Federal banking agency for such insured depository
institution.</text>
</subsection><subsection id="ID4a30a465b4d2490bb7789c6bac86d6a0"><enum>(d)</enum><header>Board of Governors
involvement in examinations</header>
<paragraph id="IDbe58f537c3884686bf5ddb4910cd5056"><enum>(1)</enum><header>Board of Governors
consultation on examination planning</header><text>The Supervisory Agency shall
consult with the Board of Governors regarding the scope and methodology of any
examination conducted under subsections (a) and (b).</text>
</paragraph><paragraph id="ID35f92758ada84022bad19c56d61bacac"><enum>(2)</enum><header>Board of Governors
participation in examination</header><text>The Board of Governors may, in its
discretion, participate in any examination led by a Supervisory Agency and
conducted under subsections (a) and (b).</text>
</paragraph></subsection><subsection id="IDfd65dbf147594d86b9bda2047df3c783"><enum>(e)</enum><header>Board of Governors
enforcement recommendations</header>
<paragraph id="ID7a7ac5c64ad448e7a486b9a2a4291bac"><enum>(1)</enum><header>Recommendation</header><text>The
Board of Governors may at any time recommend to the Supervisory Agency that
such agency take enforcement action against a designated financial market
utility. Any such recommendation for enforcement action shall provide a
detailed analysis supporting the recommendation of the Board of
Governors.</text>
</paragraph><paragraph id="IDdb3dc33de1a04c35867ea6c37575c3bc"><enum>(2)</enum><header>Consideration</header><text>The
Supervisory Agency shall consider the recommendation of the Board of Governors
and submit a response to the Board of Governors within 60 days.</text>
</paragraph><paragraph id="IDbb6cb37e243b476095a4b3a203253020"><enum>(3)</enum><header>Mediation</header><text>If
the Supervisory Agency rejects, in whole or in part, the recommendation of the
Board of Governors, the Board of Governors may dispute the matter by referring
the recommendation to the Council, which shall attempt to resolve the
dispute.</text>
</paragraph><paragraph id="IDe316d110f3b74b4996d03b6b38798a7f"><enum>(4)</enum><header>Enforcement
action</header><text>If the Council is unable to resolve the dispute under
paragraph (3) within 30 days from the date of referral, the Board of Governors
may, upon a vote of its members—</text>
<subparagraph id="idAE2D144AD5A84813AC33451C4E6E0CFB"><enum>(A)</enum><text>exercise the enforcement
authority referenced in subsection (c) as if it were the Supervisory Agency;
and</text>
</subparagraph><subparagraph id="id98E6A8472613483D9556A41881A50507"><enum>(B)</enum><text>take enforcement action
against the designated financial market utility.</text>
</subparagraph></paragraph></subsection><subsection id="IDf738b728c6e74f2da5f6594ffcfaa94e"><enum>(f)</enum><header>Emergency enforcement
actions by the Board of Governors</header>
<paragraph id="ID74682f60b29d459c8b9dbbc9457d5b01"><enum>(1)</enum><header>Imminent risk of
substantial harm</header><text>The Board of Governors may, after consulting
with the Council and the Supervisory Agency, take enforcement action against a
designated financial market utility if the Board of Governors has reasonable
cause to believe that—</text>
<subparagraph id="ID2c9c7de9c3e344aabad43a76e86d9b04"><enum>(A)</enum><text>either—</text>
<clause id="IDe893cb6d735c43039027b80cf91834bd"><enum>(i)</enum><text>an action engaged in, or
contemplated by, a designated financial market utility (including any change
proposed by the designated financial market utility to its rules, procedures,
or operations that would otherwise be subject to section 806(e)) poses an
imminent risk of substantial harm to financial institutions, critical markets,
or the broader financial system; or</text>
</clause><clause id="ID0a0e39f9307a4b159a1c47a735d0a2e5"><enum>(ii)</enum><text>the condition of a
designated financial market utility poses an imminent risk of substantial harm
to financial institutions, critical markets, or the broader financial system;
and</text>
</clause></subparagraph><subparagraph id="ID29e6b3fc323f431d902fb038ded96fd6"><enum>(B)</enum><text>the imminent risk of
substantial harm precludes the Board of Governors’ use of the procedures in
subsection (e).</text>
</subparagraph></paragraph><paragraph id="ID7f40a2c0e0b7477888a5b9ab7a9f6b35"><enum>(2)</enum><header>Enforcement
authority</header><text>For purposes of taking enforcement action under
paragraph (1), a designated financial market utility shall be subject to, and
the Board of Governors shall have authority under the provisions of subsections
(b) through (n) of section 8 of the Federal Deposit Insurance Act (12 U.S.C.
1818) in the same manner and to the same extent as if the designated financial
market utility was an insured depository institution and the Board of Governors
was the appropriate Federal banking agency for such insured depository
institution.</text>
</paragraph><paragraph id="ID37f50a0a0b6f4733a420ca235063b38d"><enum>(3)</enum><header>Prompt notice to
supervisory agency of enforcement action</header><text>Within 24 hours of
taking an enforcement action under this subsection, the Board of Governors
shall provide written notice to the designated financial market utility’s
Supervisory Agency containing a detailed analysis of the action of the Board of
Governors, with supporting documentation included.</text>
</paragraph></subsection></section><section id="ID8889657ca1c84459af9b47932f206bc6"><enum>808.</enum><header>Examination of and
enforcement actions against financial institutions subject to standards for
designated activities</header>
<subsection id="ID7643f74f06634a46aac9c616bc5af678"><enum>(a)</enum><header>Examination</header><text>The
appropriate financial regulator is authorized to examine a financial
institution subject to the standards prescribed by the Board of Governors for a
designated activity in order to determine the following:</text>
<paragraph id="ID0d4b5e30a6674831bba9fd2f182e6fb8"><enum>(1)</enum><text>The nature and scope of
the designated activities engaged in by the financial institution.</text>
</paragraph><paragraph id="ID22a8fdfe75a940bfb159c2f4932e1f21"><enum>(2)</enum><text>The financial and
operational risks the designated activities engaged in by the financial
institution may pose to the safety and soundness of the financial
institution.</text>
</paragraph><paragraph id="ID3a8671c77b3e4c3eae16a81a52f5d2f0"><enum>(3)</enum><text>The financial and
operational risks the designated activities engaged in by the financial
institution may pose to other financial institutions, critical markets, or the
broader financial system.</text>
</paragraph><paragraph id="IDe974528887a84295920d7795d5b3b7c6"><enum>(4)</enum><text>The resources available
to and the capabilities of the financial institution to monitor and control the
risks described in paragraphs (2) and (3).</text>
</paragraph><paragraph id="ID942eb96ef077469fbcbd4028addeef1a"><enum>(5)</enum><text>The financial
institution’s compliance with this title and the rules and orders prescribed by
the Board of Governors under this title.</text>
</paragraph></subsection><subsection id="ID45ad535ca264419c9535a99162bbdad4"><enum>(b)</enum><header>Enforcement</header><text>For
purposes of enforcing the provisions of this section, and the rules and orders
prescribed by the Board of Governors under this section, a financial
institution subject to the standards prescribed by the Board of Governors for a
designated activity shall be subject to, and the appropriate financial
regulator shall have authority under the provisions of subsections (b) through
(n) of section 8 of the Federal Deposit Insurance Act (12 U.S.C. 1818) in the
same manner and to the same extent as if the financial institution was an
insured depository institution and the appropriate financial regulator was the
appropriate Federal banking agency for such insured depository
institution.</text>
</subsection><subsection id="ID5c702b07d92f48bfbe6071b0e7d091ff"><enum>(c)</enum><header>Technical
assistance</header><text>The Board of Governors shall consult with and provide
such technical assistance as may be required by the appropriate financial
regulators to ensure that the rules and orders prescribed by the Board of
Governors under this title are interpreted and applied in as consistent and
uniform a manner as practicable.</text>
</subsection><subsection id="ID5d1247e53fb74e72833984c8e4d22ee1"><enum>(d)</enum><header>Delegation</header>
<paragraph id="IDebcc4ab6dd5e4843a120d9b7f3a85851"><enum>(1)</enum><header>Examination</header>
<subparagraph id="IDa7547537d3c4477c8625caed2430e34f"><enum>(A)</enum><header>Request to Board of
Governors</header><text>The appropriate financial regulator may request the
Board of Governors to conduct or participate in an examination of a financial
institution subject to the standards prescribed by the Board of Governors for a
designated activity in order to assess the compliance of such financial
institution with—</text>
<clause id="idB698E70A6E6B4063931F9839845CBD34"><enum>(i)</enum><text>this title; or</text>
</clause><clause id="id2EBD245C99704FA5883DCF6876FDCC1E"><enum>(ii)</enum><text>the rules or orders
prescribed by the Board of Governors under this title.</text>
</clause></subparagraph><subparagraph id="ID1057f5a4b4864d498013d41175ae8db2"><enum>(B)</enum><header>Examination by Board of
Governors</header><text>Upon receipt of an appropriate written request, the
Board of Governors will conduct the examination under such terms and conditions
to which the Board of Governors and the appropriate financial regulator
mutually agree.</text>
</subparagraph></paragraph><paragraph id="ID9685bfb3cb404977a6ecb848d08f9504"><enum>(2)</enum><header>Enforcement</header>
<subparagraph id="ID9c6dd893d5e5453a8e42dfacb2e011cf"><enum>(A)</enum><header>Request to Board of
Governors</header><text>The appropriate financial regulator may request the
Board of Governors to enforce this title or the rules or orders prescribed by
the Board of Governors under this title against a financial institution that is
subject to the standards prescribed by the Board of Governors for a designated
activity.</text>
</subparagraph><subparagraph id="IDbc7123106c334da2b715a63f490ded0c"><enum>(B)</enum><header>Enforcement by Board of
Governors</header><text>Upon receipt of an appropriate written request, the
Board of Governors shall determine whether an enforcement action is warranted,
and, if so, it shall enforce compliance with this title or the rules or orders
prescribed by the Board of Governors under this title and, if so, the financial
institution shall be subject to, and the Board of Governors shall have
authority under the provisions of subsections (b) through (n) of section 8 of
the Federal Deposit Insurance Act (12 U.S.C. 1818) in the same manner and to
the same extent as if the financial institution was an insured depository
institution and the Board of Governors was the appropriate Federal banking
agency for such insured depository institution.</text>
</subparagraph></paragraph></subsection><subsection id="IDcf9a6b2a51a34461aca942b88998450b"><enum>(e)</enum><header>Back-up authority of
the Board of Governors</header>
<paragraph id="ID247e7e35afd24eafbbd610cc22d2746a"><enum>(1)</enum><header>Examination and
enforcement</header><text>Notwithstanding any other provision of law, the Board
of Governors may—</text>
<subparagraph id="ID3dde107a3a8c4bda9467082a0f755c4a"><enum>(A)</enum><text>conduct an examination of
the type described in subsection (a) of any financial institution that is
subject to the standards prescribed by the Board of Governors for a designated
activity; and</text>
</subparagraph><subparagraph id="ID902ff096e5074f6cbbd96fad7799fcf1"><enum>(B)</enum><text>enforce the provisions of
this title or any rules or orders prescribed by the Board of Governors under
this title against any financial institution that is subject to the standards
prescribed by the Board of Governors for a designated activity.</text>
</subparagraph></paragraph><paragraph id="ID8bbece00e8004c24b0455b4b47f375c4"><enum>(2)</enum><header>Limitations</header>
<subparagraph id="ID7234d3949e454d3f81e472ccfdaac4a8"><enum>(A)</enum><header>Examination</header><text>The
Board of Governors may exercise the authority described in paragraph (1)(A)
only if the Board of Governors has—</text>
<clause id="IDf307c01041c04655b1099c8443dd67e4"><enum>(i)</enum><text>reasonable cause to
believe that a financial institution is not in compliance with this title or
the rules or orders prescribed by the Board of Governors under this title with
respect to a designated activity;</text>
</clause><clause id="IDd820e04a1c1a4937949e9ffe8ea9ee7e"><enum>(ii)</enum><text>notified, in writing,
the appropriate financial regulator and the Council of its belief under clause
(i) with supporting documentation included;</text>
</clause><clause id="ID6ab43264d15a454f808d6e22f14a7034"><enum>(iii)</enum><text>requested the
appropriate financial regulator to conduct a prompt examination of the
financial institution; and</text>
</clause><clause id="IDddeb9aace83a497bb0757b3a9ec29c50"><enum>(iv)</enum><text>either—</text>
<subclause id="ID9ca690ebcab745f7a0d269ab932dda62"><enum>(I)</enum><text>not been afforded a
reasonable opportunity to participate in an examination of the financial
institution by the appropriate financial regulator within 30 days after the
date of the Board’s notification under clause (ii); or</text>
</subclause><subclause id="ID60e85bd5f1524a4b95cd49a44258ca17"><enum>(II)</enum><text>reasonable cause to
believe that the financial institution’s noncompliance with this title or the
rules or orders prescribed by the Board of Governors under this title poses a
substantial risk to other financial institutions, critical markets, or the
broader financial system, subject to the Board of Governors affording the
appropriate financial regulator a reasonable opportunity to participate in the
examination.</text>
</subclause></clause></subparagraph><subparagraph id="IDf421287577df45b685c0fd83d923e849"><enum>(B)</enum><header>Enforcement</header><text>The
Board of Governors may exercise the authority described in paragraph (1)(B)
only if the Board of Governors has—</text>
<clause id="IDc6989067346b4f209f494469ca18ec51"><enum>(i)</enum><text>reasonable cause to
believe that a financial institution is not in compliance with this title or
the rules or orders prescribed by the Board of Governors under this title with
respect to a designated activity;</text>
</clause><clause id="ID1c722744ff20439ab50e5854158078a3"><enum>(ii)</enum><text>notified, in writing,
the appropriate financial regulator and the Council of its belief under clause
(i) with supporting documentation included and with a recommendation that the
appropriate financial regulator take 1 or more specific enforcement actions
against the financial institution; and</text>
</clause><clause id="ID9a9fc55098d24221b62af25097a73bd2"><enum>(iii)</enum><text>either—</text>
<subclause id="ID1e3d03083892402f8fe0fd90f3ab8bc2"><enum>(I)</enum><text>not been notified, in
writing, by the appropriate financial regulator of the commencement of an
enforcement action recommended by the Board of Governors against the financial
institution within 60 days from the date of the notification under clause (ii);
or</text>
</subclause><subclause id="IDf63ddc34b0ca4e82b48b0c39fa834a2b"><enum>(II)</enum><text>reasonable cause to
believe that the financial institution’s noncompliance with this title or the
rules or orders prescribed by the Board of Governors under this title poses a
substantial risk to other financial institutions, critical markets, or the
broader financial system, subject to the Board of Governors notifying the
appropriate financial regulator of the Board’s enforcement action.</text>
</subclause></clause></subparagraph></paragraph><paragraph id="ID4ebb0a1e742343eab9701eb9dc2d4b56"><enum>(3)</enum><header>Enforcement
provisions</header><text>For purposes of taking enforcement action under
paragraph (1), the financial institution shall be subject to, and the Board of
Governors shall have authority under the provisions of subsections (b) through
(n) of section 8 of the Federal Deposit Insurance Act (12 U.S.C. 1818) in the
same manner and to the same extent as if the financial institution was an
insured depository institution and the Board of Governors was the appropriate
Federal banking agency for such insured depository institution.</text>
</paragraph></subsection></section><section id="IDc854da55a6e6413ca70da163899a657d"><enum>809.</enum><header>Requests for
information, reports, or records</header>
<subsection id="IDf0118b1f9f0e41f19a89488cbfbc0a7c"><enum>(a)</enum><header>Information To assess
systemic importance</header>
<paragraph id="IDc3edcdfb92054476af745c7b96490777"><enum>(1)</enum><header>Financial market
utilities</header><text>The Council is authorized to require any financial
market utility to submit such information as the Council may require for the
sole purpose of assessing whether that financial market utility is systemically
important, but only if the Council has reasonable cause to believe that the
financial market utility meets the standards for systemic importance set forth
in section 804.</text>
</paragraph><paragraph id="ID2823094b2f114c31a138d22e68aa00c3"><enum>(2)</enum><header>Financial institutions
engaged in payment, clearing, or settlement activities</header><text>The
Council is authorized to require any financial institution to submit such
information as the Council may require for the sole purpose of assessing
whether any payment, clearing, or settlement activity engaged in or supported
by a financial institution is systemically important, but only if the Council
has reasonable cause to believe that the activity meets the standards for
systemic importance set forth in section 804.</text>
</paragraph></subsection><subsection id="ID632ec8d5ced94a94a80d035cde997031"><enum>(b)</enum><header>Reporting after
designation</header>
<paragraph id="ID26d087f99d46400dbde6d4feeca81fd4"><enum>(1)</enum><header>Designated financial
market utilities</header><text>The Board of Governors and the Council may
require a designated financial market utility to submit reports or data to the
Board of Governors and the Council in such frequency and form as deemed
necessary by the Board of Governors and the Council in order to assess the
safety and soundness of the utility and the systemic risk that the utility’s
operations pose to the financial system.</text>
</paragraph><paragraph id="ID35cc0886b5374bf2b411be8e25af19c3"><enum>(2)</enum><header>Financial institutions
subject to standards for designated activities</header><text>The Board of
Governors and the Council may require 1 or more financial institutions subject
to the standards prescribed by the Board of Governors for a designated activity
to submit, in such frequency and form as deemed necessary by the Board of
Governors and the Council, reports and data to the Board of Governors and the
Council solely with respect to the conduct of the designated activity and
solely to assess whether—</text>
<subparagraph id="ID88f7299a717345ac99ee84d9a1ade65e"><enum>(A)</enum><text>the rules, orders, or
standards prescribed by the Board of Governors with respect to the designated
activity appropriately address the risks to the financial system presented by
such activity; and</text>
</subparagraph><subparagraph id="ID028ad0fab2c84d3ba0a2affd9c36c8b2"><enum>(B)</enum><text>the financial
institutions are in compliance with this title and the rules and orders
prescribed by the Board of Governors under this title with respect to the
designated activity.</text>
</subparagraph></paragraph></subsection><subsection id="ID8f6e8b1dd7dc4b16b77b5215f0967993"><enum>(c)</enum><header>Coordination with
appropriate Federal supervisory agency</header>
<paragraph id="ID428cc254e2054e6b8145023cc13d109e"><enum>(1)</enum><header>Advance
coordination</header><text>Before directly requesting any material information
from, or imposing reporting or recordkeeping requirements on, any financial
market utility or any financial institution engaged in a payment, clearing, or
settlement activity, the Board of Governors and the Council shall coordinate
with the Supervisory Agency for a financial market utility or the appropriate
financial regulator for a financial institution to determine if the information
is available from or may be obtained by the agency in the form, format, or
detail required by the Board of Governors and the Council.</text>
</paragraph><paragraph id="IDde14a75de7d2479ca974372fac3d22e9"><enum>(2)</enum><header>Supervisory
reports</header><text>Notwithstanding any other provision of law, the
Supervisory Agency, the appropriate financial regulator, and the Board of
Governors are authorized to disclose to each other and the Council copies of
its examination reports or similar reports regarding any financial market
utility or any financial institution engaged in payment, clearing, or
settlement activities.</text>
</paragraph></subsection><subsection id="IDc5446b5f239746c39efaaf6a798f3d52"><enum>(d)</enum><header>Timing of response from
appropriate Federal supervisory agency</header><text>If the information,
report, records, or data requested by the Board of Governors or the Council
under subsection (c)(1) are not provided in full by the Supervisory Agency or
the appropriate financial regulator in less than 15 days after the date on
which the material is requested, the Board of Governors or the Council may
request the information or impose recordkeeping or reporting requirements
directly on such persons as provided in subsections (a) and (b) with notice to
the agency.</text>
</subsection><subsection id="ID1385c7daf01747c280a285e6359d99a0"><enum>(e)</enum><header>Sharing of
information</header>
<paragraph id="IDd3e61378e1e54f7a8ea0946cd6bc96b4"><enum>(1)</enum><header>Material
concerns</header><text>Notwithstanding any other provision of law, the Board of
Governors, the Council, the appropriate financial regulator, and any
Supervisory Agency are authorized to—</text>
<subparagraph id="idB6D7D64B215F4925B7CAE252BA2A5A2E"><enum>(A)</enum><text>promptly notify each
other of material concerns about a designated financial market utility or any
financial institution engaged in designated activities; and</text>
</subparagraph><subparagraph id="id2AE423E781384EE2A990A0B7EF2799AA"><enum>(B)</enum><text>share appropriate
reports, information, or data relating to such concerns.</text>
</subparagraph></paragraph><paragraph id="IDacc25dfed873497b819cc0fca814f66e"><enum>(2)</enum><header>Other
information</header><text>Notwithstanding any other provision of law, the Board
of Governors, the Council, the appropriate financial regulator, or any
Supervisory Agency may, under such terms and conditions as it deems
appropriate, provide confidential supervisory information and other information
obtained under this title to other persons it deems appropriate, including the
Secretary, State financial institution supervisory agencies, foreign financial
supervisors, foreign central banks, and foreign finance ministries, subject to
reasonable assurances of confidentiality.</text>
</paragraph></subsection><subsection id="ID58b07d41a88b4f5c99b49a3aaffcfff9"><enum>(f)</enum><header>Privilege
maintained</header><text>The Board of Governors, the Council, the appropriate
financial regulator, and any Supervisory Agency providing reports or data under
this section shall not be deemed to have waived any privilege applicable to
those reports or data, or any portion thereof, by providing the reports or data
to the other party or by permitting the reports or data, or any copies thereof,
to be used by the other party.</text>
</subsection><subsection id="ID3281e4c95d7d461bb5b1af09053a34f4"><enum>(g)</enum><header>Disclosure
exemption</header><text>Information obtained by the Board of Governors or the
Council under this section and any materials prepared by the Board of Governors
or the Council regarding its assessment of the systemic importance of financial
market utilities or any payment, clearing, or settlement activities engaged in
by financial institutions, and in connection with its supervision of designated
financial market utilities and designated activities, shall be confidential
supervisory information exempt from disclosure under section 552 of title 5,
United States Code. For purposes of such section 552, this subsection shall be
considered a statute described in subsection (b)(3) of such section 552.</text>
</subsection></section><section id="ID051c03986cbe4abca9945df02b04086b"><enum>810.</enum><header>Rulemaking</header><text display-inline="no-display-inline">The Board of Governors and the Council are
authorized to prescribe such rules and issue such orders as may be necessary to
administer and carry out the authorities and duties granted to the Board of
Governors or the Council, respectively, and prevent evasions thereof.</text>
</section><section id="IDdb2b14c20d7440e1b0161e57c498ba48"><enum>811.</enum><header>Other
authority</header><text display-inline="no-display-inline">Unless otherwise
provided by its terms, this title does not divest any appropriate financial
regulator, any Supervisory Agency, or any other Federal or State agency, of any
authority derived from any other applicable law, except that any standards
prescribed by the Board of Governors under section 805 shall supersede any less
stringent requirements established under other authority to the extent of any
conflict.</text>
</section><section id="ID8c6331d75af542a8a1e265371240fc2a"><enum>812.</enum><header>Effective
date</header><text display-inline="no-display-inline">This title is effective
as of the date of enactment of this Act.</text>
</section><enum>IX</enum><header>Investor protections and
improvements to the regulation of securities</header>
<subtitle id="idBB18F5438AF04AF19AC501F54AB44D48"><enum>A</enum><header>Increasing investor
protection</header>
<section id="id8C82536B75054D4184CC4F48BA6F4199"><enum>911.</enum><header>Investor Advisory
Committee established</header><text display-inline="no-display-inline">Title I
of the Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.) is amended by
adding at the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id370164B991D6451389731DC2A7A89F28" reported-display-style="italic" style="OLC">
<section id="ID04a12177dfac4ec388069b7b20210f52"><enum>39.</enum><header>Investor Advisory
Committee</header>
<subsection id="ID5b47e0be15ba43919d309cad0e32b582"><enum>(a)</enum><header>Establishment and
purpose</header>
<paragraph id="idE213725254E843CFB5796C9E939148B6"><enum>(1)</enum><header>Establishment</header><text>There
is established within the Commission the Investor Advisory Committee (referred
to in this section as the <quote>Committee</quote>).</text>
</paragraph><paragraph id="id3E1A754AF40D4DAE8B30F766764AD2FC"><enum>(2)</enum><header>Purpose</header><text>The
Committee shall—</text>
<subparagraph id="id0C5D17B502114CA497586F4E0BFDE2DF"><enum>(A)</enum><text>advise and consult with
the Commission on—</text>
<clause id="ID09ea19d22d4f49588523e9720ca323f9"><enum>(i)</enum><text>regulatory priorities of
the Commission;</text>
</clause><clause id="id5CDE5C39652E4603A48418017C9C7DE8"><enum>(ii)</enum><text>issues relating to the
regulation of securities products, trading strategies, and fee structures, and
the effectiveness of disclosure;</text>
</clause><clause id="ID7adc656cc274480c8ecb987e4cca14f7"><enum>(iii)</enum><text>initiatives to protect
investor interest; and</text>
</clause><clause id="IDa971a81268774a14b688f8885fe31040"><enum>(iv)</enum><text>initiatives to promote
investor confidence and the integrity of the securities marketplace; and</text>
</clause></subparagraph><subparagraph id="idE5253ECEFA6B4CD38856CF76734D7DBB"><enum>(B)</enum><text>submit to the Commission
such findings and recommendations as the Committee determines are appropriate,
including recommendations for proposed legislative changes.</text>
</subparagraph></paragraph></subsection><subsection id="ID20bd3e24afcb444cb37e9abfc3666a82"><enum>(b)</enum><header>Membership</header>
<paragraph id="id65C9CBDAA0094D6783171E4993DBF879"><enum>(1)</enum><header>In
general</header><text>The members of the Committee shall be—</text>
<subparagraph id="id58EFCBB40EFA4AA8ACD5568F2A1CC85D"><enum>(A)</enum><text>the Investor
Advocate;</text>
</subparagraph><subparagraph id="id9B21BC5443EB4A4DB14CE5C0625B9680"><enum>(B)</enum><text>a representative of State
securities commissions;</text>
</subparagraph><subparagraph id="id0FCCCF9CAEE3419AABA2C8A89A58CDEA"><enum>(C)</enum><text>a representative of the
interests of senior citizens; and</text>
</subparagraph><subparagraph id="idC83448A39ACE461D984BF1177883810B"><enum>(D)</enum><text>not fewer than 10, and
not more than 20, members appointed by the Commission, from among individuals
who—</text>
<clause id="ID1f8c5336e2014c9aa3c5c8310d353c85"><enum>(i)</enum><text>represent the interests
of individual equity and debt investors, including investors in mutual
funds;</text>
</clause><clause id="ID32c8c6d5d74b4e959651546693ea6ce2"><enum>(ii)</enum><text>represent the interests
of institutional investors, including the interests of pension funds and
registered investment companies;</text>
</clause><clause id="ID912b46defe4f43a2a0274a0646d44763"><enum>(iii)</enum><text>are knowledgeable about
investment issues and decisions; and</text>
</clause><clause id="id5E998556FFDB49C68349BC4E8258159C"><enum>(iv)</enum><text>have reputations of
integrity.</text>
</clause></subparagraph></paragraph><paragraph id="id79A3A196E9C143DDAF1449C6CA0B077C"><enum>(2)</enum><header>Term</header><text>Each
member of the Committee appointed under paragraph (1)(B) shall serve for a term
of 4 years.</text>
</paragraph><paragraph id="ID966140bb42de45879d70e5a923eaedc4"><enum>(3)</enum><header>Members not commission
employees</header><text>Members appointed under paragraph (1)(B) shall not be
deemed to be employees or agents of the Commission solely because of membership
on the Committee.</text>
</paragraph></subsection><subsection id="id8B41151D626141AC90AA9FEFA305CF0A"><enum>(c)</enum><header>Chairman; Vice
Chairman; Secretary; Assistant Secretary</header>
<paragraph id="idF2E34FD26607475BB456997B19084DC6"><enum>(1)</enum><header>In
general</header><text>The members of the Committee shall elect, from among the
members of the Committee—</text>
<subparagraph id="idEF48AC6248804323BA6EDF80BF0BEEE7"><enum>(A)</enum><text>a chairman, who may not
be employed by an issuer;</text>
</subparagraph><subparagraph id="idB8658F148D8C405585867864F26BF328"><enum>(B)</enum><text>a vice chairman, who may
not be employed by an issuer;</text>
</subparagraph><subparagraph id="id5025A9A461DB4A66AF10A3595D4BA93E"><enum>(C)</enum><text>a secretary; and</text>
</subparagraph><subparagraph id="id5A835783BB494FA6A57417554398121B"><enum>(D)</enum><text>an assistant
secretary.</text>
</subparagraph></paragraph><paragraph id="idA346A6D52F1B458EBDE248EF6F875A03"><enum>(2)</enum><header>Term</header><text>Each
member elected under paragraph (1) shall serve for a term of 3 years in the
capacity for which the member was elected under paragraph (1).</text>
</paragraph></subsection><subsection id="ID2f7487910fd4485c9c4d55e1c0e2b7ee"><enum>(d)</enum><header>Meetings</header>
<paragraph id="id04E861ADE51E4AD9B12DA5DACB6F33B3"><enum>(1)</enum><header>Frequency of
meetings</header><text>The Committee shall meet—</text>
<subparagraph id="id694F4CE52E41448F84293685548AE501"><enum>(A)</enum><text>not less frequently than
twice annually, at the call of the chairman of the Committee; and</text>
</subparagraph><subparagraph id="idA0BD61B9A8AF473993D7C0320129D47E"><enum>(B)</enum><text>from time to time, at the
call of the Commission.</text>
</subparagraph></paragraph><paragraph id="id2CBB1A5A60BA4F419982DB0558D1C920"><enum>(2)</enum><header>Notice</header><text>The
chairman of the Committee shall give the members of the Committee written
notice of each meeting, not later than 2 weeks before the date of the
meeting.</text>
</paragraph></subsection><subsection id="IDf3b4771d7c7a4a10a2460da6d27b099b"><enum>(e)</enum><header>Compensation and travel
expenses</header><text>Each member of the Committee who is not a full-time
employee of the United States shall—</text>
<paragraph commented="no" id="ID36190cf0a68845a5b737be7f86dfeaa4"><enum>(1)</enum><text>be compensated at a rate
not to exceed the daily equivalent of the annual rate of basic pay in effect
for a position at level V of the Executive Schedule under section 5316 of title
5, United States Code, for each day during which the member is engaged in the
actual performance of the duties of the Committee; and</text>
</paragraph><paragraph commented="no" id="ID5326a2e9770447538e1ef92d966e5ef4"><enum>(2)</enum><text>while away from the home
or regular place of business of the member in the performance of services for
the Committee, be allowed travel expenses, including per diem in lieu of
subsistence, in the same manner as persons employed intermittently in the
Government service are allowed expenses under section 5703(b) of title 5,
United States Code.</text>
</paragraph></subsection><subsection commented="no" id="idA3F8DE04AE8E43B8B5A12614FA7E4F4B"><enum>(f)</enum><header>Staff</header><text>The
Commission shall make available to the Committee such staff as the chairman of
the Committee determines are necessary to carry out this section.</text>
</subsection><subsection id="id3E6E8DAE9395444EB4EFDCB6F2E3CAD6"><enum>(g)</enum><header>Review by
Commission</header><text>The Commission shall—</text>
<paragraph id="id1E52D633FF6B4A369F3EF87CBBE5E761"><enum>(1)</enum><text>review the findings and
recommendations of the Committee; and</text>
</paragraph><paragraph id="idCD6EB7AB40F44F72A0652588EE36A7E0"><enum>(2)</enum><text>each time the Committee
submits a finding or recommendation to the Commission, issue a public
statement—</text>
<subparagraph id="id58B3ACD1F7284DB0B58C0060D2530222"><enum>(A)</enum><text>assessing the finding or
recommendation of the Committee; and</text>
</subparagraph><subparagraph id="id8F20617A0C5C40AE927B31DD254C8CEF"><enum>(B)</enum><text>disclosing the action, if
any, the Commission intends to take with respect to the finding or
recommendation.</text>
</subparagraph></paragraph></subsection><subsection id="IDfd1c0ed1fba14bd6b0f7068266075a90"><enum>(h)</enum><header>Committee
findings</header><text>Nothing in this section shall require the Commission to
agree to or act upon any finding or recommendation of the Committee.</text>
</subsection><subsection id="id692C97A8D93D4BCC90857B548B954AF8"><enum>(i)</enum><header>Federal Advisory
Committee Act</header><text>The Federal Advisory Committee Act (5 U.S.C. App.)
shall not apply with respect to the Committee and its activities.</text>
</subsection><subsection id="IDb8557f8490de45fa95d92f8adcc7c9d4"><enum>(j)</enum><header>Authorization of
appropriations</header><text>There is authorized to be appropriated to the
Commission such sums as are necessary to carry out this
section.</text>
</subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</section><section id="IDca7d02cae3fc4ee8b31547d761dc212a"><enum>912.</enum><header>Clarification of
authority of the Commission to engage in investor testing</header><text display-inline="no-display-inline">Section 19 of the Securities Act of 1933 (15
U.S.C. 77s) is amended by adding at the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idE0DD170C9A8B4094B7816A6169742778" reported-display-style="italic" style="OLC">
<subsection id="IDf89ef54f0be049eaaeef94163c8d164c"><enum>(e)</enum><header>Evaluation of rules or
programs</header><text>For the purpose of evaluating any rule or program of the
Commission issued or carried out under any provision of the securities laws, as
defined in section 3 of the Securities Exchange Act of 1934 (15 U.S.C. 78c),
and the purposes of considering, proposing, adopting, or engaging in any such
rule or program or developing new rules or programs, the Commission may—</text>
<paragraph id="id62A50B5F1D0A4EBCABAE2B4B0664BD92"><enum>(1)</enum><text>gather information from
and communicate with investors or other members of the public;</text>
</paragraph><paragraph id="idBED8EFD0EA6046058A35E05628B43F13"><enum>(2)</enum><text>engage in such temporary
investor testing programs as the Commission determines are in the public
interest or would protect investors; and</text>
</paragraph><paragraph id="idD2EFF20A9A0749908AA36A1EB46F0651"><enum>(3)</enum><text>consult with academics
and consultants, as necessary to carry out this subsection.</text>
</paragraph></subsection><subsection id="id8FA30D124F7E4792A067287FFE2D3145"><enum>(f)</enum><header>Rule of
construction</header><text>For purposes of the Paperwork Reduction Act (44
U.S.C. 3501 et seq.), any action taken under subsection (e) shall not be
construed to be a collection of
information.</text>
</subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</section><section id="idB154263A75BC41A699B81F1D834DC882"><enum>913.</enum><header>Study and rulemaking
regarding obligations of brokers, dealers, and investment advisers</header>
<subsection id="id1DA111DC297049A4AFB33A821C5C11D2"><enum>(a)</enum><header>Definitions</header><text>In
this section—</text>
<paragraph id="idAB5127CBFC22414B9F3781769159D453"><enum>(1)</enum><text>the term
<term>FINRA</term> means the Financial Industry Regulatory Authority;
and</text>
</paragraph><paragraph id="id2CBA6553307447319A901A8621BFB20F"><enum>(2)</enum><text>the term <term>retail
customer</term> means an individual customer of a broker, dealer, investment
adviser, person associated with a broker or dealer, or a person associated with
an investment adviser.</text>
</paragraph></subsection><subsection id="idFC4B4E59720E40B18EA80D5B0C914220"><enum>(b)</enum><header>In
general</header><text>The Commission shall conduct a study to evaluate—</text>
<paragraph id="id2BE2256B12774468807B0B0E8B1CB97A"><enum>(1)</enum><text>the effectiveness of
existing legal or regulatory standards of care for brokers, dealers, investment
advisers, persons associated with brokers or dealers, and persons associated
with investment advisers for providing personalized investment advice and
recommendations about securities to retail customers imposed by the Commission
and FINRA, and other Federal and State legal or regulatory standards;
and</text>
</paragraph><paragraph id="idBACCAF36E4754DD3A3AAEE5521A1D048"><enum>(2)</enum><text>whether there are legal
or regulatory gaps or overlap in legal or regulatory standards in the
protection of retail customers relating to the standards of care for brokers,
dealers, investment advisers, persons associated with brokers or dealers, and
persons associated with investment advisers for providing personalized
investment advice about securities to retail customers that should be addressed
by rule or statute.</text>
</paragraph></subsection><subsection id="id75C83AF492FF43F0B1CE9DC8D218B2F5"><enum>(c)</enum><header>Considerations</header><text>In
conducting the study required under subsection (b), the Commission shall
consider—</text>
<paragraph id="idD2F2F204C9E64A49A59C75C92524B74F"><enum>(1)</enum><text>the regulatory,
examination, and enforcement resources devoted to, and activities of, the
Commission and FINRA to enforce the standards of care for brokers, dealers,
investment advisers, persons associated with brokers or dealers, and persons
associated with investment advisers when providing personalized investment
advice and recommendations about securities to retail customers,
including—</text>
<subparagraph id="id81BAE2D3717443A7B454155EA4E45843"><enum>(A)</enum><text>the frequency of
examinations of brokers, dealers, and investment advisers; and</text>
</subparagraph><subparagraph id="idE630BE699DC64EC4A9DCF49B198831E0"><enum>(B)</enum><text>the length of time of the
examinations;</text>
</subparagraph></paragraph><paragraph id="id3F289858D9134133BE1A45772883A924"><enum>(2)</enum><text>the substantive
differences, compared and contrasted in detail, in the regulation of brokers,
dealers, and investment advisers, when providing personalized investment advice
and recommendations about securities to retail customers, including the
differences in the amount of resources devoted to the regulation and
examination of brokers, dealers, and investment advisers, by the Commission and
FINRA;</text>
</paragraph><paragraph id="id31D36E064B6441A6BA30132EAB80901C"><enum>(3)</enum><text>the specific instances in
which—</text>
<subparagraph id="id418716DBD2A941D2A2A2AC436D5D55C4"><enum>(A)</enum><text>the regulation and
oversight of investment advisers provide greater protection to retail customers
than the regulation and oversight of brokers and dealers; and</text>
</subparagraph><subparagraph id="id0073A9B9AF034B099044A124EA049233"><enum>(B)</enum><text>the regulation and
oversight of brokers and dealers provide greater protection to retail customers
than the regulation and oversight of investment advisers;</text>
</subparagraph></paragraph><paragraph id="id701AF582ABF0412AB284DC33057F3E16"><enum>(4)</enum><text>the existing legal or
regulatory standards of State securities regulators and other regulators
intended to protect retail customers;</text>
</paragraph><paragraph id="id613DC36E3F0A46C6B159F22A1BB1472B"><enum>(5)</enum><text>the potential impact on
retail customers, including the potential impact on access of retail customers
to the range of products and services offered by brokers and dealers, of
imposing upon brokers, dealers, and persons associated with brokers or
dealers—</text>
<subparagraph id="id80CFFF7AC4A84DE58F9EF18BAF340C41"><enum>(A)</enum><text>the standard of care
applied under the Investment Advisers Act of 1940 (15 U.S.C. 80b–1 et seq.) for
providing personalized investment advice about securities to retail customers
of investment advisers; and</text>
</subparagraph><subparagraph id="id23A6869C918D4B55914C47FE898E606D"><enum>(B)</enum><text>other requirements of the
Investment Advisers Act of 1940 (15 U.S.C. 80b–1 et seq.);</text>
</subparagraph></paragraph><paragraph id="id90F2AD4A57834287922FECBABEAB3959"><enum>(6)</enum><text>the potential impact
of—</text>
<subparagraph id="id9EAE60DE05F44779AC20A03D62838611"><enum>(A)</enum><text>imposing on investment
advisers the standard of care applied by the Commission and FINRA under the
Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.) for providing
recommendations about securities to retail customers of brokers and dealers and
other Commission and FINRA requirements applicable to brokers and dealers;
and</text>
</subparagraph><subparagraph id="id1CA8C84F5858421392539412B34D0F5C"><enum>(B)</enum><text>authorizing the
Commission to designate 1 or more self-regulatory organizations to augment the
efforts of the Commission to oversee investment advisers;</text>
</subparagraph></paragraph><paragraph id="idB4C65B94799241E4BE002F6E966AE43E"><enum>(7)</enum><text>the potential impact of
eliminating the broker and dealer exclusion from the definition of
<quote>investment adviser</quote> under section 202(a)(11)(C) of the Investment
Advisers Act of 1940 (15 U.S.C. 80b–2(a)(11)(C)), in terms of—</text>
<subparagraph id="idF06EDA340094484BB200BDA737B0AB67"><enum>(A)</enum><text>the potential benefits or
harm to retail customers that could result from such a change, including any
potential impact on access to personalized investment advice and
recommendations about securities to retail customers or the availability of
such advice and recommendations;</text>
</subparagraph><subparagraph id="id94E883C3128C4E6FB12E96C5ABD6ECF2"><enum>(B)</enum><text>the number of additional
entities and individuals that would be required to register under, or become
subject to, the Investment Advisers Act of 1940 (15 U.S.C. 80b–1 et seq.), and
the additional requirements to which brokers, dealers, and persons associated
with brokers and dealers would become subject, including—</text>
<clause id="idD75002D9A4DE438AAB49D755C78C47FE"><enum>(i)</enum><text>any potential additional
associated person licensing, registration, and examination requirements;
and</text>
</clause><clause id="id8CA41827883744F184CA68B6F36086FB"><enum>(ii)</enum><text>the additional costs, if
any, to the additional entities and individuals; and</text>
</clause></subparagraph><subparagraph id="id734EE00F334D4B2C8E616206967CF99C"><enum>(C)</enum><text>the impact on Commission
resources to—</text>
<clause id="idE6A0EE1746AE454A9F472316BD106496"><enum>(i)</enum><text>conduct examinations of
registered investment advisers and the representatives of registered investment
advisers, including the impact on the examination cycle; and</text>
</clause><clause id="idE71F7BFEA0EA4D82B344C154AD0DFACC"><enum>(ii)</enum><text>enforce the standard of
care and other applicable requirements imposed under the Investment Advisers
Act of 1940 (15 U.S.C. 80b–1 et seq.);</text>
</clause></subparagraph></paragraph><paragraph id="idC3AD44D00DC2449D88A89B26CC1081AF"><enum>(8)</enum><text>the ability of investors
to understand the differences in terms of regulatory oversight and examinations
between brokers, dealers, and investment advisers;</text>
</paragraph><paragraph id="idEF2607B3324F40A7AEFCDD60768058DA"><enum>(9)</enum><text>the varying level of
services provided by brokers, dealers, investment advisers, persons associated
with brokers or dealers, and persons associated with investment advisers to
retail customers and the varying scope and terms of retail customer
relationships of brokers, dealers, investment advisers, persons associated with
brokers or dealers, and persons associated with investment advisers with such
retail customers;</text>
</paragraph><paragraph id="idFEABE6DEB97747BE90A6179BCBDC3455"><enum>(10)</enum><text>any potential benefits
or harm to retail customers that could result from any potential changes in the
regulatory requirements or legal standards affecting brokers, dealers,
investment advisers, persons associated with brokers or dealers, and persons
associated with investment advisers relating to their obligations to retail
customers, including any potential impact on—</text>
<subparagraph id="idF15EAD1FD9B046A6A55CB76286084DBE"><enum>(A)</enum><text>protection from
fraud;</text>
</subparagraph><subparagraph id="id9FE51F1A9E7640709CC1312E4E1F7609"><enum>(B)</enum><text>access to personalized
investment advice, and recommendations about securities to retail customers;
or</text>
</subparagraph><subparagraph id="idF949B79CF83A405A8247DBDA82986331"><enum>(C)</enum><text>the availability of such
advice and recommendations;</text>
</subparagraph></paragraph><paragraph id="id5CAF48E3301E41A3977C77C60B2C27C6"><enum>(11)</enum><text>the additional costs and
expenses to retail customers and to brokers, dealers, and investment advisers
resulting from potential changes in the regulatory requirements or legal
standards affecting brokers, dealers, investment advisers, persons associated
with brokers or dealers, and persons associated with investment advisers
relating to their obligations to retail customers; and</text>
</paragraph><paragraph id="idE5006457CCA44C1697498FC4F4763749"><enum>(12)</enum><text>any other consideration
that the Commission deems necessary and appropriate to effectively execute the
study required under subsection (b).</text>
</paragraph></subsection><subsection id="idF0BBC36190844AB7BCAF41E7F8602D89"><enum>(d)</enum><header>Report</header>
<paragraph id="idC0E8AE8A79404D4D86EDC4368DE6F51A"><enum>(1)</enum><header>In
general</header><text>Not later than 1 year after the date of enactment of this
Act, the Commission shall submit a report on the study required under
subsection (b) to—</text>
<subparagraph id="id63AAD0EFB96F4D5A98BCB65B9B5694F2"><enum>(A)</enum><text>the Committee on Banking,
Housing, and Urban Affairs of the Senate; and</text>
</subparagraph><subparagraph id="idD4664D7C637F460AB6281F2DEBE3D571"><enum>(B)</enum><text>the Committee on
Financial Services of the House of Representatives.</text>
</subparagraph></paragraph><paragraph id="idC9CBF092CBBF418FB2696588D4B94443"><enum>(2)</enum><header>Content
requirements</header><text>The report required under paragraph (1) shall
describe the findings, conclusions, and recommendations of the Commission from
the study required under subsection (b), including—</text>
<subparagraph id="idF0CCF040530B4A21A2B3C7862C57877F"><enum>(A)</enum><text>a description of the
considerations, analysis, and public and industry input that the Commission
considered, as required under subsection (e), to make such findings,
conclusions, and policy recommendations; and</text>
</subparagraph><subparagraph id="idF5666AB071EE48DD830126D77FDA440B"><enum>(B)</enum><text>an analysis of—</text>
<clause id="idC2AEDE6199994C428C9D6D2D248D01D0"><enum>(i)</enum><text>whether any identified
legal or regulatory gaps or overlap in legal or regulatory standards in the
protection of retail customers relating to the standards of care for brokers,
dealers, investment advisers, persons associated with brokers or dealers, and
persons associated with investment advisers for providing personalized
investment advice about securities to retail customers can be addressed by
rule; and</text>
</clause><clause id="idD59C6F019FEA40C78ACFF05CCA4ACD94"><enum>(ii)</enum><text>whether, and the extent
to which, the Commission would require additional statutory authority to
address such gaps or overlap.</text>
</clause></subparagraph></paragraph></subsection><subsection id="id8CC81E8436EE417CA6358E668FAD595F"><enum>(e)</enum><header>Public
Comment</header><text>The Commission shall seek and consider public input,
comments, and data in order to prepare the report required under subsection
(d).</text>
</subsection><subsection id="id0299ADA4C0A04C21895C5A2E1392A30C"><enum>(f)</enum><header>Rulemaking</header>
<paragraph id="id5E7C202AD4074ADC81C29C73A7CCC534"><enum>(1)</enum><header>In
general</header><text>If the study required under subsection (b) identifies any
gaps or overlap in the legal or regulatory standards in the protection of
retail customers relating to the standards of care for brokers, dealers,
investment advisers, persons associated with brokers or dealers, and persons
associated with investment advisers for providing personalized investment
advice about securities to such retail customers, the Commission, not later
than 2 years after the date of enactment of this Act, shall—</text>
<subparagraph id="id4462E669972247FD9E6F217F564FF6BE"><enum>(A)</enum><text>commence a rulemaking, as
necessary or appropriate in the public interest and for the protection of
retail customers, to address such regulatory gaps and overlap that can be
addressed by rule, using its authority under the Securities Exchange Act of
1934 (15 U.S.C. 78a et seq.) and the Investment Advisers Act of 1940 (15 U.S.C.
80b–1 et seq.); and</text>
</subparagraph><subparagraph id="id6D102977F9804FE1BB15BCA72428DCE4"><enum>(B)</enum><text>consider and take into
account the findings, conclusions, and recommendations of the study required
under this section.</text>
</subparagraph></paragraph><paragraph id="id5428EA536D5449048DADAE423061DF12"><enum>(2)</enum><header>Rule of
construction</header><text>Nothing in this section shall be construed to limit
the rulemaking authority of the Commission under any other provision of Federal
law.</text>
</paragraph></subsection></section><section id="idEA3EA2FF4F83470CB7BA67C7D8100D07"><enum>914.</enum><header>Office of the Investor
Advocate</header><text display-inline="no-display-inline">Section 4 of the
Securities Exchange Act of 1934 (15 U.S.C. 78d) is amended by adding at the end
the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idED130AE2DE5E46818DDBEB2EB5AF709F" reported-display-style="italic" style="OLC">
<subsection id="id608F971EDF104DD299C6716237E38B86"><enum>(g)</enum><header>Office of the Investor
Advocate</header>
<paragraph id="id86180FB3FA4D4A9CB3C2B906A4118D94"><enum>(1)</enum><header>Office
Established</header><text>There is established within the Commission the Office
of the Investor Advocate (in this subsection referred to as the
<quote>Office</quote>).</text>
</paragraph><paragraph id="id15C872582FE14A5F9A36B4F4C2D7624E"><enum>(2)</enum><header>Investor
Advocate</header>
<subparagraph id="idF7214ADAB9204C3EA31D68187B727CB8"><enum>(A)</enum><header>In
General</header><text>The head of the Office shall be the Investor Advocate,
who shall—</text>
<clause id="id92AF9BE8EB0248D99776489910B91499"><enum>(i)</enum><text>report directly to the
Chairman; and</text>
</clause><clause id="id592BBBDFFC3E4B93AD62F2C4B3F6F8F7"><enum>(ii)</enum><text>be appointed by the
Chairman, in consultation with the Commission, from among individuals having
experience in advocating for the interests of investors in securities and
investor protection issues, from the perspective of investors.</text>
</clause></subparagraph><subparagraph id="id77529F0D44E44CEF99D031FFD5AD3804"><enum>(B)</enum><header>Compensation</header><text>The
annual rate of pay for the Investor Advocate shall be equal to the highest rate
of annual pay for a Senior Executive Service position within the
Commission.</text>
</subparagraph><subparagraph id="id7631F6EF823D43C28580486F9218DE89"><enum>(C)</enum><header>Limitation on
service</header><text>An individual who serves as the Investor Advocate may not
be employed by the Commission—</text>
<clause id="id03256D86A35A47B4980D7DAC0018FFC5"><enum>(i)</enum><text>during the 2-year period
ending on the date of appointment as Investor Advocate; or</text>
</clause><clause id="idCCB5A92D1C16492391AD77E3853EC299"><enum>(ii)</enum><text>during the 5-year period
beginning on the date on which the person ceases to serve as the Investor
Advocate.</text>
</clause></subparagraph></paragraph><paragraph id="idC91EE2D82FAC4E31B123A91CCE0D9646"><enum>(3)</enum><header>Staff of
Office</header><text>The Investor Advocate may retain or employ independent
counsel, research staff, and service staff, as the Investor Advocate deems
necessary to carry out the functions, powers, and duties of the Office.</text>
</paragraph><paragraph id="IDea8c689398fa4bea9be0b45932adc7d4"><enum>(4)</enum><header>Functions of the
Investor Advocate</header><text>The Investor Advocate shall—</text>
<subparagraph id="IDcf5cd9508eff4c15a4f717438b13d145"><enum>(A)</enum><text>assist retail investors
in resolving significant problems such investors may have with the Commission
or with self-regulatory organizations;</text>
</subparagraph><subparagraph id="IDde0f2a405b61470f86406a717a067e8f"><enum>(B)</enum><text>identify areas in which
investors would benefit from changes in the regulations of the Commission or
the rules of self-regulatory organizations;</text>
</subparagraph><subparagraph id="ID0efbee1015ab4a538cb38b39d1752fe5"><enum>(C)</enum><text>identify problems that
investors have with financial service providers and investment products;</text>
</subparagraph><subparagraph id="idCC77641662C44C1AA5F21C5812A5DC3C"><enum>(D)</enum><text>analyze the potential
impact on investors of—</text>
<clause id="idD8C023E170D94B22A5DC1018E1BFD45F"><enum>(i)</enum><text>proposed regulations of
the Commission; and</text>
</clause><clause id="id12E86624656246138419220FC569FB36"><enum>(ii)</enum><text>proposed rules of
self-regulatory organizations registered under this title; and</text>
</clause></subparagraph><subparagraph id="id291FF77435CD4B15A84C8747E3A00FD3"><enum>(E)</enum><text>to the extent
practicable, propose to the Commission changes in the regulations or orders of
the Commission and to Congress any legislative, administrative, or personnel
changes that may be appropriate to mitigate problems identified under this
paragraph and to promote the interests of investors.</text>
</subparagraph></paragraph><paragraph commented="no" id="idF354825AD7D942E2BECC39DF11F13D97"><enum>(5)</enum><header>Access to
documents</header><text>The Commission shall ensure that the Investor Advocate
has full access to the documents of the Commission and any self-regulatory
organization, as necessary to carry out the functions of the Office.</text>
</paragraph><paragraph id="IDba2438c02e1046c692891c386fb2a7b2"><enum>(6)</enum><header>Annual Reports</header>
<subparagraph id="ID929d642ae9ab4497898cbcae8592704f"><enum>(A)</enum><header>Report on
objectives</header>
<clause id="idAD65C6AC4915409F82318C926881C0A4"><enum>(i)</enum><header>In
general</header><text>Not later than June 30 of each year after 2010, the
Investor Advocate shall submit to the Committee on Banking, Housing, and Urban
Affairs of the Senate and the Committee on Financial Services of the House of
Representatives a report on the objectives of the Investor Advocate for the
following fiscal year.</text>
</clause><clause commented="no" id="idEEA93C602D8E46A49D184D4300946364"><enum>(ii)</enum><header>Contents</header><text>Each
report required under clause (i) shall contain full and substantive analysis
and explanation.</text>
</clause></subparagraph><subparagraph id="IDab43ec15192f4b2986cf41b673235b98"><enum>(B)</enum><header>Report on
activities</header>
<clause id="id5377D299989C4BF09735DDEAF8BCD4B1"><enum>(i)</enum><header>In
General</header><text>Not later than December 31 of each year after 2010, the
Investor Advocate shall submit to the Committee on Banking, Housing, and Urban
Affairs of the Senate and the Committee on Financial Services of the House of
Representatives a report on the activities of the Investor Advocate during the
immediately preceding fiscal year.</text>
</clause><clause id="id770CC076287B404386BE9B79ED5F019B"><enum>(ii)</enum><header>Contents</header><text>Each
report required under clause (i) shall include—</text>
<subclause id="id9899832E0B4840CBB564F8827F1EB0EA"><enum>(I)</enum><text>appropriate statistical
information and full and substantive analysis;</text>
</subclause><subclause id="ID15f7fb4b51e54caa83722ce2adbac6f4"><enum>(II)</enum><text>information on steps
that the Investor Advocate has taken during the reporting period to improve
investor services and the responsiveness of the Commission and self-regulatory
organizations to investor concerns;</text>
</subclause><subclause id="ID5a65b3c9e243482c8b6dedc88c78abd2"><enum>(III)</enum><text>a summary of the most
serious problems encountered by investors during the reporting period;</text>
</subclause><subclause id="ID1ffe54fe22e940c0950f0cae6379f65f"><enum>(IV)</enum><text>an inventory of the
items described in subclauses (III) that includes—</text>
<item id="idDB9A705EB9B540D79074ED6A6F94C3D9"><enum>(aa)</enum><text>identification of any
action taken by the Commission or the self-regulatory organization and the
result of such action;</text>
</item><item id="IDd06e02fc33bd4164a4a40d5baadd659a"><enum>(bb)</enum><text>the length of time that
each item has remained on such inventory; and</text>
</item><item id="ID7e2acf52b4ee4b5ca971f064e9a370f8"><enum>(cc)</enum><text>for items on which no
action has been taken, the reasons for inaction, and an identification of any
official who is responsible for such action;</text>
</item></subclause><subclause id="ID8fce051e9acb4ec8ab430f650bacb8d6"><enum>(V)</enum><text>recommendations for such
administrative and legislative actions as may be appropriate to resolve
problems encountered by investors; and</text>
</subclause><subclause id="ID36a946cfa82e4948a080eec560f8fa3b"><enum>(VI)</enum><text>any other information,
as determined appropriate by the Investor Advocate.</text>
</subclause></clause><clause id="IDa70ef3c187e24250a085253c4c684f3d"><enum>(iii)</enum><header>Independence</header><text>Each
report required under this paragraph shall be provided directly to the
Committees listed in clause (i) without any prior review or comment from the
Commission, any commissioner, any other officer or employee of the Commission,
or the Office of Management and Budget.</text>
</clause><clause id="idFE2A7C710C434A29803E65E48F60F4F7"><enum>(iv)</enum><header>Confidentiality</header><text>No
report required under clause (i) may contain confidential information.</text>
</clause></subparagraph></paragraph><paragraph id="ID480062c680e44715a6162f1b134fd915"><enum>(7)</enum><header>Regulations</header><text>The
Commission shall, by regulation, establish procedures requiring a formal
response to all recommendations submitted to the Commission by the Investor
Advocate, not later than 3 months after the date of such
submission.</text>
</paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</section><section id="id8EC98E93B6404A0EA9F893A36CFE6216"><enum>915.</enum><header>Streamlining of filing
procedures for self-regulatory organizations</header>
<subsection id="IDcb165aa755cd4353932acc7edc4892ce"><enum>(a)</enum><header>Filing
procedures</header><text>Section 19(b) of the Securities Exchange Act of 1934
(15 U.S.C. 78s(b)) is amended by striking paragraph (2) (including the
undesignated matter immediately following subparagraph (B)) and inserting the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id6E0D7304E0804340B51F4021068A5F80" reported-display-style="italic" style="OLC">
<paragraph id="IDc7f1a1369dac4ed3a4aedc149234ff44"><enum>(2)</enum><header>Approval
process</header>
<subparagraph id="ID2b6d8b059f22443e8d504e3b2a93b6d5"><enum>(A)</enum><header>Approval process
established</header>
<clause id="idEDEB264B03A748FD9958125E99D94B82"><enum>(i)</enum><header>In
general</header><text>Except as provided in clause (ii), not later than 45 days
after the date of publication of a proposed rule change under paragraph (1),
the Commission shall—</text>
<subclause id="ID541a2519cca841d684f2c7905852fdf3"><enum>(I)</enum><text>by order, approve the
proposed rule change; or</text>
</subclause><subclause id="ID3ef908a7a4264109baa960924049c574"><enum>(II)</enum><text>institute proceedings
under subparagraph (B) to determine whether the proposed rule change should be
disapproved.</text>
</subclause></clause><clause id="id58AD8DCF9699492AA417288004405BF3"><enum>(ii)</enum><header>Extension of time
period</header><text>The Commission may extend the period established under
clause (i) by not more than an additional 45 days, if—</text>
<subclause id="id98E737FEF68248A988833AE54BBCA6AC"><enum>(I)</enum><text>the Commission determines
that a longer period is appropriate and publishes the reasons for such
determination; or</text>
</subclause><subclause id="id99972E2E5D3B48948B36F595F5F501EC"><enum>(II)</enum><text>the self-regulatory
organization that filed the proposed rule change consents to the longer
period.</text>
</subclause></clause></subparagraph><subparagraph id="IDb97e14302ff645d7a7961bf825b4cb9f"><enum>(B)</enum><header>Proceedings</header>
<clause id="id308142418F48493697B5F5A34BCE75DF"><enum>(i)</enum><header>Notice and
hearing</header><text>If the Commission does not approve a proposed rule change
under subparagraph (A), the Commission shall provide to the self-regulatory
organization that filed the proposed rule change—</text>
<subclause id="id029AF2C1EC254054A3D1A87C4C968035"><enum>(I)</enum><text>notice of the grounds for
disapproval under consideration; and</text>
</subclause><subclause id="id7BCCB2C87B0243458B49171BD21F612D"><enum>(II)</enum><text>opportunity for hearing,
to be concluded not later than 180 days after the date of publication of notice
of the filing of the proposed rule change.</text>
</subclause></clause><clause id="id7F5AF0F2B6CA4762B40B70B75D210787"><enum>(ii)</enum><header>Order of approval or
disapproval</header>
<subclause id="idA421ACBB368B4390A1000FD065F40C43"><enum>(I)</enum><header>In
general</header><text>Except as provided in subclause (II), not later than 180
days after the date of publication under paragraph (1), the Commission shall
issue an order approving or disapproving the proposed rule change.</text>
</subclause><subclause id="id0484914C55814C88948EF1F2E4BE965F"><enum>(II)</enum><header>Extension of time
period</header><text>The Commission may extend the period for issuance under
clause (I) by not more than 60 days, if—</text>
<item id="id1F4D4369AD34410AA28B98B72E48097E"><enum>(aa)</enum><text>the Commission
determines that a longer period is appropriate and publishes the reasons for
such determination; or</text>
</item><item id="id54E697342D3943EA9378B06E3BA2F5E2"><enum>(bb)</enum><text>the self-regulatory
organization that filed the proposed rule change consents to the longer
period.</text>
</item></subclause></clause></subparagraph><subparagraph id="ID0994deef745146c7880a150e40d775ce"><enum>(C)</enum><header>Standards for approval
and disapproval</header>
<clause id="id0574223E346D4DD28A11294DC646CB29"><enum>(i)</enum><header>Approval</header><text>The
Commission shall approve a proposed rule change of a self-regulatory
organization if it finds that such proposed rule change is consistent with the
requirements of this title and the rules and regulations issued under this
title that are applicable to such organization.</text>
</clause><clause id="id1721B33E8C42490F9872475FB09ED437"><enum>(ii)</enum><header>Disapproval</header><text>The
Commission shall disapprove a proposed rule change of a self-regulatory
organization if it does not make a finding described in clause (i).</text>
</clause><clause id="idB2E023937ED8436B9013DED2B72A0D9E"><enum>(iii)</enum><header>Time for
approval</header><text>The Commission may not approve a proposed rule change
earlier than 30 days after the date of publication under paragraph (1), unless
the Commission finds good cause for so doing and publishes the reason for the
finding.</text>
</clause></subparagraph><subparagraph id="IDe0380277c3454ea49058a05f5b9c0cad"><enum>(D)</enum><header>Result of failure to
institute or conclude proceedings</header><text>A proposed rule change shall be
deemed to have been approved by the Commission, if—</text>
<clause id="id800BC17960B94D6FB87BA1CB5750A7F6"><enum>(i)</enum><text>the Commission does not
approve the proposed rule change or begin proceedings under subparagraph (B)
within the period described in subparagraph (A); or</text>
</clause><clause id="id689C1DFFE2BC4452A062D39963A1946B"><enum>(ii)</enum><text>the Commission does not
issue an order approving or disapproving the proposed rule change under
subparagraph (B) within the period described in subparagraph (B)(ii).</text>
</clause></subparagraph><subparagraph id="IDe563caf74915414a8139eecab9301c0b"><enum>(E)</enum><header>Publication date based
on Federal Register publishing</header><text>For purposes of this paragraph,
if, after filing a proposed rule change with the Commission pursuant to
paragraph (1), a self-regulatory organization publishes a notice of the filing
of such proposed rule change, together with the substantive terms of such
proposed rule change, on a publicly accessible website, the Commission shall
thereafter send the notice to the Federal Register for publication thereof
under paragraph (1) within 15 days of the date on which such website
publication is made. If the Commission fails to send the notice for publication
thereof within such 15 day period, then the date of publication shall be deemed
to be the date on which such website publication was
made.</text>
</subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="ID6624fc2dbacd4015ace7a2bc98939b76"><enum>(b)</enum><header>Clarification of filing
date</header>
<paragraph id="id4EB4A86D02F34481ACBDC649B47A185B"><enum>(1)</enum><header>Rule of
construction</header><text>Section 19(b) of the Securities Exchange Act of 1934
(15 U.S.C. 78s(b)) is amended by adding at the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id0837F7B214AB420EB1715173CD28D545" reported-display-style="italic" style="OLC">
<paragraph id="ID1e196845ccfc4e3286a29286d53361e2"><enum>(10)</enum><header>Rule of construction
relating to filing date of proposed rule changes</header>
<subparagraph id="ID3f81a3fe3b584ebb8373410cf1651806"><enum>(A)</enum><header>In
general</header><text>For purposes of this subsection, the date of filing of a
proposed rule change shall be deemed to be the date on which the Commission
receives the proposed rule change.</text>
</subparagraph><subparagraph id="IDa351056f07054ae3b179c6beb0a5882d"><enum>(B)</enum><header>Exception</header><text>A
proposed rule change has not been received by the Commission for purposes of
subparagraph (A) if, not later than 7 days after the date of receipt by the
Commission, the Commission notifies the self-regulatory organization that such
proposed rule change does not comply with the rules of the Commission relating
to the required form of a proposed rule
change.</text>
</subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph><paragraph id="id6E5FB5725D8B4023840B0BF658D42167"><enum>(2)</enum><header>Publication</header><text>Section
19(b)(1) of the Securities Exchange Act of 1934 (15 U.S.C. 78s(b)(1)) is
amended by striking <quote>upon</quote> and inserting <quote>as soon as
practicable after the date of</quote>.</text>
</paragraph></subsection><subsection id="IDdb9ee61591124b589437dd91973f4d00"><enum>(c)</enum><header>Effective date of
proposed rules</header><text>Section 19(b)(3) of the Securities Exchange Act of
1934 (15 U.S.C. 78s(b)(3)) is amended—</text>
<paragraph id="ID887d5adcb8d64db38755c86dabd18a57"><enum>(1)</enum><text>in subparagraph
(A)—</text>
<subparagraph id="idFDB62213DF1D483EBD5D712EAC83A124"><enum>(A)</enum><text>by striking <quote>may
take effect</quote> and inserting <quote>shall take effect</quote>; and</text>
</subparagraph><subparagraph id="ID2e0a6ed27b4642fab481d1dfd38571f1"><enum>(B)</enum><text>by inserting <quote>on
any person, whether or not the person is a member of the self-regulatory
organization</quote> after <quote>charge imposed by the self-regulatory
organization</quote>; and</text>
</subparagraph></paragraph><paragraph id="ID4e01493a774946d8815d65fb5281ba0c"><enum>(2)</enum><text>in subparagraph
(C)—</text>
<subparagraph id="ID904b67589e4d4bb6961c0512fef1f69c"><enum>(A)</enum><text>by amending the second
sentence to read as follows: <quote>At any time within the 60-day period
beginning on the date of filing of such a proposed rule change in accordance
with the provisions of paragraph (1), the Commission summarily may temporarily
suspend the change in the rules of the self-regulatory organization made
thereby, if it appears to the Commission that such action is necessary or
appropriate in the public interest, for the protection of investors, or
otherwise in furtherance of the purposes of this title.</quote>;</text>
</subparagraph><subparagraph id="id347B20A80E794DFC8DD1CD6730161C01"><enum>(B)</enum><text>by inserting after the
second sentence the following: <quote>If the Commission takes such action, the
Commission shall institute proceedings under paragraph (2)(B) to determine
whether the proposed rule should be approved or disapproved.</quote>;
and</text>
</subparagraph><subparagraph id="IDb18977d2aa744ff3b19faad3e6c37ea2"><enum>(C)</enum><text>in the third sentence, by
striking <quote>the preceding sentence</quote> and inserting <quote>this
subparagraph</quote>.</text>
</subparagraph></paragraph></subsection><subsection id="ID6fe5c9429052479fa3440de0bfc0a353"><enum>(d)</enum><header>Conforming
change</header><text>Section 19(b)(4)(D) of the Securities Exchange Act of 1934
(15 U.S.C. 78s(b)(4)(D)) is amended to read as follows:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idAB6C376DA3864D1AAF636305D12B327A" reported-display-style="italic" style="OLC">
<subparagraph id="ID51135c7cc51a4539b14a8db92ed483e5"><enum>(D)</enum><clause commented="no" display-inline="yes-display-inline" id="id0A139300C3B2479D947B618934873B7D"><enum>(i)</enum><text>The Commission shall
order the temporary suspension of any change in the rules of a clearing agency
made by a proposed rule change that has taken effect under paragraph (3), if
the appropriate regulatory agency for the clearing agency notifies the
Commission not later than 30 days after the date on which the proposed rule
change was filed of—</text>
<subclause changed="added" id="idFA0F34D13CF945BB88ACD9BB77B1BEDA" indent="up1" reported-display-style="italic"><enum>(I)</enum><text>the determination by the
appropriate regulatory agency that the rules of such clearing agency, as so
changed, may be inconsistent with the safeguarding of securities or funds in
the custody or control of such clearing agency or for which it is responsible;
and</text>
</subclause><subclause changed="added" id="id67C7195CA9E442B9A35732C1A990CB28" indent="up1" reported-display-style="italic"><enum>(II)</enum><text>the reasons for the
determination described in subclause (I).</text>
</subclause></clause><clause changed="added" id="idF7378D4D0F9C4BF1AF8AC710049ED61D" indent="up1" reported-display-style="italic"><enum>(ii)</enum><text>If
the Commission takes action under clause (i), the Commission shall institute
proceedings under paragraph (2)(B) to determine if the proposed rule change
should be approved or
disapproved.</text>
</clause></subparagraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection></section><section id="id294366874127450CBCBBA08C985F8A94"><enum>916.</enum><header>Study regarding
financial literacy among investors</header>
<subsection id="IDC0E39AA41C1B41618E9F5D07D82022E0"><enum>(a)</enum><header>In
general</header><text>The Commission shall conduct a study to identify—</text>
<paragraph id="ID734BA75EBB804536B3A3CFB9A340E3BB"><enum>(1)</enum><text>the existing level of
financial literacy among retail investors, including subgroups of investors
identified by the Commission;</text>
</paragraph><paragraph id="ID505EB3E054E84D0E81F8089D8EE29116"><enum>(2)</enum><text>methods to improve the
timing, content, and format of disclosures to investors with respect to
financial intermediaries, investment products, and investment services;</text>
</paragraph><paragraph id="id2AF7812B3BCC40BC8AC996FD90CC14CA"><enum>(3)</enum><text>the most useful and
understandable relevant information that retail investors need to make informed
financial decisions before engaging a financial intermediary or purchasing an
investment product or service that is typically sold to retail investors,
including shares of open-end companies, as that term is defined in section 5 of
the Investment Company Act of 1940 (15 U.S.C. 80a–5) that are registered under
section 8 of that Act;</text>
</paragraph><paragraph id="id98D0296B06944383A3D3D3BAA521D433"><enum>(4)</enum><text>methods to increase the
transparency of expenses and conflicts of interests in transactions involving
investment services and products, including shares of open-end companies
described in paragraph (3);</text>
</paragraph><paragraph id="ID127A3D6CE7E645369F09F011224CFE1B"><enum>(5)</enum><text>the most effective
existing private and public efforts to educate investors; and</text>
</paragraph><paragraph id="ID1C5CFB39F4D14B4CBF3D70F7B7512890"><enum>(6)</enum><text>in consultation with the
Financial Literacy and Education Commission, a strategy (including, to the
extent practicable, measurable goals and objectives) to increase the financial
literacy of investors in order to bring about a positive change in investor
behavior.</text>
</paragraph></subsection><subsection id="ID125DD648D2104F4E836581523500CE05"><enum>(b)</enum><header>Report</header><text>Not
later than 2 years after the date of enactment of this Act, the Commission
shall submit a report on the study required under subsection (a) to—</text>
<paragraph id="IDEB4B86FDEB044B0CA484BFE579F9BD6B"><enum>(1)</enum><text>the Committee on Banking,
Housing, and Urban Affairs of the Senate; and</text>
</paragraph><paragraph id="ID3BA41F4898C94D2BAE6894786F5FEEB7"><enum>(2)</enum><text>the Committee on
Financial Services of the House of Representatives.</text>
</paragraph></subsection></section><section id="IDF160394B85614895846D7773ADC241E8"><enum>917.</enum><header>Study regarding mutual
fund advertising</header>
<subsection id="ID805B205FB0564ABF94F166B162F05DA8"><enum>(a)</enum><header>In
general</header><text>The Comptroller General of the United States shall
conduct a study on mutual fund advertising to identify—</text>
<paragraph id="ID2CE521B6D92E4398B83505A866699900"><enum>(1)</enum><text>existing and proposed
regulatory requirements for open-end investment company advertisements;</text>
</paragraph><paragraph id="ID8B41DA4D0A07431AA6326BB062DB91B0"><enum>(2)</enum><text>current marketing
practices for the sale of open-end investment company shares, including the use
of past performance data, funds that have merged, and incubator funds;</text>
</paragraph><paragraph id="ID1B6F419D83E84507A33F86280043BFF3"><enum>(3)</enum><text>the impact of such
advertising on consumers; and</text>
</paragraph><paragraph id="IDB53DBF24B39244FFA4E09E59B8301023"><enum>(4)</enum><text>recommendations to
improve investor protections in mutual fund advertising and additional
information necessary to ensure that investors can make informed financial
decisions when purchasing shares.</text>
</paragraph></subsection><subsection id="IDE4E4B5881CD44BDAB8266494C283DCF0"><enum>(b)</enum><header>Report</header><text>Not
later than 1 year after the date of enactment of this Act, the Comptroller
General of the United States shall submit a report on the results of the study
conducted under subsection (a) to—</text>
<paragraph id="ID104622C9037F40ADADC600BBC1A72D8B"><enum>(1)</enum><text>the Committee on Banking,
Housing, and Urban Affairs of the United States Senate; and</text>
</paragraph><paragraph id="ID17027E13EEB142F0B0A26B070072AFB3"><enum>(2)</enum><text>the Committee on
Financial Services of the House of Representatives.</text>
</paragraph></subsection></section><section id="id450BA300F4014BCCB6701F97FF558DBD"><enum>918.</enum><header>Clarification of
commission authority to require investor disclosures before purchase of
investment products and services</header><text display-inline="no-display-inline">Section 15 of the Securities Exchange Act of
1934 (15 U.S.C. 78o) is amended by adding at the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idE2B5D14068304A599519A111B58189B8" reported-display-style="italic" style="OLC">
<subsection id="idA60D6D0382EA451AADA0DA3C1C193FA8"><enum>(k)</enum><header>Disclosures to retail
investors</header>
<paragraph id="idA9EF005FA0814151ADABF8BC87EFBC42"><enum>(1)</enum><header>In
general</header><text display-inline="yes-display-inline">Notwithstanding any
other provision of the securities laws, the Commission may issue rules
designating documents or information that shall be provided by a broker or
dealer to a retail investor before the purchase of an investment product or
service by the retail investor.</text>
</paragraph><paragraph id="id4E2539BAEF3C4CF3BACFFE7B716D85AB"><enum>(2)</enum><header>Considerations</header><text>In
developing any rules under paragraph (1), the Commission shall consider whether
the rules will promote investor protection, efficiency, competition, and
capital formation.</text>
</paragraph><paragraph id="id7016746731BF44B3869BC01314C1DDB0"><enum>(3)</enum><header>Form and contents of
documents and information</header><text>Any documents or information designated
under a rule promulgated under paragraph (1) shall—</text>
<subparagraph id="id2BBD9AAAD75F4FE39FD9E1B7C73D8543"><enum>(A)</enum><text>be in a summary format;
and</text>
</subparagraph><subparagraph id="id57BFA98800364A50AFD1185373DFAC61"><enum>(B)</enum><text>contain clear and concise
information about—</text>
<clause id="idCFEAD8EE61FD4E6BBEEE3A191A127913"><enum>(i)</enum><text>investment objectives,
strategies, costs, and risks; and</text>
</clause><clause id="idAA2B2E4FD566405BB2B1278C9ADF56E6"><enum>(ii)</enum><text>any compensation or
other financial incentive received by a broker, dealer, or other intermediary
in connection with the purchase of retail investment
products.</text>
</clause></subparagraph></paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</section><section id="id45E82CC31C784437932C247D5C1E914A"><enum>919.</enum><header>Study on conflicts of
interest</header>
<subsection id="id2AF439B37C2D46289316C06D385B9F04"><enum>(a)</enum><header>In
general</header><text>The Comptroller General of the United States shall
conduct a study—</text>
<paragraph id="id83F029DC544E4B9C898D38A175BD9630"><enum>(1)</enum><text>to identify and examine
potential conflicts of interest that exist between the staffs of the investment
banking and equity and fixed income securities analyst functions within the
same firm; and</text>
</paragraph><paragraph id="idB82B0511DD7747219D3B5DDB3602535C"><enum>(2)</enum><text>to make recommendations
to Congress designed to protect investors in light of such conflicts.</text>
</paragraph></subsection><subsection commented="no" id="ID9a57b5e154e3448bb0e97253d95700ed"><enum>(b)</enum><header>Considerations</header><text>In
conducting the study under subsection (a), the Comptroller General
shall—</text>
<paragraph commented="no" id="id7FEF25EC447D418FAAD3EA05650CAC99"><enum>(1)</enum><text>consider—</text>
<subparagraph commented="no" id="ID6a7995301b7046bf81a6c6d46c17abc8"><enum>(A)</enum><text>the potential for
investor harm resulting from conflicts, including consideration of the forms of
misconduct engaged in by the several securities firms and individuals that
entered into the Global Analyst Research Settlements in 2003 (also known as the
<quote>Global Settlement</quote>);</text>
</subparagraph><subparagraph commented="no" id="IDd402f8862d4347aa9fa8cb673ba12513"><enum>(B)</enum><text>the nature and benefits
of the undertakings to which those firms agreed in enforcement proceedings,
including firewalls between research and investment banking, separate reporting
lines, dedicated legal and compliance staffs, allocation of budget, physical
separation, compensation, employee performance evaluations, coverage decisions,
limitations on soliciting investment banking business, disclosures,
transparency, and other measures;</text>
</subparagraph><subparagraph commented="no" id="IDba8902ce48354c6c94034e139e3ff1d4"><enum>(C)</enum><text>whether any such
undertakings should be codified and applied permanently to securities firms, or
whether the Commission should adopt rules applying any such undertakings to
securities firms; and</text>
</subparagraph><subparagraph commented="no" id="IDfc74727db1734b09bc22dd7646ad3289"><enum>(D)</enum><text>whether to recommend
regulatory or legislative measures designed to mitigate possible adverse
consequences to investors arising from the conflicts of interest or to enhance
investor protection or confidence in the integrity of the securities markets;
and</text>
</subparagraph></paragraph><paragraph commented="no" id="IDaf99608e75cd4b07a76055992714a299"><enum>(2)</enum><text>consult with State
attorneys general, State securities officials, the Commission, the Financial
Industry Regulatory Authority (<quote>FINRA</quote>), NYSE Regulation, investor
advocates, brokers, dealers, retail investors, institutional investors, and
academics.</text>
</paragraph></subsection><subsection commented="no" id="IDc303ca42b2e14b64a35049253fa66dc1"><enum>(c)</enum><header>Report</header><text>The
Comptroller General shall submit a report on the results of the study required
by this section to the Committee on Banking, Housing, and Urban Affairs of the
Senate and the Committee on Financial Services of the House of Representatives,
not later than 18 months after the date of enactment of this Act.</text>
</subsection></section><section id="idEFE518B3EF34494E9009D67EEAB0A995"><enum>919A.</enum><header>Study on improved
investor access to information on investment advisers and
broker-dealers</header>
<subsection id="id14C040F041BF4AB48DD60008D40B0CEE"><enum>(a)</enum><header>Study</header>
<paragraph id="id16713B71B59E4ED9811F9B070930C2E1"><enum>(1)</enum><header>In
general</header><text>Not later than 6 months after the date of enactment of
this Act, the Commission shall complete a study, including recommendations, of
ways to improve the access of investors to registration information (including
disciplinary actions, regulatory, judicial, and arbitration proceedings, and
other information) about registered and previously registered investment
advisers, associated persons of investment advisers, brokers and dealers and
their associated persons on the existing Central Registration Depository and
Investment Adviser Registration Depository systems, as well as identify
additional information that should be made publicly available.</text>
</paragraph><paragraph id="id8722E345846E47338DBC58681C188DAD"><enum>(2)</enum><header>Contents</header><text>The
study required by subsection (a) shall include an analysis of the advantages
and disadvantages of further centralizing access to the information contained
in the 2 systems, including—</text>
<subparagraph id="ID489c4fe60b09411fb2ed9d2b4e38cf45"><enum>(A)</enum><text>identification of those
data pertinent to investors; and</text>
</subparagraph><subparagraph id="ID7e046a1023f741dc9d0e900bdec9a984"><enum>(B)</enum><text>the identification of the
method and format for displaying and publishing such data to enhance
accessibility by and utility to investors.</text>
</subparagraph></paragraph></subsection><subsection commented="no" display-inline="no-display-inline" id="ID03955c759df04c5fa8e35a9029284d6e"><enum>(b)</enum><header>Implementation</header><text>Not
later than 18 months after the date of completion of the study required by
subsection (a), the Commission shall implement any recommendations of the
study.</text>
</subsection></section><section id="IDbbffea0cd5bd40999c19be72a3e5f494"><enum>919B.</enum><header>Study on financial
planners and the use of financial designations</header>
<subsection id="IDac6ef755087040b098dad223da5eea45"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">The Comptroller
General of the United States shall conduct a study to evaluate—</text>
<paragraph id="IDdfd470d1aa7f40558e2ffe5e3e39601c"><enum>(1)</enum><text>the effectiveness of
State and Federal regulations to protect consumers from individuals who hold
themselves out as financial planners through the use of misleading
designations;</text>
</paragraph><paragraph id="ID00d4dc6b20e04ac5aa6abe8a7558a333"><enum>(2)</enum><text>current State and Federal
oversight structure and regulations for financial planners; and</text>
</paragraph><paragraph id="ID296e77df75cf4da09e209585de7ed90b"><enum>(3)</enum><text>legal or regulatory gaps
in the regulation of financial planners and other individuals who provide or
offer to provide financial planning services to consumers.</text>
</paragraph></subsection><subsection id="ID0c9a3eddae8e46309390d5578fc95e12"><enum>(b)</enum><header>Considerations</header><text>In
conducting the study required under subsection (a), the Comptroller General
shall consider—</text>
<paragraph id="IDd86d25e437304ee89477efc1042c9f27"><enum>(1)</enum><text>the role of financial
planners in providing advice regarding the management of financial resources,
including investment planning, income tax planning, education planning,
retirement planning, estate planning, and risk management;</text>
</paragraph><paragraph id="ID879258d670a549c8863335448bd839c4"><enum>(2)</enum><text>whether current
regulations at the State and Federal level provide adequate ethical and
professional standards for financial planners;</text>
</paragraph><paragraph id="ID12afde1f75a44ba0a45d8802f537db82"><enum>(3)</enum><text>the use of the title
<quote>financial planner</quote> and misleading designations in connection with
sale of financial products, including insurance and securities;</text>
</paragraph><paragraph id="ID1ef39d3b6a834a75a3ef1197ee9fc7ff"><enum>(4)</enum><text>the possible risk posed
to consumers by individuals who hold themselves out as financial planners
through the use of misleading designations, including <quote>financial
advisor</quote> and <quote>financial consultant</quote>;</text>
</paragraph><paragraph id="IDc9334b6efe7c4b449b109f845acf7bb5"><enum>(5)</enum><text>the ability of consumers
to understand licensing requirements and standards of care that apply to
individuals who provide financial advice;</text>
</paragraph><paragraph id="IDd18b6e4e8f224b9eb872a407ee675ad3"><enum>(6)</enum><text>the possible benefits to
consumers of regulation and professional oversight of financial planners;
and</text>
</paragraph><paragraph id="ID38330d54d8fb4a8993278a5d685ba173"><enum>(7)</enum><text>any other consideration
that the Comptroller General deems necessary or appropriate to effectively
execute the study required under subsection (a).</text>
</paragraph></subsection><subsection id="ID6b64d414d1d34015966d7f8679318aa9"><enum>(c)</enum><header>Recommendations</header><text display-inline="yes-display-inline">In providing recommendations for the
appropriate regulation of financial planners and other individuals who provide
or offer to provide financial planning services, in order to protect consumers
of financial planning services, the Comptroller General shall consider—</text>
<paragraph id="ID59b67d0508154c8f96770c5ce49c42bc"><enum>(1)</enum><text>the appropriate structure
for regulation of financial planners and individuals providing financial
planning services; and</text>
</paragraph><paragraph id="IDfa8861927d144c068e6c5e264534c774"><enum>(2)</enum><text>the appropriate scope of
the regulations needed to protect consumers, including but not limited to the
need to establish competency standards, practice standards, ethical guidelines,
disciplinary authority, and transparency to consumers.</text>
</paragraph></subsection><subsection id="ID819430c8cb944f3997987ab820b0242a"><enum>(d)</enum><header>Report</header>
<paragraph id="ID3998a8aa28874da3be1087fb52cb18af"><enum>(1)</enum><header>In
general</header><text>Not later than 180 days after the date of enactment of
this Act, the Comptroller General shall submit a report on the study required
under subsection (a) to—</text>
<subparagraph id="ID5d8f64ee72994207968df623b3216594"><enum>(A)</enum><text>the Committee on Banking,
Housing, and Urban Affairs of the Senate;</text>
</subparagraph><subparagraph id="ID33bc0700a0e44e3485a0c33954183a97"><enum>(B)</enum><text>the Special Committee on
Aging of the Senate; and</text>
</subparagraph><subparagraph id="ID8835af85342a4558b23cd6c1cb9eab6c"><enum>(C)</enum><text>the Committee on
Financial Services of the House of Representatives.</text>
</subparagraph></paragraph><paragraph id="ID55467b90f34a4af9b9b8d90e0e55c407"><enum>(2)</enum><header>Content
requirements</header><text>The report required under paragraph (1) shall
describe the findings and determinations made by the Comptroller General in
carrying out the study required under subsection (a), including a description
of the considerations, analysis, and government, public, industry, nonprofit
and consumer input that the Comptroller General considered to make such
findings, conclusions, and legislative, regulatory, or other
recommendations.</text>
</paragraph></subsection></section></subtitle><subtitle id="id064E1DC00CB246DF874A029D07A907E1"><enum>B</enum><header>Increasing regulatory
enforcement and remedies</header>
<section id="id07E7FA4A0B46485997455695C5031C80"><enum>921.</enum><header>Authority to issue
rules related to mandatory predispute arbitration</header>
<subsection id="IDf67850b727574083bdbdb88921d942de"><enum>(a)</enum><header>Amendment to Securities
Exchange Act of 1934</header><text>Section 15 of the Securities Exchange Act of
1934 (15 U.S.C. 78o), as amended by section 918, is amended by adding at the
end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id1F0E2D86F2F14D2F8647F140F2A38402" reported-display-style="italic" style="OLC">
<subsection id="IDc04edef464e64f8aae93a6ef391b4d86"><enum>(l)</enum><header>Authority To restrict
mandatory predispute arbitration</header><text>The Commission may conduct a
rulemaking to reaffirm or prohibit, or impose or not impose conditions or
limitations on the use of, agreements that require customers or clients of any
broker, dealer, or municipal securities dealer to arbitrate any dispute between
them and such broker, dealer, or municipal securities dealer that arises under
the securities laws or the rules of a self-regulatory organization, if the
Commission finds that such reaffirmation, prohibition, imposition of conditions
or limitations, or other action is in the public interest and for the
protection of
investors.</text>
</subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="IDab1844f62faf4fdfa27ef355885326c3"><enum>(b)</enum><header>Amendment to Investment
Advisers Act of 1940</header><text>Section 205 of the Investment Advisers Act
of 1940 (15 U.S.C. 80b–5) is amended by adding at the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id4D33478F9F9F47C69AFB25BC6884714A" reported-display-style="italic" style="OLC">
<subsection id="ID51807e862298481285bd025672ab0182"><enum>(f)</enum><header>Authority To issue
rules related to mandatory predispute arbitration</header><text>The Commission
may conduct rulemaking to reaffirm or prohibit, or impose or not impose
conditions or limitations on the use of, agreements that require customers or
clients of any investment adviser to arbitrate any dispute between them and
such investment adviser that arises under the securities laws, as defined in
section 3 of the Securities Exchange Act of 1934 (15 U.S.C. 78c), or the rules
of a self-regulatory organization, if the Commission finds that such
reaffirmation, prohibition, imposition of conditions or limitations, or other
action is in the public interest and for the protection of
investors.</text>
</subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection></section><section id="ID183a967936914efaa12b4e3136c5ddb0"><enum>922.</enum><header>Whistleblower
protection</header>
<subsection id="idCC84D658C659444FABA78AA8793117CC"><enum>(a)</enum><header>In
general</header><text>The Securities Exchange Act of 1934 (15 U.S.C. 78a et
seq.) is amended by inserting after section 21E the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idA95D5B65C0E34C1E877EF8D923150670" reported-display-style="italic" style="OLC">
<section id="ID4331e31ac911432e9abf24fe703a6856"><enum>21F.</enum><header>Securities
whistleblower incentives and protection</header>
<subsection id="id46AA86CB253E490186B06E1609D8CE25"><enum>(a)</enum><header>Definitions</header><text>In
this section the following definitions shall apply:</text>
<paragraph id="id9B89BA376C30439FA9CA44C4E839F2AA"><enum>(1)</enum><header>Covered judicial or
administrative action</header><text>The term <term>covered judicial or
administrative action</term> means any judicial or administrative action
brought by the Commission under the securities laws that results in monetary
sanctions exceeding $1,000,000.</text>
</paragraph><paragraph id="id85E7277D03ED4A1F857A315A45606DD7"><enum>(2)</enum><header>Fund</header><text>The
term <term>Fund</term> means the Securities and Exchange Commission Investor
Protection Fund.</text>
</paragraph><paragraph id="id8B9018567F3E4EAA9C51775ECA78A67D"><enum>(3)</enum><header>Original
information</header><text>The term <term>original information</term> means
information that—</text>
<subparagraph id="idA4E520BEAE6F4FA48F9728E025EBD6D4"><enum>(A)</enum><text>is derived from the
independent knowledge or analysis of a whistleblower;</text>
</subparagraph><subparagraph id="id0818F71F1448471BBB9B21A2D287299F"><enum>(B)</enum><text>is not known to the
Commission from any other source, unless the whistleblower is the original
source of the information; and</text>
</subparagraph><subparagraph id="id7798A206C83E499DB0705EB0B7780B2B"><enum>(C)</enum><text>is not exclusively
derived from an allegation made in a judicial or administrative hearing, in a
governmental report, hearing, audit, or investigation, or from the news media,
unless the whistleblower is a source of the information.</text>
</subparagraph></paragraph><paragraph id="idAD3BCA64E37845F1BED52187E8ACC395"><enum>(4)</enum><header>Monetary
sanctions</header><text>The term <term>monetary sanctions</term>, when used
with respect to any judicial or administrative action, means—</text>
<subparagraph id="id8803795BC56941BDABCB09743D7937A7"><enum>(A)</enum><text>any monies, including
penalties, disgorgement, and interest, ordered to be paid; and</text>
</subparagraph><subparagraph id="idEC274D6730DA4D9C91826C833199CD83"><enum>(B)</enum><text>any monies deposited into
a disgorgement fund or other fund pursuant to section 308(b) of the
Sarbanes-Oxley Act of 2002 (15 U.S.C. 7246(b)), as a result of such action or
any settlement of such action.</text>
</subparagraph></paragraph><paragraph id="id665E944AE4354B05817CB98CE5350969"><enum>(5)</enum><header>Related
action</header><text>The term <term>related action</term>, when used with
respect to any judicial or administrative action brought by the Commission
under the securities laws, means any judicial or administrative action brought
by an entity described in subclauses (I) through (IV) of subsection
(h)(2)(D)(i) that is based upon the original information provided by a
whistleblower pursuant to subsection (a) that led to the successful enforcement
of the Commission action.</text>
</paragraph><paragraph commented="no" id="idBFD862A640F14A609424122CBEF54C35"><enum>(6)</enum><header>Whistleblower</header><text>The
term <term>whistleblower</term> means any individual, or 2 or more individuals
acting jointly, who provides information relating to a violation of the
securities laws to the Commission, in a manner established, by rule or
regulation, by the Commission.</text>
</paragraph></subsection><subsection id="id10256699D0F54D769F0EDCBE52151CAF"><enum>(b)</enum><header>Awards</header>
<paragraph id="id936950AD662E4357BCE852C83948E4A2"><enum>(1)</enum><header>In
general</header><text>In any covered judicial or administrative action, or
related action, the Commission, under regulations prescribed by the Commission
and subject to subsection (c), shall pay an award or awards to 1 or more
whistleblowers who voluntarily provided original information to the Commission
that led to the successful enforcement of the covered judicial or
administrative action, or related action, in an aggregate amount equal
to—</text>
<subparagraph id="id01D348823195483896CFB1F6570047A2"><enum>(A)</enum><text>not less than 10 percent,
in total, of what has been collected of the monetary sanctions imposed in the
action or related actions; and</text>
</subparagraph><subparagraph id="id01641347A153497A8316495077D837F6"><enum>(B)</enum><text>not more than 30 percent,
in total, of what has been collected of the monetary sanctions imposed in the
action or related actions.</text>
</subparagraph></paragraph><paragraph id="idDA93BA11EF5C4C3693953A8512AAF7ED"><enum>(2)</enum><header>Payment of
awards</header><text>Any amount paid under paragraph (1) shall be paid from the
Fund.</text>
</paragraph></subsection><subsection id="IDb756a34439584957a15245affec6b1d6"><enum>(c)</enum><header>Determination of amount
of award; denial of award</header>
<paragraph id="IDce1c95c55b944253a6efe10769f0f054"><enum>(1)</enum><header>Determination of amount
of award</header>
<subparagraph id="id00CC010C098E40A6A9FC8E2AAF46CFFC"><enum>(A)</enum><header>Discretion</header><text>The
determination of the amount of an award made under subsection (b) shall be in
the discretion of the Commission.</text>
</subparagraph><subparagraph id="id9878CB4677C0464180845DECCC0CC4D5"><enum>(B)</enum><header>Criteria</header><text>In
determining the amount of an award made under subsection (b), the Commission
shall take into account—</text>
<clause id="id6D2AEDF6A8624A6CA10ADB15A7F269B3"><enum>(i)</enum><text>the significance of the
information provided by the whistleblower to the success of the covered
judicial or administrative action;</text>
</clause><clause id="idA319AE612B274B5791DCD9E697BD3BCE"><enum>(ii)</enum><text>the degree of assistance
provided by the whistleblower and any legal representative of the whistleblower
in a covered judicial or administrative action;</text>
</clause><clause id="idE12AD5157C564C1A92AFCDF3E20A2E6C"><enum>(iii)</enum><text>the programmatic
interest of the Commission in deterring violations of the securities laws by
making awards to whistleblowers who provide information that lead to the
successful enforcement of such laws; and</text>
</clause><clause id="idBE1EDCFBEE6443DB9308058659102623"><enum>(iv)</enum><text>such additional relevant
factors as the Commission may establish by rule or regulation.</text>
</clause></subparagraph></paragraph><paragraph id="IDc80aa1273d094c2189ee5dace354cd53"><enum>(2)</enum><header>Denial of
award</header><text>No award under subsection (b) shall be made—</text>
<subparagraph id="IDd8f95e3b5d514c338c8671fd1e4b1165"><enum>(A)</enum><text>to any whistleblower who
is, or was at the time the whistleblower acquired the original information
submitted to the Commission, a member, officer, or employee of—</text>
<clause id="id6AC10A31A83A417B91095E5E71A8932E"><enum>(i)</enum><text>an appropriate regulatory
agency;</text>
</clause><clause id="id634E69779884430293EC9138005F23AA"><enum>(ii)</enum><text>the Department of
Justice;</text>
</clause><clause id="id4D52B195443A4405915E972B1946EF47"><enum>(iii)</enum><text>a self-regulatory
organization;</text>
</clause><clause id="id9947E5F999514155ADB19958AF50504D"><enum>(iv)</enum><text>the Public Company
Accounting Oversight Board; or</text>
</clause><clause id="idE6754CF906394C64B12CD0F7139FD89A"><enum>(v)</enum><text>a law enforcement
organization;</text>
</clause></subparagraph><subparagraph id="IDc14cedc1fa4541bf88e65e602fe0a695"><enum>(B)</enum><text>to any whistleblower who
is convicted of a criminal violation related to the judicial or administrative
action for which the whistleblower otherwise could receive an award under this
section;</text>
</subparagraph><subparagraph id="ID5dd0f0f9744f45a8bd5e8eaa399d1a24"><enum>(C)</enum><text>to any whistleblower who
gains the information through the performance of an audit of financial
statements required under the securities laws and for whom such submission
would be contrary to the requirements of section 101A of the Securities
Exchange Act of 1934 (15 U.S.C. 78j–1); or</text>
</subparagraph><subparagraph id="id5733DC109D5E4194987DD22B63A7C6DF"><enum>(D)</enum><text>to any whistleblower who
fails to submit information to the Commission in such form as the Commission
may, by rule, require.</text>
</subparagraph></paragraph></subsection><subsection id="ID2d81c172f160458eb1f38b8544349703"><enum>(d)</enum><header>Representation</header>
<paragraph id="ID913d25e8102f44ff9912bd50253c912d"><enum>(1)</enum><header>Permitted
representation</header><text>Any whistleblower who makes a claim for an award
under subsection (b) may be represented by counsel.</text>
</paragraph><paragraph id="IDa0adea08706c48f59bdaf8ba2ae179a5"><enum>(2)</enum><header>Required
representation</header>
<subparagraph id="id7712338611FB490E94C431C3899461D5"><enum>(A)</enum><header>In
general</header><text>Any whistleblower who anonymously makes a claim for an
award under subsection (b) shall be represented by counsel if the whistleblower
anonymously submits the information upon which the claim is based.</text>
</subparagraph><subparagraph id="idA9642AF6100B4D219CDBF990E53D91E2"><enum>(B)</enum><header>Disclosure of
identity</header><text>Prior to the payment of an award, a whistleblower shall
disclose the identity of the whistleblower and provide such other information
as the Commission may require, directly or through counsel for the
whistleblower.</text>
</subparagraph></paragraph></subsection><subsection id="ID27371b94699b4d3c9527c227d10e439a"><enum>(e)</enum><header>No contract
necessary</header><text>No contract with the Commission is necessary for any
whistleblower to receive an award under subsection (b), unless otherwise
required by the Commission by rule or regulation.</text>
</subsection><subsection id="ID1de615a8dccf4809b86625beea035cee"><enum>(f)</enum><header>Appeals</header><text>Any
determination made under this section, including whether, to whom, or in what
amount to make awards, shall be in the discretion of the Commission. Any such
determination may be appealed to the appropriate court of appeals of the United
States not more than 30 days after the determination is issued by the
Commission. The court shall review the determination made by the Commission in
accordance with section 706 of title 5, United States Code.</text>
</subsection><subsection id="IDf5d1a4c9517742dfaa3e881fa634d345"><enum>(g)</enum><header>Investor Protection
Fund</header>
<paragraph id="IDb84b76f01b344545a2cf6d6b4a948845"><enum>(1)</enum><header>Fund
established</header><text>There is established in the Treasury of the United
States a fund to be known as the <quote>Securities and Exchange Commission
Investor Protection Fund</quote>.</text>
</paragraph><paragraph id="ID2014f57869c64ecaaa084aead1d38c16"><enum>(2)</enum><header>Use of
Fund</header><text>The Fund shall be available to the Commission, without
further appropriation or fiscal year limitation, for—</text>
<subparagraph id="id8E15BFD42D7B4065A7C182E6D2C6503C"><enum>(A)</enum><text>paying awards to
whistleblowers as provided in subsection (b); and</text>
</subparagraph><subparagraph id="id1892BB29A827408C9967CDFFE387FD20"><enum>(B)</enum><text>funding the activities of
the Inspector General of the Commission under section 4(i).</text>
</subparagraph></paragraph><paragraph id="IDfa5815a25724476587bb2b7cc3312567"><enum>(3)</enum><header>Deposits and
credits</header><text>There shall be deposited into or credited to the Fund an
amount equal to—</text>
<subparagraph id="ID34d2f20597a145a3aa71984d7ed29428"><enum>(A)</enum><text>the amount awarded under
subsection (b) from any monetary sanction collected by the Commission in any
judicial or administrative action brought by the Commission that is based on
information provided by a whistleblower under the securities laws, unless, the
balance of the Fund at the time the monetary sanction is collected exceeds
$200,000,000;</text>
</subparagraph><subparagraph id="ID01a950ed3fd744bdbe8d7f358bb4e78f"><enum>(B)</enum><text>any monetary sanction
added to a disgorgement fund or other fund pursuant to section 308 of the
Sarbanes-Oxley Act of 2002 (15 U.S.C. 7246) that is not distributed to the
victims for whom the disgorgement fund was established, unless the balance of
the disgorgement fund at the time the determination is made not to distribute
the monetary sanction to such victims exceeds $100,000,000; and</text>
</subparagraph><subparagraph id="IDa9668e89a1f343b5aab0c1ea43674246"><enum>(C)</enum><text>all income from
investments made under paragraph (4).</text>
</subparagraph></paragraph><paragraph id="IDbcbe5784a3b6469ab009e18bdd29895a"><enum>(4)</enum><header>Investments</header>
<subparagraph id="ID1e0f007a688440d597673bd4623f9b83"><enum>(A)</enum><header>Amounts in fund may be
invested</header><text>The Commission may request the Secretary of the Treasury
to invest the portion of the Fund that is not, in the discretion of the
Commission, required to meet the current needs of the Fund.</text>
</subparagraph><subparagraph id="ID800feb628631433ab9d258ba487c1b25"><enum>(B)</enum><header>Eligible
investments</header><text>Investments shall be made by the Secretary of the
Treasury in obligations of the United States or obligations that are guaranteed
as to principal and interest by the United States, with maturities suitable to
the needs of the Fund as determined by the Commission on the record.</text>
</subparagraph><subparagraph id="ID033a7d3ed56c41569c3d64f57f42ad88"><enum>(C)</enum><header>Interest and proceeds
credited</header><text>The interest on, and the proceeds from the sale or
redemption of, any obligations held in the Fund shall be credited to the
Fund.</text>
</subparagraph></paragraph><paragraph id="ID6bd4848700d04a4bbcbea9db1b377078"><enum>(5)</enum><header>Reports to
Congress</header><text>Not later than October 30 of each fiscal year beginning
after the date of enactment of this subsection, the Commission shall submit to
the Committee on Banking, Housing, and Urban Affairs of the Senate, and the
Committee on Financial Services of the House of Representatives a report
on—</text>
<subparagraph id="IDb5fcd04d0ff1493386834479715b7576"><enum>(A)</enum><text>the whistleblower award
program, established under this section, including—</text>
<clause id="idB8B267E56B634849B4B4C7AD8C8FCBEF"><enum>(i)</enum><text>a description of the
number of awards granted; and</text>
</clause><clause id="idDD071AF8CB784E1B9894C7A24B6E4623"><enum>(ii)</enum><text>the types of cases in
which awards were granted during the preceding fiscal year;</text>
</clause></subparagraph><subparagraph id="IDbe74e23b28a546819358334d746cc01a"><enum>(B)</enum><text>the balance of the Fund
at the beginning of the preceding fiscal year;</text>
</subparagraph><subparagraph id="IDaf401a8abc4441c69e51fa43da48e278"><enum>(C)</enum><text>the amounts deposited
into or credited to the Fund during the preceding fiscal year;</text>
</subparagraph><subparagraph id="ID22de4de97a7d439eafcfceb9267ef61c"><enum>(D)</enum><text>the amount of earnings on
investments made under paragraph (4) during the preceding fiscal year;</text>
</subparagraph><subparagraph id="ID4f7fec854c77458f825efbb4ceb95427"><enum>(E)</enum><text>the amount paid from the
Fund during the preceding fiscal year to whistleblowers pursuant to subsection
(b);</text>
</subparagraph><subparagraph id="ID1c464c37497a405ab1af724a18acb82f"><enum>(F)</enum><text>the balance of the Fund
at the end of the preceding fiscal year; and</text>
</subparagraph><subparagraph id="ID1e582d807ebe4942931d3fa26f91bfc7"><enum>(G)</enum><text>a complete set of audited
financial statements, including—</text>
<clause id="id370C9515BE3B43D585992A20C14E421E"><enum>(i)</enum><text>a balance sheet;</text>
</clause><clause id="idFF036569D87042B993FD2A04666ADC80"><enum>(ii)</enum><text>income statement;
and</text>
</clause><clause id="idAF31BF6AEC154C3A96E0E7F8E3B82C37"><enum>(iii)</enum><text>cash flow
analysis.</text>
</clause></subparagraph></paragraph></subsection><subsection id="ID95e2520a348147ce899a47092492252e"><enum>(h)</enum><header>Protection of
whistleblowers</header>
<paragraph id="IDf2b0faa0973c45c5961db09c34cf4495"><enum>(1)</enum><header>Prohibition against
retaliation</header>
<subparagraph id="idA66A72C67620495B909925691596D625"><enum>(A)</enum><header>In
general</header><text>No employer may discharge, demote, suspend, threaten,
harass, directly or indirectly, or in any other manner discriminate against, a
whistleblower in the terms and conditions of employment because of any lawful
act done by the whistleblower—</text>
<clause id="id013655AEE4334E098081555B9EBDCC21"><enum>(i)</enum><text>in providing information
to the Commission in accordance with subsection (a); or</text>
</clause><clause id="id8549C09D3AF248C1843EC66F42BC9545"><enum>(ii)</enum><text>in assisting in any
investigation or judicial or administrative action of the Commission based upon
or related to such information.</text>
</clause></subparagraph><subparagraph id="id2D4C9396A4734955886010F07162D857"><enum>(B)</enum><header>Enforcement</header>
<clause id="HB0179B9E743941C6B50E2AEF30A92713"><enum>(i)</enum><header>Cause of
action</header><text>An individual who alleges discharge or other
discrimination in violation of subparagraph (A) may bring an action under this
subsection in the appropriate district court of the United States for the
relief provided in subparagraph (C).</text>
</clause><clause id="H91F262AE4A63403FA3AEF40275E5C8B9"><enum>(ii)</enum><header>Subpoenas</header><text>A
subpoena requiring the attendance of a witness at a trial or hearing conducted
under this section may be served at any place in the United States.</text>
</clause><clause id="H6C265F1EB4434EB6A5AD9CF01364CD5F"><enum>(iii)</enum><header>Statute of
limitations</header>
<subclause id="id1F219F17C9E24D049745B0E1788D21F7"><enum>(I)</enum><header>In
general</header><text>An action under this subsection may not be
brought—</text>
<item id="id3BEFA9B05F02438DBD46816160D2B386"><enum>(aa)</enum><text>more than 6 years after
the date on which the violation of subparagraph (A) occurred; or</text>
</item><item id="id3C133DFDD3554B26A23F740A96CABCBD"><enum>(bb)</enum><text>more than 3 years after
the date when facts material to the right of action are known or reasonably
should have been known by the employee alleging a violation of subparagraph
(A).</text>
</item></subclause><subclause id="id65F09083941747C196A104EB2F080848"><enum>(II)</enum><header>Required action within
10 years</header><text>Notwithstanding subclause (I), an action under this
subsection may not in any circumstance be brought more than 10 years after the
date on which the violation occurs.</text>
</subclause></clause></subparagraph><subparagraph id="idB13F0FFB4AB34199AE89CBB0400B855A"><enum>(C)</enum><header>Relief</header><text>Relief
for an individual prevailing in an action brought under subparagraph (B) shall
include—</text>
<clause id="idB484BE4B681A470480756B13B086C226"><enum>(i)</enum><text>reinstatement with the
same seniority status that the individual would have had, but for the
discrimination;</text>
</clause><clause id="idECDA82D15B6E4311B1092B3CB8C10FC0"><enum>(ii)</enum><text>2 times the amount of
back pay otherwise owed to the individual, with interest; and</text>
</clause><clause id="id66AADD2763564149A05BC34F899872A4"><enum>(iii)</enum><text>compensation for
litigation costs, expert witness fees, and reasonable attorneys’ fees.</text>
</clause></subparagraph></paragraph><paragraph id="IDcdfa71e6f9fa4aafae57f610d0009cd5"><enum>(2)</enum><header>Confidentiality</header>
<subparagraph id="ID914e7d5a865441ae94123123b9bc1704"><enum>(A)</enum><header>In
general</header><text>Unless and until required to be disclosed to a defendant
or respondent in connection with a proceeding instituted by the Commission or
any entity described in subparagraph (D), all information provided to the
Commission by a whistleblower—</text>
<clause id="id2A794CF6ABC84F3F89DA65978C0601B5"><enum>(i)</enum><text>in any proceeding in any
Federal or State court or administrative agency—</text>
<subclause id="idA8F3145130134AF4B117883C28902164"><enum>(I)</enum><text>shall be confidential and
privileged as an evidentiary matter; and</text>
</subclause><subclause id="idCD0C705C5E2346B1A44D8EA15215CA3B"><enum>(II)</enum><text>shall not be subject to
civil discovery or other legal process; and</text>
</subclause></clause><clause id="idA4A361F8C1A947BD80A4996D330F7099"><enum>(ii)</enum><text>shall not be subject to
disclosure under section 552 of title 5, United States Code (commonly referred
to as the Freedom of Information Act) or under any proceeding under that
section.</text>
</clause></subparagraph><subparagraph id="id00CF55DFF808479394B49461653E9E17"><enum>(B)</enum><header>Exempted
statute</header><text>For purposes of section 552 of title 5, United States
Code, this paragraph shall be considered a statute described in subsection
(b)(3)(B) of such section 552.</text>
</subparagraph><subparagraph id="idCEB353B2E93D488DA9F387E6D58BA43E"><enum>(C)</enum><header>Rule of
construction</header><text>Nothing in this section is intended to limit, or
shall be construed to limit, the ability of the Attorney General to present
such evidence to a grand jury or to share such evidence with potential
witnesses or defendants in the course of an ongoing criminal
investigation.</text>
</subparagraph><subparagraph id="ID63da2ba972c749d6bb6c428ab299b42e"><enum>(D)</enum><header>Availability to
government agencies</header>
<clause id="idAAD75939663D47A48B8EA60ED3D6497D"><enum>(i)</enum><header>In
general</header><text>Without the loss of its status as confidential and
privileged in the hands of the Commission, all information referred to in
subparagraph (A) may, in the discretion of the Commission, when determined by
the Commission to be necessary to accomplish the purposes of this Act and to
protect investors, be made available to—</text>
<subclause id="IDcf9747795e1a4d5898a05be65ed4fc60"><enum>(I)</enum><text>the Attorney General of
the United States;</text>
</subclause><subclause id="IDe007e2c3d9a44decb9fbcafad58ef465"><enum>(II)</enum><text>an appropriate
regulatory authority;</text>
</subclause><subclause id="ID54283d727cbe41beb7f96bc86bf11ac2"><enum>(III)</enum><text>a self-regulatory
organization;</text>
</subclause><subclause id="ID5ab89d2b863b440c8eea70cb4da26ad3"><enum>(IV)</enum><text>a State attorney general
in connection with any criminal investigation;</text>
</subclause><subclause id="ID9b9b5c1f46924655a766549656c74115"><enum>(V)</enum><text>any appropriate State
regulatory authority;</text>
</subclause><subclause id="idC339B02274E2499FBD098F59FB71992F"><enum>(VI)</enum><text>the Public Company
Accounting Oversight Board;</text>
</subclause><subclause id="id671A9046C5234EF2BFEF4BCFE2E9C265"><enum>(VII)</enum><text>a foreign securities
authority; and</text>
</subclause><subclause id="idE91EE4B7BC574E628809CF57F2E3AA20"><enum>(VIII)</enum><text>a foreign law
enforcement authority.</text>
</subclause></clause><clause id="id58D6EF95196E4F75AB8853EEBA064A2C"><enum>(ii)</enum><header>Confidentiality</header>
<subclause id="id16D4D5DB26944E58A92EE10CFDE1106D"><enum>(I)</enum><header>In
general</header><text>Each of the entities described in subclauses (I) through
(VI) of clause (i) shall maintain such information as confidential and
privileged, in accordance with the requirements established under subparagraph
(A).</text>
</subclause><subclause id="idF8FA16E8DE5E42F7A389269AC8C43F19"><enum>(II)</enum><header>Foreign
authorities</header><text>Each of the entities described in subclauses (VII)
and (VIII) of clause (i) shall maintain such information in accordance with
such assurances of confidentiality as the Commission determines
appropriate.</text>
</subclause></clause></subparagraph></paragraph><paragraph id="IDde3c1f118c25477fa0885941323a7232"><enum>(3)</enum><header>Rights
retained</header><text>Nothing in this section shall be deemed to diminish the
rights, privileges, or remedies of any whistleblower under any Federal or State
law, or under any collective bargaining agreement.</text>
</paragraph></subsection><subsection id="IDc9aeedc97d6d4340bb10482d371511af"><enum>(i)</enum><header>Provision of false
information</header><text>A whistleblower shall not be entitled to an award
under this section if the whistleblower—</text>
<paragraph id="id89D0264C30E649DDA63DD12A4D1BC61E"><enum>(1)</enum><text>knowingly and willfully
makes any false, fictitious, or fraudulent statement or representation;
or</text>
</paragraph><paragraph id="idB50062CE698F40D8A3C4A7ABEEEE4DAF"><enum>(2)</enum><text>uses any false writing or
document knowing the writing or document contains any false, fictitious, or
fraudulent statement or entry.</text>
</paragraph></subsection><subsection id="id473B9447F45940D995FC02F651D33E39"><enum>(j)</enum><header>Rulemaking
authority</header><text>The Commission shall have the authority to issue such
rules and regulations as may be necessary or appropriate to implement the
provisions of this section consistent with the purposes of this
section.</text>
</subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="idC163219BCF1549B9926A4DAC03B3A5F5"><enum>(b)</enum><header>Protection for
employees of nationally recognized statistical rating
organizations</header><text>Section 1514A(a) of title 18, United States Code,
is amended—</text>
<paragraph id="id5CD64CE2D95049CD953C6F1DC7D69340"><enum>(1)</enum><text>by inserting <quote>or
nationally recognized statistical rating organization (as defined in section
3(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78c),</quote> after
<quote>78o(d)),</quote>; and</text>
</paragraph><paragraph id="id3547F76C8003405CB889E3CD1DCD4A8E"><enum>(2)</enum><text>by inserting <quote>or
nationally recognized statistical rating organization</quote> after <quote>such
company</quote>.</text>
</paragraph></subsection></section><section id="IDf7af66f8c06c454fa778e6b3f43fc923"><enum>923.</enum><header>Conforming amendments
for whistleblower protection</header>
<subsection id="id373DAA5302A0495F8A3CBED4ABEE3A7D"><enum>(a)</enum><header>In general</header>
<paragraph id="id362D03B28F674C5D93F453523F32B1A8"><enum>(1)</enum><header>Securities Act of
1933</header><text>Section 20(d)(3)(A) of the Securities Act of 1933 (15 U.S.C.
77t(d)(3)(A)) is amended by inserting <quote>and section 21F of the Securities
Exchange Act of 1934</quote> after <quote>the Sarbanes-Oxley Act of
2002</quote>.</text>
</paragraph><paragraph id="id7AE01621CAC04F5EA7ECAD200E228340"><enum>(2)</enum><header>Investment Company Act
of 1940</header><text>Section 42(e)(3)(A) of the Investment Company Act of 1940
(15 U.S.C. 80a–41(e)(3)(A)) is amended by inserting <quote>and section 21F of
the Securities Exchange Act of 1934</quote> after <quote>the Sarbanes-Oxley Act
of 2002</quote>.</text>
</paragraph><paragraph id="idCFB55B068B054FE0B0BFD10A18B63FBB"><enum>(3)</enum><header>Investment Advisers Act
of 1940</header><text>Section 209(e)(3)(A) of the Investment Advisers Act of
1940 (15 U.S.C. 80b–9(e)(3)(A)) is amended by inserting <quote>and section 21F
of the Securities Exchange Act of 1934</quote> after <quote>the Sarbanes-Oxley
Act of 2002</quote>.</text>
</paragraph></subsection><subsection id="IDc72363e9dd584af888ae079ac2980fcb"><enum>(b)</enum><header>Securities Exchange
Act</header>
<paragraph id="ID6d99da00f572419c986459dc2d12edb3"><enum>(1)</enum><header>Section
21</header><text>Section 21(d)(3)(C)(i) of the Securities Exchange Act of 1934
(15 U.S.C. 78u(d)(3)(C)(i)) is amended by inserting <quote>and section 21F of
this title</quote> after <quote>the Sarbanes-Oxley Act of 2002</quote>.</text>
</paragraph><paragraph id="ID1932ea45b1264b0384e5b1816b948c21"><enum>(2)</enum><header>Section
21A</header><text>Section 21A of the Securities Exchange Act of 1934 (15 U.S.C.
78u–1) is amended—</text>
<subparagraph id="id5BD2531D8EC448FEA98C35F84F879455"><enum>(A)</enum><text>in subsection (d)(1)
by—</text>
<clause id="IDf85c8b0a7c22475ca934bdba9ec605e6"><enum>(i)</enum><text>striking <quote>(subject
to subsection (e))</quote>; and</text>
</clause><clause id="ID7e7046df364b4a78afa8595192e4e843"><enum>(ii)</enum><text>inserting <quote>and
section 21F of this title</quote> after <quote>the Sarbanes-Oxley Act of
2002</quote>;</text>
</clause></subparagraph><subparagraph id="id37AA03D9145847ED9D29F5344D0C9626"><enum>(B)</enum><text>by striking subsection
(e); and</text>
</subparagraph><subparagraph id="idCEE8F987B8B2449F8A3F9BF8B8591F07"><enum>(C)</enum><text>by redesignating
subsections (f) and (g) as subsections (e) and (f), respectively.</text>
</subparagraph></paragraph></subsection></section><section id="ID2d9417cc5e6a49ca8cf151dec9711b72"><enum>924.</enum><header>Implementation and
transition provisions for whistleblower protection</header>
<subsection id="IDa2e916a06d5e4360be8cb43116dcb4b7"><enum>(a)</enum><header>Implementing
rules</header><text>The Commission shall issue final regulations implementing
the provisions of section 21F of the Securities Exchange Act of 1934, as added
by this subtitle, not later than 270 days after the date of enactment of this
Act.</text>
</subsection><subsection id="ID9e05cf948a004953aaf1ae7647e27127"><enum>(b)</enum><header>Original
information</header><text>Information provided to the Commission by a
whistleblower in accordance with the regulations referenced in subsection (a)
shall not lose the status of original information (as defined in section
21F(i)(1) of the Securities Exchange Act of 1934, as added by this subtitle)
solely because the whistleblower provided the information prior to the
effective date of the regulations, provided that the information is—</text>
<paragraph id="idA54B61D6EB69485EAF7BBDEB6A840BE8"><enum>(1)</enum><text>provided by the
whistleblower after the date of enactment of this subtitle, or monetary
sanctions are collected after the date of enactment of this subtitle; or</text>
</paragraph><paragraph id="idE16DF295F9CA4481AD357B1544A077E8"><enum>(2)</enum><text>related to a violation
for which an award under section 21F of the Securities Exchange Act of 1934, as
added by this subtitle, could have been paid at the time the information was
provided by the whistleblower.</text>
</paragraph></subsection><subsection id="ID0c1875085c2a48a7a52be957febb1c37"><enum>(c)</enum><header>Awards</header><text>A
whistleblower may receive an award pursuant to section 21F of the Securities
Exchange Act of 1934, as added by this subtitle, regardless of whether any
violation of a provision of the securities laws, or a rule or regulation
thereunder, underlying the judicial or administrative action upon which the
award is based, occurred prior to the date of enactment of this
subtitle.</text>
</subsection></section><section id="IDdb1f5b0703744f39bca5d1def27a649f"><enum>925.</enum><header>Collateral
bars</header>
<subsection id="ID52c70407d35e48539c54993705ac1f51"><enum>(a)</enum><header>Securities Exchange Act
of 1934</header>
<paragraph id="idFF69B328763D41688DC3FF94F5807A68"><enum>(1)</enum><header>Section
15</header><text>Section 15(b)(6)(A) of the Securities Exchange Act of 1934 (15
U.S.C. 78o(b)(6)(A)) is amended by striking <quote>12 months, or bar such
person from being associated with a broker or dealer,</quote> and inserting
<quote>12 months, or bar any such person from being associated with a broker,
dealer, investment adviser, municipal securities dealer, municipal advisor,
transfer agent, or nationally recognized statistical rating
organization,</quote>.</text>
</paragraph><paragraph id="ID6e7c24a76d364b22bd1cc9f8edc6242d"><enum>(2)</enum><header>Section
15b</header><text>Section 15B(c)(4) of the Securities Exchange Act of 1934 (15
U.S.C. 78o–4(c)(4)) is amended by striking <quote>twelve months or bar any such
person from being associated with a municipal securities dealer, </quote> and
inserting <quote>12 months or bar any such person from being associated with a
broker, dealer, investment adviser, municipal securities dealer, municipal
advisor, transfer agent, or nationally recognized statistical rating
organization,</quote>.</text>
</paragraph><paragraph id="IDb81db5588a17471184a71905af36da10"><enum>(3)</enum><header>Section
17a</header><text>Section 17A(c)(4)(C) of the Securities Exchange Act of 1934
(15 U.S.C. 78q–1(c)(4)(C)) is amended by striking <quote>twelve months or bar
any such person from being associated with the transfer agent, </quote> and
inserting <quote>12 months or bar any such person from being associated with
any transfer agent, broker, dealer, investment adviser, municipal securities
dealer, municipal advisor, or nationally recognized statistical rating
organization,</quote>.</text>
</paragraph></subsection><subsection id="ID245e1008f56e4101aaea8ddf13e6cbc9"><enum>(b)</enum><header>Investment Advisers Act
of 1940</header><text>Section 203(f) of the Investment Advisers Act of 1940 (15
U.S.C. 80b–3(f)) is amended by striking <quote>twelve months or bar any such
person from being associated with an investment adviser, </quote> and inserting
<quote>12 months or bar any such person from being associated with an
investment adviser, broker, dealer, municipal securities dealer, municipal
advisor, transfer agent, or nationally recognized statistical rating
organization,</quote>.</text>
</subsection></section><section id="id597454000C2449ED9EBC3EA247D2A654"><enum>926.</enum><header>Disqualifying felons
and other <quote>bad actors</quote> from Regulation D offerings</header><text display-inline="no-display-inline">Not later than 1 year after the date of
enactment of this Act, the Commission shall issue rules for the
disqualification of offerings and sales of securities made under section
230.506 of title 17, Code of Federal Regulations, that—</text>
<paragraph id="idC9A4C63530054F50BFF7696ED8D62BF2"><enum>(1)</enum><text>are substantially similar
to the provisions of section 230.262 of title 17, Code of Federal Regulations,
or any successor thereto; and</text>
</paragraph><paragraph id="idBCB5764B28D34CC9A28822F9841E255B"><enum>(2)</enum><text>disqualify any offering
or sale of securities by a person that—</text>
<subparagraph id="idE73A135067654054BC8AFEAD359BA509"><enum>(A)</enum><text>is subject to a final
order of a State securities commission (or an agency or officer of a State
performing like functions), a State authority that supervises or examines
banks, savings associations, or credit unions, a State insurance commission (or
an agency or officer of a State performing like functions), an appropriate
Federal banking agency, or the National Credit Union Administration,
that—</text>
<clause id="id703D7E812CE54E19A9F64E13379BFF63"><enum>(i)</enum><text>bars the person
from—</text>
<subclause id="idA2FCF6812C884E5D94E0A7DA15DE8C14"><enum>(I)</enum><text>association with an
entity regulated by such commission, authority, agency, or officer;</text>
</subclause><subclause id="id5C04CE81F4724D81B9F4EE89667D5CD1"><enum>(II)</enum><text>engaging in the business
of securities, insurance, or banking; or</text>
</subclause><subclause id="idD6E3BC0EF2E04180A6A42D6BB09C4046"><enum>(III)</enum><text>engaging in savings
association or credit union activities; or</text>
</subclause></clause><clause id="idC4D82A55B4274AE3BF7C8B183E066D2D"><enum>(ii)</enum><text>constitutes a final
order based on a violation of any law or regulation that prohibits fraudulent,
manipulative, or deceptive conduct within the 10-year period ending on the date
of the filing of the offer or sale; or</text>
</clause></subparagraph><subparagraph id="id351E9A93F212490B8960066B81891AA8"><enum>(B)</enum><text>has been convicted of any
felony or misdemeanor in connection with the purchase or sale of any security
or involving the making of any false filing with the Commission.</text>
</subparagraph></paragraph></section><section id="IDab1e04248b214f20a684c656322d0568"><enum>927.</enum><header>Equal treatment of
self-regulatory organization rules</header><text display-inline="no-display-inline">Section 29(a) of the Securities Exchange Act
of 1934 (15 U.S.C. 78cc(a)) is amended by striking <quote>an exchange required
thereby</quote> and inserting <quote>a self-regulatory
organization,</quote>.</text>
</section><section id="ID80bfee52779242878580f13c1f04fe4b"><enum>928.</enum><header>Clarification that
Section 205 of the Investment Advisers Act of 1940 does not apply to
State-registered advisers</header><text display-inline="no-display-inline">Section 205(a) of the Investment Advisers
Act of 1940 (15 U.S.C. 80b–5(a)) is amended, in the matter preceding paragraph
(1)—</text>
<paragraph id="ID6b262af13f694f3b958006cca65ace4a"><enum>(1)</enum><text>by striking <quote>,
unless exempt from registration pursuant to section 203(b),</quote> and
inserting <quote>registered or required to be registered with the
Commission</quote>;</text>
</paragraph><paragraph id="ID1441526c23eb43a8a47e20d8bf11dc5f"><enum>(2)</enum><text>by striking <quote>make
use of the mails or any means or instrumentality of interstate commerce,
directly or indirectly, to</quote>; and</text>
</paragraph><paragraph id="IDda427d64778d4ae897d3039cce6c3dfb"><enum>(3)</enum><text>by striking
<quote>to</quote> after <quote>in any way</quote>.</text>
</paragraph></section><section id="ID97a843ff545645e19b20552a95feba50"><enum>929.</enum><header>Unlawful margin
lending</header><text display-inline="no-display-inline">Section 7(c)(1)(A) of
the Securities Exchange Act of 1934 (15 U.S.C. 78g(c)(1)(A)) is amended by
striking <quote>; and</quote> and inserting <quote>; or</quote>.</text>
</section><section id="idDC3C406A4529465BB3A2597E8AABB275"><enum>929A.</enum><header>Protection for
employees of subsidiaries and affiliates of publicly traded
companies</header><text display-inline="no-display-inline">Section 1514A of
title 18, United States Code, is amended by inserting <quote>including any
subsidiary or affiliate whose financial information is included in the
consolidated financial statements of such company</quote> after <quote>the
Securities Exchange Act of 1934 (15 U.S.C. 78o(d))</quote>.</text>
</section><section id="HBFD7FAD77363483B8C045C09D8EC7674"><enum>929B.</enum><header>Fair Fund
amendments</header><text display-inline="no-display-inline">Section 308 of the
Sarbanes-Oxley Act of 2002 (15 U.S.C. 7246(a)) is amended—</text>
<paragraph id="H776ABA050FDE43928E102F9303EAF7D0"><enum>(1)</enum><text>by striking subsection
(a) and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="H243C6F18C5E042CD92D29123A979831C" reported-display-style="italic" style="OLC">
<subsection id="HE53E450A2D5F4E9EB73C707C54909419"><enum>(a)</enum><header>Civil penalties To Be
used for the relief of victims</header><text display-inline="yes-display-inline">If, in any judicial or administrative
action brought by the Commission under the securities laws, the Commission
obtains a civil penalty against any person for a violation of such laws, or
such person agrees, in settlement of any such action, to such civil penalty,
the amount of such civil penalty shall, on the motion or at the direction of
the Commission, be added to and become part of a disgorgement fund or other
fund established for the benefit of the victims of such
violation.</text>
</subsection><after-quoted-block>;</after-quoted-block></quoted-block>
</paragraph><paragraph id="H75C9E10B7E6544C0A4ACD1E5DD62A73A"><enum>(2)</enum><text>in subsection (b)—</text>
<subparagraph id="HDD23F19B54AD4E0C87B283A948DD6F0E"><enum>(A)</enum><text>by striking <quote>for a
disgorgement fund described in subsection (a)</quote> and inserting <quote>for
a disgorgement fund or other fund described in subsection (a)</quote>;
and</text>
</subparagraph><subparagraph id="H4E83A1496D94430E94BAD2F5E40410A7"><enum>(B)</enum><text>by striking <quote>in the
disgorgement fund</quote> and inserting <quote>in such fund</quote>; and</text>
</subparagraph></paragraph><paragraph commented="no" display-inline="no-display-inline" id="H1FAC90A3180D4DE4A344D1429690C6FA"><enum>(3)</enum><text>by striking subsection
(e).</text>
</paragraph></section><section commented="no" display-inline="no-display-inline" id="id7E874A7DB2A245D9ADDF54E098A7B4D7"><enum>929C.</enum><header>Increasing the
borrowing limit on Treasury loans</header><text display-inline="no-display-inline">Section 4(h) of the Securities Investor
Protection Act of 1970 (15 U.S.C. 78ddd(h)) is amended in the first sentence,
by striking <quote>$1,000,000,000</quote> and inserting
<quote>$2,500,000,000</quote>.</text>
</section></subtitle><subtitle id="idEF916A97951D46BBA6B02A8C84CDCA8F"><enum>C</enum><header>Improvements to the
Regulation of Credit Rating Agencies</header>
<section id="IDedbfcba8b66a4ccbac1d5b646016e98f"><enum>931.</enum><header>Findings</header><text display-inline="no-display-inline">Congress finds the following:</text>
<paragraph id="ID232b7ff1c63749e8a5cf0cf948474508"><enum>(1)</enum><text>Because of the systemic
importance of credit ratings and the reliance placed on credit ratings by
individual and institutional investors and financial regulators, the activities
and performances of credit rating agencies, including nationally recognized
statistical rating organizations, are matters of national public interest, as
credit rating agencies are central to capital formation, investor confidence,
and the efficient performance of the United States economy.</text>
</paragraph><paragraph id="ID0effa692308449c6a687b17717068ce7"><enum>(2)</enum><text>Credit rating agencies,
including nationally recognized statistical rating organizations, play a
critical <quote>gatekeeper</quote> role in the debt market that is functionally
similar to that of securities analysts, who evaluate the quality of securities
in the equity market, and auditors, who review the financial statements of
firms. Such role justifies a similar level of public oversight and
accountability.</text>
</paragraph><paragraph id="ID27962257752e4c0b87d227552e748a6e"><enum>(3)</enum><text>Because credit rating
agencies perform evaluative and analytical services on behalf of clients, much
as other financial <quote>gatekeepers</quote> do, the activities of credit
rating agencies are fundamentally commercial in character and should be subject
to the same standards of liability and oversight as apply to auditors,
securities analysts, and investment bankers.</text>
</paragraph><paragraph id="ID8a32fc80242d45549d6114618bbb23a9"><enum>(4)</enum><text>In certain activities,
particularly in advising arrangers of structured financial products on
potential ratings of such products, credit rating agencies face conflicts of
interest that need to be carefully monitored and that therefore should be
addressed explicitly in legislation in order to give clearer authority to the
Securities and Exchange Commission.</text>
</paragraph><paragraph id="ID2163cac107754ebbba157f19a3c9ea5c"><enum>(5)</enum><text>In the recent financial
crisis, the ratings on structured financial products have proven to be
inaccurate. This inaccuracy contributed significantly to the mismanagement of
risks by financial institutions and investors, which in turn adversely impacted
the health of the economy in the United States and around the world. Such
inaccuracy necessitates increased accountability on the part of credit rating
agencies.</text>
</paragraph></section><section id="id9F434ED5165E459390244D0C9B81F995"><enum>932.</enum><header>Enhanced regulation,
accountability, and transparency of nationally recognized statistical rating
organizations</header><text display-inline="no-display-inline">Section 15E of
the Securities Exchange Act of 1934 (15 U.S.C. 78o–7) is amended—</text>
<paragraph id="ID9b77a48e89ce4e7c9a1ce58b7970d051"><enum>(1)</enum><text>in subsection (c)—</text>
<subparagraph id="id21EE55FAC1CA4E66BEEF557CE69442CD"><enum>(A)</enum><text>in paragraph (2)—</text>
<clause id="id5E02BE9ED72A484FAAF8FE598DA51C7E"><enum>(i)</enum><text>in the second sentence,
by inserting <quote>any other provision of this section, or</quote> after
<quote>Notwithstanding</quote>; and</text>
</clause><clause id="id9CCE6A07AE7643D09EDBCD18DB741690"><enum>(ii)</enum><text>by inserting after the
period at the end the following: <quote>Nothing in this paragraph may be
construed to afford a defense against any action or proceeding brought by the
Commission to enforce the antifraud provisions of the securities laws.</quote>;
and</text>
</clause></subparagraph><subparagraph id="IDf3ba637af28042de903907f5d45d07d8"><enum>(B)</enum><text>by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id45321E2BAB6B430D85035C8351945E59" reported-display-style="italic" style="OLC">
<paragraph id="IDe316c768dc3e4395a7e21f2879d2546e"><enum>(3)</enum><header>Internal controls over
processes for determining credit ratings</header>
<subparagraph id="ID1dd74234390447918f94f6f25950cf65"><enum>(A)</enum><header>In
general</header><text>Each nationally recognized statistical rating
organization shall establish, maintain, enforce, and document an effective
internal control structure governing the implementation of and adherence to
policies, procedures, and methodologies for determining credit ratings, taking
into consideration such factors as the Commission may prescribe, by
rule.</text>
</subparagraph><subparagraph id="IDc6b575068e0e40f8bd3785cfa5228c81"><enum>(B)</enum><header>Attestation
requirement</header><text>The Commission shall prescribe rules requiring each
nationally recognized statistical rating organization to submit to the
Commission an annual internal controls report, which shall contain—</text>
<clause id="ID251ac2edc3c74bd1bea3e99cce574f8f"><enum>(i)</enum><text>a description of the
responsibility of the management of the nationally recognized statistical
rating organization in establishing and maintaining an effective internal
control structure under subparagraph (A);</text>
</clause><clause id="IDdc7e4480da9640fdaecfd1088811cfd3"><enum>(ii)</enum><text>an assessment of the
effectiveness of the internal control structure of the nationally recognized
statistical rating organization; and</text>
</clause><clause id="ID5cb1eeacc44942f096c4e43181b9b950"><enum>(iii)</enum><text>the attestation of the
chief executive officer, or equivalent individual, of the nationally recognized
statistical rating
organization.</text>
</clause></subparagraph></paragraph><after-quoted-block>;</after-quoted-block></quoted-block>
</subparagraph></paragraph><paragraph id="ID1da5cd2ba4fb4566b15481b775325cc5"><enum>(2)</enum><text>in subsection (d)—</text>
<subparagraph id="ID60c8c6d78d1045a99e50c061638e22f1"><enum>(A)</enum><text>in the subsection
heading, by inserting <quote><header-in-text level="subsection" style="OLC">Fine,</header-in-text></quote> after <quote><header-in-text level="subsection" style="OLC">Censure,</header-in-text></quote>;</text>
</subparagraph><subparagraph id="id4368943243564DBC8F1561089E447317"><enum>(B)</enum><text>by inserting
<quote>fine,</quote> after <quote>censure,</quote> each place that term
appears;</text>
</subparagraph><subparagraph id="id22568690B6F64C0CB1F6CDC135312743"><enum>(C)</enum><text>in paragraph (2), by
redesignating subparagraphs (A) and (B) as clauses (i) and (ii), respectively,
and adjusting the clause margins accordingly;</text>
</subparagraph><subparagraph id="id870071AC0AFB4F30A3FC7F4CB6BDA6EF"><enum>(D)</enum><text>by redesignating
paragraphs (1) through (5) as subparagraphs (A) through (E), respectively, and
adjusting the subparagraph margins accordingly;</text>
</subparagraph><subparagraph id="id0253020B9F944A97924A9186E95C8A31"><enum>(E)</enum><text>in the matter preceding
subparagraph (A), as so redesignated, by striking <quote>The Commission</quote>
and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idED23CC65827A4319A30062E8DF580631" reported-display-style="italic" style="OLC">
<paragraph id="id7B76B22653B148D88C48254615505810"><enum>(1)</enum><header>In
general</header><text>The
Commission</text>
</paragraph><after-quoted-block>;</after-quoted-block></quoted-block>
</subparagraph><subparagraph id="IDe2b75be656d045b0ade307506f908839"><enum>(F)</enum><text>in subparagraph (D), as
so redesignated, by striking <quote>or</quote> at the end;</text>
</subparagraph><subparagraph id="IDedb35e25ba9a4173881559f2c1b3bfe1"><enum>(G)</enum><text>in subparagraph (E), as
so redesignated, by striking the period at the end and inserting a semicolon;
and</text>
</subparagraph><subparagraph id="ID98557481787e4f6bae640e973c4dbc98"><enum>(H)</enum><text>by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id0CF96DA27F1049C8BCF3BCA525F28A31" reported-display-style="italic" style="OLC">
<subparagraph id="ID69e6882fb3a7426ab02c2aa16b4a086b"><enum>(F)</enum><text>has failed reasonably to
supervise, with a view to preventing a violation of the securities laws, an
individual who commits such a violation, if the individual is subject to the
supervision of that person.</text>
</subparagraph><paragraph id="IDb952363959f946758c7c8c53b306f5be"><enum>(2)</enum><header>Suspension or
revocation for particular class of securities</header>
<subparagraph id="id5B051994EE234948AD0481CDF503BDF7"><enum>(A)</enum><header>In
general</header><text>The Commission may temporarily suspend or permanently
revoke the registration of a nationally recognized statistical rating
organization with respect to a particular class or subclass of securities, if
the Commission finds, on the record after notice and opportunity for hearing,
that the nationally recognized statistical rating organization does not have
adequate financial and managerial resources to consistently produce credit
ratings with integrity.</text>
</subparagraph><subparagraph id="idC27BDD18533741B59C6335E3E7839D8D"><enum>(B)</enum><header>Considerations</header><text>In
making any determination under subparagraph (A), the Commission shall
consider—</text>
<clause id="id1AFBF0F8A3C34476B8B3598304F07ED8"><enum>(i)</enum><text>whether the nationally
recognized statistical rating organization has failed over a sustained period
of time, as determined by the Commission, to produce ratings that are accurate
for that class or subclass of securities; and</text>
</clause><clause id="id1091A31C8A7D4AE0903296247F350E2B"><enum>(ii)</enum><text>such other factors as
the Commission may
determine.</text>
</clause></subparagraph></paragraph><after-quoted-block>;</after-quoted-block></quoted-block>
</subparagraph></paragraph><paragraph id="ID8ec9c26efd8744cda7297d6a06da5531"><enum>(3)</enum><text>in subsection (h), by
adding at the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idA727CE8E99A9480E811BE31F7D4BC8E7" reported-display-style="italic" style="OLC">
<paragraph id="IDc14356cd71bd462395e5ef1d52aa808f"><enum>(3)</enum><header>Separation of ratings
from sales and marketing</header>
<subparagraph id="id7F2DEB683C5C4EAA97D41CB6525AF851"><enum>(A)</enum><header>Rules
required</header><text>The Commission shall issue rules to prevent the sales
and marketing considerations of a nationally recognized statistical rating
organization from influencing the production of ratings by the nationally
recognized statistical rating organization.</text>
</subparagraph><subparagraph id="id4D9D50E2B64D4466B5ECA6A7CF2FE8CD"><enum>(B)</enum><header>Contents of
rules</header><text>The rules issued under subparagraph (A) shall provide
for—</text>
<clause id="id374D3F81958A452B9EA6C63F95F9D927"><enum>(i)</enum><text>exceptions for small
nationally recognized statistical rating organizations with respect to which
the Commission determines that the separation of the production of ratings and
sales and marketing activities is not appropriate; and</text>
</clause><clause id="id51A2B03AAA974244B962A5CF46CE0377"><enum>(ii)</enum><text>suspension or revocation
of the registration of a nationally recognized statistical rating organization,
if the Commission finds, on the record, after notice and opportunity for a
hearing, that—</text>
<subclause id="id08B50EAE38E948A6A670B28D8E25F4EB"><enum>(I)</enum><text>the nationally recognized
statistical rating organization has committed a violation of a rule issued
under this subsection; and</text>
</subclause><subclause id="id6220B104AA7244218427391A7EE193C1"><enum>(II)</enum><text>the violation of a rule
issued under this subsection affected a
rating.</text>
</subclause></clause></subparagraph></paragraph><after-quoted-block>;</after-quoted-block></quoted-block>
</paragraph><paragraph id="ID24daae52ad174d6fa0af374d35371e1e"><enum>(4)</enum><text>in subsection (j)—</text>
<subparagraph id="id2E2A13B90EE44901BCC6D516E963C556"><enum>(A)</enum><text>by striking
<quote>Each</quote> and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id9C1F1A6CE0034B74AF81A4EC9CE86F4B" reported-display-style="italic" style="OLC">
<paragraph id="idD1F16A3888B24FF4A32FF0CE9D5DD7F8"><enum>(1)</enum><header>In
general</header><text>Each</text>
</paragraph><after-quoted-block>;
and</after-quoted-block></quoted-block>
</subparagraph><subparagraph id="ID34e71743a4f34a448b98bac214b2077a"><enum>(B)</enum><text>by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id14C2C43DC4824CFAAB979E9C7FD18F3A" reported-display-style="italic" style="OLC">
<paragraph id="IDf00e5047563046c0bf8ee2298801ca95"><enum>(2)</enum><header>Limitations</header>
<subparagraph id="idF8BA53D5A6EF446A8D0503E9DB543B63"><enum>(A)</enum><header>In
general</header><text>Except as provided in subparagraph (B), an individual
designated under paragraph (1) may not, while serving in the designated
capacity—</text>
<clause id="ID7646430553314c3da0bbdf8ea4fb4dac"><enum>(i)</enum><text>perform credit
ratings;</text>
</clause><clause id="ID46ac7a44defe43a7b50fa177d2e3a0e9"><enum>(ii)</enum><text>participate in the
development of ratings methodologies or models;</text>
</clause><clause id="ID2bc6cebe359644609db7905bc0f88836"><enum>(iii)</enum><text>perform marketing or
sales functions; or</text>
</clause><clause id="IDeef29f7c434c48ea8db0f3e09c1f1772"><enum>(iv)</enum><text>participate in
establishing compensation levels, other than for employees working for that
individual.</text>
</clause></subparagraph><subparagraph id="ID483e71b00c6244169cbd5f0960be8349"><enum>(B)</enum><header>Exception</header><text>The
Commission may exempt a small nationally recognized statistical rating
organization from the limitations under this paragraph, if the Commission finds
that compliance with such limitations would impose an unreasonable burden on
the nationally recognized statistical rating organization.</text>
</subparagraph></paragraph><paragraph id="IDd8c8400093b34c3fab926c9adfb20754"><enum>(3)</enum><header>Other
duties</header><text>Each individual designated under paragraph (1) shall
establish procedures for the receipt, retention, and treatment of—</text>
<subparagraph id="ID3886b6072af54645b9c6849df3ae1570"><enum>(A)</enum><text>complaints regarding
credit ratings, models, methodologies, and compliance with the securities laws
and the policies and procedures developed under this section; and</text>
</subparagraph><subparagraph id="ID0ed2c503690f461e8cbf6fc06c800254"><enum>(B)</enum><text>confidential, anonymous
complaints by employees or users of credit ratings.</text>
</subparagraph></paragraph><paragraph id="IDfb75a7703dcc4d4a861372f87ac4e38c"><enum>(4)</enum><header>Annual reports
required</header>
<subparagraph id="id7D9213E06846455185306098317E6680"><enum>(A)</enum><header>Annual reports
required</header><text>Each individual designated under paragraph (1) shall
submit to the nationally recognized statistical rating organization an annual
report on the compliance of the nationally recognized statistical rating
organization with the securities laws and the policies and procedures of the
nationally recognized statistical rating organization that includes—</text>
<clause id="idD68B9CD8B4C44393AF5BB97A12D48C60"><enum>(i)</enum><text>a description of any
material changes to the code of ethics and conflict of interest policies of the
nationally recognized statistical rating organization; and</text>
</clause><clause id="id8200B64AA44F4DEEAE411474C92A09D2"><enum>(ii)</enum><text>a certification that the
report is accurate and complete.</text>
</clause></subparagraph><subparagraph id="idEDA57CE56A474580ADB7ABB206CCC009"><enum>(B)</enum><header>Submission of reports
to the Commission</header><text>Each nationally recognized statistical rating
organization shall file the reports required under subparagraph (A) together
with the financial report that is required to be submitted to the Commission
under this section.</text>
</subparagraph></paragraph><after-quoted-block>;
and</after-quoted-block></quoted-block>
</subparagraph></paragraph><paragraph id="IDa63c621691854fd7b85f0bbfbe73842a"><enum>(5)</enum><text>by striking subsection
(p) and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id7773CAA71A134EC28C10A576907953C2" reported-display-style="italic" style="OLC">
<subsection id="IDc869f9ccf4d6446c9c880841b7b1d4a1"><enum>(p)</enum><header>Regulation of
nationally recognized statistical rating organizations</header>
<paragraph id="ID6cd9d96e58c0422da603a5b876e86026"><enum>(1)</enum><header>Establishment of Office
of Credit Ratings</header>
<subparagraph id="idE1E065E290944E3F97709D3874CB8AF5"><enum>(A)</enum><header>Office
established</header><text>The Commission shall establish within the Commission
an Office of Credit Ratings (referred to in this subsection as the
<quote>Office</quote>) to administer the rules of the Commission—</text>
<clause id="idAAD7BE2885D748CBA4944CC41F029669"><enum>(i)</enum><text>with respect to the
practices of nationally recognized statistical rating organizations in
determining ratings, for the protection of users of credit ratings and in the
public interest;</text>
</clause><clause id="id54AED0F5CA234511B844F0977831DC58"><enum>(ii)</enum><text>to promote accuracy in
credit ratings issued by nationally recognized statistical rating
organizations; and</text>
</clause><clause id="idE4A0E2336F654C458162126E9C5054A6"><enum>(iii)</enum><text>to ensure that such
ratings are not unduly influenced by conflicts of interest.</text>
</clause></subparagraph><subparagraph id="id0F4307CD8FFB4B718221B0E7B6CACB93"><enum>(B)</enum><header>Director of the
Office</header><text>The head of the Office shall be the Director, who shall
report to the Chairman.</text>
</subparagraph></paragraph><paragraph id="ID64ce1cc7a7b549239c42ff9635895540"><enum>(2)</enum><header>Staffing</header><text>The
Office established under this subsection shall be staffed sufficiently to carry
out fully the requirements of this section. The staff shall include persons
with knowledge of and expertise in corporate, municipal, and structured debt
finance.</text>
</paragraph><paragraph id="ID2441fc542ef247e8a6edfe26159b24fb"><enum>(3)</enum><header>Commission
examinations</header>
<subparagraph id="idC29431B986DD403BBBED289BE99B7F27"><enum>(A)</enum><header>Annual examinations
required</header><text>The Office shall conduct an examination of each
nationally recognized statistical rating organization at least annually.</text>
</subparagraph><subparagraph id="idA336332918F44B5CB0C030A26641C694"><enum>(B)</enum><header>Conduct of
examinations</header><text>Each examination under subparagraph (A) shall
include a review of—</text>
<clause id="idDF7478C423D444F091FCACCBE5E438C8"><enum>(i)</enum><text>whether the nationally
recognized statistical rating organization conducts business in accordance with
the policies, procedures, and rating methodologies of the nationally recognized
statistical rating organization;</text>
</clause><clause id="idCE1216F970CC4271B3EE1DB98EFD12E7"><enum>(ii)</enum><text>the management of
conflicts of interest by the nationally recognized statistical rating
organization;</text>
</clause><clause id="idA30C2D90AE2A483C873E56124C66BECA"><enum>(iii)</enum><text>implementation of
ethics policies by the nationally recognized statistical rating
organization;</text>
</clause><clause id="idA586F99521F746D38DF25A92FA5F94CD"><enum>(iv)</enum><text>the internal supervisory
controls of the nationally recognized statistical rating organization;</text>
</clause><clause id="id24E0E89A7DDC4D57955826F9E1FD311A"><enum>(v)</enum><text>the governance of the
nationally recognized statistical rating organization;</text>
</clause><clause id="idC2662EEAFCC84EA599575254678A3451"><enum>(vi)</enum><text>the activities of the
individual designated by the nationally recognized statistical rating
organization under subsection (j)(1);</text>
</clause><clause id="id23206A9CC6694C0C97ACB0B4B1E4918A"><enum>(vii)</enum><text>the processing of
complaints by the nationally recognized statistical rating organization;
and</text>
</clause><clause id="idD06D49A1FD604DDC94136763C9FD930E"><enum>(viii)</enum><text>the policies of the
nationally recognized statistical rating organization governing the
post-employment activities of former staff of the nationally recognized
statistical rating organization.</text>
</clause></subparagraph><subparagraph id="id76A80CE57554460FB0DD9E748CC1DF35"><enum>(C)</enum><header>Inspection
reports</header><text>The Commission shall make available to the public, in an
easily understandable format, an annual report summarizing—</text>
<clause id="idCBE6154A694D486194C858FB80BBDAB6"><enum>(i)</enum><text>the essential findings of
all examinations conducted under subparagraph (A), as deemed appropriate by the
Commission;</text>
</clause><clause id="id5B153E8DB950455FB5DC0984D81B2CA6"><enum>(ii)</enum><text>the responses by the
nationally recognized statistical rating organizations to any material
regulatory deficiencies identified by the Commission under clause (i);
and</text>
</clause><clause id="idA5FC5DF83E66428A9BB217C312A4A6FB"><enum>(iii)</enum><text>whether the nationally
recognized statistical rating organizations have appropriately addressed the
recommendations of the Commission contained in previous reports under this
subparagraph.</text>
</clause></subparagraph></paragraph><paragraph id="IDf370cd0dbb6f47fdaef8a53e4c909913"><enum>(4)</enum><header>Rulemaking
authority</header><text>The Commission shall—</text>
<subparagraph id="IDc9c36b7eecd94831bfed9f568fa26292"><enum>(A)</enum><text>establish, by rule,
fines, and other penalties applicable to any nationally recognized statistical
rating organization that violates the requirements of this subsection and the
rules thereunder; and</text>
</subparagraph><subparagraph id="IDff064a62ac694cecb56add2393b0ceac"><enum>(B)</enum><text>issue such rules as may
be necessary to carry out this subsection.</text>
</subparagraph></paragraph></subsection><subsection id="IDa1474df4561a44ecad5c84c75f159e46"><enum>(q)</enum><header>Transparency of ratings
performance</header>
<paragraph id="IDe740a7fc25db463b992be3a2f70e5a27"><enum>(1)</enum><header>Rulemaking
required</header><text>The Commission shall, by rule, require that each
nationally recognized statistical rating organization publicly disclose
information on the initial credit ratings determined by the nationally
recognized statistical rating organization for each type of obligor, security,
and money market instrument, and any subsequent changes to such credit ratings,
for the purpose of allowing users of credit ratings to evaluate the accuracy of
ratings and compare the performance of ratings by different nationally
recognized statistical rating organizations.</text>
</paragraph><paragraph id="IDde1e5ea2d4724c058e5d214333dbcea8"><enum>(2)</enum><header>Content</header><text>The
rules of the Commission under this subsection shall require, at a minimum,
disclosures that—</text>
<subparagraph id="ID4d12a8efd37b42f7955701608450e61e"><enum>(A)</enum><text>are comparable among
nationally recognized statistical rating organizations, to allow users of
credit ratings to compare the performance of credit ratings across nationally
recognized statistical rating organizations;</text>
</subparagraph><subparagraph id="ID748a5f778f764d3dbe63d4c3bcddc723"><enum>(B)</enum><text>are clear and informative
for investors who use or might use credit ratings;</text>
</subparagraph><subparagraph id="ID18dc34237bb74b8e9d9195bd8171b263"><enum>(C)</enum><text>include performance
information over a range of years and for a variety of types of credit ratings,
including for credit ratings withdrawn by the nationally recognized statistical
rating organization;</text>
</subparagraph><subparagraph id="ID07f0372f174a4af49f004bb5ce0ae21b"><enum>(D)</enum><text>are published and made
freely available by the nationally recognized statistical rating organization,
on an easily accessible portion of its website, and in writing, when requested;
and</text>
</subparagraph><subparagraph id="idF70E676B886845A990D4DA3BE26FE402"><enum>(E)</enum><text>are appropriate to the
business model of a nationally recognized statistical rating
organization.</text>
</subparagraph></paragraph></subsection><subsection id="ID6d6a975f17124315a586f7a9266e173e"><enum>(r)</enum><header>Credit ratings
methodologies</header><text>The Commission shall prescribe rules, for the
protection of investors and in the public interest, with respect to the
procedures and methodologies, including qualitative and quantitative data and
models, used by nationally recognized statistical rating organizations that
require each nationally recognized statistical rating organization—</text>
<paragraph id="ID8e1622681d5141a1b9d69b61f76aea24"><enum>(1)</enum><text>to ensure that credit
ratings are determined using procedures and methodologies, including
qualitative and quantitative data and models, that are—</text>
<subparagraph id="id07BC742D5EEB458C8C2C9C49C777ED12"><enum>(A)</enum><text>approved by the board of
the nationally recognized statistical rating organization, a body performing a
function similar to that of a board, or the senior credit officer of the
nationally recognized statistical rating organization; and</text>
</subparagraph><subparagraph id="id57F01D99183E456D8CAE738D2900F1FD"><enum>(B)</enum><text>in accordance with the
policies and procedures of the nationally recognized statistical rating
organization for the development and modification of credit rating procedures
and methodologies;</text>
</subparagraph></paragraph><paragraph id="ID6170bb8aba2b45f9ab2dca24b27cbad3"><enum>(2)</enum><text>to ensure that when
material changes to credit rating procedures and methodologies (including
changes to qualitative and quantitative data and models) are made, that—</text>
<subparagraph id="idD5BC87DCF6524A058542FAA65E6E1FC6"><enum>(A)</enum><text>the changes are applied
consistently to all credit ratings to which the changed procedures and
methodologies apply;</text>
</subparagraph><subparagraph id="id5468DB11807C4D738EF3034BFAE732A8"><enum>(B)</enum><text>to the extent that
changes are made to credit rating surveillance procedures and methodologies,
the changes are applied to then-current credit ratings by the nationally
recognized statistical rating organization within a reasonable time period
determined by the Commission, by rule; and</text>
</subparagraph><subparagraph id="id1F0107DAED64426CAF4D7CD4B1F52D26"><enum>(C)</enum><text>the nationally recognized
statistical rating organization publicly discloses the reason for the change;
and</text>
</subparagraph></paragraph><paragraph id="IDa0b87a2f096f4cc995e55cfe78947940"><enum>(3)</enum><text>to notify users of credit
ratings—</text>
<subparagraph id="idD9C1858955784EA4AD9747AC0898C4EF"><enum>(A)</enum><text>of the version of a
procedure or methodology, including the qualitative methodology or quantitative
inputs, used with respect to a particular credit rating;</text>
</subparagraph><subparagraph id="ID45df4428ffc24693b9152e904e65711d"><enum>(B)</enum><text>when a material change is
made to a procedure or methodology, including to a qualitative model or
quantitative inputs;</text>
</subparagraph><subparagraph id="id27FAF92F2F634619A1C5A18CCC2987E2"><enum>(C)</enum><text>when a significant error
is identified in a procedure or methodology, including a qualitative or
quantitative model, that may result in credit rating actions; and</text>
</subparagraph><subparagraph id="id2DD6FD1549064500A10E138DF8A3CFD4"><enum>(D)</enum><text>of the likelihood of a
material change described in subparagraph (B) resulting in a change in current
credit ratings.</text>
</subparagraph></paragraph></subsection><subsection id="IDa73640687e884050bd5f971d57a3eab9"><enum>(s)</enum><header>Transparency of credit
rating methodologies and information reviewed</header>
<paragraph id="ID0a83c7bd81394e40890b0d335db71e45"><enum>(1)</enum><header>Form for
disclosures</header><text>The Commission shall require, by rule, each
nationally recognized statistical rating organization to prescribe a form to
accompany the publication of each credit rating that discloses—</text>
<subparagraph id="ID30e7591025be4c23814c711bb27b4672"><enum>(A)</enum><text>information relating
to—</text>
<clause id="id604ECD5880724447B328B7880A416028"><enum>(i)</enum><text>the assumptions
underlying the credit rating procedures and methodologies;</text>
</clause><clause id="id8635C3E35DC44AFDB99408A0701BAE5C"><enum>(ii)</enum><text>the data that was relied
on to determine the credit rating; and</text>
</clause><clause id="idE2AE8AEA6A414396AAE8DA447BD0C7DC"><enum>(iii)</enum><text>if applicable, how the
nationally recognized statistical rating organization used servicer or
remittance reports, and with what frequency, to conduct surveillance of the
credit rating; and</text>
</clause></subparagraph><subparagraph id="IDc7537e8d47014380b4ce4d8178e0d446"><enum>(B)</enum><text>information that can be
used by investors and other users of credit ratings to better understand credit
ratings in each class of credit rating issued by the nationally recognized
statistical rating organization.</text>
</subparagraph></paragraph><paragraph id="IDd52c6512190a43c6b81fa8e002a93b01"><enum>(2)</enum><header>Format</header><text>The
form developed under paragraph (1) shall—</text>
<subparagraph id="ID858b107b554947f69ef258b424eca395"><enum>(A)</enum><text>be easy to use and
helpful for users of credit ratings to understand the information contained in
the report;</text>
</subparagraph><subparagraph id="IDa659dceab1474c4c9faf6368971396b9"><enum>(B)</enum><text>require the nationally
recognized statistical rating organization to provide the content described in
paragraph (3)(B) in a manner that is directly comparable across types of
securities; and</text>
</subparagraph><subparagraph id="id894202DCEB7B454DA089F833F4172E75"><enum>(C)</enum><text>be made readily available
to users of credit ratings, in electronic or paper form, as the Commission may,
by rule, determine.</text>
</subparagraph></paragraph><paragraph id="ID44f044119704434da8a82cf9b0cca59c"><enum>(3)</enum><header>Content of
form</header>
<subparagraph id="id02ADC5C2E0484D72B6CB7D76A0566707"><enum>(A)</enum><header>Qualitative
content</header><text>Each nationally recognized statistical rating
organization shall disclose on the form developed under paragraph (1)—</text>
<clause id="idC364D9B6AECB431C820110EE436F78C1"><enum>(i)</enum><text>the credit ratings
produced by the nationally recognized statistical rating organization;</text>
</clause><clause id="IDe8e03f75354444119c1e92c72d823160"><enum>(ii)</enum><text>the main assumptions and
principles used in constructing procedures and methodologies, including
qualitative methodologies and quantitative inputs and assumptions about the
correlation of defaults across obligors used in rating structured
products;</text>
</clause><clause id="ID3b03735c468d4ddaa0abd93943938869"><enum>(iii)</enum><text>the potential
limitations of the credit ratings, and the types of risks excluded from the
credit ratings that the nationally recognized statistical rating organization
does not comment on, including liquidity, market, and other risks;</text>
</clause><clause id="IDcc5dad73c256495ebd8f1604236c5448"><enum>(iv)</enum><text>information on the
uncertainty of the credit rating, including—</text>
<subclause id="id5AD44F29438F456E9520DAF07FED6C94"><enum>(I)</enum><text>information on the
reliability, accuracy, and quality of the data relied on in determining the
credit rating; and</text>
</subclause><subclause id="id21311324D8384BB7B071727C68061F14"><enum>(II)</enum><text>a statement relating to
the extent to which data essential to the determination of the credit rating
were reliable or limited, including—</text>
<item id="idDA6A1B4359884107AEF277012820AB93"><enum>(aa)</enum><text>any limits on the scope
of historical data; and</text>
</item><item id="id8E96048D78F3487AA826BBA0BE738F41"><enum>(bb)</enum><text>any limits in
accessibility to certain documents or other types of information that would
have better informed the credit rating;</text>
</item></subclause></clause><clause id="IDbb400cf3d94843aca322d5cc9cd7071c"><enum>(v)</enum><text>whether and to what
extent third party due diligence services have been used by the nationally
recognized statistical rating organization, a description of the information
that such third party reviewed in conducting due diligence services, and a
description of the findings or conclusions of such third party;</text>
</clause><clause id="IDb59d54872fe44b01a6a292cb790c56a1"><enum>(vi)</enum><text>a description of the
data about any obligor, issuer, security, or money market instrument that were
relied upon for the purpose of determining the credit rating;</text>
</clause><clause id="ID4427209061344cd59b188935db7360c7"><enum>(vii)</enum><text>a statement containing
an overall assessment of the quality of information available and considered in
producing a rating for an obligor, security, or money market instrument, in
relation to the quality of information available to the nationally recognized
statistical rating organization in rating similar issuances;</text>
</clause><clause id="id10F5C61F79F74CBBB4305A2B32355057"><enum>(viii)</enum><text>information relating
to conflicts of interest of the nationally recognized statistical rating
organization; and</text>
</clause><clause id="ID019f7c83790848baadd1d1a0a6fdb777"><enum>(ix)</enum><text>such additional
information as the Commission may require.</text>
</clause></subparagraph><subparagraph id="ID308151e934de4e1c9ff0746468f107ec"><enum>(B)</enum><header>Quantitative
content</header><text>Each nationally recognized statistical rating
organization shall disclose on the form developed under this subsection—</text>
<clause id="ID071faf53e11d4da19dbcf3e645d23c3e"><enum>(i)</enum><text>an explanation or measure
of the potential volatility of the credit rating, including—</text>
<subclause id="idF74AE9F6A6454B35A0A70413B47A2144"><enum>(I)</enum><text>any factors that might
lead to a change in the credit ratings; and</text>
</subclause><subclause id="idE6EFF21B557E4C0ABC40830E3315F83C"><enum>(II)</enum><text>the magnitude of the
change that a user can expect under different market conditions;</text>
</subclause></clause><clause id="IDc51e695b0a91421f914262b0cf8adc16"><enum>(ii)</enum><text>information on the
content of the rating, including—</text>
<subclause id="ID86fc8ec8adfa462482943a9a4168ef50"><enum>(I)</enum><text>the historical
performance of the rating; and</text>
</subclause><subclause id="ID1300193f51b44c9fa9edc5c665961262"><enum>(II)</enum><text>the expected probability
of default and the expected loss in the event of default;</text>
</subclause></clause><clause id="IDf75bbf01e2f4460ca474a56ec842bed9"><enum>(iii)</enum><text>information on the
sensitivity of the rating to assumptions made by the nationally recognized
statistical rating organization; and</text>
</clause><clause id="ID1c5de58df5314ed7baaa5b96c5ea9aee"><enum>(iv)</enum><text>such additional
information as may be required by the Commission.</text>
</clause></subparagraph></paragraph><paragraph id="ID74f7a8c442154d86a4c3a2016d33ace2"><enum>(4)</enum><header>Due diligence services
for asset-backed securities</header>
<subparagraph id="id1223657E1B50426BB6EA0B3637796ECE"><enum>(A)</enum><header>Findings</header><text>The
issuer or underwriter of any asset-backed security shall make publicly
available the findings and conclusions of any third-party due diligence report
obtained by the issuer or underwriter.</text>
</subparagraph><subparagraph id="ID64c8b4d49ed24612a27dafd0f076c20f"><enum>(B)</enum><header>Certification
required</header><text>In any case in which third-party due diligence services
are employed by a nationally recognized statistical rating organization, an
issuer, or an underwriter, the person providing the due diligence services
shall provide to any nationally recognized statistical rating organization that
produces a rating to which such services relate, written certification, as
provided in subparagraph (C).</text>
</subparagraph><subparagraph id="IDcc6060b0ee524edca51c43479fe52d3b"><enum>(C)</enum><header>Format and
content</header><text>The Commission shall establish the appropriate format and
content for the written certifications required under subparagraph (B), to
ensure that providers of due diligence services have conducted a thorough
review of data, documentation, and other relevant information necessary for a
nationally recognized statistical rating organization to provide an accurate
rating.</text>
</subparagraph><subparagraph id="ID9720aa4ffe584529a0b0bdafca5536cc"><enum>(D)</enum><header>Disclosure of
certification</header><text>The Commission shall adopt rules requiring a
nationally recognized statistical rating organization, at the time at which the
nationally recognized statistical rating organization produces a rating, to
disclose the certification described in subparagraph (B) to the public in a
manner that allows the public to determine the adequacy and level of due
diligence services provided by a third party.</text>
</subparagraph></paragraph></subsection><subsection id="idB953E6563F9C4C75A3E66FB491BA0872"><enum>(t)</enum><header>Corporate governance,
organization, and management of conflicts of interest</header>
<paragraph id="IDcb0de3e16d864b57a6bec22a20a2b58d"><enum>(1)</enum><header>Board of
directors</header><text>Each nationally recognized statistical rating
organization shall have a board of directors.</text>
</paragraph><paragraph id="ID2209c10f8e104efe941d2ef5aa3cca2c"><enum>(2)</enum><header>Independent
directors</header>
<subparagraph id="id725182EEB0814F6E9C343A60CAF53A74"><enum>(A)</enum><header>In
general</header><text>At least ½ of the board of directors, but not fewer than
2 of the members thereof, shall be independent of the nationally recognized
statistical rating agency. A portion of the independent directors shall include
users of ratings from a nationally recognized statistical rating
organization.</text>
</subparagraph><subparagraph id="idA2027C88AC93458A85877DD20CB28347"><enum>(B)</enum><header>Independence
determination</header><text>In order to be considered independent for purposes
of this subsection, a member of the board of directors of a nationally
recognized statistical rating organization—</text>
<clause id="id589DE4303D17411CA02422B2478D2828"><enum>(i)</enum><text>may not, other than in
his or her capacity as a member of the board of directors or any committee
thereof—</text>
<subclause id="IDeb52cdefd46a452bb43fa77b24f3ee4a"><enum>(I)</enum><text>accept any consulting,
advisory, or other compensatory fee from the nationally recognized statistical
rating organization; or</text>
</subclause><subclause id="ID9d0e8eb5dd5e46fc971e71fc47fa32d4"><enum>(II)</enum><text>be a person associated
with the nationally recognized statistical rating organization or with any
affiliated company thereof; and</text>
</subclause></clause><clause id="IDe41c09633a464b7dae15006e7d62a130"><enum>(ii)</enum><text>shall be disqualified
from any deliberation involving a specific rating in which the independent
board member has a financial interest in the outcome of the rating.</text>
</clause></subparagraph><subparagraph id="ID40442314d12b4e1ab559fe2f9f38657e"><enum>(C)</enum><header>Compensation and
term</header><text>The compensation of the independent members of the board of
directors of a nationally recognized statistical rating organization shall not
be linked to the business performance of the nationally recognized statistical
rating organization, and shall be arranged so as to ensure the independence of
their judgment. The term of office of the independent directors shall be for a
pre-agreed fixed period, not to exceed 5 years, and shall not be
renewable.</text>
</subparagraph></paragraph><paragraph id="ID794c916cb43d4dfe9a24520167539f65"><enum>(3)</enum><header>Duties of board of
directors</header><text>In addition to the overall responsibilities of the
board of directors, the board shall oversee—</text>
<subparagraph id="ID3ed7b18a92114d5288d6b8bf59cd3fbd"><enum>(A)</enum><text>the establishment,
maintenance, and enforcement of policies and procedures for determining credit
ratings;</text>
</subparagraph><subparagraph id="ID8208477d2acb4ebb969630d1fb565bfb"><enum>(B)</enum><text>the establishment,
maintenance, and enforcement of policies and procedures to address, manage, and
disclose any conflicts of interest;</text>
</subparagraph><subparagraph id="ID7d6fd8e7a72646f2bc5cf1a98710f5b7"><enum>(C)</enum><text>the effectiveness of the
internal control system with respect to policies and procedures for determining
credit ratings; and</text>
</subparagraph><subparagraph id="IDfc17143160ab409d8ab41e968b0eeafb"><enum>(D)</enum><text>the compensation and
promotion policies and practices of the nationally recognized statistical
rating organization.</text>
</subparagraph></paragraph><paragraph id="ID29cc32c8d8024210bd05a3fddecad101"><enum>(4)</enum><header>Treatment of nrsro
subsidiaries</header><text>If a nationally recognized statistical rating
organization is a subsidiary of a parent entity, the board of the directors of
the parent entity may satisfy the requirements of this subsection by assigning
to a committee of such board of directors the duties under paragraph (3),
if—</text>
<subparagraph id="id63E35A75CA764F22A49F388D02857730"><enum>(A)</enum><text>at least ½ of the members
of the committee (including the chairperson of the committee) are independent,
as defined in this section; and</text>
</subparagraph><subparagraph id="idDD0A64B1424A4FB6B3E6CF1B36AF9EA5"><enum>(B)</enum><text>at least 1 member of the
committee is a user of ratings from a nationally recognized statistical rating
organization.</text>
</subparagraph></paragraph><paragraph id="idDC8B33474BB649808F5C4F82BF766FFE"><enum>(5)</enum><header>Exception
authority</header><text>If the Commission finds that compliance with the
provisions of this subsection present an unreasonable burden on a small
nationally recognized statistical rating organization, the Commission may
permit the nationally recognized statistical rating organization to delegate
such responsibilities to a committee that includes at least one individual who
is a user of ratings of a nationally recognized statistical rating
organization.</text>
</paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></section><section id="ID9c3182e9b72e4963b7a4411f56a7da82"><enum>933.</enum><header>State of mind in
private actions</header>
<subsection id="id28749ED307F0495CB066A77CB805CCCE"><enum>(a)</enum><header>Accountability</header><text>Section
15E(m) of the Securities Exchange Act of 1934 (15 U.S.C. 78o–7(m)) is amended
to read as follows:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id5C656509B4344DA797B2883AF0000D60" reported-display-style="italic" style="OLC">
<subsection id="id8FEC4DD075F746FD90485416AEBE3B63"><enum>(m)</enum><header>Accountability</header>
<paragraph id="id2AC0B61CABF54DB39F402C89177C28B0"><enum>(1)</enum><header>In
general</header><text>The enforcement and penalty provisions of this title
shall apply to statements made by a credit rating agency in the same manner and
to the same extent as such provisions apply to statements made by a registered
public accounting firm or a securities analyst under the securities laws, and
such statements shall not be deemed forward-looking statements for the purposes
of section 21E.</text>
</paragraph><paragraph id="idD328D363DF7B4E2894F8F2657CC48D7B"><enum>(2)</enum><header>Rulemaking</header><text>The
Commission shall issue such rules as may be necessary to carry out this
subsection.</text>
</paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="idD718E8FE89B64AF2BAF735B87714ECB0"><enum>(b)</enum><header>State of
mind</header><text display-inline="yes-display-inline">Section 21D(b)(2) of the
Securities Exchange Act of 1934 (15 U.S.C. 78u–4(b)(2)) is amended—</text>
<paragraph id="idEAB517C4825944C4870FB33B0C824EEC"><enum>(1)</enum><text display-inline="yes-display-inline">by striking <quote>In any</quote> and
inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id5CEBAC2A4EBA490799CBE8A31F5CA278" reported-display-style="italic" style="OLC">
<subparagraph id="idE5411165FF08423BB556A181AC1C5CFA"><enum>(A)</enum><header>In
general</header><text>Except as provided in subparagraph (B), in
any</text>
</subparagraph><after-quoted-block>;
and</after-quoted-block></quoted-block>
</paragraph><paragraph id="id9CC08DF9955F4E90930C87F0959CDB2C"><enum>(2)</enum><text>by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id091E2D718EEA4CB8990A9675C84EEF11" reported-display-style="italic" style="OLC">
<subparagraph id="idE0BC8759FE5A499DBB02819797A93FCC"><enum>(B)</enum><header>Exception</header><text display-inline="yes-display-inline">In the case of an action for money damages
brought against a credit rating agency or a controlling person under this
title, it shall be sufficient, for purposes of pleading any required state of
mind in relation to such action, that the complaint state with particularity
facts giving rise to a strong inference that the credit rating agency knowingly
or recklessly failed—</text>
<clause id="id5B1BF652AD4B4696A428D1A27D115339"><enum>(i)</enum><text display-inline="yes-display-inline">to conduct a reasonable investigation of
the rated security with respect to the factual elements relied upon by its own
methodology for evaluating credit risk; or</text>
</clause><clause id="idD5661F1D72FE480C8E591CA514D8A776"><enum>(ii)</enum><text display-inline="yes-display-inline">to obtain reasonable verification of such
factual elements (which verification may be based on a sampling technique that
does not amount to an audit) from other sources that the credit rating agency
considered to be competent and that were independent of the issuer and
underwriter.</text>
</clause></subparagraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection></section><section id="ID45dd154a02d647f29da673628b453982"><enum>934.</enum><header>Referring tips to law
enforcement or regulatory authorities</header><text display-inline="no-display-inline">Section 15E of the Securities Exchange Act
of 1934 (15 U.S.C. 78o–7), as amended by this subtitle, is amended by adding at
the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id1A8BFC9A40D846309A050DF4A178A595" reported-display-style="italic" style="OLC">
<subsection id="ID1f4f4724dd7a49b3b39aca1902c1351a"><enum>(u)</enum><header>Duty To report tips
alleging material violations of law</header>
<paragraph id="id533515C33DE349F692797E8D411CED73"><enum>(1)</enum><header>Duty to
report</header><text>Each nationally recognized statistical rating organization
shall refer to the appropriate law enforcement or regulatory authorities any
information that the nationally recognized statistical rating organization
receives from a third party and finds credible that alleges that an issuer of
securities rated by the nationally recognized statistical rating organization
has committed or is committing a material violation of law that has not been
adjudicated by a Federal or State court.</text>
</paragraph><paragraph id="idB0C567CA04634713A8254868E0DF7526"><enum>(2)</enum><header>Rule of
construction</header><text>Nothing in paragraph (1) may be construed to require
a nationally recognized statistical rating organization to verify the accuracy
of the information described in paragraph
(1).</text>
</paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</section><section id="ID1a1bb7fce92f4d739cdd1d20dfeea0db"><enum>935.</enum><header>Consideration of
information from sources other than the issuer in rating
decisions</header><text display-inline="no-display-inline">Section 15E of the
Securities Exchange Act of 1934 (15 U.S.C. 78o–7), as amended by this subtitle,
is amended by adding at the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id7854F6923D1B45AFB7B56E81A699B91C" reported-display-style="italic" style="OLC">
<subsection id="ID8c0b59f22f0d481aa32fc6d2d9ee37f5"><enum>(v)</enum><header>Information from
sources other than the issuer</header><text>In producing a credit rating, a
nationally recognized statistical rating organization shall consider
information about an issuer that the nationally recognized statistical rating
organization has, or receives from a source other than the issuer, that the
nationally recognized statistical rating organization finds credible and
potentially significant to a rating
decision.</text>
</subsection><after-quoted-block>.
</after-quoted-block></quoted-block>
</section><section id="ID7638d55f75e148dfa5c7a1de7765886e"><enum>936.</enum><header>Qualification
standards for credit rating analysts</header><text display-inline="no-display-inline">Not later than 1 year after the date of
enactment of this Act, the Commission shall issue rules that are reasonably
designed to ensure that any person employed by a nationally recognized
statistical rating organization to perform credit ratings—</text>
<paragraph id="id00ADA316AE4744A7828AC0CD7BA95890"><enum>(1)</enum><text display-inline="yes-display-inline">meets standards of training, experience,
and competence necessary to produce accurate ratings for the categories of
issuers whose securities the person rates; and</text>
</paragraph><paragraph id="idAA2846553F134D70AD41FD80F89A9469"><enum>(2)</enum><text display-inline="yes-display-inline">is tested for knowledge of the credit
rating process.</text>
</paragraph></section><section id="IDc8f74a7fe81c4242995097c3834225e6"><enum>937.</enum><header>Timing of
regulations</header><text display-inline="no-display-inline">Unless otherwise
specifically provided in this subtitle, the Commission shall issue final
regulations, as required by this subtitle and the amendments made by this
subtitle, not later than 1 year after the date of enactment of this Act.</text>
</section><section id="id61B14A530C5D4297B277D27702B308AA"><enum>938.</enum><header>Universal ratings
symbols</header>
<subsection id="id0D2D4E749F454BAE9AB11065DC394654"><enum>(a)</enum><header>Rulemaking</header><text display-inline="yes-display-inline">The Commission shall require, by rule, each
nationally recognized statistical rating organization to establish, maintain,
and enforce written policies and procedures that—</text>
<paragraph id="id3A985D00390B4E0A93A3B14C87208738"><enum>(1)</enum><text display-inline="yes-display-inline">assess the probability that an issuer of a
security or money market instrument will default, fail to make timely payments,
or otherwise not make payments to investors in accordance with the terms of the
security or money market instrument;</text>
</paragraph><paragraph id="idBEED85E6C0924A40A0C1759F9DEE2C8D"><enum>(2)</enum><text>clearly define and
disclose the meaning of any symbol used by the nationally recognized
statistical rating organization to denote a credit rating; and</text>
</paragraph><paragraph id="idD3D783B06B9D465991FEF68734D5FEF5"><enum>(3)</enum><text>apply any symbol
described in paragraph (2) in a manner that is consistent for all types of
securities and money market instruments for which the symbol is used.</text>
</paragraph></subsection><subsection id="id660A8FD91421480EA75D26A1F14E81C0"><enum>(b)</enum><header>Rule of
construction</header><text>Nothing in this section shall prohibit a nationally
recognized statistical rating organization from using distinct sets of symbols
to denote credit ratings for different types of securities or money market
instruments.</text>
</subsection></section><section commented="no" id="id33A9644C8EB140B3BB30FF1E7C4352F6"><enum>939.</enum><header>Removal of statutory
references to credit ratings</header>
<subsection commented="no" id="idEE47017D7BBC40F5B82869266CBD04DF"><enum>(a)</enum><header>Federal Deposit
Insurance Act</header><text display-inline="yes-display-inline">The Federal
Deposit Insurance Act (12 U.S.C. 1811 et seq.) is amended—</text>
<paragraph commented="no" id="id1899BDE0C0D64F61B6891B43F134659D"><enum>(1)</enum><text>in section 7(b)(1)(E)(i),
by striking <quote>credit rating entities, and other private economic</quote>
and insert <quote>private economic, credit,</quote>;</text>
</paragraph><paragraph commented="no" id="id144C8534AC7C4F2EB93E5BEBAFC7DCC4"><enum>(2)</enum><text>in section 28(d)—</text>
<subparagraph commented="no" id="idACA048444A99486E81335FBF19358B6D"><enum>(A)</enum><text>in the subsection
heading, by striking <quote><header-in-text level="subsection" style="OLC">not
of investment grade</header-in-text></quote>;</text>
</subparagraph><subparagraph commented="no" id="id2B6E710DCA8140A8AD866E64EF3F4519"><enum>(B)</enum><text>in paragraph (1), by
striking <quote>not of investment grade</quote> and inserting <quote>that does
not meet standards of credit-worthiness as established by the
Corporation</quote>;</text>
</subparagraph><subparagraph commented="no" id="id89F1D5361CBF4EC98864B23415FAA7E0"><enum>(C)</enum><text>in paragraph (2), by
striking <quote>not of investment grade</quote>;</text>
</subparagraph><subparagraph commented="no" id="id1C6743D188264F7DAD2BD47716DC085E"><enum>(D)</enum><text>by striking paragraph
(3);</text>
</subparagraph><subparagraph commented="no" id="id4FFD180EAFF74B4886E20B8D36280B0F"><enum>(E)</enum><text>by redesignating
paragraph (4) as paragraph (3); and</text>
</subparagraph><subparagraph commented="no" id="idC843E467D67242A6B8F38E9A54735AC6"><enum>(F)</enum><text>in paragraph (3), as so
redesignated—</text>
<clause commented="no" id="id525A7C47FE434D42B4840C11CEBDA341"><enum>(i)</enum><text>by striking subparagraph
(A);</text>
</clause><clause commented="no" id="idC8AAF2673A12402D8E8FBBC7F54BCA77"><enum>(ii)</enum><text>by redesignating
subparagraphs (B) and (C) as subparagraphs (A) and (B), respectively;
and</text>
</clause><clause commented="no" id="id8B16577EB41B4119814E2D16E74C6CAA"><enum>(iii)</enum><text>in subparagraph (B), as
so redesignated, by striking <quote>not of investment grade</quote> and
inserting <quote>that does not meet standards of credit-worthiness as
established by the Corporation</quote>; and</text>
</clause></subparagraph></paragraph><paragraph commented="no" id="id206B551E6CCA4B27AAC2604F8A8F1324"><enum>(3)</enum><text>in section 28(e)—</text>
<subparagraph commented="no" id="idE2C292F286154A7BA29DC9EEA86BAB45"><enum>(A)</enum><text>in the subsection
heading, by striking <quote><header-in-text level="subsection" style="OLC">not
of investment grade</header-in-text></quote>;</text>
</subparagraph><subparagraph commented="no" id="idD8A15057D5F4468AB68B6A8639414A15"><enum>(B)</enum><text display-inline="yes-display-inline">in paragraph (1), by striking <quote>not of
investment grade</quote> and inserting <quote>that does not meet standards of
credit-worthiness as established by the Corporation</quote>; and</text>
</subparagraph><subparagraph commented="no" id="idBA5543AE8088440D950BA6224E8183F3"><enum>(C)</enum><text>in paragraphs (2) and
(3), by striking <quote>not of investment grade</quote> each place that it
appears and inserting <quote>that does not meet standards of credit-worthiness
established by the Corporation</quote>.</text>
</subparagraph></paragraph></subsection><subsection commented="no" id="idE0031D3A654C4D5596F4DECF8DA34092"><enum>(b)</enum><header>Federal Housing
Enterprises Financial Safety and Soundness Act of 1992</header><text display-inline="yes-display-inline">Section 1319 of the Federal Housing
Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4519) is
amended by striking <quote>that is a nationally registered statistical rating
organization, as such term is defined in section 3(a) of the Securities
Exchange Act of 1934,</quote>.</text>
</subsection><subsection commented="no" id="idA0E5FC01D37C4C00B6D222B86CD2E977"><enum>(c)</enum><header>Investment Company Act
of 1940</header><text display-inline="yes-display-inline">Section
6(a)(5)(A)(iv)(I) Investment Company Act of 1940 (15 U.S.C.
80a–6(a)(5)(A)(iv)(I)) is amended by striking <quote>is rated investment grade
by not less than 1 nationally registered statistical rating
organization</quote> and inserting <quote>meets such standards of
credit-worthiness as the Commission shall adopt</quote>.</text>
</subsection><subsection commented="no" id="id3BC5AE1291664EBD9CBE9657B2E71716"><enum>(d)</enum><header>Revised
Statutes</header><text display-inline="yes-display-inline">Section 5136A of
title LXII of the Revised Statutes of the United States (12 U.S.C. 24a) is
amended—</text>
<paragraph commented="no" id="idFEDA4AF4516243D4B4BF12CC4634220D"><enum>(1)</enum><text>in subsection (a)(2)(E),
by striking <quote>any applicable rating</quote> and inserting <quote>standards
of credit-worthiness established by the Comptroller of the
Currency</quote>;</text>
</paragraph><paragraph commented="no" id="idD9A12C2A9D5142158F8D9009BFE1DB3B"><enum>(2)</enum><text>in the heading for
subsection (a)(3) by striking <quote><header-in-text level="subsection" style="OLC">Rating or comparable requirement</header-in-text></quote> and
inserting <quote><header-in-text level="subsection" style="OLC">Requirement</header-in-text></quote>;</text>
</paragraph><paragraph commented="no" id="id6071C291CB8A4582A64550097BBAF4BD"><enum>(3)</enum><text>subsection (a)(3), by
amending subparagraph (A) to read as follows:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id8E6EB6CC1A7E4B41BCFC7E5F2D240D6F" reported-display-style="italic" style="OLC">
<subparagraph commented="no" id="id2576DCF9979E4107B788B1C8A2946193"><enum>(A)</enum><header>In
general</header><text display-inline="yes-display-inline">A national bank meets
the requirements of this paragraph if the bank is one of the 100 largest
insured banks and has not fewer than 1 issue of outstanding debt that meets
standards of credit-worthiness or other criteria as the Secretary of the
Treasury and the Board of Governors of the Federal Reserve System may jointly
establish.</text>
</subparagraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph><paragraph commented="no" id="id70E01D8E84374BBF8BBCB97ADCCA4B69"><enum>(4)</enum><text>in the heading for
subsection (f), by striking <quote><header-in-text level="subsection" style="OLC">maintain public rating or</header-in-text></quote> and inserting
<quote><header-in-text level="subsection" style="OLC">meet standards of
credit-worthiness</header-in-text></quote>; and</text>
</paragraph><paragraph commented="no" id="id4DAFFEB8EAC84177BAA13919B9977828"><enum>(5)</enum><text display-inline="yes-display-inline">in subsection (f)(1), by striking
<quote>any applicable rating</quote> and inserting <quote>standards of
credit-worthiness established by the Comptroller of the
Currency</quote>.</text>
</paragraph></subsection><subsection commented="no" id="id3DAB83F53D08445A91046E7D54D0B4F0"><enum>(e)</enum><header>Securities Exchange Act
of 1934</header><text display-inline="yes-display-inline">Section 3(a)
Securities Exchange Act of 1934 (15 U.S.C. 78a(3)(a)) is amended—</text>
<paragraph commented="no" id="id8628A1500F1643AA98960B6D98895392"><enum>(1)</enum><text>in paragraph (41), by
striking <quote>is rated in one of the two highest rating categories by at
least one nationally registered statistical rating organization</quote> and
inserting <quote>meets standards of credit-worthiness as established by the
Commission</quote>; and</text>
</paragraph><paragraph commented="no" id="id0A6D45B0466C4DB3A912559247DB24A6"><enum>(2)</enum><text display-inline="yes-display-inline">in paragraph (53)(A), by striking <quote>is
rated in 1 of the 4 highest rating categories by at least 1 nationally
registered statistical rating organization</quote> and inserting <quote>meets
standards of credit-worthiness as established by the Commission</quote>.</text>
</paragraph></subsection><subsection commented="no" id="idCF15E06D637646F0BFB915B04DE0DBCA"><enum>(f)</enum><header>World Bank
discussions</header><text display-inline="yes-display-inline">Section 3(a)(6)
of the amendment in the nature of a substitute to the text of H.R. 4645, as
ordered reported from the Committee on Banking, Finance and Urban Affairs on
September 22, 1988, as enacted into law by section 555 of Public Law 100–461,
(22 U.S.C. 286hh(a)(6)), is amended by striking <quote>credit rating</quote>
and inserting <quote>credit-worthiness</quote>.</text>
</subsection><subsection commented="no" id="id51D83BDF51C240B98E877FB36F9A8348"><enum>(g)</enum><header>Effective
date</header><text>The amendments made by this section shall take effect 2
years after the date of enactment of this Act.</text>
<paragraph commented="no" id="idBE78D4E76AD04407A58AA99256B0AE11"><enum>(1)</enum><header>In
general</header><text display-inline="yes-display-inline">Commission shall
undertake a study on the feasability and desirability of—</text>
<subparagraph commented="no" id="id92219D0F160B4968AE0992A7116111AE"><enum>(A)</enum><text display-inline="yes-display-inline">standardizing credit ratings terminology,
so that all credit rating agencies issue credit ratings using identical
terms;</text>
</subparagraph><subparagraph commented="no" id="id74382C54893E401ABCCF36E851E2C7E5"><enum>(B)</enum><text>standardizing the market
stress conditions under which ratings are evaluated;</text>
</subparagraph><subparagraph commented="no" id="id75B31F868EC0421787DC620864E623DC"><enum>(C)</enum><text display-inline="yes-display-inline">requiring a quantitative correspondence
between credit ratings and a range of default probabilities and loss
expectations under standardized conditions of economic stress; and</text>
</subparagraph><subparagraph commented="no" id="idC8344B9084BC4B5BAD40386CEDC9695F"><enum>(D)</enum><text display-inline="yes-display-inline">standardizing credit rating terminology
across asset classes, so that named ratings correspond to a standard range of
default probabilities and expected losses independent of asset class and
issuing entity.</text>
</subparagraph></paragraph><paragraph commented="no" id="idAB5DE22063604BE38627D8A71CAB8B8F"><enum>(2)</enum><header>Report</header><text>Not
later than 1 year after the date of enactment of this Act, the Commission shall
submit to Congress a report containing the findings of the study under
paragraph (1) and the recommendations, if any, of the Commission with respect
to the study.</text>
</paragraph></subsection></section><section id="id6E87C868538B4D0D86D8D5BA097B8046"><enum>939A.</enum><header>Securities and
Exchange Commission study on strengthening credit rating agency
independence</header>
<subsection id="idB27FD9DD8D024E40A4AE8E5BDE23B62D"><enum>(a)</enum><header>Study</header><text>The
Commission shall conduct a study of—</text>
<paragraph id="idA986FE6A358A40EC9CB3EC351292FE7C"><enum>(1)</enum><text>the independence of
nationally recognized statistical rating organizations; and</text>
</paragraph><paragraph id="id8CFB42D84B5F4A7E87E31E9D1F157A4C"><enum>(2)</enum><text>how the independence of
nationally recognized statistical rating organizations affects the ratings
issued by the nationally recognized statistical rating organizations.</text>
</paragraph></subsection><subsection id="id8A40FA148AAD4C2BB0A9A17DE9BAD788"><enum>(b)</enum><header>Subjects for
evaluation</header><text>In conducting the study under subsection (a), the
Commission shall evaluate—</text>
<paragraph id="id616C8991CB5844329BB9F294BCDC9C5C"><enum>(1)</enum><text>the management of
conflicts of interest raised by a nationally recognized statistical rating
organization providing other services, including risk management advisory
services, ancillary assistance, or consulting services;</text>
</paragraph><paragraph id="idCACEBABED6C24C65BCB71DDED23A4385"><enum>(2)</enum><text>the potential impact of
rules prohibiting a nationally recognized statistical rating organization that
provides a rating to an issuer from providing other services to the issuer;
and</text>
</paragraph><paragraph id="id7ADE00AFA4754CCCA7127E08B304B231"><enum>(3)</enum><text>any other issue relating
to nationally recognized statistical rating organizations, as the Chairman of
the Commission determines is appropriate.</text>
</paragraph></subsection><subsection id="idBB15FB27D45E41BC9AC9F43C725D147A"><enum>(c)</enum><header>Report</header><text>Not
later than 3 years after the date of enactment of this Act, the Chairman of the
Commission shall submit to the Committee on Banking, Housing, and Urban Affairs
of the Senate and the Committee on Financial Services of the House of
Representatives a report on the results of the study conducted under subsection
(a), including recommendations, if any, for improving the integrity of ratings
issued by nationally recognized statistical rating organizations.</text>
</subsection></section><section id="idDD0536722DE2474080FF310EF4BB2D73"><enum>939B.</enum><header>Government
Accountability Office study on alternative business models</header>
<subsection id="idC7613D37E1AA4ABA8011CDEF113B01E5"><enum>(a)</enum><header>Study</header><text>The
Comptroller General of the United States shall conduct a study on alternative
means for compensating nationally recognized statistical rating organizations
in order to create incentives for nationally recognized statistical rating
organizations to provide more accurate credit ratings, including any statutory
changes that would be required to facilitate the use of an alternative means of
compensation.</text>
</subsection><subsection id="idE583DFDF86964CE0815882B90F87FB20"><enum>(b)</enum><header>Report</header><text>Not
later than 1 year after the date of enactment of this Act, the Comptroller
General shall submit to the Committee on Banking, Housing, and Urban Affairs of
the Senate and the Committee on Financial Services of the House of
Representatives a report on the results of the study conducted under subsection
(a), including recommendations, if any, for providing incentives to credit
rating agencies to improve the credit rating process.</text>
</subsection></section><section id="id7AD92F7CE4F94BCD81D9D8A28D6B8DB0"><enum>939C.</enum><header>Government
Accountability Office study on the creation of an independent professional
analyst organization</header>
<subsection id="id165E2937C31B49008B0060423FFD3EE3"><enum>(a)</enum><header>Study</header><text>The
Comptroller General of the United States shall conduct a study on the
feasibility and merits of creating an independent professional organization for
rating analysts employed by nationally recognized statistical rating
organizations that would be responsible for—</text>
<paragraph id="id78F5406861EB4FE19705AD3B7F1D6242"><enum>(1)</enum><text>establishing independent
standards for governing the profession of rating analysts;</text>
</paragraph><paragraph id="id3D3DA43C69F54C57A8F22B43F1D60A1B"><enum>(2)</enum><text>establishing a code of
ethical conduct; and</text>
</paragraph><paragraph id="id782A8174352D4DAC9F9D2BEA7CE1D2D4"><enum>(3)</enum><text>overseeing the profession
of rating analysts.</text>
</paragraph></subsection><subsection id="id910E906E8E954BE59F6C66023C289665"><enum>(b)</enum><header>Report</header><text>Not
later than 1 year after the date of enactment of this Act, the Comptroller
General shall submit to the Committee on Banking, Housing, and Urban Affairs of
the Senate and the Committee on Financial Services of the House of
Representatives a report on the results of the study conducted under subsection
(a).</text>
</subsection></section><section id="id799C4E9A9D1A426EA1FDED421E9A0EAE"><enum>939D.</enum><header>Initial credit rating
assignments</header><text display-inline="no-display-inline">Section 15E of the
Securities Exchange Act of 1934 (15 U.S.C. 78o–7), as amended by this Act, is
amended by adding at the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idF0D3B325606F4616AE06F36AB5FE9B01" reported-display-style="italic" style="OLC">
<subsection id="id3CFFC0B3A5F4413EB8F6F1B11F57FE58"><enum>(w)</enum><header>Initial credit rating
assignments</header>
<paragraph id="id3E7B092779964C9DB5B1A273352047C5"><enum>(1)</enum><header>Definitions</header><text>In
this subsection the following definitions shall apply:</text>
<subparagraph id="id042D892C125E40B7BB9A7854F446619C"><enum>(A)</enum><header>Board</header><text>The
term <term>Board</term> means the Credit Rating Agency Board established under
paragraph (2).</text>
</subparagraph><subparagraph id="idB4858ACFE9954D228089CB81D13DADB4"><enum>(B)</enum><header>Qualified nationally
recognized statistical rating organization</header><text>The term
<term>qualified nationally recognized statistical rating organization</term>,
with respect to a category of structured finance products, means a nationally
recognized statistical rating organization that the Board determines, under
paragraph (3)(B), to be qualified to issue initial credit ratings with respect
to such category.</text>
</subparagraph><subparagraph id="idAFB544EDB9EF48C383D13403D5C7B54E"><enum>(C)</enum><header>Regulations</header>
<clause commented="no" id="ID83f7618599ba4714b8cf7bebfe08b9ef"><enum>(i)</enum><header>Category of structured
finance products</header>
<subclause commented="no" id="id3AA8F0FA778A4BDA82F984D0A13CF76E"><enum>(I)</enum><header>In
general</header><text>The term <term>category of structured finance
products</term>—</text>
<item commented="no" id="idB2C9FA340F6D4724B8E6F50CDBEEF91C"><enum>(aa)</enum><text>shall include any asset
backed security and any structured product based on an asset-backed security;
and</text>
</item><item commented="no" id="id2AEEDD682ED5491782966DB5F37EA51D"><enum>(bb)</enum><text>shall be further defined
and expanded by the Commission, by rule, as necessary.</text>
</item></subclause><subclause id="id23954F43E7154748A1BC8386057657B8"><enum>(II)</enum><header>Considerations</header><text>In
issuing the regulations required under subclause (I), the Commission shall
consider—</text>
<item id="id0918DD1C705F423489BC83DFF86A7DDC"><enum>(aa)</enum><text>the types of issuers
that issue structured finance products;</text>
</item><item id="IDc718b02a060e4f0384399691a390aa0f"><enum>(bb)</enum><text>the types of investors
who purchase structured finance products;</text>
</item><item id="IDe5918c055f9c423794974e5e1a893d4d"><enum>(cc)</enum><text>the different categories
of structured finance products according to—</text>
<subitem id="IDa688e393aa97412fb53190cadbe7bbf5"><enum>(AA)</enum><text>the types of capital
flow and legal structure used;</text>
</subitem><subitem id="ID11b5254070204d8988b731323faaf75f"><enum>(BB)</enum><text>the types of underlying
products used; and</text>
</subitem><subitem id="id6B3B546DBD974573BA3C2E1EDB5199E1"><enum>(CC)</enum><text>the types of terms used
in debt securities;</text>
</subitem></item><item commented="no" id="id49FB2B097EA44AC5ABD96F0F426D9276"><enum>(dd)</enum><text>the different values of
debt securities; and</text>
</item><item commented="no" id="idAFD3F8EF926E4396926F182B6090A5C5"><enum>(ee)</enum><text>the different numbers of
units of debt securities that are issued together.</text>
</item></subclause></clause><clause id="idAD4C99A5878F4CCDB09C5F2A4F8A7F46"><enum>(ii)</enum><header>Reasonable
fee</header><text>The Board shall issue regulations to define the term
<term>reasonable fee</term>.</text>
</clause></subparagraph></paragraph><paragraph id="id28644BAAADE44CB9A54FDDEAEEC38421"><enum>(2)</enum><header>Credit Rating Agency
Board</header>
<subparagraph id="ID477f47f841824a3891c6cd18838fcb04"><enum>(A)</enum><header>In
general</header><text>Not later than 180 days after the date of enactment of
the Restoring American Financial Stability Act of 2010, the Commission
shall—</text>
<clause id="id81A5356EB7A5464FA5CBDA43BE2B0EE3"><enum>(i)</enum><text>establish the Credit
Rating Agency Board, which shall be a self-regulatory organization;</text>
</clause><clause id="idA42FA49402E145D592FE553EF0FF0E64"><enum>(ii)</enum><text>subject to subparagraph
(C), select the initial members of the Board; and</text>
</clause><clause id="id7F6A2F0FF3AD4ED28ED80107ECCD7248"><enum>(iii)</enum><text>establish a schedule to
ensure that the Board begins assigning qualified nationally recognized
statistical rating organizations to provide initial ratings not later than 1
year after the selection of the members of the Board.</text>
</clause></subparagraph><subparagraph id="id753FEF6FA51E4B5F8F4D971589BD026B"><enum>(B)</enum><header>Schedule</header><text>The
schedule established under subparagraph (A)(iii) shall prescribe when—</text>
<clause id="IDda80c0c5a7ef4554aeeb9cc0896dce85"><enum>(i)</enum><text>the Board will conduct a
study of the securitization and ratings process and provide recommendations to
the Commission;</text>
</clause><clause id="IDda8c44bde65e424884d981836f29ce5a"><enum>(ii)</enum><text>the Commission will
issue rules and regulations under this section;</text>
</clause><clause id="ID1488eceacbaf4442b816b233992a9f22"><enum>(iii)</enum><text>the Board may issue
rules under this subsection; and</text>
</clause><clause id="IDabf0de782e1640fd9737af2fa4d3242b"><enum>(iv)</enum><text>the Board will—</text>
<subclause id="id76D107B0348442B7A22C6B53A5CE005B"><enum>(I)</enum><text>begin accepting
applications to select qualified national recognized statistical rating
organizations; and</text>
</subclause><subclause id="id44F68B5935E142D58CC1977D79410BA6"><enum>(II)</enum><text>begin assigning
qualified national recognized statistical rating organizations to provide
initial ratings.</text>
</subclause></clause></subparagraph><subparagraph id="ID4cb91faaca7446e1b9277d6f5ab114d4"><enum>(C)</enum><header>Membership</header>
<clause id="id97BFFD9713D8435EBEFE69238A92E7CE"><enum>(i)</enum><header>In
general</header><text>The Board shall initially be composed of an odd number of
members selected from the industry, with the total numerical membership of the
Board to be determined by the Commission.</text>
</clause><clause id="IDc211a16b12134ceebcd4e5fc511d3b2b"><enum>(ii)</enum><header>Specifications</header><text>Of
the members initially selected to serve on the Board—</text>
<subclause id="idEDFDB3B937344CDB9B1E394DF80B6E8F"><enum>(I)</enum><text>not less than a majority
of the members shall be representatives of the investor industry who do not
represent issuers;</text>
</subclause><subclause id="idC630855E888B4E098606EF0E9B8129CF"><enum>(II)</enum><text>not less than 1 member
should be a representative of the issuer industry;</text>
</subclause><subclause id="id935AB0532600443E9B51D366EE80F430"><enum>(III)</enum><text>not less than 1 member
should be a representative of the credit rating agency industry; and</text>
</subclause><subclause id="idE3C3CFF6CEDA4774A2D642578804778C"><enum>(IV)</enum><text>not less than 1 member
should be an independent member.</text>
</subclause></clause><clause id="ID7ab95d0f73d3431389f335a69461d86d"><enum>(iii)</enum><header>Terms</header><text>Initial
members shall be appointed by the Commission for a term of 4 years.</text>
</clause><clause id="ID2a14caa0d9ab43babaf6861b8c4bd0d6"><enum>(iv)</enum><header>Nomination and
election of members</header>
<subclause id="id8AB30AFF5EF74D2487528332B9574157"><enum>(I)</enum><header>In
general</header><text>Prior to the expiration of the terms of office of the
initial members, the Commission shall establish fair procedures for the
nomination and election of future members of the Board.</text>
</subclause><subclause id="idE76C6BD498B847C0AFFE3292F4938130"><enum>(II)</enum><header>Modifications of the
Board</header><text>Prior to the expiration of the terms of office of the
initial members, the Commission—</text>
<item id="id0A948D1C60024CCF8BFE1E5216B2AF06"><enum>(aa)</enum><text>may increase the size of
the board to a larger odd number and adjust the length of future terms;
and</text>
</item><item id="idF0DA724CA4B8453B81FC3F3727728F46"><enum>(bb)</enum><text>shall retain the
composition of members described in clause (ii).</text>
</item></subclause></clause><clause id="ID80d0958134264863bc63520fb6e886aa"><enum>(v)</enum><header>Responsibilities of
members</header><text>Members shall perform, at a minimum, the duties described
in this subsection.</text>
</clause><clause id="ID2d3a3fdb21f24c0e96e8a7900c61f998"><enum>(vi)</enum><header>Rulemaking
authority</header><text>The Commission shall, if it determines necessary and
appropriate, issue further rules and regulations on the composition of the
membership of the Board and the responsibilities of the members.</text>
</clause></subparagraph><subparagraph id="ID717375a72fd0438186de46630f47eddb"><enum>(D)</enum><header>Other authorities of
the Board</header><text>The Board shall have the authority to levy fees from
qualified nationally recognized statistical rating organization applicants, and
periodically from qualified nationally recognized statistical rating
organizations as necessary to fund expenses of the Board.</text>
</subparagraph><subparagraph id="ID6098c53262c1460784f25c5206f8009c"><enum>(E)</enum><header>Regulation</header><text>The
Commission has the authority to regulate the activities of the Board, and issue
any further regulations of the Board it deems necessary, not in contravention
with the intent of this section.</text>
</subparagraph></paragraph><paragraph id="idB4E49E57F07E4F3088EF7EF1200EB09C"><enum>(3)</enum><header>Board selection of
qualified nationally recognized statistical rating organization</header>
<subparagraph id="idDCD2153C819C441F9548843CE14BA5DE"><enum>(A)</enum><header>Application</header>
<clause id="idF9F604D5B2664816A5C8A1342975C8CF"><enum>(i)</enum><header>In
general</header><text>A nationally recognized statistical rating organization
may submit an application to the Board, in such form and manner as the Board
may require, to become a qualified nationally recognized statistical rating
organization with respect to a category of structured finance products.</text>
</clause><clause id="id26450FD2F4D2443AAF76B8624F0352CB"><enum>(ii)</enum><header>Contents</header><text>An
application submitted under clause (i) shall contain—</text>
<subclause id="idF5F5F802B66A4C99BD5631D70F0137F3"><enum>(I)</enum><text>information regarding the
institutional and technical capacity of the nationally recognized statistical
rating organization to issue credit ratings;</text>
</subclause><subclause id="id5A8FFB8B9A1D4C0C894073722B322103"><enum>(II)</enum><text>information on whether
the nationally recognized statistical rating organization has been exempted by
the Commission from any requirements under any other provision of this section;
and</text>
</subclause><subclause id="idEAD80456A48145769541D5022CB273A2"><enum>(III)</enum><text>any additional
information the Board may require.</text>
</subclause></clause><clause id="id36381EA5843C43298464E0B74E4BD16C"><enum>(iii)</enum><header>Rejection of
applications</header><text>The Board may reject an application submitted under
this paragraph if the nationally recognized statistical rating organization has
been exempted by the Commission from any requirements under any other provision
of this section.</text>
</clause></subparagraph><subparagraph id="idA3E70190B6F044B4BC5BBE47A73B056D"><enum>(B)</enum><header>Selection</header><text>The
Board shall select qualified national recognized statistical rating
organizations with respect to each category of structured finance products from
among nationally recognized statistical rating organizations that submit
applications under subparagraph (A).</text>
</subparagraph><subparagraph id="idE7A014B8DF3D46E3BA1BA8C2024F874F"><enum>(C)</enum><header>Retention of status and
obligations after selection</header><text>An entity selected as a qualified
nationally recognized statistical rating organization shall retain its status
and obligations under the law as a nationally recognized statistical rating
organization, and nothing in this subsection grants authority to the Commission
or the Board to exempt qualified nationally recognized statistical rating
organizations from obligations or requirements otherwise imposed by Federal law
on nationally recognized statistical rating organizations.</text>
</subparagraph></paragraph><paragraph id="id4A9C930F69EE454BACAE1E75B22D4FCD"><enum>(4)</enum><header>Requesting an initial
credit rating</header><text>An issuer that seeks an initial credit rating for a
structured finance product—</text>
<subparagraph id="id42CC65F2C98F44D9A578F09AF451F2C5"><enum>(A)</enum><text>may not request an
initial credit rating from a nationally recognized statistical rating
organization; and</text>
</subparagraph><subparagraph id="id796452A894AE47F88767B7B129328129"><enum>(B)</enum><text>shall submit a request
for an initial credit rating to the Board, in such form and manner as the Board
may prescribe.</text>
</subparagraph></paragraph><paragraph id="idF22E5BB830F54CFDA87888781188271A"><enum>(5)</enum><header>Assignment of rating
duties</header>
<subparagraph id="id3D7D169612BF47F8B4246C4EF20EAD85"><enum>(A)</enum><header>In
general</header><text>For each request received by the Board under paragraph
(4)(B), the Board shall select a qualified nationally recognized statistical
rating organization to provide the initial credit rating to the issuer.</text>
</subparagraph><subparagraph id="id2138936960024C95841D0AB05AD10007"><enum>(B)</enum><header>Method of
selection</header>
<clause id="IDdf4662d8c7594283b8c8258eb8b19fad"><enum>(i)</enum><header>In
general</header><text>The Board shall—</text>
<subclause id="id9EE7647CBB9E4376A6F19DD48D95F8F2"><enum>(I)</enum><text>evaluate a number of
selection methods, including a lottery or rotating assignment system,
incorporating the factors described in clause (ii), to reduce the conflicts of
interest that exist under the issuer-pays model; and</text>
</subclause><subclause id="id4D834942CE4F422E88746175E12C948D"><enum>(II)</enum><text>prescribe and publish
the selection method to be used under subparagraph (A).</text>
</subclause></clause><clause id="ID91bab648706e44e898870538b0957b7c"><enum>(ii)</enum><header>Consideration</header><text>In
evaluating a selection method described in clause (i)(I), the Board shall
consider—</text>
<subclause id="ID9beb709c5a524a78bb513079cf7e9116"><enum>(I)</enum><text>the information submitted
by the qualified nationally recognized statistical rating organization under
paragraph (3)(A)(ii) regarding the institutional and technical capacity of the
qualified nationally recognized statistical rating organization to issue credit
ratings;</text>
</subclause><subclause id="ID9edf17c6062245689f22c75e30ce758c"><enum>(II)</enum><text>evaluations conducted
under paragraph (7);</text>
</subclause><subclause id="ID63bfbbb679aa46298084ed6da0869ad0"><enum>(III)</enum><text>formal feedback from
institutional investors; and</text>
</subclause><subclause id="IDf2a726e429304c23946beeb0b7e3f9e2"><enum>(IV)</enum><text>information from
subclauses (I) and (II) to implement a mechanism which increases or decreases
assignments based on past performance.</text>
</subclause></clause><clause id="ID639f5c8be4084b898b076071ba6b888b"><enum>(iii)</enum><header>Prohibition</header><text>The
Board, in choosing a selection method, may not use a method that would allow
for the solicitation or consideration of the preferred national recognized
statistical rating organizations of the issuer.</text>
</clause><clause id="IDca57b751169e427d88b7059d8caaeeff"><enum>(iv)</enum><header>Adjustment of
process</header><text>The Board shall issue rules describing the process by
which it can modify the assignment process described in clause (i).</text>
</clause></subparagraph><subparagraph id="id79FEC72A4E2E41959B2661E9FE9022DC"><enum>(C)</enum><header>Right of
refusal</header>
<clause id="id5F60881EB29C4F2E880669A05DEE9EF9"><enum>(i)</enum><header>Refusal</header><text>A
qualified nationally recognized statistical rating organization selected under
subparagraph (A) may refuse to accept a selection for a particular request
by—</text>
<subclause id="id35DC3C99FA454076A65BAA314740BF49"><enum>(I)</enum><text>notifying the Board of
such refusal; and</text>
</subclause><subclause id="idDA45079955D54FF39E20C329A37B1CA0"><enum>(II)</enum><text>submitting to the Board
a written explanation of the refusal.</text>
</subclause></clause><clause id="idA95EBF0FC2A143038226DE52A2891D8C"><enum>(ii)</enum><header>Selection</header><text>Upon
receipt of a notification under clause (i), the Board shall make an additional
selection under subparagraph (A).</text>
</clause><clause id="id58666407479D427DA7D27B59AADF5B6D"><enum>(iii)</enum><header>Inspection
reports</header><text>The Board shall annually submit any explanations of
refusals received under clause (i)(II) to the Commission, and such explanatory
submissions shall be published in the annual inspection reports required under
subsection (p)(3)(C).</text>
</clause></subparagraph></paragraph><paragraph id="id34305E16C6CA437286D386771F0C86B5"><enum>(6)</enum><header>Disclaimer
required</header><text>Each initial credit rating issued under this subsection
shall include, in writing, the following disclaimer: <quote>This initial rating
has not been evaluated, approved, or certified by the Government of the United
States or by a Federal agency.</quote>.</text>
</paragraph><paragraph id="idE63DBA0014084C59A0411AB021C3F654"><enum>(7)</enum><header>Evaluation of
performance</header>
<subparagraph id="ID9d2e0be5e98f4361b7c0b33c64365bd6"><enum>(A)</enum><header>In
general</header><text>The Board shall prescribe rules by which the Board will
evaluate the performance of each qualified nationally recognized statistical
rating organization, including rules that require, at a minimum, an annual
evaluation of each qualified nationally recognized statistical rating
organization.</text>
</subparagraph><subparagraph id="id4582C2E9C1E5440CAED1B5B20D7BD297"><enum>(B)</enum><header>Considerations</header><text>The
Board, in conducting an evaluation under subparagraph (A), shall
consider—</text>
<clause id="id40A3DDDF5B78459A98E2D02D48AA9246"><enum>(i)</enum><text>the results of the annual
examination conducted under subsection (p)(3);</text>
</clause><clause id="id00BAC51D64344655B85A523BF5AEA782"><enum>(ii)</enum><text>surveillance of credit
ratings conducted by the qualified nationally recognized statistical rating
organization after the credit ratings are issued, including—</text>
<subclause id="id50B62085CC2B485D88C32B0FFCA9FC8C"><enum>(I)</enum><text>how the rated instruments
perform;</text>
</subclause><subclause id="id166D4076A1C04A0AB54EFDB890032602"><enum>(II)</enum><text>the accuracy of the
ratings provided by the qualified nationally recognized statistical rating
organization as compared to the other nationally recognized statistical rating
organizations; and</text>
</subclause><subclause id="id9CF997A316124536B320AF711DF090DA"><enum>(III)</enum><text>the effectiveness of
the methodologies used by the qualified nationally recognized statistical
rating organization; and</text>
</subclause></clause><clause id="idDD2D37DA69074B009C9FB80C8F6FC682"><enum>(iii)</enum><text>any additional factors
the Board determines to be relevant.</text>
</clause></subparagraph><subparagraph commented="no" id="id0AB12B2FB9EB4AF28EC7FFCC112A911E"><enum>(C)</enum><header>Request for
reevaluation</header><text>Subject to rules prescribed by the Board, and not
less frequently than once a year, a qualified nationally recognized statistical
rating organization may request that the Board conduct an evaluation under this
paragraph.</text>
</subparagraph><subparagraph id="IDcea24e65fcc7421f8c5adab8c41abf8c"><enum>(D)</enum><header>Disclosure</header><text>The
Board shall make the evaluations conducted under this paragraph available to
Congress.</text>
</subparagraph></paragraph><paragraph id="idEDB3DB303B0643C5AFD62951A7CD0046"><enum>(8)</enum><header>Rating fees charged to
issuers</header>
<subparagraph id="idDB25F5F96DBD41CF887D60DD1B7797DA"><enum>(A)</enum><header>Limited to reasonable
fees</header><text>A qualified nationally recognized statistical rating
organization shall charge an issuer a reasonable fee, as determined by the
Commission, for an initial credit rating provided under this section.</text>
</subparagraph><subparagraph id="id281244DC35DB43D8950BC19203FA9FE9"><enum>(B)</enum><header>Fees</header><text>Fees
may be determined by the qualified national recognized statistical rating
organizations unless the Board determines it is necessary to issue rules on
fees.</text>
</subparagraph></paragraph><paragraph id="idCAB8A56F3B19496AA8FB3B91F42BEFF8"><enum>(9)</enum><header>No prohibition on
additional ratings</header><text>Nothing in this section shall prohibit an
issuer from requesting or receiving additional credit ratings with respect to a
debt security, if the initial credit rating is provided in accordance with this
section.</text>
</paragraph><paragraph id="idAE6C8C17B0A04420B0E06B2F3F58014C"><enum>(10)</enum><header>No prohibition on
independent ratings offered by nationally recognized statistical rating
organizations</header>
<subparagraph id="id461CC497818D4DFEBC05264A2E9811BF"><enum>(A)</enum><header>In
general</header><text>Nothing in this section shall prohibit a nationally
recognized statistical rating organization from independently providing a
credit rating with respect to a debt security, if—</text>
<clause id="id8481229C5EA24A2EBA14440AA7CD7339"><enum>(i)</enum><text>the nationally recognized
statistical rating organization does not enter into a contract with the issuer
of the debt security to provide the initial credit rating; and</text>
</clause><clause id="idCF4FD8DF72B74A9FA56F5E2D0D8A7DE0"><enum>(ii)</enum><text>the nationally
recognized statistical rating organization is not paid by the issuer of the
debt security to provide the initial credit rating.</text>
</clause></subparagraph><subparagraph id="id9C6C09916E14428A9FB4CFA512EB7CBC"><enum>(B)</enum><header>Rule of
construction</header><text>For purposes of this section, a credit rating
described in subparagraph (A) may not be construed to be an initial credit
rating.</text>
</subparagraph></paragraph><paragraph id="idA1554886612B43D08A68ACCC972D9D24"><enum>(11)</enum><header>Public
communications</header><text>Any communications made with the public by an
issuer with respect to the credit rating of a debt security shall clearly
specify whether the credit rating was made by—</text>
<subparagraph id="id475A978746C44AB6AA5DA8DF896B6806"><enum>(A)</enum><text>a qualified nationally
recognized statistical rating organization selected under paragraph (5)(A) to
provide the initial credit rating for such debt security; or</text>
</subparagraph><subparagraph id="id416F4F1C39BD4A89A79290D07A90F44D"><enum>(B)</enum><text>a nationally recognized
statistical rating organization not selected under paragraph (5)(A).</text>
</subparagraph></paragraph><paragraph id="idA8E3CF35B1D0468194ED4A3F06CC3A59"><enum>(12)</enum><header>Prohibition on
misrepresentation</header><text>With respect to a debt security, it shall be
unlawful for any person to misrepresent any subsequent credit rating provided
for such debt security as an initial credit rating provided for such debt
security by a qualified nationally recognized statistical rating organization
selected under paragraph (5)(A).</text>
</paragraph><paragraph id="id748DD0E397104E298C0F5B508BC636AB"><enum>(13)</enum><header>Initial credit rating
revision after material change in circumstance</header><text>If the Board
determines that it is necessary or appropriate in the public interest or for
the protection of investors, the Board may issue regulations requiring that an
issuer that has received an initial credit rating under this subsection request
a revised initial credit rating, using the same method as provided under
paragraph (4), each time the issuer experiences a material change in
circumstances, as defined by the Board.</text>
</paragraph><paragraph id="ID8b99b95b1f0743b3a1d444cd90eced9c"><enum>(14)</enum><header>Conflicts</header>
<subparagraph id="ID5e8ba586628d496da6d4965effa3bb90"><enum>(A)</enum><header>Members or employees of
the Board</header>
<clause id="idA90E9A950D894C989DF3E9D3D9A3EB7D"><enum>(i)</enum><header>Loan of money or
securities prohibited</header>
<subclause id="idFC749ECF3919482FAA2C01671027ADED"><enum>(I)</enum><header>In
general</header><text>A member or employee of the Board shall not accept any
loan of money or securities, or anything above nominal value, from any
nationally recognized statistical rating organization, issuer, or
investor.</text>
</subclause><subclause id="id5019BB3F592E4B6F84FF363C57E80876"><enum>(II)</enum><header>Exception</header><text>The
prohibition in subclause (I) does not apply to a loan made in the context of
disclosed, routine banking and brokerage agreements, or a loan that is clearly
motivated by a personal or family relationship.</text>
</subclause></clause><clause id="ID8951059c80794420907f348224fb9483"><enum>(ii)</enum><header>Employment
negotiations prohibition</header><text>A member or employee of the Board shall
not engage in employment negotiations with any nationally recognized
statistical rating organization, issuer, or investor, unless the member or
employee—</text>
<subclause id="id394485AA09D44E30AF17FDEAC36AB492"><enum>(I)</enum><text>discloses the
negotiations immediately upon initiation of the negotiations; and</text>
</subclause><subclause id="id35173E3E930A44ACA505F7208FA08A36"><enum>(II)</enum><text>recuses himself from all
proceedings concerning the entity involved in the negotiations until
termination of negotiations or until termination of his employment by the
Board, if an offer of employment is accepted.</text>
</subclause></clause></subparagraph><subparagraph id="IDe08b01c0d7e34c9f9a2ffc32ce1b9cfd"><enum>(B)</enum><header>Credit
analysts</header>
<clause id="idDDD0C2E4498147C891E3D06E751560FD"><enum>(i)</enum><header>In
general</header><text>A credit analyst of a qualified nationally recognized
statistical rating organization shall not accept any loan of money or
securities, or anything above nominal value, from any issuer or
investor.</text>
</clause><clause id="idCB4DD42C34604F8D80159CD553C69AAD"><enum>(ii)</enum><header>Exception</header><text>The
prohibition described in clause (i) does not apply to a loan made in the
context of disclosed, routine banking and brokerage agreements, or a loan that
is clearly motivated by a personal or family relationship.</text>
</clause></subparagraph></paragraph><paragraph id="ID2e46b9685c894d34adee573bfadb370f"><enum>(15)</enum><header>Evaluation of Credit
Rating Agency Board</header><text>Not later than 5 years after the date that
the Board begins assigning qualified nationally recognized statistical rating
organizations to provide initial ratings, the Commission shall submit to
Congress a report that provides recommendations of—</text>
<subparagraph id="id555DA0E642C44ABDBB912B028B772121"><enum>(A)</enum><text>the continuation of the
Board;</text>
</subparagraph><subparagraph id="id43ECE23A61DB4BE6A7A19C40B6FF5078"><enum>(B)</enum><text>any modification to the
procedures of the Board; and</text>
</subparagraph><subparagraph id="id92C499115504442385A774F2D96369E5"><enum>(C)</enum><text>modifications to the
provisions in this
subsection.</text>
</subparagraph></paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</section></subtitle><subtitle id="id3234CF1457C1406AB6509512C7B25ACA"><enum>D</enum><header>Improvements to the
Asset-Backed Securitization Process</header>
<section id="idDDF943AE74B74DC0BFB321AF04545DBA"><enum>941.</enum><header>Regulation of credit
risk retention</header>
<subsection id="id48D73E755D08464CA902427E9F28BEDE"><enum>(a)</enum><header>Definition of
asset-backed security</header><text display-inline="yes-display-inline">Section
3(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78c(a)) is amended by
adding at the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id4E00749B960E46988F16E18CA0263327" reported-display-style="italic" style="OLC">
<paragraph id="id3F01F3DD72F44C63B2E3A66139FB0F4F"><enum>(77)</enum><header>Asset-backed
security</header><text>The term <term>asset-backed security</term>—</text>
<subparagraph id="id892AAA591E6B4A8AB282BE95242A6661"><enum>(A)</enum><text>means a fixed-income or
other security collateralized by any type of self-liquidating financial asset
(including a loan, a lease, a mortgage, or a secured or unsecured receivable)
that allows the holder of the security to receive payments that depend
primarily on cash flow from the asset, including—</text>
<clause id="id00A068CAF66F429B9580328BE1F1C9F1"><enum>(i)</enum><text>a collateralized mortgage
obligation;</text>
</clause><clause id="id90C03CBF589847D9A36BB698D7FABF09"><enum>(ii)</enum><text>a collateralized debt
obligation;</text>
</clause><clause id="id640D9949885B4B2781BA92C22A37E92E"><enum>(iii)</enum><text>a collateralized bond
obligation;</text>
</clause><clause id="idD88536084F874C95AF08F5D575211BE8"><enum>(iv)</enum><text>a collateralized debt
obligation of asset-backed securities;</text>
</clause><clause id="idC78DEF8C55524A74AA09E30BA454271E"><enum>(v)</enum><text>a collateralized debt
obligation of collateralized debt obligations; and</text>
</clause><clause id="id78AD8AF86B694409A3CC8A04C043E259"><enum>(vi)</enum><text>a security that the
Commission, by rule, determines to be an asset-backed security for purposes of
this section; and</text>
</clause></subparagraph><subparagraph id="id0D7434824F0144759FBB634452CF3F58"><enum>(B)</enum><text>does not include a
security issued by a finance subsidiary held by the parent company or a company
controlled by the parent company, if none of the securities issued by the
finance subsidiary are held by an entity that is not controlled by the parent
company.</text>
</subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="id3CA0B8048A174563B76C9083FB65C52B"><enum>(b)</enum><header>Credit risk
retention</header><text display-inline="yes-display-inline">The Securities
Exchange Act of 1934 (15 U.S.C. 78a et seq.) is amended by inserting after
section 15F, as added by this Act, the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idB2FDA55E7D6246B8857CE272BDAC8602" reported-display-style="italic" style="OLC">
<section id="IDa2c14615fa0c45068977a8e48f8ec1da"><enum>15G.</enum><header>Credit risk
retention</header>
<subsection id="ID24f1ff7603ea40d989daf5b4c9611f2f"><enum>(a)</enum><header>Definitions</header><text>In
this section—</text>
<paragraph id="idFFCA8B7DBCA1456DA331D0B04ECC5666"><enum>(1)</enum><text>the term <term>Federal
banking agencies</term> means the Office of the Comptroller of the Currency,
the Board of Governors of the Federal Reserve System, and the Federal Deposit
Insurance Corporation;</text>
</paragraph><paragraph id="id125CD461BFCF450396A954C82455D328"><enum>(2)</enum><text>the term <quote>insured
depository institution</quote> has the same meaning as in section 3(c) of the
Federal Deposit Insurance Act (12 U.S.C. 1813(c));</text>
</paragraph><paragraph id="IDd766e7c51a314787a733026ac4f26afd"><enum>(3)</enum><text>the term
<term>securitizer</term> means—</text>
<subparagraph id="idA859C16BBFBD4211948174009B7D2B59"><enum>(A)</enum><text>an issuer of an
asset-backed security; or</text>
</subparagraph><subparagraph id="id57C6FB47ED554625A329FE6ABAAF869E"><enum>(B)</enum><text>a person who organizes
and initiates an asset-backed securities transaction by selling or transferring
assets, either directly or indirectly, including through an affiliate, to the
issuer; and</text>
</subparagraph></paragraph><paragraph id="IDb1b1c94d0a024a08b0394c7b481f969b"><enum>(4)</enum><text>the term
<term>originator</term> means a person who—</text>
<subparagraph id="idA6D83C48955A4EC4A6DEC1A91A068774"><enum>(A)</enum><text>through the extension of
credit or otherwise, creates a financial asset that collateralizes an
asset-backed security; and</text>
</subparagraph><subparagraph id="id5EE3E1F7FE0F42559FC6E0F2FEA06520"><enum>(B)</enum><text>sells an asset to a
securitizer.</text>
</subparagraph></paragraph></subsection><subsection id="ID529a11b1ece94a1dbef74baa2f849994"><enum>(b)</enum><header>In
general</header><text>Not later than 270 days after the date of enactment of
this section, the Federal banking agencies and the Commission shall jointly
prescribe regulations to require any securitizer to retain an economic interest
in a portion of the credit risk for any asset that the securitizer, through the
issuance of an asset-backed security, transfers, sells, or conveys to a third
party.</text>
</subsection><subsection id="ID512b8a4e97e84b5099d58906dfbf86c2"><enum>(c)</enum><header>Standards for
regulations</header>
<paragraph id="idCEC5A777DFEF4AB18263BFCF2A63CC92"><enum>(1)</enum><header>Standards</header><text>The
regulations prescribed under subsection (b) shall—</text>
<subparagraph id="IDfd3bd21b1cab4c76bae8606d5908440c"><enum>(A)</enum><text>prohibit a securitizer
from directly or indirectly hedging or otherwise transferring the credit risk
that the securitizer is required to retain with respect to an asset;</text>
</subparagraph><subparagraph id="IDebaae43b83c9496ea38b9763f0789eda"><enum>(B)</enum><text>require a securitizer to
retain—</text>
<clause id="id8BC1BAAF4A7C4AB586916F03B4F4D3A1"><enum>(i)</enum><text>not less than 5 percent
of the credit risk for any asset—</text>
<subclause id="idE9280320AFAD4AADAD985C4084D29C66"><enum>(I)</enum><text>that is not a qualified
residential mortgage that is transferred, sold, or conveyed through the
issuance of an asset-backed security by the securitizer; or</text>
</subclause><subclause id="id53BE7C630990451984590368EF1A4C75"><enum>(II)</enum><text>that is a qualified
residential mortgage that is transferred, sold, or conveyed through the
issuance of an asset-backed security by the securitizer, if 1 or more of the
assets that collateralize the asset-backed security are not qualified
residential mortgages; or</text>
</subclause></clause><clause id="id0805750088D24A2CBDE6EA43EC1AD3AC"><enum>(ii)</enum><text>less than 5 percent of
the credit risk for an asset that is not a qualified residential mortgage that
is transferred, sold, or conveyed through the issuance of an asset-backed
security by the securitizer, if the originator of the asset meets the
underwriting standards prescribed under paragraph (2)(B);</text>
</clause></subparagraph><subparagraph id="id9522FF56A04F4394A7CA3A78E98841EF"><enum>(C)</enum><text>specify—</text>
<clause id="id717110CF009C47ECAD50D7FCEAE5A113"><enum>(i)</enum><text>the permissible forms of
risk retention for purposes of this section;</text>
</clause><clause id="id9B0C6F81ADFF45B780A0218963D38F51"><enum>(ii)</enum><text>the minimum duration of
the risk retention required under this section; and</text>
</clause><clause id="id979E01A3BC704FB59E27BCDE682BBBD1"><enum>(iii)</enum><text>that a securitizer is
not required to retain any part of the credit risk for an asset that is
transferred, sold or conveyed through the issuance of an asset-backed security
by the securitizer, if all of the assets that collateralize the asset-backed
security are qualified residential mortgages;</text>
</clause></subparagraph><subparagraph id="IDce5946a12bcd4e33bdfdafd7649d2b54"><enum>(D)</enum><text>apply, regardless of
whether the securitizer is an insured depository institution; and</text>
</subparagraph><subparagraph id="id3DFC7252B56D438DB79DED2383DCDBDC"><enum>(E)</enum><text>with respect to a
commercial mortgage, specify the permissible types, forms, and amounts of risk
retention that would meet the requirements of subparagraph (B), such as—</text>
<clause id="id0BEAB51CE90C4F89BFAF701D1B57DB14"><enum>(i)</enum><text>retention of a specified
amount or percentage of the total credit risk of the asset;</text>
</clause><clause id="id9666A5F31CD64D299D0134930615156C"><enum>(ii)</enum><text>retention of the
first-loss position by a third-party purchaser that specifically negotiates for
the purchase of such first-loss position and provides due diligence on all
individual assets in the pool before the issuance of the asset-backed
securities;</text>
</clause><clause id="id69C5E311B0E44156AB355A0835A414DD"><enum>(iii)</enum><text>a determination by a
Federal banking agency or the Commission that the underwriting standards and
controls for the asset are adequate; and</text>
</clause><clause id="id8556E2DFDFDB4F669F6DE562EF76C53E"><enum>(iv)</enum><text>provision of adequate
representations and warranties and related enforcement mechanisms; and</text>
</clause></subparagraph><subparagraph id="id309FBFC94BCD46008A8E0BE55C52ADD1"><enum>(F)</enum><text>provide for—</text>
<clause id="IDe1ea59212f284579bb8ef0e5a11dcf94"><enum>(i)</enum><text>a total or partial
exemption of any securitization, as may be appropriate in the public interest
and for the protection of investors; and</text>
</clause><clause id="IDa7459f50dd8a488086591ea59432d94a"><enum>(ii)</enum><text>the allocation of risk
retention obligations between a securitizer and an originator in the case of a
securitizer that purchases assets from an originator, as the Federal banking
agencies and the Commission jointly determine appropriate.</text>
</clause></subparagraph></paragraph><paragraph id="idC246E0A2E37E44078633F7481B1DEE38"><enum>(2)</enum><header>Asset classes</header>
<subparagraph id="idC5934BF0090D42B7896B06775F30BCB3"><enum>(A)</enum><header>Asset
classes</header><text>The regulations prescribed under subsection (b) shall
establish asset classes with separate rules for securitizers of different
classes of assets, including residential mortgages, commercial mortgages,
commercial loans, auto loans, and any other class of assets that the Federal
banking agencies and the Commission deem appropriate.</text>
</subparagraph><subparagraph id="id215A9F18884A4B77B6691950AFD5D727"><enum>(B)</enum><header>Contents</header><text>For
each asset class established under subparagraph (A), the regulations prescribed
under subsection (b) shall establish underwriting standards that specify the
terms, conditions, and characteristics of a loan within the asset class that
indicate a reduced credit risk with respect to the loan.</text>
</subparagraph></paragraph></subsection><subsection id="id5D66C7DBD47C44DA8AFFFA91504B8269"><enum>(d)</enum><header>Originators</header><text>In
determining how to allocate risk retention obligations between a securitizer
and an originator under subsection (c)(1)(E)(ii), the Federal banking agencies
and the Commission shall—</text>
<paragraph id="idA81376A91D9D433B98254D037C52DA48"><enum>(1)</enum><text>reduce the percentage of
risk retention obligations required of the securitizer by the percentage of
risk retention obligations required of the originator; and</text>
</paragraph><paragraph id="idEF7D31C054904A53901CF1A70BD29304"><enum>(2)</enum><text>consider—</text>
<subparagraph id="idF45948423B99401891190EDCBD0C1E3E"><enum>(A)</enum><text>whether the assets sold
to the securitizer have terms, conditions, and characteristics that reflect
reduced credit risk;</text>
</subparagraph><subparagraph id="id31EDA0686EDB47A99E8B8222652450DF"><enum>(B)</enum><text>whether the form or
volume of transactions in securitization markets creates incentives for
imprudent origination of the type of loan or asset to be sold to the
securitizer; and</text>
</subparagraph><subparagraph id="idED4793DDFBE6436B85262C929389EA52"><enum>(C)</enum><text>the potential impact of
the risk retention obligations on the access of consumers and businesses to
credit on reasonable terms, which may not include the transfer of credit risk
to a third party.</text>
</subparagraph></paragraph></subsection><subsection id="ID11715f91ca0643e3bdefc04fe9f6272d"><enum>(e)</enum><header>Exemptions, exceptions,
and adjustments</header>
<paragraph id="ID1c0f3bab87c942c497f1984f8495d28c"><enum>(1)</enum><header>In
general</header><text>The Federal banking agencies and the Commission may
jointly adopt or issue exemptions, exceptions, or adjustments to the rules
issued under this section, including exemptions, exceptions, or adjustments for
classes of institutions or assets relating to the risk retention requirement
and the prohibition on hedging under subsection (c)(1).</text>
</paragraph><paragraph id="ID148e497f89c54df8ab7aef280cb70203"><enum>(2)</enum><header>Applicable
standards</header><text>Any exemption, exception, or adjustment adopted or
issued by the Federal banking agencies and the Commission under this paragraph
shall—</text>
<subparagraph id="IDca272a7fe56b4adc9a3a54418e2fa2f9"><enum>(A)</enum><text>help ensure high quality
underwriting standards for the securitizers and originators of assets that are
securitized or available for securitization; and</text>
</subparagraph><subparagraph id="ID0d946db4f1da40a685f00ce4a0f2ce72"><enum>(B)</enum><text>encourage appropriate
risk management practices by the securitizers and originators of assets,
improve the access of consumers and businesses to credit on reasonable terms,
or otherwise be in the public interest and for the protection of
investors.</text>
</subparagraph></paragraph><paragraph id="id58F4C1983E044C2D8F90E0C83B80D56E"><enum>(3)</enum><header>Farm credit system
institutions</header><text>A Farm Credit System institution, including the
Federal Agricultural Mortgage Corporation, that is chartered and subject to the
provisions of the Farm Credit Act of 1971, as amended (12 U.S.C. 2001 et seq.),
shall be exempt from the risk retention provisions of this subsection.</text>
</paragraph><paragraph id="ID996dac70e52e44ae9f76a3bcadec96e7"><enum>(4)</enum><header>Exemption for qualified
residential mortgages</header>
<subparagraph id="IDcebc143c2bb0453e9d699996d6706926"><enum>(A)</enum><header>In
general</header><text>The Federal banking agencies, the Commission, the
Secretary of Housing and Urban Development, and the Director of the Federal
Housing Finance Agency shall jointly issue regulations to exempt qualified
residential mortgages from the risk retention requirements of this
subsection.</text>
</subparagraph><subparagraph id="IDe636c1bc84a74b1195a8f27a4631be0c"><enum>(B)</enum><header>Qualified residential
mortgage</header><text>The Federal banking agencies, the Commission, the
Secretary of Housing and Urban Development, and the Director of the Federal
Housing Finance Agency shall jointly define the term <term>qualified
residential mortgage</term> for purposes of this subsection, taking into
consideration underwriting and product features that historical loan
performance data indicate result in a lower risk of default, such as—</text>
<clause id="IDfda91d17814f4080a79171ab69cbe1ce"><enum>(i)</enum><text>documentation and
verification of the financial resources relied upon to qualify the
mortgagor;</text>
</clause><clause id="ID96dd90a7ee4b4916be1e4e0a4ea07763"><enum>(ii)</enum><text>standards with respect
to—</text>
<subclause id="id76C0D5D5AD0F44AE92E1CD341F360398"><enum>(I)</enum><text>the residual income of
the mortgagor after all monthly obligations;</text>
</subclause><subclause id="IDb38ab166873240ffbfc05ea0c920398e"><enum>(II)</enum><text>the ratio of the housing
payments of the mortgagor to the monthly income of the mortgagor;</text>
</subclause><subclause id="IDcf5ca4977d144213845d4b621925e98e"><enum>(III)</enum><text>the ratio of total
monthly installment payments of the mortgagor to the income of the
mortgagor;</text>
</subclause></clause><clause id="ID7fa4c67e5c684f888ca74a780e545bef"><enum>(iii)</enum><text>mitigating the
potential for payment shock on adjustable rate mortgages through product
features and underwriting standards;</text>
</clause><clause id="IDfa93093257b54f879b661a11dfa99b00"><enum>(iv)</enum><text>mortgage guarantee
insurance obtained at the time of origination for loans with combined
loan-to-value ratios of greater than 80 percent; and</text>
</clause><clause id="ID3cbff6b010b644c6b1d1daf4ada4ed2b"><enum>(v)</enum><text>prohibiting or
restricting the use of balloon payments, negative amortization, prepayment
penalties, interest-only payments, and other features that have been
demonstrated to exhibit a higher risk of borrower default.</text>
</clause></subparagraph></paragraph><paragraph id="IDd8e1840f47e74a97a14c0578a497261a"><enum>(5)</enum><header>Condition for qualified
residential mortgage exemption</header><text>The regulations issued under
paragraph (4) shall provide that an asset-backed security that is
collateralized by tranches of other asset-backed securities shall not be exempt
from the risk retention requirements of this subsection.</text>
</paragraph><paragraph id="IDad417c304834488a8e1bd05cc384d3d6"><enum>(6)</enum><header>Certification</header><text>The
Commission shall require an issuer to certify, for each issuance of an
asset-backed security collateralized exclusively by qualified residential
mortgages, that the issuer has evaluated the effectiveness of the internal
supervisory controls of the issuer with respect to the process for ensuring
that all assets that collateralize the asset-backed security are qualified
residential mortgages.</text>
</paragraph></subsection><subsection id="ID8227fea6e53e4854b002063c5d84fbb9"><enum>(f)</enum><header>Enforcement</header><text>The
regulations issued under this section shall be enforced by—</text>
<paragraph id="IDe7e7827585b1480cabebb8f64ee7b6bd"><enum>(1)</enum><text>the appropriate Federal
banking agency, with respect to any securitizer that is an insured depository
institution; and</text>
</paragraph><paragraph id="ID9ee2f8cbd99244779214cabefff10e0e"><enum>(2)</enum><text>the Commission, with
respect to any securitizer that is not an insured depository
institution.</text>
</paragraph></subsection><subsection id="ID34ce5415bdff4508945a14e7f03bb6d7"><enum>(g)</enum><header>Authority of
Commission</header><text>The authority of the Commission under this section
shall be in addition to the authority of the Commission to otherwise enforce
the securities laws.</text>
</subsection><subsection id="IDf42fe6a930054344b950eade16f3837b"><enum>(h)</enum><header>Effective date of
regulations</header><text>The regulations issued under this section shall
become effective—</text>
<paragraph id="idAE43224F2C15488A9BF0041A63CE0CF4"><enum>(1)</enum><text>with respect to
securitizers and originators of asset-backed securities backed by residential
mortgages, 1 year after the date on which final rules under this section are
published in the Federal Register; and</text>
</paragraph><paragraph id="id0C0309E8418A4934B866532F0B225AE6"><enum>(2)</enum><text>with respect to
securitizers and originators of all other classes of asset-backed securities, 2
years after the date on which final rules under this section are published in
the Federal
Register.</text>
</paragraph></subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection></section><section id="IDf316c78e98cc407e853cbc9de85b3503"><enum>942.</enum><header>Disclosures and
reporting for asset-backed securities</header>
<subsection id="id0C0F99938A7D4C31889F92C17BD13CBA"><enum>(a)</enum><header>Securities Exchange Act
of 1934</header><text display-inline="yes-display-inline">Section 15(d) of the
Securities Exchange Act of 1934 (15 U.S.C. 78o(d)) is amended—</text>
<paragraph id="id76E28DB0D84245D9A74BC560A1FD0584"><enum>(1)</enum><text>by striking <quote>(d)
Each</quote> and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idDCEE0AE8CCBA4D44837FB5233865222A" reported-display-style="italic" style="OLC">
<subsection id="id28EE4D112B52487891EB86A2B50DF12E"><enum>(d)</enum><header>Supplementary and
periodic information</header>
<paragraph id="id2A120DB285C1432CA0542A93B4C26776"><enum>(1)</enum><header>In
general</header><text>Each</text>
</paragraph></subsection><after-quoted-block>;</after-quoted-block></quoted-block>
</paragraph><paragraph id="id666879351B6B40108795EAAF79ECF771"><enum>(2)</enum><text>in the third sentence, by
inserting after <quote>securities of each class</quote> the following: <quote>,
other than any class of asset-backed securities,</quote>; and</text>
</paragraph><paragraph id="IDec12f1477d9142919b8953de05439c9d"><enum>(3)</enum><text>by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idAE36F23518A44ABCBDBF1C331BACB3A3" reported-display-style="italic" style="OLC">
<paragraph id="idA84871745676419F92B3BEA6B7EC6EAD"><enum>(2)</enum><header>Asset-backed
securities</header>
<subparagraph id="id9931412B972442E89CB736790C1F02D1"><enum>(A)</enum><header>Suspension of duty to
file</header><text>The Commission may, by rule or regulation, provide for the
suspension or termination of the duty to file under this subsection for any
class of asset-backed security, on such terms and conditions and for such
period or periods as the Commission deems necessary or appropriate in the
public interest or for the protection of investors.</text>
</subparagraph><subparagraph id="idA3C520F0397D44198AADC9B0F8267899"><enum>(B)</enum><header>Classification of
issuers</header><text>The Commission may, for purposes of this subsection,
classify issuers and prescribe requirements appropriate for each class of
issuers of asset-backed
securities.</text>
</subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="idD884BF79174844EFBD1A61F9AFC46780"><enum>(b)</enum><header>Securities Act of
1933</header><text>Section 7 of the Securities Act of 1933 (15 U.S.C. 77g) is
amended by adding at the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id91D6B071780A4D5D830D3A6D375E4589" reported-display-style="italic" style="OLC">
<subsection id="id0E1426516A9740C2AED06C93E8357895"><enum>(c)</enum><header>Disclosure
requirements</header>
<paragraph id="id39D33F82BB664084962A66BB9A814591"><enum>(1)</enum><header>In
general</header><text>The Commission shall adopt regulations under this
subsection requiring each issuer of an asset-backed security to disclose, for
each tranche or class of security, information regarding the assets backing
that security.</text>
</paragraph><paragraph id="id98A77C843331426F9AE046DAF58AF748"><enum>(2)</enum><header>Content of
regulations</header><text>In adopting regulations under this subsection, the
Commission shall—</text>
<subparagraph id="idE07068E88BFC4DF69D6EC72EFB315C3D"><enum>(A)</enum><text>set standards for the
format of the data provided by issuers of an asset-backed security, which
shall, to the extent feasible, facilitate comparison of such data across
securities in similar types of asset classes; and</text>
</subparagraph><subparagraph id="idB43E7D0E7DB24E6DBC5CFF1231FFEDCB"><enum>(B)</enum><text>require issuers of
asset-backed securities, at a minimum, to disclose asset-level or loan-level
data necessary for investors to independently perform due diligence,
including—</text>
<clause id="id497BD6DF6A624A2D9AB121D9D93E7A4B"><enum>(i)</enum><text>data having unique
identifiers relating to loan brokers or originators;</text>
</clause><clause id="id461A354028E540FAA391BB36B97698F6"><enum>(ii)</enum><text>the nature and extent of
the compensation of the broker or originator of the assets backing the
security; and</text>
</clause><clause id="idBDC0D80F7B614E74A33A5A3D0DAFFA3D"><enum>(iii)</enum><text>the amount of risk
retention by the originator and the securitizer of such
assets.</text>
</clause></subparagraph></paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection></section><section id="IDdc7dd59514954c04b857b6ab40d565cb"><enum>943.</enum><header>Representations and
warranties in asset-backed offerings</header><text display-inline="no-display-inline">Not later than 180 days after the date of
enactment of this Act, the Securities and Exchange Commission shall prescribe
regulations on the use of representations and warranties in the market for
asset-backed securities (as that term is defined in section 3(a)(77) of the
Securities Exchange Act of 1934, as added by this subtitle) that—</text>
<paragraph id="ID1c58fe653f0445ceb4d315c2ef871f59"><enum>(1)</enum><text>require each national
recognized statistical rating organization to include in any report
accompanying a credit rating a description of—</text>
<subparagraph id="id6E1CC13ABEFA452EB6F3EF29EAAA3F4C"><enum>(A)</enum><text>the representations,
warranties, and enforcement mechanisms available to investors; and</text>
</subparagraph><subparagraph id="id6729B4E9589D4C4BAC3ED1100689B3EA"><enum>(B)</enum><text>how they differ from the
representations, warranties, and enforcement mechanisms in issuances of similar
securities; and</text>
</subparagraph></paragraph><paragraph id="IDc22d12a2d4644259b0c0e6710f0201e3"><enum>(2)</enum><text>require any securitizer
(as that term is defined in section 15G(a) of the Securities Exchange Act of
1934, as added by this subtitle) to disclose fulfilled and unfulfilled
repurchase requests across all trusts aggregated by the securitizer, so that
investors may identify asset originators with clear underwriting
deficiencies.</text>
</paragraph></section><section id="ID1672bf7261e14314a6bd0d7186efc0e0"><enum>944.</enum><header>Exempted transactions
under the Securities Act of 1933</header>
<subsection id="ID007c44800008439da9c0f64216727ed7"><enum>(a)</enum><header>Exemption
eliminated</header><text>Section 4 of the Securities Act of 1933 (15 U.S.C.
77d) is amended—</text>
<paragraph id="ID99272371221f4726b527b03b8274d758"><enum>(1)</enum><text>by striking paragraph
(5); and</text>
</paragraph><paragraph id="IDd7eb2ac7973a4eabb45608d62abe88cc"><enum>(2)</enum><text>by striking <quote>(6)
transactions</quote> and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id8B56B74763C9472092F64780D2302111" reported-display-style="italic" style="OLC">
<paragraph id="idB7CA8EA1AB8F42DFB21BD7570D0E0CFF"><enum>(5)</enum><text>transactions</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="ID125bfb8bdcb44618bc3163310de5ad41"><enum>(b)</enum><header>Conforming
amendment</header><text>Section 3(a)(4)(B)(vii)(I) of the Securities Exchange
Act of 1934 (15 U.S.C. 78c(a)(4)(B)(vii)(I)) is amended by striking
<quote>4(6)</quote> and inserting <quote>4(5)</quote>.</text>
</subsection></section><section id="id75B7B13466094D3092C98A1C8B70F958"><enum>945.</enum><header>Due diligence analysis
and disclosure in asset-backed securities issues</header><text display-inline="no-display-inline">Section 7 of the Securities Act of 1933 (15
U.S.C. 77g), as amended by this subtitle, is amended by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id685013FF2AA446568FAB11D07A81DD34" reported-display-style="italic" style="OLC">
<subsection id="idDFE8CCC456CB407FA21AC4C4E9FDF1A0"><enum>(d)</enum><header>Registration statement
for asset-backed securities</header><text>Not later than 180 days after the
date of enactment of this subsection, the Commission shall issue rules relating
to the registration statement required to be filed by any issuer of an
asset-backed security (as that term is defined in section 3(a)(77) of the
Securities Exchange Act of 1934) that require any issuer of an asset-backed
security—</text>
<paragraph id="idCB78FF9CBD9340328BA237E5AD864E70"><enum>(1)</enum><text>to perform a due
diligence analysis of the assets underlying the asset-backed security;
and</text>
</paragraph><paragraph id="idA93A7C7ED34B4A158AB2A3DA576423A1"><enum>(2)</enum><text>to disclose the nature of
the analysis under paragraph
(1).</text>
</paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</section></subtitle><subtitle id="idEFA7E26AC8F54A3DB378E7B6078144D1"><enum>E</enum><header>Accountability and
Executive Compensation</header>
<section commented="no" display-inline="no-display-inline" id="H4E1486A9DF1C4939A7F053BB16885C0" section-type="subsequent-section"><enum>951.</enum><header display-inline="yes-display-inline">Shareholder vote on executive compensation
disclosures</header><text display-inline="no-display-inline">The Securities
Exchange Act of 1934 (15 U.S.C. 78a et seq.) is amended by inserting after
section 14 (15 U.S.C. 78n) the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="H97686321E421421099DA059F7079DFE" reported-display-style="italic" style="OLC">
<section commented="no" display-inline="no-display-inline" id="H35E8FEAE5A4B47AA87C2B320916BB5DB"><enum>14A.</enum><header display-inline="yes-display-inline">Annual shareholder approval of executive
compensation</header>
<subsection commented="no" display-inline="no-display-inline" id="idA65DE38B540A4F51B320B119D85845F1"><enum>(a)</enum><header>Separate resolution
required</header><text display-inline="yes-display-inline">Any proxy or consent
or authorization for an annual or other meeting of the shareholders occurring
after the end of the 6-month period beginning on the date of enactment of this
section, for which the proxy solicitation rules of the Commission require
compensation disclosure, shall include a separate resolution subject to
shareholder vote to approve the compensation of executives, as disclosed
pursuant to section 229.402 of title 17, Code of Federal Regulations, or any
successor thereto.</text>
</subsection><subsection commented="no" display-inline="no-display-inline" id="idA280CFB2350B442483D3E03C55E94A65"><enum>(b)</enum><header>Rule of
construction</header><text display-inline="yes-display-inline">The shareholder
vote referred to in subsection (a) shall not be binding on the issuer or the
board of directors of an issuer, and may not be construed—</text>
<paragraph commented="no" display-inline="no-display-inline" id="id0FC6AE141B2544D3BF6B7DE5A3A64817"><enum>(1)</enum><text display-inline="yes-display-inline">as overruling a decision by such issuer or
board of directors;</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="id5269169DBD1B41ABB0AC80A6F7F19F51"><enum>(2)</enum><text display-inline="yes-display-inline">to create or imply any change to the
fiduciary duties of such issuer or board of directors;</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="id750A767681FE4114A533877AF0B165DB"><enum>(3)</enum><text display-inline="yes-display-inline">to create or imply any additional fiduciary
duties for such issuer or board of directors; or</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="idDB242C6F244341FCBE5E2E13C2D7DA64"><enum>(4)</enum><text display-inline="yes-display-inline">to restrict or limit the ability of
shareholders to make proposals for inclusion in proxy materials related to
executive
compensation.</text>
</paragraph></subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</section><section id="ID87dd42d4ac8e4d88b06a4ba5ef9f4fdf"><enum>952.</enum><header>Compensation committee
independence</header><text display-inline="no-display-inline">The Securities
Exchange Act of 1934 (15 U.S.C. 78 et seq.) is amended by inserting after
section 10B, as added by section 753, the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idFD004C6C08FE4053853B783B4FBC1116" reported-display-style="italic" style="OLC">
<section id="IDb03bc563f43840ce95e2b4eb78136a52"><enum>10C.</enum><header>Compensation
committees</header>
<subsection id="id1391878B41BF401DBE6F8E1D26B10614"><enum>(a)</enum><header>Independence of
compensation committees</header>
<paragraph id="id70AF2460CC1C4D4A9D4DEFEE02F32343"><enum>(1)</enum><header>Listing
standards</header><text>The Commission shall, by rule, direct the national
securities exchanges and national securities associations to prohibit the
listing of any security of an issuer that does not comply with the requirements
of this subsection.</text>
</paragraph><paragraph id="id91490B8DBFB944818D340B1B5DCA43CD"><enum>(2)</enum><header>Independence of
compensation committees</header><text>The rules of the Commission under
paragraph (1) shall require that each member of the compensation committee of
the board of directors of an issuer be—</text>
<subparagraph id="idDD1C407581E04E61B7EB1FC966C19133"><enum>(A)</enum><text>a member of the board of
directors of the issuer; and</text>
</subparagraph><subparagraph id="id13F5B449C22440FAAE7A85593AB513B5"><enum>(B)</enum><text>independent.</text>
</subparagraph></paragraph><paragraph id="ID0b6a305a7eee4d0ca7151ecff508ed3a"><enum>(3)</enum><header>Independence</header><text>The
rules of the Commission under paragraph (1) shall require that, in determining
the definition of the term <term>independence</term> for purposes of paragraph
(2), the national securities exchanges and the national securities associations
shall consider relevant factors, including—</text>
<subparagraph id="idAD83EC2100EC4641948D8D7D1D2546F8"><enum>(A)</enum><text>the source of
compensation of a member of the board of directors of an issuer, including any
consulting, advisory, or other compensatory fee paid by the issuer to such
member of the board of directors; and</text>
</subparagraph><subparagraph id="idCAFC66260FA74CD282A9D1B6CAB819DA"><enum>(B)</enum><text>whether a member of the
board of directors of an issuer is affiliated with the issuer, a subsidiary of
the issuer, or an affiliate of a subsidiary of the issuer.</text>
</subparagraph></paragraph><paragraph id="ID224db3c73a074bb09203f023392ac5cc"><enum>(4)</enum><header>Exemption
authority</header><text>The rules of the Commission under paragraph (1) shall
permit a national securities exchange or a national securities association to
exempt a particular relationship from the requirements of paragraph (2), with
respect to the members of a compensation committee, as the national securities
exchange or national securities association determines is appropriate, taking
into consideration the size of an issuer and any other relevant factors.</text>
</paragraph></subsection><subsection id="ID12135910c14a4db8a430066c657ebac9"><enum>(b)</enum><header>Independence of
compensation consultants and other compensation committee advisers</header>
<paragraph id="id6C3DBF4A03EE45D5A98859DD1F343F7E"><enum>(1)</enum><header>In
general</header><text>The compensation committee of an issuer may only select a
compensation consultant, legal counsel, or other adviser to the compensation
committee after taking into consideration the factors identified by the
Commission under paragraph (2).</text>
</paragraph><paragraph id="idAA64A9FA5F34429E9DF8495A31BD93A7"><enum>(2)</enum><header>Rules</header><text>The
Commission shall identify factors that affect the independence of a
compensation consultant, legal counsel, or other adviser to a compensation
committee of an issuer, including—</text>
<subparagraph id="id5DA7CF50CD264B4A8D1F1641A4936EF9"><enum>(A)</enum><text>the provision of other
services to the issuer by the person that employs the compensation consultant,
legal counsel, or other adviser;</text>
</subparagraph><subparagraph id="id10CF61CF91594E42AE87775A4F134E32"><enum>(B)</enum><text>the amount of fees
received from the issuer by the person that employs the compensation
consultant, legal counsel, or other adviser, as a percentage of the total
revenue of the person that employs the compensation consultant, legal counsel,
or other adviser;</text>
</subparagraph><subparagraph id="id4814BBF4A9A64C42ABD629529D6FBF52"><enum>(C)</enum><text>the policies and
procedures of the person that employs the compensation consultant, legal
counsel, or other adviser that are designed to prevent conflicts of
interest;</text>
</subparagraph><subparagraph id="idCBCF976FB0EA4360A41E119C23B4CE5C"><enum>(D)</enum><text>any business or personal
relationship of the compensation consultant, legal counsel, or other adviser
with a member of the compensation committee; and</text>
</subparagraph><subparagraph id="idEB5B7208D273465CBA151BB14A568E99"><enum>(E)</enum><text>any stock of the issuer
owned by the compensation consultant, legal counsel, or other adviser.</text>
</subparagraph></paragraph></subsection><subsection id="ID147c177f07cb43279b089ee968ed181c"><enum>(c)</enum><header>Compensation committee
authority relating to compensation consultants</header>
<paragraph id="IDde1d1cc834144ca28c334ef70de877be"><enum>(1)</enum><header>Authority to retain
compensation consultant</header>
<subparagraph id="id35F19B414AC544D89E0225500DC61130"><enum>(A)</enum><header>In
general</header><text>The compensation committee of an issuer, in its capacity
as a committee of the board of directors, may, in its sole discretion, retain
or obtain the advice of a compensation consultant.</text>
</subparagraph><subparagraph id="idFD6E2499FD2E4176914779F39208CEAD"><enum>(B)</enum><header>Direct responsibility
of compensation committee</header><text>The compensation committee of an issuer
shall be directly responsible for the appointment, compensation, and oversight
of the work of a compensation consultant.</text>
</subparagraph><subparagraph id="idAA2A39BC92A74D2AB35298BC7CD82F5C"><enum>(C)</enum><header>Rule of
construction</header><text>This paragraph may not be construed—</text>
<clause id="id8810995896E44FD89E98B77495404F71"><enum>(i)</enum><text>to require the
compensation committee to implement or act consistently with the advice or
recommendations of the compensation consultant; or</text>
</clause><clause id="id8D314DCBC1CE47C3A090DD6BAF4913BA"><enum>(ii)</enum><text>to affect the ability or
obligation of a compensation committee to exercise its own judgment in
fulfillment of the duties of the compensation committee.</text>
</clause></subparagraph></paragraph><paragraph id="ID340b42d356294238851c45c295697f60"><enum>(2)</enum><header>Disclosure</header><text>In
any proxy or consent solicitation material for an annual meeting of the
shareholders (or a special meeting in lieu of the annual meeting) occurring on
or after the date that is 1 year after the date of enactment of this section,
each issuer shall disclose in the proxy or consent material, in accordance with
regulations of the Commission, whether—</text>
<subparagraph id="ID97496db66b0a46d98d57b45eff728ffa"><enum>(A)</enum><text>the compensation
committee of the issuer retained or obtained the advice of a compensation
consultant; and</text>
</subparagraph><subparagraph id="ID5183f02753734f529e48bb5b602d4805"><enum>(B)</enum><text>the work of the
compensation consultant has raised any conflict of interest and, if so, the
nature of the conflict and how the conflict is being addressed.</text>
</subparagraph></paragraph></subsection><subsection id="IDf96749eb52a34367a30c5d654f146aa8"><enum>(d)</enum><header>Authority To engage
independent legal counsel and other advisers</header>
<paragraph id="id07D440AD33014F608657DF38E3B552CE"><enum>(1)</enum><header>In
general</header><text>The compensation committee of an issuer, in its capacity
as a committee of the board of directors, may, in its sole discretion, retain
and obtain the advice of independent legal counsel and other advisers.</text>
</paragraph><paragraph id="id8791343F2320435AA62843566A08A894"><enum>(2)</enum><header>Direct responsibility
of compensation committee</header><text>The compensation committee of an issuer
shall be directly responsible for the appointment, compensation, and oversight
of the work of independent legal counsel and other advisers.</text>
</paragraph><paragraph id="idB3A06AB16A2F40C2881212B77CBDEAD1"><enum>(3)</enum><header>Rule of
construction</header><text>This subsection may not be construed—</text>
<subparagraph id="id3FD5136B813645DCA566A0969FF17F4B"><enum>(A)</enum><text>to require a compensation
committee to implement or act consistently with the advice or recommendations
of independent legal counsel or other advisers under this subsection; or</text>
</subparagraph><subparagraph id="id53B7E30024854AE992AD84B04E69966C"><enum>(B)</enum><text>to affect the ability or
obligation of a compensation committee to exercise its own judgment in
fulfillment of the duties of the compensation committee.</text>
</subparagraph></paragraph></subsection><subsection id="ID10fe1db9e70044eca2699f8cfe73ba26"><enum>(e)</enum><header>Compensation of
compensation consultants, independent legal counsel, and other
advisers</header><text>Each issuer shall provide for appropriate funding, as
determined by the compensation committee in its capacity as a committee of the
board of directors, for payment of reasonable compensation—</text>
<paragraph id="ID684f687d4808462a80a83ed9741c9b56"><enum>(1)</enum><text>to a compensation
consultant; and</text>
</paragraph><paragraph id="ID1cd683b228b64e0f8368348a8d9bfa24"><enum>(2)</enum><text>to independent legal
counsel or any other adviser to the compensation committee.</text>
</paragraph></subsection><subsection id="id40550AD701904689A0C4DAF1DAB4B184"><enum>(f)</enum><header>Commission
rules</header>
<paragraph id="ID63023fb0605b45c193855f67a7cb148a"><enum>(1)</enum><header>In
general</header><text>Not later than 360 days after the date of enactment of
this section, the Commission shall, by rule, direct the national securities
exchanges and national securities associations to prohibit the listing of any
security of an issuer that is not in compliance with the requirements of this
section.</text>
</paragraph><paragraph id="ID392506cab3de46c89c163b1714a81780"><enum>(2)</enum><header>Opportunity to cure
defects</header><text>The rules of the Commission under paragraph (1) shall
provide for appropriate procedures for an issuer to have a reasonable
opportunity to cure any defects that would be the basis for the prohibition
under paragraph (1), before the imposition of such prohibition.</text>
</paragraph><paragraph id="IDab9497c897a74188be480f281e95538f"><enum>(3)</enum><header>Exemption
authority</header>
<subparagraph id="id9A20CE7523C04D8D8B90BA4F6F94ADD4"><enum>(A)</enum><header>In
general</header><text>The rules of the Commission under paragraph (1) shall
permit a national securities exchange or a national securities association to
exempt a category of issuers from the requirements under this section, as the
national securities exchange or the national securities association determines
is appropriate.</text>
</subparagraph><subparagraph id="idB1893686544140C88E8DA74816D0D7ED"><enum>(B)</enum><header>Considerations</header><text>In
determining appropriate exemptions under subparagraph (A), the national
securities exchange or the national securities association shall take into
account the potential impact of the requirements of this section on smaller
reporting
issuers.</text>
</subparagraph></paragraph></subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</section><section id="id55C445468CEA41E498823C0041AA2E7D"><enum>953.</enum><header>Executive compensation
disclosures</header>
<subsection id="idFE97735A1009463795BDBEE6FC582BD2"><enum>(a)</enum><header>Disclosure of pay
versus performance</header><text display-inline="yes-display-inline">Section 14
of the Securities Exchange Act of 1934 (15 U.S.C. 78n), as amended by this
title, is amended by adding at the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id914ACE2D116A415995C3AEACE844D935" reported-display-style="italic" style="OLC">
<subsection id="id7960D62E662443578437BC5BDC3EDBDF"><enum>(i)</enum><header>Disclosure of pay
versus performance</header><text>The Commission shall, by rule, require each
issuer to disclose in any proxy or consent solicitation material for an annual
meeting of the shareholders of the issuer a clear description of any
compensation required to be disclosed by the issuer under section 229.402 of
title 17, Code of Federal Regulations (or any successor thereto), including
information that shows the relationship between executive compensation actually
paid and the financial performance of the issuer, taking into account any
change in the value of the shares of stock and dividends of the issuer and any
distributions. The disclosure under this subsection may include a graphic
representation of the information required to be
disclosed.</text>
</subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="id2F4E69D2664C4BE7937625E3A05B5AE6"><enum>(b)</enum><header>Additional disclosure
requirements</header>
<paragraph id="id814B64B3BCD6425C8833A9791DFA10F0"><enum>(1)</enum><header>In
general</header><text>The Commission shall amend section 229.402 of title 17,
Code of Federal Regulations, to require each issuer to disclose in any filing
of the issuer described in section 229.10(a) of title 17, Code of Federal
Regulations (or any successor thereto)—</text>
<subparagraph id="id126AA16CF6974FA5BB052983A78D1246"><enum>(A)</enum><text>the median of the annual
total compensation of all employees of the issuer, except the chief executive
officer (or any equivalent position) of the issuer;</text>
</subparagraph><subparagraph id="id2164967B025B496093F5A22404DECBE9"><enum>(B)</enum><text>the annual total
compensation of the chief executive officer (or any equivalent position) of the
issuer; and</text>
</subparagraph><subparagraph id="idCD7AB5D50172406FA890978B0E72F854"><enum>(C)</enum><text>the ratio of the amount
described in subparagraph (A) to the amount described in subparagraph
(B).</text>
</subparagraph></paragraph><paragraph id="idBF4D9AE3C25A4E568051F32453FC5A65"><enum>(2)</enum><header>Total
compensation</header><text>For purposes of this subsection, the total
compensation of an employee of an issuer shall be determined in accordance with
section 229.402(c)(2)(x) of title 17, Code of Federal Regulations, as in effect
on the day before the date of enactment of this Act.</text>
</paragraph></subsection></section><section id="idCC68DE40EDCD47A5AFDF5C5CBA956C89"><enum>954.</enum><header>Recovery of
erroneously awarded compensation</header><text display-inline="no-display-inline">The Securities Exchange Act of 1934 is
amended by inserting after section 10C, as added by section 952, the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id7ED7319148D549DE901D69F373510CE6" reported-display-style="italic" style="OLC">
<section id="idD51414E7620E42B6921E523065DF5B51"><enum>10D.</enum><header>Recovery of
erroneously awarded compensation policy</header>
<subsection id="id1395CCAC246648348FA367ACABF7F333"><enum>(a)</enum><header>Listing
standards</header><text>The Commission shall, by rule, direct the national
securities exchanges and national securities associations to prohibit the
listing of any security of an issuer that does not comply with the requirements
of this section.</text>
</subsection><subsection id="id4B7D693BC9D64574AFFF2195486A8062"><enum>(b)</enum><header>Recovery of
funds</header><text>The rules of the Commission under subsection (a) shall
require each issuer to develop and implement a policy providing—</text>
<paragraph id="idC31EC1F19EA84CA1AA3AA0F4D708837E"><enum>(1)</enum><text>for disclosure of the
policy of the issuer on incentive-based compensation that is based on financial
information required to be reported under the securities laws; and</text>
</paragraph><paragraph id="id5B21F122F60640E5BF013654D38AF891"><enum>(2)</enum><text>that, in the event that
the issuer is required to prepare an accounting restatement due to the material
noncompliance of the issuer with any financial reporting requirement under the
securities laws, the issuer will recover from any current or former executive
officer of the issuer who received incentive-based compensation (including
stock options awarded as compensation) during the 3-year period preceding the
date on which the issuer is required to prepare an accounting restatement,
based on the erroneous data, in excess of what would have been paid to the
executive officer under the accounting
restatement.</text>
</paragraph></subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</section><section id="id65007B949EFE44C396406BA048827506"><enum>955.</enum><header>Disclosure regarding
employee and director hedging</header><text display-inline="no-display-inline">Section 14 of the Securities Exchange Act of
1934 (15 U.S.C. 78n), as amended by this title, is amended by adding at the end
the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id083834635EA847EE853A2B2A94310B43" reported-display-style="italic" style="OLC">
<subsection id="id5FC153EDE0DF452DA1D785DAA738C257"><enum>(j)</enum><header>Disclosure of hedging
by employees and directors</header><text display-inline="yes-display-inline">The Commission shall, by rule, require each
issuer to disclose in any proxy or consent solicitation material for an annual
meeting of the shareholders of the issuer whether any employee or member of the
board of directors of the issuer, or any designee of such employee or member,
is permitted to purchase financial instruments (including prepaid variable
forward contracts, equity swaps, collars, and exchange funds) that are designed
to hedge or offset any decrease in the market value of equity
securities—</text>
<paragraph id="id4B26A25C430A433EA04CAB3055080473"><enum>(1)</enum><text display-inline="yes-display-inline">granted to the employee or member of the
board of directors by the issuer as part of the compensation of the employee or
member of the board of directors; or</text>
</paragraph><paragraph id="id12A5C6333A624AE2A833D6CD4F31936F"><enum>(2)</enum><text display-inline="yes-display-inline">held, directly or indirectly, by the
employee or member of the board of
directors.</text>
</paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</section><section id="idFCFF1D169C3E4373B2287A865E1882A1"><enum>956.</enum><header>Excessive compensation
by holding companies of depository institutions</header><text display-inline="no-display-inline">Section 5 of the Bank Holding Company Act of
1956 (12 U.S.C. 1844) is amended by adding at the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idEA16221E7E4E44F1A59CDCB450393923" reported-display-style="italic" style="OLC">
<subsection id="id6C87404549914FCE89752E019502127D"><enum>(i)</enum><header>Excessive
compensation</header>
<paragraph id="idEBE7C0BFA2854A44A1E033B899BDBCD7"><enum>(1)</enum><header>In
general</header><text display-inline="yes-display-inline">Not later than 180
days after the transfer date established under section 311 of the Restoring
American Financial Stability Act of 2010, the Board of Governors, in
consultation with the Comptroller of the Currency and the Federal Deposit
Insurance Corporation, shall, by rule, establish standards prohibiting as an
unsafe and unsound practice any compensation plan of a bank holding company
that—</text>
<subparagraph id="idBD1CAA2E1F624D39988E510E4BB348AC"><enum>(A)</enum><text display-inline="yes-display-inline">provides an executive officer, employee,
director, or principal shareholder of the bank holding company with excessive
compensation, fees, or benefits; or</text>
</subparagraph><subparagraph id="idC701A89F8C7444039A2DD628C961FCE0"><enum>(B)</enum><text display-inline="yes-display-inline">could lead to material financial loss to
the bank holding company.</text>
</subparagraph></paragraph><paragraph id="id7DB2852E46564F4AB0AF6EDC83FE15C6"><enum>(2)</enum><header>Considerations</header><text display-inline="yes-display-inline">In establishing the standards under
paragraph (1), the Board of Governors shall take into consideration the
compensation standards described in section 39(c) of the Federal Deposit
Insurance Act (12 U.S.C. 1831p–1(c)) and the views and recommendations of the
Comptroller of the Currency and the Federal Deposit Insurance
Corporation.</text>
</paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</section><section id="id3EDE8E909EDF4713832A96CF2EB8EB6B"><enum>957.</enum><header>Voting by
brokers</header><text display-inline="no-display-inline">Section 6(b) of the
Securities Exchange Act of 1934 (15 U.S.C. 78f(b)) is amended—</text>
<paragraph id="id82AD280CB98F46EABF7CAEB436CA84E6"><enum>(1)</enum><text>in paragraph (9)—</text>
<subparagraph id="idAD108E56941E4641BCCBFA56F1FF0D3C"><enum>(A)</enum><text>in subparagraph (A), by
redesignating clauses (i) through (v) as subclauses (I) through (V),
respectively, and adjusting the margins accordingly;</text>
</subparagraph><subparagraph id="id8AE8EA7832194D318D3A10D7C5D72104"><enum>(B)</enum><text>by redesignating
subparagraphs (A) through (D) as clauses (i) through (iv), respectively, and
adjusting the margins accordingly;</text>
</subparagraph><subparagraph id="id3C0644F0EEAC4B0DBD89342A61F7E16E"><enum>(C)</enum><text>by inserting
<quote>(A)</quote> after <quote>(9)</quote>; and</text>
</subparagraph><subparagraph id="id5F027D6CCA7F43E0955DC4DFEE1AB056"><enum>(D)</enum><text>in the matter immediately
following clause (iv), as so redesignated, by striking <quote>As used</quote>
and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id37F850C1F6844BA8B842DD3EFC7EBD95" reported-display-style="italic" style="OLC">
<subparagraph id="id329C64FF2B6841919DB3518FCA894BA0" indent="up1"><enum>(B)</enum><text>As
used</text>
</subparagraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subparagraph></paragraph><paragraph id="idEE65D16B06054858872B7E8EA3CC9E03"><enum>(2)</enum><text>by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idA1A6149D87AA43E4B0034C6B8904F7B6" reported-display-style="italic" style="OLC">
<paragraph id="id9ECF73F7279948A79484303AF4708464"><enum>(10)</enum><subparagraph commented="no" display-inline="yes-display-inline" id="id2D659DDF7469482998832E1992D78F8F"><enum>(A)</enum><text>The rules of the
exchange prohibit any member that is not the beneficial owner of a security
registered under section 12 from granting a proxy to vote the security in
connection with a shareholder vote described in subparagraph (B), unless the
beneficial owner of the security has instructed the member to vote the proxy in
accordance with the voting instructions of the beneficial owner.</text>
</subparagraph><subparagraph changed="added" id="idEF5C83B2C44F4E87B30C921E4764F03C" indent="up1" reported-display-style="italic"><enum>(B)</enum><text>A
shareholder vote described in this subparagraph is a shareholder vote with
respect to the election of a member of the board of directors of an issuer,
executive compensation, or any other significant matter, as determined by the
Commission, by rule.</text>
</subparagraph><subparagraph changed="added" id="idA1DEE2333BEF4F739BAE204E43D82E4D" indent="up1" reported-display-style="italic"><enum>(C)</enum><text>Nothing in this paragraph
shall be construed to prohibit a national securities exchange from prohibiting
a member that is not the beneficial owner of a security registered under
section 12 from granting a proxy to vote the security in connection with a
shareholder vote not described in subparagraph
(A).</text>
</subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></section></subtitle><subtitle id="id4F89387A3B374819A2A67EC4467CF5A1"><enum>F</enum><header>Improvements to the
Management of the Securities and Exchange Commission</header>
<section id="id20412E5469DF46288A25389BBA45F6FC"><enum>961.</enum><header>Report and
Certification of Internal Supervisory Controls</header>
<subsection id="ID9064d4b921fe478fa30a126f4c776221"><enum>(a)</enum><header>Annual reports and
certification</header><text>Not later than 90 days after the end of each fiscal
year, the Commission shall submit a report to the Committee on Banking,
Housing, and Urban Affairs of the Senate and the Committee on Financial
Services of the House of Representatives on the conduct by the Commission of
examinations of registered entities, enforcement investigations, and review of
corporate financial securities filings.</text>
</subsection><subsection id="ID9c1ec52fd16349218a2d67686f321f0f"><enum>(b)</enum><header>Contents of
reports</header><text>Each report under subsection (a) shall contain—</text>
<paragraph id="id7C2E08F4EC194113B59E4B33CCC4C5CD"><enum>(1)</enum><text>an assessment, as of the
end of the most recent fiscal year, of the effectiveness of—</text>
<subparagraph id="idD1A7B79A4D794431BFAD65AA39932366"><enum>(A)</enum><text>the internal supervisory
controls of the Commission; and</text>
</subparagraph><subparagraph id="id39ABC8A9968646BCB25F274DA2D02A8E"><enum>(B)</enum><text>the procedures of the
Commission applicable to the staff of the Commission who perform examinations
of registered entities, enforcement investigations, and reviews of corporate
financial securities filings;</text>
</subparagraph></paragraph><paragraph id="idECFC0F3591ED423AA11FC2468FD8331A"><enum>(2)</enum><text>a certification that the
Commission has adequate internal supervisory controls to carry out the duties
of the Commission described in paragraph (1)(B); and</text>
</paragraph><paragraph id="id603994E12E1D4E629416F4AEDCF3E964"><enum>(3)</enum><text>a summary by the
Comptroller General of the United States of the review carried out under
subsection (d).</text>
</paragraph></subsection><subsection id="idC70ACB8C0C9B468F97B8836CB496E9D9"><enum>(c)</enum><header>Certification</header>
<paragraph id="id4B1EF4C02720481B9FACFD1CC1BB6474"><enum>(1)</enum><header>Signature</header><text>The
certification under subsection (b)(2) shall be signed by the Director of the
Division of Enforcement, the Director of the Division of Corporation Finance,
and the Director of the Office of Compliance Inspections and Examinations (or
the head of any successor division or office).</text>
</paragraph><paragraph id="id2E6B0514BB094EFD925AC6FDDE934973"><enum>(2)</enum><header>Content of
certification</header><text>Each individual described in paragraph (1) shall
certify that the individual—</text>
<subparagraph id="idAE0E26EE9F6A4CEC9AAB0829427D0D78"><enum>(A)</enum><text>is directly responsible
for establishing and maintaining the internal supervisory controls of the
Division or Office of which the individual is the head;</text>
</subparagraph><subparagraph id="idA5A02FBB1C7C4546B0645B4BEFAEFFB7"><enum>(B)</enum><text>is knowledgeable about
the internal supervisory controls of the Division or Office of which the
individual is the head;</text>
</subparagraph><subparagraph id="idEF369E30BCE54103A0C6FDB4616C8B72"><enum>(C)</enum><text>has evaluated the
effectiveness of the internal supervisory controls during the 90-day period
ending on the final day of the fiscal year to which the report relates;
and</text>
</subparagraph><subparagraph id="idE2888DCD98D24CE0BDFAD0B6AE2EE903"><enum>(D)</enum><text>has disclosed to the
Commission any significant deficiencies in the design or operation of internal
supervisory controls that could adversely affect the ability of the Division or
Office to consistently conduct inspections, or investigations, or reviews of
filings with professional competence and integrity.</text>
</subparagraph></paragraph></subsection><subsection commented="no" id="ID8cc549cc8c8947078d16da6af35cd1b8"><enum>(d)</enum><header>Review by the
Comptroller General</header><text>Not later than the date on which the first
report is submitted under subsection (a), the Comptroller General of the United
States shall submit to the Committee on Banking, Housing, and Urban Affairs of
the Senate and the Committee on Financial Services of the House of
Representatives an initial report that contains a review of the adequacy and
effectiveness of the internal supervisory control structure and procedures
described in subsection (b)(1).</text>
</subsection></section><section id="id317BBF7F5ECD4D558DF0F0EA8D93D68B"><enum>962.</enum><header>Triennial report on
personnel management</header>
<subsection id="ID407cafadc36244c082b8f4963aa98ae5"><enum>(a)</enum><header>Triennial report
required</header><text>Once every 3 years, the Comptroller General of the
United States shall submit a report to the Committee on Banking, Housing, and
Urban Affairs of the Senate and the Committee on Financial Services of the
House of Representatives on the quality of personnel management by the
Commission.</text>
</subsection><subsection id="ID4697bc6ba2c84c8fb468d4f52f218527"><enum>(b)</enum><header>Contents of
report</header><text>Each report under subsection (a) shall include—</text>
<paragraph id="idF238B6CE4D7044C487CFC6B79912AA73"><enum>(1)</enum><text>an evaluation of—</text>
<subparagraph id="ID068ba51ae1ac421cb0b50a39f3ffcdcb"><enum>(A)</enum><text>the effectiveness of
supervisors in using the skills, talents, and motivation of the employees of
the Commission to achieve the goals of the Commission;</text>
</subparagraph><subparagraph id="IDb543cba5b2d346cbae5bf98dbd2e7b20"><enum>(B)</enum><text>the criteria for
promoting employees of the Commission to supervisory positions;</text>
</subparagraph><subparagraph id="ID6ed8698899f949a49bed81543278c7a3"><enum>(C)</enum><text>the fairness of the
application of the promotion criteria to the decisions of the
Commission;</text>
</subparagraph><subparagraph id="ID20089a1260dd4bbda0c950ffcff501dc"><enum>(D)</enum><text>the competence of the
professional staff of the Commission;</text>
</subparagraph><subparagraph id="IDdb8a9d29f7b34f30a6e5d6a694d2eb43"><enum>(E)</enum><text>the efficiency of
communication between the units of the Commission regarding the work of the
Commission (including communication between divisions and between subunits of a
division) and the efforts by the Commission to promote such
communication;</text>
</subparagraph><subparagraph id="IDda4f5f610f2948c68c82988c2d772baf"><enum>(F)</enum><text>the turnover within
subunits of the Commission, including the identification of supervisors whose
subordinates have an unusually high rate of turnover;</text>
</subparagraph><subparagraph id="ID3117eae28ab94e8eb7e1cbfb19dc033d"><enum>(G)</enum><text>whether there are
excessive numbers of low-level, mid-level, or senior-level managers;</text>
</subparagraph><subparagraph id="ID81912a5532b44fe8a3f5a35eadb13ad4"><enum>(H)</enum><text>any initiatives of the
Commission that increase the competence of the staff of the Commission;</text>
</subparagraph><subparagraph id="ID4af2b3b1f658484eaba440c1ce095a8b"><enum>(I)</enum><text>the actions taken by the
Commission regarding employees of the Commission who have failed to perform
their duties; and</text>
</subparagraph><subparagraph id="idFCE68645296241859C8EDEE53A1F2FBF"><enum>(J)</enum><text>such other factors
relating to the management of the Commission as the Comptroller General
determines are appropriate;</text>
</subparagraph></paragraph><paragraph id="id164D4D3CB83445B6AA343EA9BC5C9514"><enum>(2)</enum><text>an evaluation of any
improvements made with respect to the areas described in paragraph (1) since
the date of submission of the previous report; and</text>
</paragraph><paragraph id="id9A773AFF4E9E42A8A116328A177814FD"><enum>(3)</enum><text>recommendations for how
the Commission can use the human resources of the Commission more effectively
and efficiently to carry out the mission of the Commission.</text>
</paragraph></subsection><subsection id="IDfe51a84399ae420d8d436604b36063c9"><enum>(c)</enum><header>Consultation</header><text>In
preparing the report under subsection (a), the Comptroller General shall
consult with current employees of the Commission, retired employees and other
former employees of the Commission, the Inspector General of the Commission,
persons that have business before the Commission, any union representing the
employees of the Commission, private management consultants, academics, and any
other source that the Comptroller General deems appropriate.</text>
</subsection><subsection id="idA869455BCE4944EAB19FE42966058304"><enum>(d)</enum><header>Report by
Commission</header><text>Not later than 90 days after the date on which the
Comptroller General submits each report under subsection (a), the Commission
shall submit to the Committee on Banking, Housing, and Urban Affairs of the
Senate and the Committee on Financial Services of the House of Representatives
a report describing the actions taken by the Commission in response to the
recommendations contained in the report under subsection (a).</text>
</subsection><subsection id="idD994A7D3F5654321BA9D6C13881B9CE5"><enum>(e)</enum><header>Reimbursements for cost
of reports</header>
<paragraph id="id0EA2ED52130D497CB0025073147821BD"><enum>(1)</enum><header>Reimbursements
required</header><text>The Commission shall reimburse the Government
Accountability Office for the full cost of making the reports under this
section, as billed therefor by the Comptroller General.</text>
</paragraph><paragraph id="id786C169F6ACE43A69CD89FCDA706E000"><enum>(2)</enum><header>Crediting and use of
reimbursements</header><text>Such reimbursements shall—</text>
<subparagraph id="idC3A8415C4B84458597C2046042AF2C7E"><enum>(A)</enum><text>be credited to the
appropriation account <quote>Salaries and Expenses, Government Accountability
Office</quote> current when the payment is received; and</text>
</subparagraph><subparagraph id="id4F199950B3CC416AA01D9656023E72FA"><enum>(B)</enum><text>remain available until
expended.</text>
</subparagraph></paragraph></subsection></section><section id="id2F17F2DDC386457384AAF2D006834FD8"><enum>963.</enum><header>Annual financial
controls audit</header>
<subsection id="ID112fcf92b4524ae2a8bba535f6216478"><enum>(a)</enum><header>Reports of
commission</header>
<paragraph id="idB19936C6CBA24220895C7C55229BA3C8"><enum>(1)</enum><header>Annual reports
required</header><text>Not later than 6 months after the end of each fiscal
year, the Commission shall publish and submit to Congress a report that—</text>
<subparagraph id="ID233bc57bfb3340379e2ad8d55377531b"><enum>(A)</enum><text>describes the
responsibility of the management of the Commission for establishing and
maintaining an adequate internal control structure and procedures for financial
reporting; and</text>
</subparagraph><subparagraph id="ID113eed565a8a41b6b8c1c934ac56ccde"><enum>(B)</enum><text>contains an assessment of
the effectiveness of the internal control structure and procedures for
financial reporting of the Commission during that fiscal year.</text>
</subparagraph></paragraph><paragraph id="ID2e9880bcccee44edbd2aa773b6beaf7f"><enum>(2)</enum><header>Attestation</header><text>The
reports required under paragraph (1) shall be attested to by the Chairman and
chief financial officer of the Commission.</text>
</paragraph></subsection><subsection id="ID05a34a323a844018b0d5eba261607cd9"><enum>(b)</enum><header>Report by Comptroller
General</header>
<paragraph id="idA1AC75170E844BDA90343CF48569B2D1"><enum>(1)</enum><header>Report
required</header><text>Not later than 6 months after the end of the first
fiscal year after the date of enactment of this Act, the Comptroller General of
the United States shall submit a report to Congress that assesses—</text>
<subparagraph id="IDd628f2d9c64745a6ae74d1508f1bfc89"><enum>(A)</enum><text>the effectiveness of the
internal control structure and procedures of the Commission for financial
reporting; and</text>
</subparagraph><subparagraph id="ID92005698e6744d578c595b20c07695eb"><enum>(B)</enum><text>the assessment of the
Commission under subsection (a)(1)(B).</text>
</subparagraph></paragraph><paragraph id="ID378fe54ede5f48b6896f487f3f5b5abf"><enum>(2)</enum><header>Attestation</header><text>The
Comptroller General shall attest to, and report on, the assessment made by the
Commission under subsection (a).</text>
</paragraph></subsection><subsection id="id7817309A1BE242F6969A3F94C638885F"><enum>(c)</enum><header>Reimbursements for cost
of reports</header>
<paragraph id="id2772BE0A81FE4AF88527ADFD6DB878C1"><enum>(1)</enum><header>Reimbursements
required</header><text>The Commission shall reimburse the Government
Accountability Office for the full cost of making the reports under subsection
(b), as billed therefor by the Comptroller General.</text>
</paragraph><paragraph id="idE5B2BA273CAD476F951C1BD36B087AE8"><enum>(2)</enum><header>Crediting and use of
reimbursements</header><text>Such reimbursements shall—</text>
<subparagraph id="idD45ADA292A82460BAFCA424349F1EFEF"><enum>(A)</enum><text>be credited to the
appropriation account <quote>Salaries and Expenses, Government Accountability
Office</quote> current when the payment is received; and</text>
</subparagraph><subparagraph id="idD212D66B5C774861BA58E6D69762E240"><enum>(B)</enum><text>remain available until
expended.</text>
</subparagraph></paragraph></subsection></section><section id="id4BB8AAA0B83E4004920CDE275876545F"><enum>964.</enum><header>Report on oversight of
national securities associations</header>
<subsection id="id1115DCE2BD68493F94CDC9237BA55B60"><enum>(a)</enum><header>Report
required</header><text display-inline="yes-display-inline">Not later than 2
years after the date of enactment of this Act, and every 3 years thereafter,
the Comptroller General of the United States shall submit to the Committee on
Banking, Housing, and Urban Affairs of the Senate and the Committee on
Financial Services of the House of Representatives a report that includes an
evaluation of the oversight by the Commission of national securities
associations registered under section 15A of the Securities Exchange Act of
1934 (15 U.S.C. 78o–3) with respect to—</text>
<paragraph id="IDeefbe2726ce04c7690a2a10e03f3a00f"><enum>(1)</enum><text>the governance of such
national securities associations, including the identification and management
of conflicts of interest by such national securities associations, together
with an analysis of the impact of any conflicts of interest on the regulatory
enforcement or rulemaking by such national securities associations;</text>
</paragraph><paragraph id="idEDEA94FC319646DD8C539C771EC88D92"><enum>(2)</enum><text>the examinations carried
out by the national securities associations, including the expertise of the
examiners;</text>
</paragraph><paragraph id="ID1daf082ed0c5416caec787d705e9b4be"><enum>(3)</enum><text>the executive
compensation practices of such national securities associations;</text>
</paragraph><paragraph id="ID15f9cb91934c458a80c70d80f788a8fb"><enum>(4)</enum><text>the arbitration services
provided by the national securities associations;</text>
</paragraph><paragraph id="ID55175a9866bb4bed88a9e9799b2a8a4b"><enum>(5)</enum><text>the review performed by
national securities associations of advertising by the members of the national
securities associations;</text>
</paragraph><paragraph id="idB55434481FF6427EAD8CAEAC0EC3CD76"><enum>(6)</enum><text>the cooperation with and
assistance to State securities administrators by the national securities
associations to promote investor protection;</text>
</paragraph><paragraph id="idE54A8B4DB94D403E8662E02D41BBC873"><enum>(7)</enum><text>how the funding of
national securities associations is used to support the mission of the national
securities associations, including—</text>
<subparagraph id="id9A9F1ECCD92A492C8F8F9A5B9DA5ABFE"><enum>(A)</enum><text>the methods of
funding;</text>
</subparagraph><subparagraph id="id147B34313D144759A3FE673B0AB9A7A2"><enum>(B)</enum><text>the sufficiency of
funds;</text>
</subparagraph><subparagraph commented="no" id="idA8F807F4060F4301A9DAC2C22EF9ED45"><enum>(C)</enum><text>how funds are invested by
the national securities association pending use; and</text>
</subparagraph><subparagraph commented="no" id="idD94C658F122A43DA93EDFD40352D4EF9"><enum>(D)</enum><text>the impact of the
methods, sufficiency, and investment of funds on regulatory enforcement by the
national securities associations;</text>
</subparagraph></paragraph><paragraph id="id80345B6C2A804BF7B10FC8D146AE3FC9"><enum>(8)</enum><text>the policies regarding
the employment of former employees of national securities associations by
regulated entities;</text>
</paragraph><paragraph id="id3BBF4856FDBA479D923972404D7B6A3E"><enum>(9)</enum><text>the ongoing effectiveness
of the rules of the national securities associations in achieving the goals of
the rules;</text>
</paragraph><paragraph id="id50DFB4ADE70348D4838AC648307AFA3F"><enum>(10)</enum><text>the transparency of
governance and activities of the national securities associations; and</text>
</paragraph><paragraph id="ID3d584ea689c644b68bb7ce91be68cdc1"><enum>(11)</enum><text>any other issue that has
an impact, as determined by the Comptroller General, on the effectiveness of
such national securities associations in performing their mission and in
dealing fairly with investors and members;</text>
</paragraph></subsection><subsection id="id77D6B92E861D4F1FA1C325B68B69F627"><enum>(b)</enum><header>Reimbursements for cost
of reports</header>
<paragraph id="id73309D8B1FEE4C07800BCFFB9CC026EA"><enum>(1)</enum><header>Reimbursements
required</header><text>The Commission shall reimburse the Government
Accountability Office for the full cost of making the reports under subsection
(a), as billed therefor by the Comptroller General.</text>
</paragraph><paragraph id="id2EA577FBB9B64EF2A31E63CE35B51426"><enum>(2)</enum><header>Crediting and use of
reimbursements</header><text>Such reimbursements shall—</text>
<subparagraph id="id9197FE30CC494B209AA95F5FBC266173"><enum>(A)</enum><text>be credited to the
appropriation account <quote>Salaries and Expenses, Government Accountability
Office</quote> current when the payment is received; and</text>
</subparagraph><subparagraph id="idBE0F53E3462840F1984EC67EDD0A13AE"><enum>(B)</enum><text>remain available until
expended.</text>
</subparagraph></paragraph></subsection></section><section id="id890B17883BBC47B4AADF086C204D34CE"><enum>965.</enum><header>Compliance
Examiners</header><text display-inline="no-display-inline">Section 4 of the
Securities Exchange Act of 1934 (15 U.S.C. 78d) is amended by adding at the end
the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id50EE1A6F5EF64403846A992461EEF18E" reported-display-style="italic" style="OLC">
<subsection id="ID0f09ae4f193e40738716cb232a0a3737"><enum>(h)</enum><header>Examiners</header>
<paragraph id="id9BDC19713A4544C9B1C7360FBFE111D7"><enum>(1)</enum><header>Division of Trading and
Markets</header><text>The Division of Trading and Markets of the Commission, or
any successor organizational unit, shall have a staff of examiners who
shall—</text>
<subparagraph id="idAA888E2DBCAC4B9B991C082CAA13B865"><enum>(A)</enum><text>perform compliance
inspections and examinations of entities under the jurisdiction of that
Division; and</text>
</subparagraph><subparagraph id="id4A9A3CE2FBC841EF92A4969592BAFE29"><enum>(B)</enum><text>report to the Director of
that Division.</text>
</subparagraph></paragraph><paragraph id="idC29A5F9AE404473B82F898F6DC2195BA"><enum>(2)</enum><header>Division of Investment
Management</header><text>The Division of Investment Management of the
Commission, or any successor organizational unit, shall have a staff of
examiners who shall—</text>
<subparagraph id="id2E1D1C6B028148DCAEE09CD33AC71030"><enum>(A)</enum><text>perform compliance
inspections and examinations of entities under the jurisdiction of that
Division; and</text>
</subparagraph><subparagraph id="id53D8E156F2254EA5BB489E80D197FE8E"><enum>(B)</enum><text>report to the Director of
that
Division.</text>
</subparagraph></paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</section><section id="idDB8089C82BCA45E6842815D5875C5E73"><enum>966.</enum><header>Suggestion program for
employees of the Commission</header><text display-inline="no-display-inline">The Securities Exchange Act of 1934 (15
U.S.C. 78a et seq.) is amended by inserting after section 4C (15 U.S.C. 78d–3)
the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id4BB453CCA5664089941A633D2B092CFD" reported-display-style="italic" style="OLC">
<section id="idBE053D859B7144948050E91CEEBF8768"><enum>4D.</enum><header>Additional duties of
Inspector General</header>
<subsection id="idDA1992835BC2410DB4A16CBFA79DC11E"><enum>(a)</enum><header>Suggestion submissions
by Commission employees</header>
<paragraph id="idB3BF8DAC59B441E2A0BF1C4749C4FC01"><enum>(1)</enum><header>Hotline
established</header><text>The Inspector General of the Commission shall
establish and maintain a telephone hotline or other electronic means for the
receipt of—</text>
<subparagraph id="id028D1D9D502045B8838CC3DE71B1A04C"><enum>(A)</enum><text>suggestions by employees
of the Commission for improvements in the work efficiency, effectiveness, and
productivity, and the use of the resources, of the Commission; and</text>
</subparagraph><subparagraph id="id33428092D1F543139AD8EF4BD2B8A147"><enum>(B)</enum><text>allegations by employees
of the Commission of waste, abuse, misconduct, or mismanagement within the
Commission.</text>
</subparagraph></paragraph><paragraph id="id4DE412737A384833B45FE94D5EEA1306"><enum>(2)</enum><header>Confidentiality</header><text>The
Inspector General shall maintain as confidential—</text>
<subparagraph id="id34FF41709BCC4A8B9D86197BAC39171E"><enum>(A)</enum><text>the identity of any
individual who provides information by the means established under paragraph
(1), unless the individual requests otherwise, in writing; and</text>
</subparagraph><subparagraph id="id38C062B030F34AD8A2A0CBDB6489DB9E"><enum>(B)</enum><text>at the request of any
such individual, any specific information provided by the individual.</text>
</subparagraph></paragraph></subsection><subsection id="id702C11D4090245869E4207A6ACCDE3F7"><enum>(b)</enum><header>Consideration of
reports</header><text>The Inspector General shall consider any suggestions or
allegations received by the means established under subsection (a)(1), and
shall recommend appropriate action in relation to such suggestions or
allegations.</text>
</subsection><subsection id="id606740D03BB04746B4B32C0D9CFE6746"><enum>(c)</enum><header>Recognition</header><text>The
Inspector General may recognize any employee who makes a suggestion under
subsection (a)(1) (or by other means) that would or does—</text>
<paragraph id="idD90D3BE7C9874952AED08BAB684A6B2D"><enum>(1)</enum><text>increase the work
efficiency, effectiveness, or productivity of the Commission; or</text>
</paragraph><paragraph id="id7BE064126B6942B0B122A5E389219FAC"><enum>(2)</enum><text>reduce waste, abuse,
misconduct, or mismanagement within the Commission.</text>
</paragraph></subsection><subsection id="idC82D07277BB24E7788834A4BAB0B55FE"><enum>(d)</enum><header>Report</header><text>The
Inspector General of the Commission shall submit to Congress an annual report
containing a description of—</text>
<paragraph id="idD4FDC8DEB0BD4CAE8865FE8CBF464F19"><enum>(1)</enum><text>the nature, number, and
potential benefits of any suggestions received under subsection (a);</text>
</paragraph><paragraph id="id4D11E2E150FD4879B43926F841EA01B0"><enum>(2)</enum><text>the nature, number, and
seriousness of any allegations received under subsection (a);</text>
</paragraph><paragraph id="idF87DC02A7F8A4DC9883232C0189B0986"><enum>(3)</enum><text>any recommendations made
or actions taken by the Inspector General in response to substantiated
allegations received under subsection (a); and</text>
</paragraph><paragraph id="idC7A5140E04164506AFA75A046BFC6135"><enum>(4)</enum><text>any action the Commission
has taken in response to suggestions or allegations received under subsection
(a).</text>
</paragraph></subsection><subsection id="id42D233360E3B4A2E85D971D02D4304E9"><enum>(e)</enum><header>Funding</header><text>The
activities of the Inspector General under this subsection shall be funded by
the Securities and Exchange Commission Investor Protection Fund established
under section
21F.</text>
</subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</section></subtitle><subtitle id="id84381FAD36FA41BCA72F39FBB97DD9D9"><enum>G</enum><header>Strengthening Corporate
Governance</header>
<section id="id04333C6FFCFE4E68BF5D6F06A4D82FD4"><enum>971.</enum><header>Election of Directors
by Majority Vote in Uncontested Elections</header><text display-inline="no-display-inline">The Securities Exchange Act of 1934 (15
U.S.C. 78a et seq.) is amended by inserting after section 14A, as added by this
title, the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idCB6515B6F256487DA3B70005C723E938" reported-display-style="italic" style="OLC">
<section id="ID6b5ea444936446b184b20fa093c98e7b"><enum>14B.</enum><header>Corporate
governance</header>
<subsection id="idA2F1458310594D80B18D36D6815A8C0C"><enum>(a)</enum><header>Corporate Governance
Standards</header>
<paragraph id="IDe8bc6efe1d8e4ab0b64f5ca54a6f9245"><enum>(1)</enum><header>Listing
standards</header>
<subparagraph id="IDf7cc93705f4d46f8ad20a68d95791db7"><enum>(A)</enum><header>In
general</header><text>Not later than 1 year after the date of enactment of this
subsection, the Commission shall, by rule, direct the national securities
exchanges and national securities associations to prohibit the listing of any
security of an issuer that is not in compliance with any of the requirements of
this subsection.</text>
</subparagraph><subparagraph id="ID5db9b9cdfc004db183a43606ff4ad259"><enum>(B)</enum><header>Opportunity to comply
and cure</header><text>The rules established under this paragraph shall allow
an issuer to have an opportunity to come into compliance with the requirements
of this subsection, and to cure any defect that would be the basis for a
prohibition under subparagraph (A), before the imposition of such
prohibition.</text>
</subparagraph><subparagraph id="ID63cbe39d899649179aa6fdbd8c5733fa"><enum>(C)</enum><header>Authority to
exempt</header><text>The Commission may, by rule or order, exempt an issuer
from any or all of the requirements of this subsection and the rules issued
under this subsection, based on the size of the issuer, the market
capitalization of the issuer, the number of shareholders of record of the
issuer, or any other criteria, as the Commission deems necessary and
appropriate in the public interest or for the protection of investors.</text>
</subparagraph></paragraph><paragraph id="ID0a309fcebf244f9594eb934eb81931e9"><enum>(2)</enum><header>Commission rules on
elections</header><text>In an election for membership on the board of directors
of an issuer—</text>
<subparagraph id="IDe95f7c9aed944ea1ae22b7c8466e78f9"><enum>(A)</enum><text>that is uncontested, each
director who receives a majority of the votes cast shall be deemed to be
elected;</text>
</subparagraph><subparagraph id="ID74cfaf39ced846c4889503052db0ba3c"><enum>(B)</enum><text>that is contested, if the
number of nominees exceeds the number of directors to be elected, each director
shall be elected by the vote of a plurality of the shares represented at a
meeting and entitled to vote; and</text>
</subparagraph><subparagraph id="ID1b43b8c0b96542e8bd08012d7a7c4cab"><enum>(C)</enum><text>if a director of an
issuer receives less than a majority of the votes cast in an uncontested
election—</text>
<clause id="IDec538efd319a46058b2787511fbc59a0"><enum>(i)</enum><text>the director shall tender
the resignation of the director to the board of directors; and</text>
</clause><clause id="ID2dbb084a372a4840926f6c3745848661"><enum>(ii)</enum><text>the board of
directors—</text>
<subclause id="IDa9565023750a4532b78e2f040f1b424e"><enum>(I)</enum><text>shall—</text>
<item id="idFB86BBEF7503424AA2FCCB5126ADBF6D"><enum>(aa)</enum><text>accept the resignation
of the director;</text>
</item><item id="IDbca95f3ea4da471996f966e99cd93928"><enum>(bb)</enum><text>determine a date on
which the resignation will take effect, within a reasonable period of time, as
established by the Commission; and</text>
</item><item id="ID46794b593f0645eaa99ad51843ba5d67"><enum>(cc)</enum><text>make the date under item
(bb) public within a reasonable period of time, as established by the
Commission; or</text>
</item></subclause><subclause id="ID55ecf100727947fd8b461d34252b4a3f"><enum>(II)</enum><text>shall, upon a unanimous
vote of the board, decline to accept the resignation and, not later than 30
days after the date of the vote (or within such shorter period as the
Commission may establish), make public, together with a discussion of the
analysis used in reaching the conclusion, the specific reasons that—</text>
<item id="id744126076F9E4D2B8504E887DAE7D649"><enum>(aa)</enum><text>the board chose not to
accept the resignation; and</text>
</item><item id="id70E02FECF70A4B87BFB1DAA24CE8D340"><enum>(bb)</enum><text>the decision was in the
best interests of the issuer and the shareholders of the
issuer.</text>
</item></subclause></clause></subparagraph></paragraph></subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</section><section id="id00DA7247E5AC4BE3BC75DDB0502815F4"><enum>972.</enum><header>Proxy access</header>
<subsection id="idF18BD70EED6B4AB898EA207B93823C79"><enum>(a)</enum><header>Proxy
access</header><text>Section 14(a) of the Securities Exchange Act of 1934 (15
U.S.C. 78n(a)) is amended—</text>
<paragraph id="id8C0ACD2CB80B4BBAB51822A07D83893A"><enum>(1)</enum><text>by inserting
<quote>(1)</quote> after <quote>(a)</quote>; and</text>
</paragraph><paragraph id="idFCAB0897696D485187A1915E69887778"><enum>(2)</enum><text>by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id3F4F50F0B2114D6AB87DDCF56C65D661" reported-display-style="italic" style="OLC">
<paragraph id="id781F54E2E3254C61B7CB46C0CEDA3632" indent="up1"><enum>(2)</enum><text>The rules and regulations
prescribed by the Commission under paragraph (1) may include—</text>
<subparagraph id="id351BE761C0FE432DA284B3918D7DE0A9"><enum>(A)</enum><text>a
requirement that a solicitation of proxy, consent, or authorization by (or on
behalf of) an issuer include a nominee submitted by a shareholder to serve on
the board of directors of the issuer; and</text>
</subparagraph><subparagraph id="id762D0A43EDC84673A2823539E9430F85"><enum>(B)</enum><text>a
requirement that an issuer follow a certain procedure in relation to a
solicitation described in subparagraph
(A).</text>
</subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="idC1F4B264E4294B74AF53E36D3D3B3147"><enum>(b)</enum><header>Regulations</header><text display-inline="yes-display-inline">The Commission may issue rules permitting
the use by shareholders of proxy solicitation materials supplied by an issuer
of securities for the purpose of nominating individuals to membership on the
board of directors of the issuer, under such terms and conditions as the
Commission determines are in the interests of shareholders and for the
protection of investors.</text>
</subsection></section><section id="idC3A5D15A361B42188F10B78256CFE7B8"><enum>973.</enum><header>Disclosures regarding
chairman and CEO structures</header><text display-inline="no-display-inline">Section 14B of the Securities Exchange Act
of 1934, as added by section 971, is amended by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idC5A9E625822A4A90A9FED20CEA6FFF35" reported-display-style="italic" style="OLC">
<subsection id="id83BF0DDA5AC34CF29EE4043E8F162E72"><enum>(b)</enum><header>Disclosures regarding
chairman and CEO structures</header><text display-inline="yes-display-inline">Not later than 180 days after the date of
enactment of this subsection, the Commission shall issue rules that require an
issuer to disclose in the annual proxy sent to investors the reasons why the
issuer has chosen—</text>
<paragraph id="idF6BD5EC1FAD045EB8694981297D9E36E"><enum>(1)</enum><text display-inline="yes-display-inline">the same person to serve as chairman of the
board of directors and chief executive officer (or in equivalent positions);
or</text>
</paragraph><paragraph id="idFFB7D4622268481B961D3255C406B425"><enum>(2)</enum><text display-inline="yes-display-inline">different individuals to serve as chairman
of the board of directors and chief executive officer (or in equivalent
positions of the
issuer).</text>
</paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</section></subtitle><subtitle id="id1E3EB5958E864908B870C5607AD458EC"><enum>H</enum><header>Municipal
Securities</header>
<section id="id8C448E1A84D342349CCC8E48EF1943B9"><enum>975.</enum><header>Regulation of
municipal securities and changes to the board of the MSRB</header>
<subsection id="id29880281A43A441C9BAB67B9CE66F706"><enum>(a)</enum><header>Registration of
municipal securities dealers and municipal advisors</header><text display-inline="yes-display-inline">Section 15B(a) of the Securities Exchange
Act of 1934 (15 U.S.C. 78o–4(a)) is amended—</text>
<paragraph id="idFA6115A4F24C4B7B9FADACCC47C1F671"><enum>(1)</enum><text>in paragraph (1)—</text>
<subparagraph id="id4E51854226B748469C98226E5F733E1D"><enum>(A)</enum><text>by inserting
<quote>(A)</quote> after <quote>(1)</quote>; and</text>
</subparagraph><subparagraph id="id4637D0047C4144BAA543E74D6A3303A9"><enum>(B)</enum><text>by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id90B4AFB406654B88A6E6619270A5EA53" reported-display-style="italic" style="OLC">
<subparagraph id="idECDAE337315F4781B44A98FC5C0A0808"><enum>(B)</enum><text>It shall be unlawful for
a municipal advisor to provide advice to or on behalf of a municipal entity or
obligated person with respect to municipal financial products or the issuance
of municipal securities, or to undertake a solicitation of a municipal entity
or obligated person, unless the municipal advisor is registered in accordance
with this
subsection.</text>
</subparagraph><after-quoted-block>;</after-quoted-block></quoted-block>
</subparagraph></paragraph><paragraph id="id971C571ABE004542A4A0D2A78BCB47D2"><enum>(2)</enum><text>in paragraph (2), by
inserting <quote>or municipal advisor</quote> after <quote>municipal securities
dealer</quote> each place that term appears;</text>
</paragraph><paragraph id="id4159D61C579645D48745D9E6F1CA6E48"><enum>(3)</enum><text>in paragraph (3), by
inserting <quote>or municipal advisor</quote> after <quote>municipal securities
dealer</quote> each place that term appears;</text>
</paragraph><paragraph id="idB1E8551AD0134ADFA70792FCAFF23F23"><enum>(4)</enum><text>in paragraph (4), by
striking <quote>dealer, or municipal securities dealer or class of brokers,
dealers, or municipal securities dealers</quote> and inserting <quote>dealer,
municipal securities dealer, or municipal advisor, or class of brokers,
dealers, municipal securities dealers, or municipal advisors</quote>;
and</text>
</paragraph><paragraph id="id48E77F5EF2A140BC875B4094BD472E58"><enum>(5)</enum><text>by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id33DCBD936089417BAE03FB44FBE0A911" reported-display-style="italic" style="OLC">
<paragraph id="idE1C8F36A627D42199C348949BBB6AE38"><enum>(5)</enum><text>No municipal advisor
shall make use of the mails or any means or instrumentality of interstate
commerce to provide advice to or on behalf of a municipal entity or obligated
person with respect to municipal financial products, the issuance of municipal
securities, or participation in the issuance of municipal securities, or to
undertake a solicitation of a municipal entity or obligated person, in
connection with which such municipal advisor engages in any fraudulent,
deceptive, or manipulative act or
practice.</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="id85D3517C73854EF1BE8BA64D204617ED"><enum>(b)</enum><header>Municipal Securities
Rulemaking Board</header><text>Section 15B(b) of the Securities Exchange Act of
1934 (15 U.S.C. 78o–4(b)) is amended—</text>
<paragraph id="idEF46F2B6B20146D8A99EE429C91DD015"><enum>(1)</enum><text>in paragraph (1)—</text>
<subparagraph id="id698549399CDE4D6CB5F245182B7BBF05"><enum>(A)</enum><text>in the first sentence, by
striking <quote>Not later than</quote> and all that follows through
<quote>appointed by the Commission</quote> and inserting <quote>The Municipal
Securities Rulemaking Board shall be composed of 15 members, or such other
number of members as specified by rules of the Board pursuant to paragraph
(2)(B),</quote>;</text>
</subparagraph><subparagraph id="id66A284A6E91F4E9FBF7925C1A5E2C152"><enum>(B)</enum><text>by striking the second
sentence and inserting the following: <quote>The members of the Board shall
serve as members for a term of 3 years or for such other terms as specified by
rules of the Board pursuant to paragraph (2)(B), and shall consist of (A) 8
individuals who are not associated with any broker, dealer, municipal
securities dealer, or municipal advisor (other than by reason of being under
common control with, or indirectly controlling, any broker or dealer which is
not a municipal securities broker or municipal securities dealer), at least 1
of whom shall be representative of institutional or retail investors in
municipal securities, at least 1 of whom shall be representative of municipal
entities, and at least 1 of whom shall be a member of the public with knowledge
of or experience in the municipal industry (which members are hereinafter
referred to as <quote>public representatives</quote>); and (B) 7 individuals
who are associated with a broker, dealer, municipal securities dealer, or
municipal advisor, including at least 1 individual who is associated with and
representative of brokers, dealers, or municipal securities dealers that are
not banks or subsidiaries or departments or divisions of banks (which members
are hereinafter referred to as <quote>broker-dealer representatives</quote>),
at least 1 individual who is associated with and representative of municipal
securities dealers which are banks or subsidiaries or departments or divisions
of banks (which members are hereinafter referred to as <quote>bank
representatives</quote>), and at least 1 individual who is associated with a
municipal advisor (which member is hereinafter referred to as the
<quote>advisor representative</quote>).</quote>; and</text>
</subparagraph><subparagraph id="id1F459C12F3CB48BFB02EF0CA9FF3580D"><enum>(C)</enum><text>in the third sentence, by
striking <quote>initial</quote>;</text>
</subparagraph></paragraph><paragraph id="idF8DBE3ADC5F44CD0B10A9C1503D2FDDB"><enum>(2)</enum><text>in paragraph (2)—</text>
<subparagraph id="idA8D4408AF8FC4313A68764FF92169E79"><enum>(A)</enum><text>in the matter preceding
subparagraph (A)—</text>
<clause id="id6FB1A81222384CA298D66B6C380D7E2F"><enum>(i)</enum><text>by inserting before the
period at the end of the first sentence the following: <quote>and advice
provided to or on behalf of municipal entities or obligated persons by brokers,
dealers, municipal securities dealers, and municipal advisors with respect to
municipal financial products, the issuance of municipal securities, or
participation in the issuance of municipal securities, and solicitations of
municipal entities or obligated persons undertaken by brokers, dealers,
municipal securities dealers, and municipal advisors</quote>; and</text>
</clause><clause id="id2CCC8FAD88C343A18896094A60AEB6DE"><enum>(ii)</enum><text>by striking the second
sentence;</text>
</clause></subparagraph><subparagraph commented="no" id="id18FDBF7E5EA84FAEBA680369BA1B45BF"><enum>(B)</enum><text>in subparagraph
(A)—</text>
<clause commented="no" id="id72BA3720D99A410A95684E117CCEB3D2"><enum>(i)</enum><text>in the matter preceding
clause (i)—</text>
<subclause commented="no" id="id8020394041CB499C8EAA489BF58DB112"><enum>(I)</enum><text>by inserting <quote>, and
no broker, dealer, municipal securities dealer, or municipal advisor shall
provide advice to or on behalf of a municipal entity or obligated person with
respect to municipal financial products, the issuance of municipal securities,
or participation in the issuance of municipal securities</quote> after
<quote>sale of, any municipal security</quote>; and</text>
</subclause><subclause commented="no" id="id63BAEEA2240C4308B8BD1979A57EFD1E"><enum>(II)</enum><text>by inserting <quote>and
municipal entities or obligated persons</quote> after <quote>protection of
investors</quote>;</text>
</subclause></clause><clause commented="no" id="id1ADC51E9B6144E6B8749A8FF74583AE3"><enum>(ii)</enum><text>in clause (i), by
striking <quote>municipal securities brokers and municipal securities
dealers</quote> each place that term appears and inserting <quote>municipal
securities brokers, municipal securities dealers, and municipal
advisors</quote>;</text>
</clause><clause commented="no" id="id60E6C8CFC439431E8BB07B7F8BF13264"><enum>(iii)</enum><text>in clause (ii), by
adding <quote>and</quote> at the end;</text>
</clause><clause commented="no" id="id33C1CE9F6E9845FAA3BACB41F3B41C6E"><enum>(iv)</enum><text>in clause (iii), by
striking <quote>; and</quote> and inserting a period; and</text>
</clause><clause commented="no" id="id1FFA009DBC4D4F91A58BC94AF9B6EEC7"><enum>(v)</enum><text>by striking clause
(iv);</text>
</clause></subparagraph><subparagraph commented="no" id="id17FD20A6176C422F93B4668FD0DDE9F8"><enum>(C)</enum><text>in subparagraph (B), by
striking <quote>nominations and elections</quote> and all that follows through
<quote>specify</quote> and inserting <quote>nominations and elections of public
representatives, broker-dealer representatives, bank representatives, and
advisor representatives. Such rules shall provide that the membership of the
Board shall at all times be as evenly divided in number as possible between
entities or individuals who are subject to regulation by the Board and entities
or individuals not subject to regulation by the Board, provided, however, that
a majority of the members of the Board shall at all times be public
representatives. Such rules shall also specify</quote>;</text>
</subparagraph><subparagraph commented="no" id="idEB2959A523634D228301E111DF9637F6"><enum>(D)</enum><text>in subparagraph
(C)—</text>
<clause commented="no" id="id0C7EE33596A349D98C12CAF4B6BFFEBC"><enum>(i)</enum><text>by inserting <quote>and
municipal financial products</quote> after <quote>municipal securities</quote>
the first two times that term appears;</text>
</clause><clause commented="no" id="idF1DB807121B544738134FC48C88E9181"><enum>(ii)</enum><text>by inserting <quote>,
municipal entities, obligated persons,</quote> before <quote>and the public
interest</quote>;</text>
</clause><clause commented="no" id="id3D172D9AD56F4BF68BB573EE6F15D546"><enum>(iii)</enum><text>by striking
<quote>between</quote> and inserting <quote>among</quote>;</text>
</clause><clause commented="no" id="id945042D940E240329122BCB6161F0526"><enum>(iv)</enum><text>by striking
<quote>issuers, municipal securities brokers, or municipal securities dealers,
to fix</quote> and inserting <quote>municipal entities, obligated persons,
municipal securities brokers, municipal securities dealers, or municipal
advisors, to fix</quote>; and</text>
</clause><clause id="ID455869380fd443a2b2a6b0b206160f69"><enum>(v)</enum><text>by striking
<quote>brokers or municipal securities dealers, to regulate</quote> and
inserting <quote>brokers, municipal securities dealers, or municipal advisors,
to regulate</quote>;</text>
</clause></subparagraph><subparagraph commented="no" id="id3CFECE90588E4C5B8D795CBF8CED510B"><enum>(E)</enum><text>in subparagraph
(D)—</text>
<clause commented="no" id="id33422E2A36AF4A3C85259242A4027D74"><enum>(i)</enum><text>by inserting <quote>and
advice concerning municipal financial products</quote> after
<quote>transactions in municipal securities</quote>;</text>
</clause><clause commented="no" id="id224B4DA463B0451D861A701F6AC94960"><enum>(ii)</enum><text>by striking <quote>That
no</quote> and inserting <quote>that no</quote>;</text>
</clause><clause commented="no" id="id543B433ED87E40EF8681AC7431DBAD09"><enum>(iii)</enum><text>by inserting
<quote>municipal advisor,</quote> before <quote>or person associated</quote>;
and</text>
</clause><clause commented="no" id="idD4FCB93A6664491B8C70F2E1F09DBDFB"><enum>(iv)</enum><text>by striking <quote>a
municipal securities broker or municipal securities dealer may be
compelled</quote> and inserting <quote>a municipal securities broker, municipal
securities dealer, or municipal advisor may be compelled</quote>;</text>
</clause></subparagraph><subparagraph commented="no" id="id98879FC06E12471E9CD1F0A602627C56"><enum>(F)</enum><text>in subparagraph
(E)—</text>
<clause commented="no" id="idAFD3BCEC95484E9E9B32E89EE88DA1BF"><enum>(i)</enum><text>by striking
<quote>municipal securities brokers and municipal securities dealers</quote>
and inserting <quote>municipal securities brokers, municipal securities
dealers, and municipal advisors</quote>; and</text>
</clause><clause commented="no" id="idEC15368134924B07A122F31B88511477"><enum>(ii)</enum><text>by striking
<quote>municipal securities broker or municipal securities dealer</quote> and
inserting <quote>municipal securities broker, municipal securities dealer, or
municipal advisor</quote>;</text>
</clause></subparagraph><subparagraph commented="no" id="id0564EAED02DE4172AE0D3BDCAE415468"><enum>(G)</enum><text>in subparagraph (G), by
striking <quote>municipal securities brokers and municipal securities
dealers</quote> and inserting <quote>municipal securities brokers, municipal
securities dealers, and municipal advisors</quote>;</text>
</subparagraph><subparagraph commented="no" id="id599C4F5A42D042CFAFAC2C2DF571D538"><enum>(H)</enum><text>in subparagraph
(J)—</text>
<clause commented="no" id="id5404BEB25E4F486992DBD1BD6AAD5EFA"><enum>(i)</enum><text>by striking
<quote>municipal securities broker and each municipal securities dealer</quote>
and inserting <quote>municipal securities broker, municipal securities dealer,
and municipal advisor</quote>; and</text>
</clause><clause commented="no" id="id169BCFE064DA477BA5CC1284661EF7B3"><enum>(ii)</enum><text>by striking the period
at the end of the second sentence and inserting <quote>, which may include
charges for failure to submit to the Board required information or documents to
any information system operated by the Board in a full, accurate, or timely
manner, or any other failure to comply with the rules of the
Board.</quote>;</text>
</clause></subparagraph><subparagraph commented="no" id="id1B54D764386A41A39857928DF4159514"><enum>(I)</enum><text>in subparagraph
(K)—</text>
<clause commented="no" id="idE7EB0AF6932C455E94F5276517BB607A"><enum>(i)</enum><text>by inserting
<quote>broker, dealer, or </quote> before <quote>municipal securities
dealer</quote> each place that term appears; and</text>
</clause><clause commented="no" id="id611D0679063848A49B2AC139F4174B77"><enum>(ii)</enum><text>by striking
<quote>municipal securities investment portfolio</quote> and inserting
<quote>related account of a broker, dealer, or municipal securities
dealer</quote>; and</text>
</clause></subparagraph><subparagraph commented="no" id="idC6A2CB273386407CA0AC8050B2A5F27D"><enum>(J)</enum><text>by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id8B12783EABF74DC8860476592B2F14CC" reported-display-style="italic" style="OLC">
<subparagraph commented="no" id="id276D11AD10404AE88DC4C8818581EEC6"><enum>(L)</enum><text>provide continuing
education requirements for municipal advisors.</text>
</subparagraph><subparagraph commented="no" id="id0EE5EEA3D4AE4AE38D8B38369D206E5D"><enum>(M)</enum><text>provide professional
standards.</text>
</subparagraph><subparagraph commented="no" id="id484A36C5E4A842B78104324F45F74307"><enum>(N)</enum><text>not impose a regulatory
burden on small municipal advisors that is not necessary or appropriate in the
public interest and for the protection of investors, municipal entities, and
obligated
persons.</text>
</subparagraph><after-quoted-block>;</after-quoted-block></quoted-block>
</subparagraph></paragraph><paragraph commented="no" id="id7B51642423044C63ACA784DEA2309D65"><enum>(3)</enum><text>by redesignating
paragraph (3) as paragraph (7); and</text>
</paragraph><paragraph commented="no" id="id0208FFEB22214040B996628925A6ACCE"><enum>(4)</enum><text>by inserting after
paragraph (2) the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id52A07DC716174997BA5A6E44C2BFD6DB" reported-display-style="italic" style="OLC">
<paragraph id="idD7B1413DAE09489AA81538E5E5EFB3AE"><enum>(3)</enum><text>The Board, in conjunction
with or on behalf of any Federal financial regulator or self-regulatory
organization, may—</text>
<subparagraph id="id88A954B695A3482A832FA93A241F978E"><enum>(A)</enum><text>establish information
systems; and</text>
</subparagraph><subparagraph id="id049C82CE312F43279DA840283A30AE29"><enum>(B)</enum><text>assess such reasonable
fees and charges for the submission of information to, or the receipt of
information from, such systems from any persons which systems may be developed
for the purposes of serving as a repository of information from municipal
market participants or otherwise in furtherance of the purposes of the Board, a
Federal financial regulator, or a self-regulatory organization.</text>
</subparagraph></paragraph><paragraph id="idC108368F3CC14290B78AF92CF44B447F"><enum>(4)</enum><text>The Board shall provide
guidance and assistance in the enforcement of, and examination for, compliance
with the rules of the Board to the Commission, a registered securities
association under section 15A, or any other appropriate regulatory agency, as
applicable.</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="idBAAEE0001E0C4EAFB79B35748FBABC95"><enum>(c)</enum><header>Discipline of dealers
and municipal advisors and other matters</header><text>Section 15B(c) of the
Securities Exchange Act of 1934 (15 U.S.C. 78o–4(c)) is amended—</text>
<paragraph id="id45577B869FC342AEB560495012CE02C4"><enum>(1)</enum><text>in paragraph (1), by
inserting <quote>, and no broker, dealer, municipal securities dealer, or
municipal advisor shall make use of the mails or any means or instrumentality
of interstate commerce to provide advice to or on behalf of a municipal entity
or obligated person with respect to municipal financial products, the issuance
of municipal securities, or participation in the issuance of municipal
securities, or to undertake a solicitation of a municipal entity or obligated
person,</quote> after <quote>any municipal security</quote>;</text>
</paragraph><paragraph id="idD39193B5789741939E5261F73ED30F46"><enum>(2)</enum><text>in paragraph (2), by
inserting <quote>or municipal advisor</quote> after <quote>municipal securities
dealer</quote> each place that term appears;</text>
</paragraph><paragraph id="idFCE75951C2384187ABF32BAC3ED9FEE9"><enum>(3)</enum><text>in paragraph (3)—</text>
<subparagraph id="id2EB5307BBA30433CA5609B4A2A9409CB"><enum>(A)</enum><text>by inserting <quote>or
municipal entities or obligated person</quote> after <quote>protection of
investors</quote> each place that term appears; and</text>
</subparagraph><subparagraph id="id05AA0A7FF8B4419F9ACC26F5644B4F30"><enum>(B)</enum><text>by inserting <quote>or
municipal advisor</quote> after <quote>municipal securities dealer</quote> each
place that term appears;</text>
</subparagraph></paragraph><paragraph id="id0B598FCAB86D4CB481BB89833D1E926F"><enum>(4)</enum><text>in paragraph (4), by
inserting <quote>or municipal advisor</quote> after <quote>municipal securities
dealer or obligated person</quote> each place that term appears;</text>
</paragraph><paragraph id="idEFE3C20F03AC42E6A3E0593AAB753EDA"><enum>(5)</enum><text>in paragraph (6)(B), by
inserting <quote>or municipal entities</quote> after <quote>protection of
investors</quote>;</text>
</paragraph><paragraph id="id03AB2E7A737D4CF7A3C01B7A15A361D4"><enum>(6)</enum><text>in paragraph (7)—</text>
<subparagraph id="idCFB3229D4677484EA2179536E6ACEDA0"><enum>(A)</enum><text>in subparagraph
(A)—</text>
<clause id="id430FDBD335E74CB7968070AC1CE43BC9"><enum>(i)</enum><text>in clause (i), by
striking <quote>; and</quote> and inserting a semicolon;</text>
</clause><clause id="id9222ABE0EDC24344A20882195CB009E2"><enum>(ii)</enum><text>in clause (ii), by
striking the period and inserting <quote>; and</quote>; and</text>
</clause><clause id="id456707D4DEBC4CF6A988E452836B93A0"><enum>(iii)</enum><text>by adding at the end
the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idBCEDF76026D34DEF952CBB3DBD511FD4" reported-display-style="italic" style="OLC">
<clause id="idBBC04456D95C4502A6D941BA58910D88"><enum>(iii)</enum><text>the Commission, or its
designee, in the case of municipal
advisors.</text>
</clause><after-quoted-block>.</after-quoted-block></quoted-block>
</clause></subparagraph><subparagraph id="id4AA89F26FA964BCEA9A60DFDF75354A2"><enum>(B)</enum><text>in subparagraph (B), by
inserting <quote>or municipal entities or obligated person</quote> after
<quote>protection of investors</quote>; and</text>
</subparagraph></paragraph><paragraph id="id8E880A62DB634B77842C24ED698C07E0"><enum>(7)</enum><text>by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id28519B079639485DA69752EA57B30648" reported-display-style="italic" style="OLC">
<paragraph id="id206B83F7CEF746D48ABB57E54F743AE3"><enum>(9)</enum><subparagraph commented="no" display-inline="yes-display-inline" id="id0089B59797F84A6780A79C2ECE840BFB"><enum>(A)</enum><text>Fines collected by the
Commission for violations of the rules of the Board shall be equally divided
between the Commission and the Board.</text>
</subparagraph><subparagraph changed="added" id="id4B8BCBCD3EF8406EB183D0F8054F8F40" indent="up1" reported-display-style="italic"><enum>(B)</enum><text>Fines
collected by a registered securities association under section 15A(7) with
respect to violations of the rules of the Board shall be accounted for by such
registered securities association separately from other fines collected under
section 15A(7) and shall be allocated between such registered securities
association and the Board at the direction of the
Commission.</text>
</subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="id09951380FBEC44EFA87A05740F9DC1B4"><enum>(d)</enum><header>Issuance of municipal
securities</header><text>Section 15B(d)(2) of the Securities Exchange Act of
1934 (15 U.S.C. 78o–4(d)) is amended—</text>
<paragraph id="id32A2B11D95284B3DB2AA4E533BC91874"><enum>(1)</enum><text>by striking
<quote>through a municipal securities broker or municipal securities dealer or
otherwise</quote> and inserting <quote>through a municipal securities broker,
municipal securities dealer, municipal advisor, or otherwise</quote>;
and</text>
</paragraph><paragraph id="idBEC624A0E25341A5988A95FD31019A54"><enum>(2)</enum><text>by inserting <quote>or
municipal advisors</quote> before <quote>to furnish</quote>.</text>
</paragraph></subsection><subsection id="id946212BAA05D43F0BA0E0299D36299F8"><enum>(e)</enum><header>Definitions</header><text>Section
15B of the Securities Exchange Act of 1934 (15 U.S.C. 78o–4) is amended by
adding at the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idDA8F1F1D44B3416996FA6CEE805E2D2F" reported-display-style="italic" style="OLC">
<subsection id="id923B2392372D4C068D0B6FDACFE0BBC4"><enum>(e)</enum><header>Definitions</header><text>For
purposes of this section—</text>
<paragraph id="idADE267286A614A66B1F45A796944E277"><enum>(1)</enum><text>the term
<term>Board</term> means the Municipal Securities Rulemaking Board established
under subsection (b)(1);</text>
</paragraph><paragraph id="id48BCD317B9804433B4EC6BFE20FB35B2"><enum>(2)</enum><text>the term <term>guaranteed
investment contract</term> includes any investment that has specified
withdrawal or reinvestment provisions and a specifically negotiated or bid
interest rate, and also includes any agreement to supply investments on 2 or
more future dates, such as a forward supply contract;</text>
</paragraph><paragraph id="idC92FBEF8918A4163AB17C5F75FCF5DDB"><enum>(3)</enum><text>the term <term>investment
strategies</term> includes plans or programs for the investment of the proceeds
of municipal securities that are not municipal derivatives, guaranteed
investment contracts, and the recommendation of and brokerage of municipal
escrow investments;</text>
</paragraph><paragraph id="idCBD65A4AD7314225B723EEFECA9E113F"><enum>(4)</enum><text>the term <term>municipal
advisor</term>—</text>
<subparagraph id="idA80D7F670B5345ECA0A91BCB359ACF0D"><enum>(A)</enum><text>means a person (who is
not a municipal entity or an employee of a municipal entity) that—</text>
<clause id="id671C074AB24F4A268E48FB6AB1B5C6A7"><enum>(i)</enum><text>provides advice to or on
behalf of a municipal entity or obligated person with respect to municipal
financial products or the issuance of municipal securities, including advice
with respect to the structure, timing, terms, and other similar matters
concerning such financial products or issues;</text>
</clause><clause id="id3B640E39BC0C40D8BD417F4C9707650D"><enum>(ii)</enum><text>participates in the
issuance of municipal securities; or</text>
</clause><clause commented="no" id="id343CFA141B574A9E9565CADBECC721A0"><enum>(iii)</enum><text>undertakes a
solicitation of a municipal entity;</text>
</clause></subparagraph><subparagraph commented="no" id="idC565A54EFDC8420D89E992E05CC52CA8"><enum>(B)</enum><text>includes financial
advisors, guaranteed investment contract brokers, third-party marketers,
placement agents, solicitors, finders, and swap advisors, if such persons are
described in any of clauses (i) through (iii) of subparagraph (A); and</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="id15A265C397E34DD9BD898471DC859964"><enum>(C)</enum><text>does not include a
broker, dealer, or municipal securities dealer serving as an underwriter (as
defined in section 2(a)(11) of the Securities Act of 1933) (15 U.S.C.
77b(a)(11)), any investment adviser registered under the Investment Advisers
Act of 1940, or persons associated with such investment advisers who are
providing investment advice, attorneys offering legal advice or providing
services that are of a traditional legal nature, or engineers providing
engineering advice;</text>
</subparagraph></paragraph><paragraph id="id17C188045B144186A1CB68378672F5AE"><enum>(5)</enum><text>the term <term>municipal
derivative</term> means any financial instrument or contract designed to hedge
a risk (including interest rate swaps, basis swaps, credit default swaps, caps,
floors, and collars);</text>
</paragraph><paragraph id="id1239031D51ED454A894FCDCF012539DC"><enum>(6)</enum><text>the term <term>municipal
financial product</term> means municipal derivatives, guaranteed investment
contracts, and investment strategies;</text>
</paragraph><paragraph id="idFE1094D9AD2048BA875C51A56D490CE7"><enum>(7)</enum><text>the term <term>rules of
the Board</term> means the rules proposed and adopted by the Board under
subsection (b)(2);</text>
</paragraph><paragraph id="idC5DC620713184D13BEA3E4D7614A2DDD"><enum>(8)</enum><text>the term <quote>person
associated with a municipal advisor</quote> or <quote>associated person of an
advisor</quote> means—</text>
<subparagraph id="idCDF1311474FF463ABD5FDADCCCA59F51"><enum>(A)</enum><text>any partner, officer,
director, or branch manager of such municipal advisor (or any person occupying
a similar status or performing similar functions);</text>
</subparagraph><subparagraph id="id886CAAFC0BC34ABAA3DC3F6AE0FBD70B"><enum>(B)</enum><text>any other employee of
such municipal advisor who is engaged in the management, direction,
supervision, or performance of any activities relating to the provision of
advice to or on behalf of a municipal entity or obligated person with respect
to municipal financial products, the issuance of municipal securities, or
participation in the issuance of municipal securities; and</text>
</subparagraph><subparagraph id="id0602C877E2FB49CBA3723C33A0A67D15"><enum>(C)</enum><text>any person directly or
indirectly controlling, controlled by, or under common control with such
municipal advisor;</text>
</subparagraph></paragraph><paragraph id="id5F8A57C6385C4330974CA06700075EC9"><enum>(9)</enum><text>the term <term>municipal
entity</term> means any State, political subdivision of a State, or municipal
corporate instrumentality of a State, including—</text>
<subparagraph id="id5209A470127D4697AF2E7F4568A2302F"><enum>(A)</enum><text>any agency, authority, or
instrumentality of the State, political subdivision, or municipal corporate
instrumentality;</text>
</subparagraph><subparagraph id="id76014FA69EE142A5AEBB1EB628FC1213"><enum>(B)</enum><text>any plan, program, or
pool of assets sponsored or established by the State, political subdivision, or
municipal corporate instrumentality or any agency, authority, or
instrumentality thereof; and</text>
</subparagraph><subparagraph id="idF7F8BB1F4A5D43CD921F7A0AB7ADACE1"><enum>(C)</enum><text>any other issuer of
municipal securities;</text>
</subparagraph></paragraph><paragraph id="id02A60A6CD276478DB6898CF948B41925"><enum>(10)</enum><text>the term
<term>solicitation of a municipal entity or obligated person</term> means a
direct or indirect communication with a municipal entity or obligated person
made by a person, for direct or indirect compensation, on behalf of a broker,
dealer, municipal securities dealer, municipal advisor, or investment adviser
(as defined in section 202 of the Investment Advisers Act of 1940) that does
not control, is not controlled by, or is not under common control with the
person undertaking such solicitation for the purpose of obtaining or retaining
an engagement by a municipal entity or obligated person of a broker, dealer,
municipal securities dealer, or municipal advisor for or in connection with
municipal financial products, the issuance of municipal securities, or
participation in the issuance of municipal securities, or of an investment
adviser to provide investment advisory services to or on behalf of a municipal
entity; and</text>
</paragraph><paragraph id="id2113A60069004657A59F34DFF27F36ED"><enum>(11)</enum><text>the term <term>obligated
person</term> means any person, including an issuer of municipal securities,
who is either generally or through an enterprise, fund, or account of such
person, committed by contract or other arrangement to support the payment of
all or part of the obligations on the municipal securities to be sold in an
offering of municipal
securities.</text>
</paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="idF924E96D923A49F088508E8CB688DFAB"><enum>(f)</enum><header>Registered securities
association</header><text>Section 15A(b) of the Securities Exchange Act of 1934
(15 U.S.C. 78o–3(b)) is amended by adding at the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id3F0F864B8A2D45E58CB91F60D49D309C" reported-display-style="italic" style="OLC">
<paragraph id="idD030951FF027414B9EFD660EBC5E06A9"><enum>(15)</enum><text>The rules of the
association provide that the association shall—</text>
<subparagraph id="id185041EA6E974B11A6F49564DED0738C"><enum>(A)</enum><text>request guidance from the
Municipal Securities Rulemaking Board in interpretation of the rules of the
Municipal Securities Rulemaking Board; and</text>
</subparagraph><subparagraph id="id32FA36D02FF944B389E8127F9B57B8DD"><enum>(B)</enum><text>provide information to
the Municipal Securities Rulemaking Board about the enforcement actions and
examinations of the association under section 15B(b)(2)(E), so that the
Municipal Securities Rulemaking Board may—</text>
<clause id="id91DED08560944012A805FAEA4B0AAB9C"><enum>(i)</enum><text>assist in such
enforcement actions and examinations; and</text>
</clause><clause id="id7BBC36FC266848BE965B407E3322C6FC"><enum>(ii)</enum><text>evaluate the ongoing
effectiveness of the rules of the
Board.</text>
</clause></subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="ID70414f0139fb4d17989e53a47fcc82f1"><enum>(g)</enum><header>Registration and
regulation of brokers and dealers</header><text>Section 15 of the Securities
Exchange Act of 1934 is amended—</text>
<paragraph id="id220E8E8716E34761B8D4018B72215E71"><enum>(1)</enum><text>in subsection (b)(4), by
inserting <quote>municipal advisor,</quote> after <quote>municipal securities
dealer</quote> each place that term appears; and</text>
</paragraph><paragraph id="id22E7070A56114910B19262D7CCF970CF"><enum>(2)</enum><text>in subsection (c), by
inserting <quote>broker, dealer, or</quote> before <term>municipal securities
dealer</term> each place that term appears.</text>
</paragraph></subsection><subsection id="IDefd03eee89d1465d8c4b496f58d283b9"><enum>(h)</enum><header>Accounts and records,
reports, examinations of exchanges, members, and others</header><text>Section
17(a)(1) of the Securities Exchange Act of 1934 is amended by inserting
<quote>municipal advisor,</quote> after <quote>municipal securities
dealer</quote>.</text>
</subsection><subsection id="ID065f249851794938a45a96ec4ac528c3"><enum>(i)</enum><header>Savings
clause</header><text>Notwithstanding any provision of the Over-the-Counter
Derivatives Markets Act of 2010, or any amendment made pursuant to such Act,
the provisions of this section, and the amendments made pursuant to this
section, shall apply to any municipal derivative.</text>
</subsection><subsection id="id72A2C7B71AC842ADBAD1CBF572BA226C"><enum>(j)</enum><header>Effective
date</header><text>This section, and the amendments made by this section, shall
take effect on October 1, 2010.</text>
</subsection></section><section id="id9E007575A7054A7AAA1E866DC22D9099"><enum>976.</enum><header>Government
Accountability Office study of increased disclosure to investors</header>
<subsection id="id85D7E7799ACE4EE2B82EC899C29FD82E"><enum>(a)</enum><header>Study</header><text>The
Comptroller General of the United States shall conduct a study and review of
the disclosure required to be made by issuers of municipal securities.</text>
</subsection><subsection id="id0AC5A6CB1FEE445FA09D3DE3E9EEE3F0"><enum>(b)</enum><header>Subjects for
evaluation</header><text>In conducting the study under subsection (a), the
Comptroller General of the United States shall—</text>
<paragraph id="idED07311FFD15421A89A6048CA6267917"><enum>(1)</enum><text>broadly describe—</text>
<subparagraph id="id783912262AE2429A80C35537C8ECEA8D"><enum>(A)</enum><text>the size of the municipal
securities markets and the issuers and investors; and</text>
</subparagraph><subparagraph id="idFBB26F5710954835914FB24D255417F3"><enum>(B)</enum><text>the disclosures provided
by issuers to investors;</text>
</subparagraph></paragraph><paragraph id="id05AD1E1CA38448738AACFCB9C6E277E2"><enum>(2)</enum><text>compare the amount,
frequency, and quality of disclosures that issuers of municipal securities are
required by law to provide for the benefit of municipal securities holders,
including the amount of and frequency of disclosures actually provided by
issuers of municipal securities, with the amount of and frequency of
disclosures that issuers of corporate securities provide for the benefit of
corporate securities holders, taking into account the differences between
issuers of municipal securities and issuers of corporate securities;</text>
</paragraph><paragraph id="id063EEE4FA7CE4ECA9DA0E8415F092203"><enum>(3)</enum><text>evaluate the costs and
benefits to various types of issuers of municipal securities of requiring
issuers of municipal bonds to provide additional financial disclosures for the
benefit of investors;</text>
</paragraph><paragraph id="id0E5D5A49E487451D9180B928B498B7D1"><enum>(4)</enum><text>evaluate the potential
benefit to investors from additional financial disclosures by issuers of
municipal bonds; and</text>
</paragraph><paragraph id="id22BB946789654463B64D17AA9D55D8D3"><enum>(5)</enum><text>make recommendations
relating to disclosure requirements for municipal issuers, including the
advisability of the repeal or retention of section 15B(d) of the Securities
Exchange Act of 1934 (15 U.S.C. 78o–4(d)) (commonly known as the <quote>Tower
Amendment</quote>).</text>
</paragraph></subsection><subsection id="id5996A36A512B4054A638DA0CFBD015EF"><enum>(c)</enum><header>Report</header><text>Not
later than 1 year after the date of enactment of this Act, the Comptroller
General of the United States shall submit a report to Congress on the results
of the study conducted under subsection (a), including recommendations for how
to improve disclosure by issuers of municipal securities.</text>
</subsection></section><section id="id9910161884D94AA8B06BB598C646B252"><enum>977.</enum><header>Government
Accountability Office study on the municipal securities markets</header>
<subsection id="id15A0412928854042BAEFB76A51C16B09"><enum>(a)</enum><header>Study</header><text>The
Comptroller General of the United States shall conduct a study of the municipal
securities markets.</text>
</subsection><subsection id="id791ECEBE7D7F4702BFC09E6F9E6434D9"><enum>(b)</enum><header>Report</header><text>Not
later than 180 days after the date of enactment of this Act, the Comptroller
General of the United States shall submit a report to the Committee on Banking,
Housing, and Urban Affairs of the Senate, and the Committee on Financial
Services of the House of Representatives, with copies to the Special Committee
on Aging of the Senate and the Commission, on the results of the study
conducted under subsection (a), including—</text>
<paragraph commented="no" id="id363ACD987E2E4915A5D2F0E5D8F17371"><enum>(1)</enum><text>an analysis of the
mechanisms for trading, quality of trade executions, market transparency, trade
reporting, price discovery, settlement clearing, and credit
enhancements;</text>
</paragraph><paragraph id="idB29114B56CAC479FA9F111D6C639A13C"><enum>(2)</enum><text>the needs of the markets
and investors and the impact of recent innovations;</text>
</paragraph><paragraph id="idC440575AAE4A46FB88B7B557D7384523"><enum>(3)</enum><text>recommendations for how
to improve the transparency, efficiency, fairness, and liquidity of trading in
the municipal securities markets, including with reference to items listed in
paragraph (1); and</text>
</paragraph><paragraph id="idE276DBA7B20A401997D7999CF1208D90"><enum>(4)</enum><text>potential uses of
derivatives in the municipal securities markets.</text>
</paragraph></subsection><subsection id="idC923B78CA5CC435B978F905CD75127D6"><enum>(c)</enum><header>Responses</header><text>Not
later than 180 days after receipt of the report required under subsection (b),
the Commission shall submit a response to the Committee on Banking, Housing,
and Urban Affairs of the Senate, and the Committee on Financial Services of the
House of Representatives, with a copy to the Special Committee on Aging of the
Senate, stating the actions the Commission has taken in response to the
recommendations contained in such report.</text>
</subsection></section><section id="id68B72732C4AA4B36AA26D1426D23BDB3"><enum>978.</enum><header>Study of funding for
Government Accounting Standards Board</header>
<subsection id="idC346039CCA97445989EFDB25B036B56A"><enum>(a)</enum><header>Study</header><text>The
Commission shall conduct a study that evaluates—</text>
<paragraph id="id2AA7827888F34F84A2A95F586544515F"><enum>(1)</enum><text>the role and importance
of the Government Accounting Standards Board in the municipal securities
markets;</text>
</paragraph><paragraph id="id426A2A009C9249B4A6ACF15BF5F1E275"><enum>(2)</enum><text>the manner in which the
Government Accounting Standards Board is funded, and how such manner of funding
affects the financial information available to securities investors;</text>
</paragraph><paragraph id="id89B23D4E6E764226A78D677E07A57502"><enum>(3)</enum><text>the advisability of
changes to the manner in which the Government Accounting Standards Board is
funded; and</text>
</paragraph><paragraph id="idDC7F3DC55D584378B8C5491B11FD4992"><enum>(4)</enum><text>whether legislative
changes to the manner in which the Government Accounting Standards Board is
funded are necessary for the benefit of investors and in the public
interest.</text>
</paragraph></subsection><subsection id="id9D8168D3125C44B292418095D6950813"><enum>(b)</enum><header>Consultation</header><text>In
conducting the study required under subsection (a), the Commission shall
consult with State and local government financial officers.</text>
</subsection><subsection id="id0CC06491B00B4D02B70E7686AB409D8E"><enum>(c)</enum><header>Report</header><text>Not
later than 270 days after the date of enactment of this Act, the Commission
shall submit to the Committee on Banking, Housing, and Urban Affairs of the
Senate and the Committee on Financial Services of the House of Representatives
a report on the study required under subsection (a).</text>
</subsection></section><section id="idA306172FB79F4A5C9879B7C9AD2F99AE"><enum>979.</enum><header>Commission Office of
Municipal Securities</header>
<subsection id="idB65967DA4FA54DC895FF4367A3FF4971"><enum>(a)</enum><header>In
general</header><text>There shall be in the Commission an Office of Municipal
Securities, which shall—</text>
<paragraph id="id908ACEA31BB94C51AF500E708F32577E"><enum>(1)</enum><text>administer the rules of
the Commission with respect to the practices of municipal securities brokers
and dealers, municipal securities advisors, municipal securities investors, and
municipal securities issuers; and</text>
</paragraph><paragraph id="id34C4D3A0938041B79D0A521C716424B9"><enum>(2)</enum><text>coordinate with the
Municipal Securities Rulemaking Board for rulemaking and enforcement actions as
required by law.</text>
</paragraph></subsection><subsection id="id28F0895A2CC1447F83CDD3243B3D68A4"><enum>(b)</enum><header>Director of the
Office</header><text>The head of the Office of Municipal Securities shall be
the Director, who shall report to the Chairman.</text>
</subsection><subsection id="id8F1B444B3AE0437D925AB1F7194DBBBA"><enum>(c)</enum><header>Staffing</header>
<paragraph id="id27E8B30652C64D15BEC121BD5DC7449A"><enum>(1)</enum><header>In
general</header><text>The Office of Municipal Securities shall be staffed
sufficiently to carry out the requirements of this section.</text>
</paragraph><paragraph id="idFB2E01DC46FC451EBAD8769F8708C38B"><enum>(2)</enum><header>Requirement</header><text>The
staff of the Office of Municipal Securities shall include individuals with
knowledge of and expertise in municipal finance.</text>
</paragraph></subsection></section></subtitle><subtitle id="idB5DCCF63F5A3444D959B63DEEC369E13"><enum>I</enum><header>Public Company Accounting
Oversight Board, portfolio margining, and other matters</header>
<section id="idA2998CC3EE73432F8173D2D31E959149"><enum>981.</enum><header>Authority to share
certain information with foreign authorities</header>
<subsection id="HCB420D8EE679417580D355D467520F44"><enum>(a)</enum><header>Definition</header><text display-inline="yes-display-inline">Section 2(a) of the Sarbanes-Oxley Act of
2002 (15 U.S.C. 7201(a)) is amended by adding at the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="H7175BD2A21334B839DE9CF9B197CBAE9" reported-display-style="italic" style="OLC">
<paragraph id="H03B3EE54C84C4567B74FB6070317FAE9"><enum>(17)</enum><header>Foreign auditor
oversight authority</header><text display-inline="yes-display-inline">The term
<term>foreign auditor oversight authority</term> means any governmental body or
other entity empowered by a foreign government to conduct inspections of public
accounting firms or otherwise to administer or enforce laws related to the
regulation of public accounting
firms.</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="HB8CD1500C0CA4FCE81624309E0746D7D"><enum>(b)</enum><header>Availability To Share
information</header><text>Section 105(b)(5) of the Sarbanes-Oxley Act of 2002
(15 U.S.C. 7215(b)(5)) is amended by adding at the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="HA55134E1F4CE4CB7B51E99648FB66187" reported-display-style="italic" style="OLC">
<subparagraph id="H790A9C3D06614B85B73D3DA776720477"><enum>(C)</enum><header>Availability to foreign
oversight authorities</header><text display-inline="yes-display-inline">Without
the loss of its status as confidential and privileged in the hands of the
Board, all information referred to in subparagraph (A) that relates to a public
accounting firm that a foreign government has empowered a foreign auditor
oversight authority to inspect or otherwise enforce laws with respect to, may,
at the discretion of the Board, be made available to the foreign auditor
oversight authority, if—</text>
<clause id="id6EF822502BE944DFBB777FDC695A3D76"><enum>(i)</enum><text display-inline="yes-display-inline">the Board finds that it is necessary to
accomplish the purposes of this Act or to protect investors;</text>
</clause><clause id="id49A2DB9812964EFDBE2C53E382877974"><enum>(ii)</enum><text display-inline="yes-display-inline">the foreign auditor oversight authority
provides—</text>
<subclause id="idF0CDC4A747E3439A9A7651534FBE0DF6"><enum>(I)</enum><text display-inline="yes-display-inline">such assurances of confidentiality as the
Board may request;</text>
</subclause><subclause id="idACC8FDE83B5A42C483AFB8615D44C975"><enum>(II)</enum><text>a description of the
applicable information systems and controls of the foreign auditor oversight
authority; and</text>
</subclause><subclause id="id8D9D286611A14F15AA169398762D9083"><enum>(III)</enum><text>a description of the
laws and regulations of the foreign government of the foreign auditor oversight
authority that are relevant to information access; and</text>
</subclause></clause><clause id="id072FA7490CB049FBBD8BD63A8D3A7D34"><enum>(iii)</enum><text display-inline="yes-display-inline">the Board determines that it is appropriate
to share such
information.</text>
</clause></subparagraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection commented="no" display-inline="no-display-inline" id="HA4BF4CA509F64304B10BCB3A17F4288B"><enum>(c)</enum><header>Conforming
amendment</header><text display-inline="yes-display-inline">Section
105(b)(5)(A) of the Sarbanes-Oxley Act of 2002 (15 U.S.C. 7215(b)(5)(A)) is
amended by striking <quote>subparagraph (B)</quote> and inserting
<quote>subparagraphs (B) and (C)</quote>.</text>
</subsection></section><section commented="no" display-inline="no-display-inline" id="id51187836D9ED4E96BB65B2757B568B83"><enum>982.</enum><header>Oversight of brokers
and dealers</header>
<subsection id="HDBD76099A3064BFA86D0C61633A972AC"><enum>(a)</enum><header>Definitions</header>
<paragraph id="idE9B29CABA23945169B29AE28521773ED"><enum>(1)</enum><header>Definitions
amended</header><text display-inline="yes-display-inline">Title I of the
Sarbanes-Oxley Act of 2002 (15 U.S.C. 7201 et seq.) is amended by adding at the
end the following new section:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="HFAC8E95652874BF7B3E3228804096D68" reported-display-style="italic" style="OLC">
<section id="H1E97962D5D004A7390DE04629DBABB43"><enum>110.</enum><header>Definitions</header><text display-inline="no-display-inline">For the purposes of this title, the
following definitions shall apply:</text>
<paragraph id="H1E359FA8BE494E5D842B7A8B8998B21B"><enum>(1)</enum><header>Audit</header><text display-inline="yes-display-inline">The term <term>audit</term> means an
examination of the financial statements, reports, documents, procedures,
controls, or notices of any issuer, broker, or dealer by an independent public
accounting firm in accordance with the rules of the Board or the Commission,
for the purpose of expressing an opinion on the financial statements or
providing an audit report.</text>
</paragraph><paragraph id="H9852351EA2B04441B8D98418E1DF2C9D"><enum>(2)</enum><header>Audit
report</header><text display-inline="yes-display-inline">The term <term>audit
report</term> means a document, report, notice, or other record—</text>
<subparagraph id="HA3381372E17648D99879184BCDC68DD6"><enum>(A)</enum><text>prepared following an
audit performed for purposes of compliance by an issuer, broker, or dealer with
the requirements of the securities laws; and</text>
</subparagraph><subparagraph id="HD1E7764B95224E68879CFD30FF05D5A8"><enum>(B)</enum><text>in which a public
accounting firm either—</text>
<clause id="HABEAA7D1B1004CC58363DC2025C349E0"><enum>(i)</enum><text>sets forth the opinion of
that firm regarding a financial statement, report, notice, or other document,
procedures, or controls; or</text>
</clause><clause id="H065FBEE2E0104720AA99182E42D84625"><enum>(ii)</enum><text>asserts that no such
opinion can be expressed.</text>
</clause></subparagraph></paragraph><paragraph id="HDB567514C6024F98ADE17DDD1DF94150"><enum>(3)</enum><header>Broker</header><text display-inline="yes-display-inline">The term <term>broker</term> means a broker
(as such term is defined in section 3(a)(4) of the Securities Exchange Act of
1934 (15 U.S.C. 78c(a)(4))) that is required to file a balance sheet, income
statement, or other financial statement under section 17(e)(1)(A) of such Act
(15 U.S.C. 78q(e)(1)(A)), where such balance sheet, income statement, or
financial statement is required to be certified by a registered public
accounting firm.</text>
</paragraph><paragraph id="H3C78EEE692F34E6A9E40A1904ACA2959"><enum>(4)</enum><header>Dealer</header><text display-inline="yes-display-inline">The term <quote>dealer</quote> means a
dealer (as such term is defined in section 3(a)(5) of the Securities Exchange
Act of 1934 (15 U.S.C. 78c(a)(5))) that is required to file a balance sheet,
income statement, or other financial statement under section 17(e)(1)(A) of
such Act (15 U.S.C. 78q(e)(1)(A)), where such balance sheet, income statement,
or financial statement is required to be certified by a registered public
accounting firm.</text>
</paragraph><paragraph display-inline="no-display-inline" id="H01D1A7D8C8B4423185281654E531A9C4"><enum>(5)</enum><header>Professional
standards</header><text>The term <term>professional standards</term>
means—</text>
<subparagraph id="H966BC00444684F05B2736A736C0F5E8F"><enum>(A)</enum><text>accounting principles
that are—</text>
<clause id="H884C77097EA344088ADEFD9CD08AA042"><enum>(i)</enum><text>established by the
standard setting body described in section 19(b) of the Securities Act of 1933,
as amended by this Act, or prescribed by the Commission under section 19(a) of
that Act (15 U.S.C. 17a(s)) or section 13(b) of the Securities Exchange Act of
1934 (15 U.S.C. 78a(m)); and</text>
</clause><clause id="H3FB916E173554CBE90E6434FE73EB5C3"><enum>(ii)</enum><text>relevant to audit
reports for particular issuers, brokers, or dealers, or dealt with in the
quality control system of a particular registered public accounting firm;
and</text>
</clause></subparagraph><subparagraph id="H1DEE94C334FD4B36846B74DFC1B21AB6"><enum>(B)</enum><text>auditing standards,
standards for attestation engagements, quality control policies and procedures,
ethical and competency standards, and independence standards (including rules
implementing title II) that the Board or the Commission determines—</text>
<clause id="H0ADBF1D0C0434A57973F2267C288546B"><enum>(i)</enum><text>relate to the preparation
or issuance of audit reports for issuers, brokers, or dealers; and</text>
</clause><clause id="H63B022C14D4C44EBBE002D0FA4166213"><enum>(ii)</enum><text>are established or
adopted by the Board under section 103(a), or are promulgated as rules of the
Commission.</text>
</clause></subparagraph></paragraph><paragraph id="HF176F0498E6D4BB18AAE49117D412AEE"><enum>(6)</enum><header>Self-regulatory
organization</header><text display-inline="yes-display-inline">The term
<quote>self-regulatory organization</quote> has the same meaning as in section
3(a) of the Securities Exchange Act of 1934 (15 U.S.C.
78c(a)).</text>
</paragraph></section><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph><paragraph id="id378A7B61ABC44D40BFB3D272DB02D955"><enum>(2)</enum><header>Conforming
amendment</header><text>Section 2(a) of the Sarbanes-Oxley Act of 2002 (15
U.S.C. 7201(a)) is amended in the matter preceding paragraph (1), by striking
<quote>In this</quote> and inserting <quote>Except as otherwise specifically
provided in this Act, in this</quote>.</text>
</paragraph></subsection><subsection id="H7F766004CA6B4BF9B6C3FB342F916B84"><enum>(b)</enum><header>Establishment and
Administration of the Public Company Accounting Oversight
Board</header><text>Section 101 of the Sarbanes-Oxley Act of 2002 (15 U.S.C.
7211) is amended—</text>
<paragraph id="HDE133776D6C44BA495FA5D37945F7000"><enum>(1)</enum><text>by striking
<quote>issuers</quote> each place that term appears and inserting
<quote>issuers, brokers, and dealers</quote>; and</text>
</paragraph><paragraph id="HE22D69889B8E4A1388F7D666FBFFBC9B"><enum>(2)</enum><text>in subsection (a)—</text>
<subparagraph id="idBA7B14B055A54F08A5A98060EA77E7E1"><enum>(A)</enum><text>by striking <quote>public
companies</quote> and inserting <quote>companies</quote>; and</text>
</subparagraph><subparagraph id="HFFCF5360E8974F65960FE77B88D0985F"><enum>(B)</enum><text>by striking <quote>for
companies the securities of which are sold to, and held by and for, public
investors</quote>.</text>
</subparagraph></paragraph></subsection><subsection id="H0CDAA66D6DE142B298274088D7032E1C"><enum>(c)</enum><header>Registration with the
Board</header><text display-inline="yes-display-inline">Section 102 of the
Sarbanes-Oxley Act of 2002 (15 U.S.C. 7212) is amended—</text>
<paragraph id="HF3CBEEF1CC3342909E17BD7ACF9C3FDF"><enum>(1)</enum><text>in subsection (a)—</text>
<subparagraph id="idBE2A9AD24E264C3598B31B9149BC8D5E"><enum>(A)</enum><text>by striking
<quote>Beginning 180</quote> and all that follows through <quote>101(d),
it</quote> and inserting <quote>It</quote>; and</text>
</subparagraph><subparagraph id="id64DA63A63D514CC8A3E8C3A379AF675A"><enum>(B)</enum><text>by striking
<quote>issuer</quote> and inserting <quote>issuer, broker, or
dealer</quote>;</text>
</subparagraph></paragraph><paragraph id="idDA574DC7B303494A9BBBECD0E3B03416"><enum>(2)</enum><text>in subsection (b)—</text>
<subparagraph id="id6B54B9D3DBE0404ABE0018FA97939F9E"><enum>(A)</enum><text>in paragraph (2)(A), by
striking <quote>issuers</quote> and inserting <quote>issuers, brokers, and
dealers</quote>; and</text>
</subparagraph><subparagraph id="H729D6A12B6B14D8999E64748BB2D9A8C"><enum>(B)</enum><text>by striking
<quote>issuer</quote> each place that term appears and inserting <quote>issuer,
broker, or dealer</quote>.</text>
</subparagraph></paragraph></subsection><subsection id="HCA324D74AE1546F6AFA70B9B8340EF49"><enum>(d)</enum><header>Auditing and
independence</header><text>Section 103(a) of the Sarbanes-Oxley Act of 2002 (15
U.S.C. 7213(a)) is amended—</text>
<paragraph id="HBA2D40CA531D48D48447D1804A71B7F3"><enum>(1)</enum><text>in paragraph (1), by
striking <quote>and such ethics standards</quote> and inserting <quote>such
ethics standards, and such independence standards</quote>;</text>
</paragraph><paragraph id="HB2973802D51046F7916CD66FB47F214F"><enum>(2)</enum><text>in paragraph (2)(A)(iii),
by striking <quote>describe in each audit report</quote> and inserting
<quote>in each audit report for an issuer, describe</quote>; and</text>
</paragraph><paragraph id="HDE549091810A4EFD83BB45EA50B53B5F"><enum>(3)</enum><text>in paragraph (2)(B)(i),
by striking <quote>issuers</quote> and inserting <quote>issuers, brokers, and
dealers</quote>.</text>
</paragraph></subsection><subsection id="HE3A8EECCDF4840B8805ECDFE9BC6D4C9"><enum>(e)</enum><header>Inspections of
registered public accounting firms</header><text>Section 104 of the
Sarbanes-Oxley Act of 2002 (15 U.S.C. 7214) is amended—</text>
<paragraph id="HEC90233D62BC4D728B5B045EEEF28E98"><enum>(1)</enum><text>in subsection (a), by
striking <quote>issuers</quote> and inserting <quote>issuers, brokers, and
dealers</quote>; and</text>
</paragraph><paragraph id="H4E5CC4956DF846BDABF80D60B26242AE"><enum>(2)</enum><text>in subsection
(b)(1)—</text>
<subparagraph id="id1BF24AE55E1344C2BABDAE97183D2005"><enum>(A)</enum><text>by striking <quote>audit
reports for</quote> each place that term appears and inserting <quote>audit
reports on annual financial statements for</quote>;</text>
</subparagraph><subparagraph id="idB93A947B5AE44805B33D793E8128C07E"><enum>(B)</enum><text>in subparagraph (A), by
striking <quote>and</quote> at the end;</text>
</subparagraph><subparagraph id="HEB3E951BBC7B4BDC896DD8701A1C8F01"><enum>(C)</enum><text>in subparagraph (B), by
striking the period at the end and inserting <quote>; and</quote>; and</text>
</subparagraph><subparagraph id="idBCD0B266F7244B67A36BAEA2D51C7334"><enum>(D)</enum><text>by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idEF6BFFA98B004B62A21A2BF485751B7F" reported-display-style="italic" style="OLC">
<subparagraph id="idCD8FE1CF1257472F971004C3AB507752"><enum>(C)</enum><text>with respect to each
registered public accounting firm that regularly provides audit reports and
that is not described in subparagraph (A) or (B), on a basis determined by the
Board, by rule, that is consistent with the public interest and protection of
investors.</text>
</subparagraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subparagraph></paragraph></subsection><subsection id="H2049B6D4C9DE4B87A24E67FB48A20E94"><enum>(f)</enum><header>Investigations and
disciplinary proceedings</header><text>Section 105(c)(7)(B) of the
Sarbanes-Oxley Act of 2002 (15 U.S.C. 7215(c)(7)(B)) is amended—</text>
<paragraph id="HD0CD468B91EC4633882E0ADEEB009E7C"><enum>(1)</enum><text>in the subparagraph
heading, by inserting <quote><header-in-text level="subparagraph" style="OLC">,
broker, or dealer</header-in-text></quote> after <quote><header-in-text level="subparagraph" style="OLC">issuer</header-in-text></quote>;</text>
</paragraph><paragraph id="id6B30834C8E1643E7B5F4A8AA6AEE5DAF"><enum>(2)</enum><text>by striking <quote>any
issuer</quote> each place that term appears and inserting <quote>any issuer,
broker, or dealer</quote>; and</text>
</paragraph><paragraph id="HB43B363550374342B0AAC5D46F5F57BE"><enum>(3)</enum><text>by striking <quote>an
issuer under this subsection</quote> and inserting <quote>a registered public
accounting firm under this subsection</quote>.</text>
</paragraph></subsection><subsection id="H28E1EF53602948BAA1B127E3644BA2E0"><enum>(g)</enum><header>Foreign public
accounting firms</header><text>Section 106(a) of the Sarbanes-Oxley Act of 2002
(15 U.S.C. 7216(a)) is amended—</text>
<paragraph id="id1F2F650BB7B74517B81CB7261BE8FDAD"><enum>(1)</enum><text>in paragraph (1), by
striking <quote>issuer</quote> and inserting <quote>issuer, broker, or
dealer</quote>; and</text>
</paragraph><paragraph id="H5C76887687274DA4BD94E4A75978767D"><enum>(2)</enum><text>in paragraph (2), by
striking <quote>issuers</quote> and inserting <quote>issuers, brokers, or
dealers</quote>.</text>
</paragraph></subsection><subsection id="H5EC1B2EC200B454BB4BF437EA842C8F5"><enum>(h)</enum><header>Funding</header><text display-inline="yes-display-inline">Section 109 of the Sarbanes-Oxley Act of
2002 (15 U.S.C. 7219) is amended—</text>
<paragraph display-inline="no-display-inline" id="H17007801DEBE4F02963B8A2E1D6EEFCC"><enum>(1)</enum><text>in subsection (c)(2), by
striking <quote>subsection (i)</quote> and inserting <quote>subsection
(j)</quote>;</text>
</paragraph><paragraph id="H68EC9B873B004C52A485B06A3BE9EB78"><enum>(2)</enum><text>in subsection (d)—</text>
<subparagraph id="idF56BA637B32C483E9259EC4AAA5A259A"><enum>(A)</enum><text>in paragraph (2), by
striking <quote>allowing for differentiation among classes of issuers, as
appropriate</quote> and inserting <quote>and among brokers and dealers, in
accordance with subsection (h), and allowing for differentiation among classes
of issuers, brokers and dealers, as appropriate</quote>; and</text>
</subparagraph><subparagraph id="id2F0CD89BE14744C3A75D53334A98B92B"><enum>(B)</enum><text>by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id576A4CF95E6C4DFE87FCFF9BCA426374" reported-display-style="italic" style="OLC">
<paragraph id="id1131B666D9F0496681199D8F89BA0C8A"><enum>(3)</enum><header>Brokers and
dealers</header><text>The Board shall begin the allocation, assessment, and
collection of fees under paragraph (2) with respect to brokers and dealers with
the payment of support fees to fund the first full fiscal year beginning after
the effective date of this
paragraph.</text>
</paragraph><after-quoted-block>;</after-quoted-block></quoted-block>
</subparagraph></paragraph><paragraph id="H9BB6ABA5A73C40899D6A4B7892E94248"><enum>(3)</enum><text>by redesignating
subsections (h), (i), and (j) as subsections (i), (j), and (k), respectively;
and</text>
</paragraph><paragraph id="H44B9D6E87DCF4AB1A8A4C7CE37D29D07"><enum>(4)</enum><text>by inserting after
subsection (g) the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="HD7206C28FC5C4B7293759E1BAF257B07" reported-display-style="italic" style="OLC">
<subsection id="H30E407D9372D485E89D3E1339EE734F7"><enum>(h)</enum><header>Allocation of
accounting support fees among brokers and dealers</header>
<paragraph id="idD7E440E998204BC28D526E41FB7821A4"><enum>(1)</enum><header>Obligation to
pay</header><text display-inline="yes-display-inline">Each broker or dealer
shall pay to the Board the annual accounting support fee allocated to such
broker or dealer under this section.</text>
</paragraph><paragraph id="idCB5940D66A2242D7B4B6320D380F87F5"><enum>(2)</enum><header>Allocation</header><text>Any
amount due from a broker or dealer (or from a particular class of brokers and
dealers) under this section shall be allocated among brokers and dealers and
payable by the broker or dealer (or the brokers and dealers in the particular
class, as applicable).</text>
</paragraph><paragraph id="idD5106BB25AFF41C8962F77F581D4704A"><enum>(3)</enum><header>Proportionality</header><text>The
amount due from a broker or dealer shall be in proportion to the net capital of
the broker or dealer, compared to the total net capital of all brokers and
dealers, in accordance with rules issued by the
Board.</text>
</paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="H645A8D4E0C934D1F969B99E2C8F7497C"><enum>(i)</enum><header>Referral of
investigations to a self-regulatory organization</header><text>Section
105(b)(4)(B) of the Sarbanes-Oxley Act of 2002 (15 U.S.C. 7215(b)(4)(B)) is
amended—</text>
<paragraph id="H4C68EFBFBC80413D903C6CFBFC3937C4"><enum>(1)</enum><text>by redesignating clauses
(ii) and (iii) as clauses (iii) and (iv), respectively; and</text>
</paragraph><paragraph id="H1BBD0281525347E8AE00DB2DE10B3F91"><enum>(2)</enum><text>by inserting after clause
(i) the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="H98BBD15B4B614A4EADFD5C7B1DA1570A" reported-display-style="italic" style="OLC">
<clause id="H008FEA8C02494324852DAECED6066E1E"><enum>(ii)</enum><text display-inline="yes-display-inline">to a self-regulatory organization, in the
case of an investigation that concerns an audit report for a broker or dealer
that is under the jurisdiction of such self-regulatory
organization;</text>
</clause><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="H4594AE5D4E3A43A98E39A00E04773F4C"><enum>(j)</enum><header>Use of documents
related to an inspection or investigation</header><text>Section
105(b)(5)(B)(ii) of the Sarbanes-Oxley Act of 2002 (15 U.S.C.
7215(b)(5)(B)(ii)) is amended—</text>
<paragraph id="H456C6CE16F354CCCAC8F68E16781065C"><enum>(1)</enum><text>in subclause (III), by
striking <quote>and</quote> at the end;</text>
</paragraph><paragraph id="H5567E4FE3EB24FB1B45D3FE7F6B2A457"><enum>(2)</enum><text>in subclause (IV), by
striking the comma and inserting <quote>; and</quote>; and</text>
</paragraph><paragraph id="H7918A095177A4CEDAAEF7363DCE29FB0"><enum>(3)</enum><text>by inserting after
subclause (IV) the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="HD6B251535DE549A9B85286493AC7DD54" reported-display-style="italic" style="OLC">
<subclause id="HE7EAC79E85614175B9968CF77E2F189A"><enum>(V)</enum><text display-inline="yes-display-inline">a self-regulatory organization, with
respect to an audit report for a broker or dealer that is under the
jurisdiction of such self-regulatory
organization,</text>
</subclause><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection commented="no" display-inline="no-display-inline" id="H5342C4B82AE046C5B249F54E595C14F8"><enum>(k)</enum><header>Effective
date</header><text display-inline="yes-display-inline">The amendments made by
this section shall take effect 180 days after the date of enactment of this
Act.</text>
</subsection></section><section commented="no" display-inline="no-display-inline" id="id70198622E325431A85D1511606058363"><enum>983.</enum><header>Portfolio
margining</header>
<subsection id="H30FF606F167A4174BC22D47592BF44C3"><enum>(a)</enum><header>Advances</header><text display-inline="yes-display-inline">Section 9(a)(1) of the Securities Investor
Protection Act of 1970 (15 U.S.C. 78fff–3(a)(1)) is amended by inserting
<quote>or options on commodity futures contracts</quote> after <quote>claim for
securities</quote>.</text>
</subsection><subsection id="HD9B32AEB4A964570AF79BA3C25975C12"><enum>(b)</enum><header>Definitions</header><text>Section
16 of the Securities Investor Protection Act of 1970 (15 U.S.C. 78lll) is
amended—</text>
<paragraph id="HCC3C6B16CC96405194A80073460080A7"><enum>(1)</enum><text>by striking paragraph (2)
and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="HCCDEF7071F654422996F660090B5E453" reported-display-style="italic" style="OLC">
<paragraph id="HD93002EDE66548D7BA76E5DD289D4CDC"><enum>(2)</enum><header>Customer</header>
<subparagraph id="H358B0C8BF9514C44BF75D2E8BF7DD103"><enum>(A)</enum><header>In
general</header><text>The term <term>customer</term> of a debtor means any
person (including any person with whom the debtor deals as principal or agent)
who has a claim on account of securities received, acquired, or held by the
debtor in the ordinary course of its business as a broker or dealer from or for
the securities accounts of such person for safekeeping, with a view to sale, to
cover consummated sales, pursuant to purchases, as collateral, security, or for
purposes of effecting transfer.</text>
</subparagraph><subparagraph id="HA33800EFD8C546FA84A3B6A1D52E6657"><enum>(B)</enum><header>Included
persons</header><text>The term <term>customer</term> includes—</text>
<clause id="H4D230C95C64E4794BAAFF21616E1F5AA"><enum>(i)</enum><text>any person who has
deposited cash with the debtor for the purpose of purchasing securities;</text>
</clause><clause id="H20C84A06085441B8B76DBEC600E1D443"><enum>(ii)</enum><text display-inline="yes-display-inline">any person who has a claim against the
debtor for cash, securities, futures contracts, or options on futures contracts
received, acquired, or held in a portfolio margining account carried as a
securities account pursuant to a portfolio margining program approved by the
Commission; and</text>
</clause><clause id="H557697A8A0DD4E18992BC8AECD36F37B"><enum>(iii)</enum><text>any person who has a
claim against the debtor arising out of sales or conversions of such
securities.</text>
</clause></subparagraph><subparagraph id="H7FBCF0FF78114E2E96E0175905B82D36"><enum>(C)</enum><header>Excluded
persons</header><text>The term <term>customer</term> does not include any
person, to the extent that—</text>
<clause id="H937C2D01FF5E4EB6AC2F70A5BA349DE2"><enum>(i)</enum><text>the claim of such person
arises out of transactions with a foreign subsidiary of a member of SIPC;
or</text>
</clause><clause id="H8BC63D0CBAAB44858FC3D52C2E841C9D"><enum>(ii)</enum><text>such person has a claim
for cash or securities which by contract, agreement, or understanding, or by
operation of law, is part of the capital of the debtor, or is subordinated to
the claims of any or all creditors of the debtor, notwithstanding that some
ground exists for declaring such contract, agreement, or understanding void or
voidable in a suit between the claimant and the
debtor.</text>
</clause></subparagraph></paragraph><after-quoted-block>;</after-quoted-block></quoted-block>
</paragraph><paragraph id="H5375FF8D65AB4055801C47B49E146E67"><enum>(2)</enum><text>in paragraph (4)—</text>
<subparagraph id="idFBC50A7E254E4D589678C472CE03F9A1"><enum>(A)</enum><text>in subparagraph (C), by
striking <quote>and</quote> at the end;</text>
</subparagraph><subparagraph id="idB5852662DA2F41AF89110C1DA4836243"><enum>(B)</enum><text>by redesignating
subparagraph (D) as subparagraph (E); and</text>
</subparagraph><subparagraph id="idEFB20277A3C148209F08642A710E7FF5"><enum>(C)</enum><text>by inserting after
subparagraph (C) the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id03F51D3D39724DB991B9DD8CFAD4E169" reported-display-style="italic" style="OLC">
<subparagraph id="id1273686F78C64F429237BD1E49D8C354"><enum>(D)</enum><text>in the case of a
portfolio margining account of a customer that is carried as a securities
account pursuant to a portfolio margining program approved by the Commission, a
futures contract or an option on a futures contract received, acquired, or held
by or for the account of a debtor from or for such portfolio margining account,
and the proceeds thereof;
and</text>
</subparagraph><after-quoted-block>;</after-quoted-block></quoted-block>
</subparagraph></paragraph><paragraph id="HF608B7285B5446AB966BA3540222BFB4"><enum>(3)</enum><text>in paragraph (9), in the
matter following subparagraph (L), by inserting after <quote>Such term</quote>
the following: <quote>includes revenues earned by a broker or dealer in
connection with a transaction in the portfolio margining account of a customer
carried as securities accounts pursuant to a portfolio margining program
approved by the Commission. Such term</quote>; and</text>
</paragraph><paragraph id="H49453212E063463098AFA3ADDB8D16AA"><enum>(4)</enum><text>in paragraph (11)—</text>
<subparagraph id="id9716C69A6FC64D918EE5C2C471BEC7B1"><enum>(A)</enum><text>in subparagraph
(A)—</text>
<clause id="H3407B8923CDA4207BEAAA0FE0000F2FD"><enum>(i)</enum><text>by striking <quote>filing
date, all</quote> and all that follows through the end of the subparagraph and
inserting the following: “filing date—</text>
<quoted-block changed="added" display-inline="no-display-inline" id="HACFC43B506AE4016867CB9ACBCD6D5AA" reported-display-style="italic" style="OLC">
<clause id="H021FBCC16B334F80888D1C53EB043BA8"><enum>(i)</enum><text>all securities positions
of such customer (other than customer name securities reclaimed by such
customer); and</text>
</clause><clause id="HCA84474B86AE4E57B901E908AF3C7E7B"><enum>(ii)</enum><text>all positions in futures
contracts and options on futures contracts held in a portfolio margining
account carried as a securities account pursuant to a portfolio margining
program approved by the Commission, including all property collateralizing such
positions, to the extent that such property is not otherwise included herein;
minus</text>
</clause><after-quoted-block>;
and</after-quoted-block></quoted-block>
</clause></subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="HD7354F948D0648448074008BD18C1048"><enum>(B)</enum><text>in the matter following
subparagraph (C), by striking <quote>In determining</quote> and inserting the
following: <quote>A claim for a commodity futures contract received, acquired,
or held in a portfolio margining account pursuant to a portfolio margining
program approved by the Commission or a claim for a security futures contract,
shall be deemed to be a claim with respect to such contract as of the filing
date, and such claim shall be treated as a claim for cash. In
determining</quote>.</text>
</subparagraph></paragraph></subsection></section><section commented="no" display-inline="no-display-inline" id="idBE792972181443E1B9B31EBE1EAFC2E0"><enum>984.</enum><header>Loan or borrowing of
securities</header>
<subsection commented="no" display-inline="no-display-inline" id="id72C5FAEE030B40CA80F007254E4486E0"><enum>(a)</enum><header>Rulemaking
authority</header><text display-inline="yes-display-inline">Section 10 of the
Securities Exchange Act of 1934 (15 U.S.C. 78j) is amended by adding at the end
the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idDB0D39797FC24C7DAD2197BA3E772719" reported-display-style="italic" style="OLC">
<subsection id="IDe1d4523716284b9f978c2e4209e02163" indent="down1"><enum>(c)</enum><paragraph commented="no" display-inline="yes-display-inline" id="idAD8E4EA7D86C4BB280E7C1313FC75E87"><enum>(1)</enum><text>To effect, accept, or
facilitate a transaction involving the loan or borrowing of securities in
contravention of such rules and regulations as the Commission may prescribe as
necessary or appropriate in the public interest or for the protection of
investors.</text>
<subparagraph changed="added" id="ID5dbeb80086a343feb44423126a65c209" indent="up2" reported-display-style="italic"><enum>(2)</enum><text>Nothing in paragraph (1)
may be construed to limit the authority of the appropriate Federal banking
agency (as defined in section 3(q) of the Federal Deposit Insurance Act (12
U.S.C. 1813(q))), the National Credit Union Administration, or any other
Federal department or agency having a responsibility under Federal law to
prescribe rules or regulations restricting transactions involving the loan or
borrowing of securities in order to protect the safety and soundness of a
financial institution or to protect the financial system from systemic
risk.</text>
</subparagraph></paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection commented="no" display-inline="no-display-inline" id="id1EDEAAE75740423ABC91F23348A00983"><enum>(b)</enum><header>Rulemaking
required</header><text>Not later than 2 years after the date of enactment of
this Act, the Commission shall promulgate rules that are designed to increase
the transparency of information available to brokers, dealers, and investors,
with respect to the loan or borrowing of securities.</text>
</subsection></section><section id="id09ED673ACC9B4AEF9201A9B96EBB546E"><enum>985.</enum><header>Technical corrections
to Federal securities laws</header>
<subsection id="H4C8C9AA8463F457D9B02D253AA93E6D"><enum>(a)</enum><header>Securities Act of
1933</header><text display-inline="yes-display-inline">The Securities Act of
1933 (15 U.S.C. 77a et seq.) is amended—</text>
<paragraph id="H638CDFDA25004EB38F2853B1035067CF"><enum>(1)</enum><text>in section 3(a)(4) (15
U.S.C. 77c(a)(4)), by striking <quote>individual;</quote> and inserting
<quote>individual,</quote>;</text>
</paragraph><paragraph id="HE16D0E07FF9B44139E4711BC3647BF9B"><enum>(2)</enum><text display-inline="yes-display-inline">in section 18 (15 U.S.C. 77r)—</text>
<subparagraph id="id4E3EE6D59C7641ECB8EBDDD1D01B105F"><enum>(A)</enum><text display-inline="yes-display-inline">in subsection (b)(1)(C), by striking
<quote>is a security</quote> and inserting <quote>a security</quote>;
and</text>
</subparagraph><subparagraph id="H49A09552651F44B79339EE9787F0CC55"><enum>(B)</enum><text display-inline="yes-display-inline">in subsection (c)(2)(B)(i), by striking
<quote>State, or</quote> and inserting <quote>State or</quote>;</text>
</subparagraph></paragraph><paragraph id="H9F9DD580B6B942869469FD1D00F436F8"><enum>(3)</enum><text display-inline="yes-display-inline">in section 19(d)(6)(A) (15 U.S.C.
77s(d)(6)(A)), by striking <quote>in paragraph (1) of (3)</quote> and inserting
<quote>in paragraph (1) or (3)</quote>; and</text>
</paragraph><paragraph id="H390F2313B9A74F929E45712FCA70B83E"><enum>(4)</enum><text display-inline="yes-display-inline">in section 27A(c)(1)(B)(ii) (15 U.S.C.
77z–2(c)(1)(B)(ii)), by striking <quote>business entity;</quote> and inserting
<quote>business entity,</quote>.</text>
</paragraph></subsection><subsection id="HA5BFBBDA677043E48B7057761D0900B6"><enum>(b)</enum><header>Securities Exchange Act
of 1934</header><text display-inline="yes-display-inline">The Securities
Exchange Act of 1934 (15 U.S.C. 78a et seq.) is amended—</text>
<paragraph id="H034739305B744E529BEB276F31D325BF"><enum>(1)</enum><text>in section 2 (15 U.S.C.
78b), by striking <quote>affected</quote> and inserting
<quote>effected</quote>;</text>
</paragraph><paragraph id="H527C89DC386F459992CE6D2FCB841B90"><enum>(2)</enum><text display-inline="yes-display-inline">in section 3 (15 U.S.C. 78c)—</text>
<subparagraph id="id4B5ACC9495C94C89AD0468AF35E7100A"><enum>(A)</enum><text display-inline="yes-display-inline">in subsection (a)(55)(A), by striking
<quote>section 3(a)(12) of the Securities Exchange Act of 1934</quote> and
inserting <quote>section 3(a)(12) of this title</quote>; and</text>
</subparagraph><subparagraph id="HEC1EBD4050704ACF82E860A313FFFF14"><enum>(B)</enum><text display-inline="yes-display-inline">in subsection (g), by striking
<quote>company, account person, or entity</quote> and inserting <quote>company,
account, person, or entity</quote>;</text>
</subparagraph></paragraph><paragraph id="HF507A2ECD538411C8167F5B34FEF91C"><enum>(3)</enum><text display-inline="yes-display-inline">in section 10A(i)(1)(B) (15 U.S.C.
78j–1(i)(1)(B))—</text>
<subparagraph id="idA153AB55E0E642F083D0B60552EBD548"><enum>(A)</enum><text display-inline="yes-display-inline">in the subparagraph heading, by striking
<quote><header-in-text level="subparagraph" style="OLC">minimus</header-in-text></quote> and inserting
<quote><header-in-text level="subparagraph" style="OLC">minimis</header-in-text></quote>; and</text>
</subparagraph><subparagraph id="id9F9920257D12449F89C8B84FAEE07A8E"><enum>(B)</enum><text display-inline="yes-display-inline">in clause (i), by striking
<quote>nonaudit</quote> and inserting <quote>non-audit</quote>;</text>
</subparagraph></paragraph><paragraph id="HF5DC2244A3514CD1ACABD13694865961"><enum>(4)</enum><text display-inline="yes-display-inline">in section 13(b)(1) (15 U.S.C. 78m(b)(1)),
by striking <quote>earning statement</quote> and inserting <quote>earnings
statement</quote>;</text>
</paragraph><paragraph id="H5545DA3DC14444FCB4FD9566E5D14A5"><enum>(5)</enum><text display-inline="yes-display-inline">in section 15 (15 U.S.C. 78o)—</text>
<subparagraph id="idDC1E8EAF2E81466FAAB2E2CC99B151E4"><enum>(A)</enum><text display-inline="yes-display-inline">in subsection (b)(1)—</text>
<clause id="HB51780BB332D43E3B88C5C974063E223"><enum>(i)</enum><text>in subparagraph (B), by
striking <quote>The order granting</quote> and all that follows through
<quote>from such membership.</quote>; and</text>
</clause><clause id="H11A961BA715344F4B68523D4F38487DA"><enum>(ii)</enum><text>in the undesignated
matter immediately following subparagraph (B), by inserting after the first
sentence the following: <quote>The order granting registration shall not be
effective until such broker or dealer has become a member of a registered
securities association, or until such broker or dealer has become a member of a
national securities exchange, if such broker or dealer effects transactions
solely on that exchange, unless the Commission has exempted such broker or
dealer, by rule or order, from such membership.</quote>;</text>
</clause></subparagraph></paragraph><paragraph id="H135F7536307D46B9AD06685600F800C6"><enum>(6)</enum><text display-inline="yes-display-inline">in section 15C(a)(2) (15 U.S.C.
78o–5(a)(2))—</text>
<subparagraph commented="no" id="HEAA139A6AB514B969509E7FE2CA05C39"><enum>(A)</enum><text>by redesignating clauses
(i) and (ii) as subparagraphs (A) and (B), respectively, and adjusting the
subparagraph margins accordingly;</text>
</subparagraph><subparagraph id="HFFE191BD414B4BEDB3E2AA6C622C02F3"><enum>(B)</enum><text>in subparagraph (B), as
so redesignated, by striking <quote>The order granting</quote> and all that
follows through <quote>from such membership.</quote>; and</text>
</subparagraph><subparagraph id="H5AFB6CF5CD0544EC941695C1165E721B"><enum>(C)</enum><text>in the matter following
subparagraph (B), as so redesignated, by inserting after the first sentence the
following: <quote>The order granting registration shall not be effective until
such government securities broker or government securities dealer has become a
member of a national securities exchange registered under section 6 of this
title, or a securities association registered under section 15A of this title,
unless the Commission has exempted such government securities broker or
government securities dealer, by rule or order, from such
membership.</quote>;</text>
</subparagraph></paragraph><paragraph id="H7E1E1DA8B8C745DC983CE9EADC67CA87"><enum>(7)</enum><text display-inline="yes-display-inline">in section 17(b)(1)(B) (15 U.S.C.
78q(b)(1)(B)), by striking <quote>15A(k) gives</quote> and inserting
<quote>15A(k), give</quote>; and</text>
</paragraph><paragraph id="H819F4DF81F24431CACABF4D9D5CFC8FF"><enum>(8)</enum><text display-inline="yes-display-inline">in section 21C(c)(2) (15 U.S.C.
78u–3(c)(2)), by striking <quote>paragraph (1) subsection</quote> and inserting
<quote>Paragraph (1)</quote>.</text>
</paragraph></subsection><subsection id="HD47E42626EA24CB7BC38D24BE7CA864B"><enum>(c)</enum><header>Trust Indenture Act of
1939</header><text display-inline="yes-display-inline">The Trust Indenture Act
of 1939 (15 U.S.C. 77aaa et seq.) is amended—</text>
<paragraph id="H5F619A68D36A4ED78E8DFE33EF5323E9"><enum>(1)</enum><text display-inline="yes-display-inline">in section 304(b) (15 U.S.C. 77ddd(b)), by
striking <quote>section 2 of such Act</quote> and inserting <quote>section 2(a)
of such Act</quote>; and</text>
</paragraph><paragraph id="HDA347B29401C46A2B78FB5A2C1007C03"><enum>(2)</enum><text display-inline="yes-display-inline">in section 317(a)(1) (15 U.S.C.
77qqq(a)(1)), by striking <quote>, in the</quote> and inserting <quote>in
the</quote>.</text>
</paragraph></subsection><subsection id="H28D5C16DBD5E4BCAB7D85085538FB87F"><enum>(d)</enum><header>Investment Company Act
of 1940</header><text display-inline="yes-display-inline">The Investment
Company Act of 1940 (15 U.S.C. 80a–1 et seq.) is amended—</text>
<paragraph id="H0D5F1957C728492B81301F89C73E0026"><enum>(1)</enum><text display-inline="yes-display-inline">in section 2(a)(19) (15 U.S.C.
80a–2(a)(19)), in the matter following subparagraph (B)(vii)—</text>
<subparagraph id="id38D78F8225BC49E1BAD2283E65941E18"><enum>(A)</enum><text display-inline="yes-display-inline">by striking <quote>clause (vi)</quote> each
place that term appears and inserting <quote>clause (vii)</quote>; and</text>
</subparagraph><subparagraph id="idF41EA6B8FC1E483796F5A72E1C3B3D47"><enum>(B)</enum><text>in each of subparagraphs
(A)(vi) and (B)(vi), by adding <quote>and</quote> at the end of subclause
(III);</text>
</subparagraph></paragraph><paragraph id="HB6084CAE92264E41AEC14948C0FA9EC0"><enum>(2)</enum><text display-inline="yes-display-inline">in section 9(b)(4)(B) (15 U.S.C.
80a–9(b)(4)(B)), by adding <quote>or</quote> after the semicolon at the
end;</text>
</paragraph><paragraph id="H3ECFE06034D74EAD9624EA797BF000B3"><enum>(3)</enum><text display-inline="yes-display-inline">in section 12(d)(1)(J) (15 U.S.C.
80a–12(d)(1)(J)), by striking <quote>any provision of this subsection</quote>
and inserting <quote>any provision of this paragraph</quote>;</text>
</paragraph><paragraph id="H50FEF8DA58C44D88BA71CDAF14367451"><enum>(4)</enum><text display-inline="yes-display-inline">in section 17(f) (15 U.S.C.
80a–17(f))—</text>
<subparagraph id="id74DF29BDE70E4F26A829B130C58EAFC1"><enum>(A)</enum><text display-inline="yes-display-inline">in paragraph (4), by striking <quote>No
such member</quote> and inserting <quote>No member of a national securities
exchange</quote>; and</text>
</subparagraph><subparagraph id="H08E74555636C4E60A232E96F4B6E7901"><enum>(B)</enum><text display-inline="yes-display-inline">in paragraph (6), by striking
<quote>company may serve</quote> and inserting <quote>company, may
serve</quote>; and</text>
</subparagraph></paragraph><paragraph id="H03EEF25FBB084DBAA8695D61A84EE00"><enum>(5)</enum><text display-inline="yes-display-inline">in section 61(a)(3)(B)(iii) (15 U.S.C.
80a–60(a)(3)(B)(iii))—</text>
<subparagraph id="HC3AD4C90330447CDB100B500922B002E"><enum>(A)</enum><text>by striking
<quote>paragraph (1) of section 205</quote> and inserting <quote>section
205(a)(1)</quote>; and</text>
</subparagraph><subparagraph id="H6348EF3E436C43EE93F8C094B139909B"><enum>(B)</enum><text>by striking <quote>clause
(A) or (B) of that section</quote> and inserting <quote>paragraph (1) or (2) of
section 205(b)</quote>.</text>
</subparagraph></paragraph></subsection><subsection id="H245CEC63FC3144B889488595A9837C37"><enum>(e)</enum><header>Investment Advisers Act
of 1940</header><text display-inline="yes-display-inline">The Investment
Advisers Act of 1940 (15 U.S.C. 80b–1 et seq.) is amended—</text>
<paragraph id="H62ED47C0780D427CB4DEF672152AC3C"><enum>(1)</enum><text display-inline="yes-display-inline">in section 203 (15 U.S.C. 80b–3)—</text>
<subparagraph id="id70DD19F0AFEB42348E236752CBF36BFA"><enum>(A)</enum><text display-inline="yes-display-inline">in subsection (c)(1)(A), by striking
<quote>principal business office and</quote> and inserting <quote>principal
office, principal place of business, and </quote>; and</text>
</subparagraph><subparagraph id="id36984EF97C00442D9736747CE1D154E5"><enum>(B)</enum><text display-inline="yes-display-inline">in subsection (k)(4)(B), in the matter
following clause (ii), by striking <quote>principal place of business</quote>
and inserting <quote>principal office or place of business</quote>;</text>
</subparagraph></paragraph><paragraph id="HF034596386734E88917E3CC472005D2C"><enum>(2)</enum><text display-inline="yes-display-inline">in section 206(3) (15 U.S.C. 80b–6(3)), by
adding <quote>or</quote> after the semicolon at the end;</text>
</paragraph><paragraph id="id9CA3978B6EC14705B693545C61B2616A"><enum>(3)</enum><text display-inline="yes-display-inline">in section 213(a) (15 U.S.C. 80b–13(a)), by
striking <quote>principal place of business</quote> and inserting
<quote>principal office or place of business</quote>; and</text>
</paragraph><paragraph id="id5D7170287771439BBCA6E3B874EBCA90"><enum>(4)</enum><text display-inline="yes-display-inline">in section 222 (15 U.S.C. 80b–18a), by
striking <quote>principal place of business</quote> each place that term
appears and inserting <quote>principal office and place of
business</quote>.</text>
</paragraph></subsection></section><section display-inline="no-display-inline" id="H01278C7E0E1043DFA4F5A9C3BC68A487"><enum>986.</enum><header>Conforming amendments
relating to repeal of the Public Utility Holding Company Act of 1935</header>
<subsection id="HE97962223383401E8FF8D9372B930000"><enum>(a)</enum><header>Securities Exchange Act
of 1934</header><text display-inline="yes-display-inline">The Securities
Exchange Act of 1934 (15 U.S.C. 78 et seq.) is amended—</text>
<paragraph id="H89B26566AEC54BB2871970BCDEFF6279"><enum>(1)</enum><text>in section 3(a)(47) (15
U.S.C. 78c(a)(47)), by striking <quote>the Public Utility Holding Company Act
of 1935 (15 U.S.C. 79a et seq.),</quote>;</text>
</paragraph><paragraph id="H05FAE756835A4C6FAD6018C4B05A3FD"><enum>(2)</enum><text>in section 12(k) (15
U.S.C. 78l(k)), by amending paragraph (7) to read as follows: </text>
<quoted-block changed="added" display-inline="no-display-inline" id="H9CA89EF107204C5E9D422EDCADAA4B2D" reported-display-style="italic" style="OLC">
<paragraph id="H226E95B7B0D342409E9FF2023429B0AE"><enum>(7)</enum><header>Definition</header><text>For
purposes of this subsection, the term <term>emergency</term> means—</text>
<subparagraph id="HA33E6DF3415248B3A72171BF29854426"><enum>(A)</enum><text>a major market
disturbance characterized by or constituting—</text>
<clause id="H713FAF2A42AA4797BD12C2C0EDD933BE"><enum>(i)</enum><text>sudden and excessive
fluctuations of securities prices generally, or a substantial threat thereof,
that threaten fair and orderly markets; or</text>
</clause><clause id="H1C94A955392A4A7B89E860BE5B99C4E"><enum>(ii)</enum><text>a substantial disruption
of the safe or efficient operation of the national system for clearance and
settlement of transactions in securities, or a substantial threat thereof;
or</text>
</clause></subparagraph><subparagraph id="H7E2A66F8F9B448A0966DAACF918BEF"><enum>(B)</enum><text>a major disturbance that
substantially disrupts, or threatens to substantially disrupt—</text>
<clause id="H1F3F08900F7149C3B62B9E00F0623430"><enum>(i)</enum><text>the functioning of
securities markets, investment companies, or any other significant portion or
segment of the securities markets; or</text>
</clause><clause id="HE76CE739EEC54CD8854D32CBF6710043"><enum>(ii)</enum><text>the transmission or
processing of securities transactions.</text>
</clause></subparagraph></paragraph><after-quoted-block>;
and</after-quoted-block></quoted-block>
</paragraph><paragraph id="H73E9B7F1255A4D9E98F867EA9255C546"><enum>(3)</enum><text>in section 21(h)(2) (15
U.S.C. 78u(h)(2)), by striking <quote>section 18(c) of the Public Utility
Holding Company Act of 1935,</quote>.</text>
</paragraph></subsection><subsection id="H7A5C75A558344A48A34D3C5F93838DCA"><enum>(b)</enum><header>Trust Indenture Act of
1939</header><text display-inline="yes-display-inline">The Trust Indenture Act
of 1939 (15 U.S.C. 77aaa et seq.) is amended—</text>
<paragraph id="H9CD688CC0715414086151B211FB30064"><enum>(1)</enum><text display-inline="yes-display-inline">in section 303 (15 U.S.C. 77ccc), by
striking paragraph (17) and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="H071545A02449455AA60045E805D65900" reported-display-style="italic" style="OLC">
<paragraph id="H035BA57B7E0745D4862339FF1FD9055C"><enum>(17)</enum><text>The terms
<term>Securities Act of 1933</term> and <term>Securities Exchange Act of
1934</term> shall be deemed to refer, respectively, to such Acts, as amended,
whether amended prior to or after the enactment of this
title.</text>
</paragraph><after-quoted-block>;</after-quoted-block></quoted-block>
</paragraph><paragraph id="HBFD551147E1644FB8B62458E65DF1713"><enum>(2)</enum><text display-inline="yes-display-inline">in section 308 (15 U.S.C. 77hhh), by
striking <quote>Securities Act of 1933, the Securities Exchange Act of 1934, or
the Public Utility Holding Company Act of 1935</quote> each place that term
appears and inserting <quote>Securities Act of 1933 or the Securities Exchange
Act of 1934</quote>;</text>
</paragraph><paragraph id="HA371BE9534D445EF887454EAD187A835"><enum>(3)</enum><text display-inline="yes-display-inline">in section 310 (15 U.S.C. 77jjj), by
striking subsection (c);</text>
</paragraph><paragraph id="H6C03000CBC944EFFB39783F0375C01F3"><enum>(4)</enum><text display-inline="yes-display-inline">in section 311 (15 U.S.C. 77kkk), by
striking subsection (c);</text>
</paragraph><paragraph id="HC0856E7950C04C48A3F8F2C6D9338160"><enum>(5)</enum><text display-inline="yes-display-inline">in section 323(b) (15 U.S.C. 77www(b)), by
striking <quote>Securities Act of 1933, or the Securities Exchange Act of 1934,
or the Public Utility Holding Company Act of 1935</quote> and inserting
<quote>Securities Act of 1933 or the Securities Exchange Act of 1934</quote>;
and</text>
</paragraph><paragraph id="HB495880401FA4E5E96D18F132235778E"><enum>(6)</enum><text display-inline="yes-display-inline">in section 326 (15 U.S.C. 77zzz), by
striking <quote>Securities Act of 1933, or the Securities Exchange Act of 1934,
or the Public Utility Holding Company Act of 1935,</quote> and inserting
<quote>Securities Act of 1933 or the Securities Exchange Act of
1934</quote>.</text>
</paragraph></subsection><subsection id="HD7139AACE2B04CB2BDFCF76299F1707E"><enum>(c)</enum><header>Investment Company Act
of 1940</header><text display-inline="yes-display-inline">The Investment
Company Act of 1940 (15 U.S.C. 80a–1 et seq.) is amended—</text>
<paragraph id="HBBB8C710A0FB4B7DA72E17626CB86BB1"><enum>(1)</enum><text display-inline="yes-display-inline">in section 2(a)(44) (15 U.S.C.
80a–2(a)(44)), by striking <quote><quote>Public Utility Holding Company Act of
1935</quote>,</quote>;</text>
</paragraph><paragraph id="HB3F0B2B8D4B24D06931C30ED990048E9"><enum>(2)</enum><text display-inline="yes-display-inline">in section 3(c) (15 U.S.C. 80a–3(c)), by
striking paragraph (8) and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="H8438F34B23194571ADFF9D7BAD3CBD58" reported-display-style="italic" style="OLC">
<paragraph id="H2D2131B344804E4089D1C2306C37CDB7"><enum>(8)</enum><text>[Repealed]</text>
</paragraph><after-quoted-block>;</after-quoted-block></quoted-block>
</paragraph><paragraph id="H101783C4EFD346AB9C136FD8C874B1AE"><enum>(3)</enum><text display-inline="yes-display-inline">in section 38(b) (15 U.S.C. 80a–37(b)), by
striking <quote>the Public Utility Holding Company Act of 1935,</quote>;
and</text>
</paragraph><paragraph id="H52517801D1EF4EAD988E30FE33452F34"><enum>(4)</enum><text display-inline="yes-display-inline">in section 50 (15 U.S.C. 80a–49), by
striking <quote>the Public Utility Holding Company Act of 1935,</quote>.</text>
</paragraph></subsection><subsection commented="no" display-inline="no-display-inline" id="H6D9851C99E104359BD471C63E20032B3"><enum>(d)</enum><header>Investment Advisers Act
of 1940</header><text display-inline="yes-display-inline">Section 202(a)(21) of
the Investment Advisers Act of 1940 (15 U.S.C. 80b–2(a)(21)) is amended by
striking <quote><quote>Public Utility Holding Company Act of
1935</quote>,</quote>.</text>
</subsection></section><section id="HA0596F753FBA4E37A6F7C683BD5BC4A"><enum>987.</enum><header>Amendment to
definition of material loss and nonmaterial losses to the Deposit Insurance
Fund for purposes of Inspector General reviews</header>
<subsection id="HAAE621FB6C7B4D849D2874E42CA87869"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">Section 38(k) of the
Federal Deposit Insurance Act (U.S.C. 1831o(k)) is amended—</text>
<paragraph id="H71F23F8BC09E4ACD844B4FE7F239AF00"><enum>(1)</enum><text>in paragraph (2), by
striking subparagraph (B) and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="H5159DC4A2DC0442C83BFFBE4D5E5CD52" reported-display-style="italic" style="OLC">
<subparagraph id="HDD2E7B1369BE4A8695D8CB5789851FB2"><enum>(B)</enum><header>Material loss
defined</header><text display-inline="yes-display-inline">The term
<quote>material loss</quote> means any estimated loss in excess of—</text>
<clause id="idEE26A8989F7543B4BA2716C75A0AD402"><enum>(i)</enum><text display-inline="yes-display-inline">$100,000,000, if the loss occurs during the
period beginning on September 30, 2009, and ending on December 31, 2010;</text>
</clause><clause id="id15D6A447DCD84896B1AEA6F7D662A460"><enum>(ii)</enum><text display-inline="yes-display-inline">$75,000,000, if the loss occurs during the
period beginning on January 1, 2011, and ending on December 31, 2011;
and</text>
</clause><clause id="id8647E10740FE4DC19DDEA002AD736DE9"><enum>(iii)</enum><text display-inline="yes-display-inline">$50,000,000, if the loss occurs on or after
January 1,
2012.</text>
</clause></subparagraph><after-quoted-block>;</after-quoted-block></quoted-block>
</paragraph><paragraph id="H3E077EF76EAA42AAA29F48E4B4A0D04F"><enum>(2)</enum><text>in paragraph (4)(A) by
striking <quote>the report</quote> and inserting <quote>any report on losses
required under this subsection,</quote>;</text>
</paragraph><paragraph id="H36291338178F4B43A1B7DFEDC2DF353"><enum>(3)</enum><text>by striking paragraph
(6);</text>
</paragraph><paragraph id="H85286F708A5A46589EC7555074D7F27D"><enum>(4)</enum><text>by redesignating
paragraph (5) as paragraph (6); and</text>
</paragraph><paragraph id="HC96BF83FE1FB4BE6B95915BA3FA52C90"><enum>(5)</enum><text>by inserting after
paragraph (4) the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="H4B3D0265CE0849CE94CEF8FF98369F42" reported-display-style="italic" style="OLC">
<paragraph id="H9DB524B101374A1DBA171C8B328B26C2"><enum>(5)</enum><header>Losses that are not
material</header>
<subparagraph id="H02757C66628E49F8A01E7F119FA43E03"><enum>(A)</enum><header>Semiannual
report</header><text display-inline="yes-display-inline">For the 6-month period
ending on March 31, 2010, and each 6-month period thereafter, the Inspector
General of each Federal banking agency shall—</text>
<clause id="HB2C0EC8122354D55B16DC98EA97E8C8D"><enum>(i)</enum><text display-inline="yes-display-inline">identify losses that the Inspector General
estimates have been incurred by the Deposit Insurance Fund during that 6-month
period, with respect to the insured depository institutions supervised by the
Federal banking agency;</text>
</clause><clause id="HE9FA3A19B08B4C09A32990E1996113D6"><enum>(ii)</enum><text>for each loss incurred
by the Deposit Insurance Fund that is not a material loss, determine—</text>
<subclause id="id00E9127FF69044EC9E5E047007D0DBC3"><enum>(I)</enum><text>the grounds identified by
the Federal banking agency or State bank supervisor for appointing the
Corporation as receiver under section 11(c)(5); and</text>
</subclause><subclause id="idFB4A37380D93408197273767FD2C47E2"><enum>(II)</enum><text>whether any unusual
circumstances exist that might warrant an in-depth review of the loss;
and</text>
</subclause></clause><clause id="H722C8BB6F20D46AE95823D2F9CF9D7AC"><enum>(iii)</enum><text display-inline="yes-display-inline">prepare and submit a written report to the
appropriate Federal banking agency and to Congress on the results of any
determination by the Inspector General, including—</text>
<subclause id="H15A2C53A882D4D9DBDE63E37315284F2"><enum>(I)</enum><text display-inline="yes-display-inline">an identification of any loss that warrants
an in-depth review, together with the reasons why such review is warranted, or,
if the Inspector General determines that no review is warranted, an explanation
of such determination; and</text>
</subclause><subclause id="H141A8197BC9949FFB1B05DD0FEE6FD3"><enum>(II)</enum><text display-inline="yes-display-inline">for each loss identified under subclause
(I) that warrants an in-depth review, the date by which such review, and a
report on such review prepared in a manner consistent with reports under
paragraph (1)(A), will be completed and submitted to the Federal banking agency
and Congress.</text>
</subclause></clause></subparagraph><subparagraph id="H1A1F1AC07CE54E79BCD0D9D38B482C55"><enum>(B)</enum><header>Deadline for semiannual
report</header><text display-inline="yes-display-inline">The Inspector General
of each Federal banking agency shall—</text>
<clause id="HEEC12B2381E94478B69698B171DE2488"><enum>(i)</enum><text display-inline="yes-display-inline">submit each report required under paragraph
(A) expeditiously, and not later than 90 days after the end of the 6-month
period covered by the report; and</text>
</clause><clause id="H499327817F964D62BC8058804DBAC4BC"><enum>(ii)</enum><text>provide a copy of the
report required under paragraph (A) to any Member of Congress, upon
request.</text>
</clause></subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="H013BD676BC914978825D69B6F6801D59"><enum>(b)</enum><header>Technical and
conforming amendment</header><text display-inline="yes-display-inline">The
heading for subsection (k) of section 38 of the Federal Deposit Insurance Act
(U.S.C. 1831o(k)) is amended to read as follows:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id699F1968C9074C6EA8405A0C8D1D4CC7" reported-display-style="italic" style="OLC">
<subsection id="id0D4F6ED40918488BACA72AE5D58E2AD1"><enum>(k)</enum><header>Reviews required when
Deposit Insurance Fund incurs
losses</header>
</subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection></section><section id="HFBC2125C6A9342FC9667E834B9C3E592"><enum>988.</enum><header>Amendment to
definition of material loss and nonmaterial losses to the National Credit Union
Share Insurance Fund for purposes of Inspector General reviews</header>
<subsection id="HF66B126F71514BA7837D928880F92552"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">Section 216(j) of the
Federal Credit Union Act (12 U.S.C. 1790d(j)) is amended to read as
follows:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="H79316C03EB2842CAABDA85B321F4E36A" reported-display-style="italic" style="OLC">
<subsection id="H86586F5D98DA447CA9AD62E95AC66996"><enum>(j)</enum><header>Reviews required when
share insurance fund experiences losses</header>
<paragraph id="H1E107EF2680044399F9A46D05CF9B59C"><enum>(1)</enum><header>In
general</header><text display-inline="yes-display-inline">If the Fund incurs a
material loss with respect to an insured credit union, the Inspector General of
the Board shall—</text>
<subparagraph id="H749220EFD4204BFDB2836B699E368984"><enum>(A)</enum><text>submit to the Board a
written report reviewing the supervision of the credit union by the
Administration (including the implementation of this section by the
Administration), which shall include—</text>
<clause id="HAB092AE3631E43F393036829DF24CC45"><enum>(i)</enum><text>a description of the
reasons why the problems of the credit union resulted in a material loss to the
Fund; and</text>
</clause><clause id="H5AAACDB1AE09477A8BC80A4C79EA2D08"><enum>(ii)</enum><text>recommendations for
preventing any such loss in the future; and</text>
</clause></subparagraph><subparagraph id="HBF8C6742BE0D4988B44595A7D1335FAE"><enum>(B)</enum><text>submit a copy of the
report under subparagraph (A) to—</text>
<clause id="HD8929BB78DB04E19815371F52426D856"><enum>(i)</enum><text>the Comptroller General
of the United States;</text>
</clause><clause id="id829C60B2E50649918A6B2696C0D6E9EE"><enum>(ii)</enum><text>the Corporation;</text>
</clause><clause id="H4726340A7A224964B1AB1603072F1BDE"><enum>(iii)</enum><text>in the case of a report
relating to a State credit union, the appropriate State supervisor; and</text>
</clause><clause id="H4E724C9EC9B5480F8BF60771158AF56B"><enum>(iv)</enum><text>to any Member of
Congress, upon request.</text>
</clause></subparagraph></paragraph><paragraph id="HC8FF887CFD5F48A3A344F9A6EA1C48A8"><enum>(2)</enum><header>Material loss
defined</header><text display-inline="yes-display-inline">For purposes of
determining whether the Fund has incurred a material loss with respect to an
insured credit union, a loss is material if it exceeds the sum of—</text>
<subparagraph id="H15440BE6028542C79CCEA22CB11D21B8"><enum>(A)</enum><text>$25,000,000; and</text>
</subparagraph><subparagraph id="HEAD1D2A3EB2F402A823D455AB57A9ACB"><enum>(B)</enum><text>an amount equal to 10
percent of the total assets of the credit union on the date on which the Board
initiated assistance under section 208 or was appointed liquidating
agent.</text>
</subparagraph></paragraph><paragraph id="H7CA6A708A949411D8832A20284BE2DAE"><enum>(3)</enum><header>Public disclosure
required</header>
<subparagraph id="HEBF1E5EC13D648A8A8733D95E5FF93E2"><enum>(A)</enum><header>In
general</header><text display-inline="yes-display-inline">The Board shall
disclose a report under this subsection, upon request under section 552 of
title 5, United States Code, without excising—</text>
<clause id="HE7915424CA154D2881D2CB5F1835BF81"><enum>(i)</enum><text>any portion under section
552(b)(5) of title 5, United States Code; or</text>
</clause><clause id="HE89DB849B7574F7998B7B4176677695D"><enum>(ii)</enum><text>any information about
the insured credit union (other than trade secrets) under section 552(b)(8) of
title 5, United States Code.</text>
</clause></subparagraph><subparagraph id="H11E72A735F0B49369499624C578E07E4"><enum>(B)</enum><header>Rule of
construction</header><text>Subparagraph (A) may not be construed as requiring
the agency to disclose the name of any customer of the insured credit union
(other than an institution-affiliated party), or information from which the
identity of such customer could reasonably be ascertained.</text>
</subparagraph></paragraph><paragraph display-inline="no-display-inline" id="HBA178522A4B54C8FADDEA4FF3BB4BC0F"><enum>(4)</enum><header>Losses that are not
material</header>
<subparagraph id="H98FFF294D6B943E4A6DE569B957858C8"><enum>(A)</enum><header>Semiannual
report</header><text display-inline="yes-display-inline">For the 6-month period
ending on March 31, 2010, and each 6-month period thereafter, the Inspector
General of the Board shall—</text>
<clause id="H94B4D57CBBE5479B80D51B13E9E09EC6"><enum>(i)</enum><text display-inline="yes-display-inline">identify any losses that the Inspector
General estimates were incurred by the Fund during such 6-month period, with
respect to insured credit unions;</text>
</clause><clause id="H544F7F018E0B4AB6A13BDBEF45FFADAB"><enum>(ii)</enum><text>for each loss to the
Fund that is not a material loss, determine—</text>
<subclause id="id17D7831E3DBB4D639EF61C965F37FB1B"><enum>(I)</enum><text>the grounds identified by
the Board or the State official having jurisdiction over a State credit union
for appointing the Board as the liquidating agent for any Federal or State
credit union; and</text>
</subclause><subclause id="id337F162E505E4007A96167FC6CAF68AE"><enum>(II)</enum><text>whether any unusual
circumstances exist that might warrant an in-depth review of the loss;
and</text>
</subclause></clause><clause id="HBADDF100212A4AB08A6E81803D919989"><enum>(iii)</enum><text display-inline="yes-display-inline">prepare and submit a written report to the
Board and to Congress on the results of the determinations of the Inspector
General that includes—</text>
<subclause id="H02CF17A992E0490EA81DAD3B9DB8F047"><enum>(I)</enum><text display-inline="yes-display-inline">an identification of any loss that warrants
an in-depth review, and the reasons such review is warranted, or if the
Inspector General determines that no review is warranted, an explanation of
such determination; and</text>
</subclause><subclause id="H64F2DC946D704BE8BBBEC171BF528DC9"><enum>(II)</enum><text display-inline="yes-display-inline">for each loss identified in subclause (I)
that warrants an in-depth review, the date by which such review, and a report
on the review prepared in a manner consistent with reports under paragraph
(1)(A), will be completed.</text>
</subclause></clause></subparagraph><subparagraph id="HF35873AD3DFD4455A6D5BE74F880B5DD"><enum>(B)</enum><header>Deadline for semiannual
report</header><text display-inline="yes-display-inline">The Inspector General
of the Board shall—</text>
<clause id="H269833E363824DC182D9236D39C1783A"><enum>(i)</enum><text display-inline="yes-display-inline">submit each report required under
subparagraph (A) expeditiously, and not later than 90 days after the end of the
6-month period covered by the report; and</text>
</clause><clause id="H1F04D9C07B5E408DB13D1F2F4AAB2E08"><enum>(ii)</enum><text>provide a copy of the
report required under subparagraph (A) to any Member of Congress, upon
request.</text>
</clause></subparagraph></paragraph><paragraph id="HFC9E1439B5734255BE481E65D86A2F8B"><enum>(5)</enum><header>GAO
review</header><text display-inline="yes-display-inline">The Comptroller
General of the United States shall, under such conditions as the Comptroller
General determines to be appropriate—</text>
<subparagraph id="id085909E6F44C43E8934515C512BC1B02"><enum>(A)</enum><text display-inline="yes-display-inline">review each report made under paragraph
(1), including the extent to which the Inspector General of the Board complied
with the requirements under section 8L of the Inspector General Act of 1978 (5
U.S.C. App.) with respect to each such report; and</text>
</subparagraph><subparagraph id="idD8061D2C310C456DA22959A37EFDAF98"><enum>(B)</enum><text display-inline="yes-display-inline">recommend improvements to the supervision
of insured credit unions (including improvements relating to the implementation
of this
section).</text>
</subparagraph></paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection></section><section id="id702D28B002DC48CC818F9061A1D75BE3"><enum>989.</enum><header>Government
Accountability Office study on proprietary trading</header>
<subsection id="ID7634a394495f4804bb47a1ebae0f50d8"><enum>(a)</enum><header>Definitions</header><text>In
this section—</text>
<paragraph id="ID2c9fd9a6e76947238a019d092bd4cea4"><enum>(1)</enum><text>the term <term>covered
entity</term> means—</text>
<subparagraph id="idD89C45206F134E6283875C8C58D8AD76"><enum>(A)</enum><text>an insured depository
institution, an affiliate of an insured depository institution, a bank holding
company, a financial holding company, or a subsidiary of a bank holding company
or a financial holding company, as those terms are defined in the Bank Holding
Company Act of 1956 (12 U.S.C. 1841 et seq.); and</text>
</subparagraph><subparagraph id="idBE625AFE6AED4C7FA75DFA9E0FA66C5A"><enum>(B)</enum><text>any other entity, as the
Comptroller General of the United States may determine; and</text>
</subparagraph></paragraph><paragraph id="id94DE2AB474A34FC8B0F7B2B12F9FB8EC"><enum>(2)</enum><text>the term
<term>proprietary trading</term> means the act of a covered entity investing as
a principal in securities, commodities, derivatives, hedge funds, private
equity firms, or such other financial products or entities as the Comptroller
General may determine.</text>
</paragraph></subsection><subsection id="idCB4154497A194DEFB2827A72C23867B9"><enum>(b)</enum><header>Study</header>
<paragraph id="ID52a7c8785dbc4ea2a7d30201f44a1b99"><enum>(1)</enum><header>In
general</header><text>The Comptroller General of the United States shall
conduct a study regarding the risks and conflicts associated with proprietary
trading by and within covered entities, including an evaluation of—</text>
<subparagraph id="ID567f4c84ee364909a12bb1576ca58f85"><enum>(A)</enum><text>whether proprietary
trading presents a material systemic risk to the stability of the United States
financial system, and if so, the costs and benefits of options for mitigating
such systemic risk;</text>
</subparagraph><subparagraph id="ID58511139df814064a03f180df6add84b"><enum>(B)</enum><text>whether proprietary
trading presents material risks to the safety and soundness of the covered
entities that engage in such activities, and if so, the costs and benefits of
options for mitigating such risks;</text>
</subparagraph><subparagraph id="ID1882f37004334e1ea198b2580534f8ec"><enum>(C)</enum><text>whether proprietary
trading presents material conflicts of interest between covered entities that
engage in proprietary trading and the clients of the institutions who use the
firm to execute trades or who rely on the firm to manage assets, and if so, the
costs and benefits of options for mitigating such conflicts of interest;</text>
</subparagraph><subparagraph id="ID97d5d49d887e4ac6b002ae91281ad57b"><enum>(D)</enum><text>whether adequate
disclosure regarding the risks and conflicts of proprietary trading is provided
to the depositors, trading and asset management clients, and investors of
covered entities that engage in proprietary trading, and if not, the costs and
benefits of options for the improvement of such disclosure; and</text>
</subparagraph><subparagraph id="IDbe2db4bb0e4b442686089c8a6f743ad1"><enum>(E)</enum><text>whether the banking,
securities, and commodities regulators of institutions that engage in
proprietary trading have in place adequate systems and controls to monitor and
contain any risks and conflicts of interest related to proprietary trading, and
if not, the costs and benefits of options for the improvement of such systems
and controls.</text>
</subparagraph></paragraph><paragraph id="ID3493a2e86fd6420c884361640f1ed08a"><enum>(2)</enum><header>Considerations</header><text>In
carrying out the study required under paragraph (1), the Comptroller General
shall consider—</text>
<subparagraph id="IDffee504c3a8e4c5c92f4e3aa6f8e2985"><enum>(A)</enum><text>current practice relating
to proprietary trading;</text>
</subparagraph><subparagraph id="IDf21842bee74144569c842095daa890d7"><enum>(B)</enum><text>the advisability of a
complete ban on proprietary trading;</text>
</subparagraph><subparagraph id="ID681ec8576fb8473e8b4a2a5eac76134b"><enum>(C)</enum><text>limitations on the scope
of activities that covered entities may engage in with respect to proprietary
trading;</text>
</subparagraph><subparagraph id="IDcd5f56a160da4aebbe095280b2bf4b2c"><enum>(D)</enum><text>the advisability of
additional capital requirements for covered entities that engage in proprietary
trading;</text>
</subparagraph><subparagraph id="IDeb44e11078534357bc0cc7bf407c4319"><enum>(E)</enum><text>enhanced restrictions on
transactions between affiliates related to proprietary trading;</text>
</subparagraph><subparagraph id="ID6c030c479c1e4da2999fb158b2f364c4"><enum>(F)</enum><text>enhanced accounting
disclosures relating to proprietary trading;</text>
</subparagraph><subparagraph id="ID6db107e7df814705994ca9c929e5817a"><enum>(G)</enum><text>enhanced public
disclosure relating to proprietary trading; and</text>
</subparagraph><subparagraph id="ID9cf4af762e324d2a8a42459f0d22a298"><enum>(H)</enum><text>any other options the
Comptroller General deems appropriate.</text>
</subparagraph></paragraph></subsection><subsection id="IDa1a04a0b6fcf412288b7ab3554b7ca56"><enum>(c)</enum><header>Report to
Congress</header><text>Not later than 15 months after the date of enactment of
this Act, the Comptroller General shall submit a report to Congress on the
results of the study conducted under subsection (b).</text>
</subsection><subsection id="IDce5ff609a5a643fc801abb34731f6211"><enum>(d)</enum><header>Access by Comptroller
General</header><text>For purposes of conducting the study required under
subsection (b), the Comptroller General shall have access, upon request, to any
information, data, schedules, books, accounts, financial records, reports,
files, electronic communications, or other papers, things, or property
belonging to or in use by a covered entity that engages in proprietary trading,
and to the officers, directors, employees, independent public accountants,
financial advisors, staff, and agents and representatives of a covered entity
(as related to the activities of the agent or representative on behalf of the
covered entity), at such reasonable times as the Comptroller General may
request. The Comptroller General may make and retain copies of books, records,
accounts, and other records, as the Comptroller General deems
appropriate.</text>
</subsection><subsection id="IDc9bd0099bc084d0790fd0d4a3862ed85"><enum>(e)</enum><header>Confidentiality of
reports</header>
<paragraph id="idEC700C29D7F242808EC21EC2F5F2773D"><enum>(1)</enum><header>In
general</header><text>Except as provided in paragraph (2), the Comptroller
General may not disclose information regarding—</text>
<subparagraph id="id673F200702D24ECE937FF1F30841010A"><enum>(A)</enum><text>any proprietary trading
activity of a covered entity, unless such information is disclosed at a level
of generality that does not reveal the investment or trading position or
strategy of the covered entity for any specific security, commodity,
derivative, or other investment or financial product; or</text>
</subparagraph><subparagraph id="id00541A7BAD8D44D681270D46D471C749"><enum>(B)</enum><text>any individual
interviewed by the Comptroller General for purposes of the study under
subsection (b), unless such information is disclosed at a level of generality
that does not reveal—</text>
<clause id="idD2BFD0D38FEE4ACCBFF114AEB8E8056C"><enum>(i)</enum><text>the name of or
identifying details relating to such individual; or</text>
</clause><clause id="id41E0720FA0BE46C1B941AAF297F23955"><enum>(ii)</enum><text>in the case of an
individual who is an employee of a third party that provides professional
services to a covered entity believed to be engaged in proprietary trading, the
name of or any identifying details relating to such third party.</text>
</clause></subparagraph></paragraph><paragraph id="idD8D3A0DFB0E745DE99E93B2905E9D23F"><enum>(2)</enum><header>Exceptions</header><text>The
Comptroller General may disclose the information described in paragraph
(1)—</text>
<subparagraph id="ID4e1eb34cbac44737b3f01650922fd4ad"><enum>(A)</enum><text>to a department, agency,
or official of the Federal Government, for official use, upon request;</text>
</subparagraph><subparagraph id="ID15aad2c757ca4825a0234a68aa984b2d"><enum>(B)</enum><text>to a committee of
Congress, upon request; and</text>
</subparagraph><subparagraph id="IDf235b4f5082f4c0198a68bf0066d008e"><enum>(C)</enum><text>to a court, upon an order
of such court.</text>
</subparagraph></paragraph></subsection></section><section commented="no" display-inline="no-display-inline" id="IDfc1f0df3594446728bed6e4d71363abb" section-type="subsequent-section"><enum>989A.</enum><header display-inline="yes-display-inline">Senior investor protections</header>
<subsection commented="no" display-inline="no-display-inline" id="id4130432B68354511AE0F3DD358419586"><enum>(a)</enum><header display-inline="yes-display-inline">Definitions</header><text display-inline="yes-display-inline">As used in this section—</text>
<paragraph commented="no" display-inline="no-display-inline" id="id762294BF7FD34F0A8EE9A1559464B2F7"><enum>(1)</enum><text>the term <term>eligible
entity</term> means—</text>
<subparagraph id="id0E0094C051F643A284DBAE39BE65FC03"><enum>(A)</enum><text>a securities commission
(or any agency or office performing like functions) of a State that the Office
determines has adopted rules on the appropriate use of designations in the
offer or sale of securities or investment advice that meet or exceed the
minimum requirements of the NASAA Model Rule on the Use of Senior-Specific
Certifications and Professional Designations (or any successor thereto);</text>
</subparagraph><subparagraph id="IDc6d9db5c7f6d413c8168a35e3101d67c"><enum>(B)</enum><text>the insurance commission
(or any agency or office performing like functions) of any State that the
Office determines has—</text>
<clause id="idD0994E72C6454E238F9BC9472E6B315D"><enum>(i)</enum><text>adopted rules on the
appropriate use of designations in the sale of insurance products that, to the
extent practicable, conform to the minimum requirements of the National
Association of Insurance Commissioners Model Regulation on the Use of
Senior-Specific Certifications and Professional Designations in the Sale of
Life Insurance and Annuities (or any successor thereto); and</text>
</clause><clause id="id0984BD136291472096FF7D95A49EA83F"><enum>(ii)</enum><text>adopted rules with
respect to fiduciary or suitability requirements in the sale of annuities that
meet or exceed the minimum requirements established by the Suitability in
Annuity Transactions Model Regulation of the National Association of Insurance
Commissioners (or any successor thereto); or</text>
</clause></subparagraph><subparagraph id="ID2f5077ca7b194edaa40e5fc389a4252d"><enum>(C)</enum><text>a consumer protection
agency of any State, if—</text>
<clause id="id81E0C636A10341859FC05932A476ED10"><enum>(i)</enum><text>the securities commission
(or any agency or office performing like functions) of the State is eligible
under subparagraph (A); or</text>
</clause><clause id="idD2C7626F6B8245068BECBB24E55139BF"><enum>(ii)</enum><text>the insurance commission
(or any agency or office performing like functions) of the State is eligible
under subparagraph (B);</text>
</clause></subparagraph></paragraph><paragraph commented="no" display-inline="no-display-inline" id="ID8c6806a463c440a0855748c3982877d5"><enum>(2)</enum><text display-inline="yes-display-inline">the term <term>financial product</term>
means a security, an insurance product (including an insurance product that
pays a return, whether fixed or variable), a bank product, and a loan
product;</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="ID2d2c5b181a7846d4b90202273e3c81da"><enum>(3)</enum><text display-inline="yes-display-inline">the term <term>misleading
designation</term>—</text>
<subparagraph commented="no" display-inline="no-display-inline" id="id6DED7988598646B3A1207F4E2ECF698B"><enum>(A)</enum><text display-inline="yes-display-inline">means a certification, professional
designation, or other purported credential that indicates or implies that a
salesperson or adviser has special certification or training in advising or
servicing seniors; and</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="id5CBAB3782DEB4D49A2604431F6F676DB"><enum>(B)</enum><text display-inline="yes-display-inline">does not include a certification,
professional designation, license, or other credential that—</text>
<clause commented="no" display-inline="no-display-inline" id="ID0e88bf0b88da40008b8aaf0b1e44ecb8"><enum>(i)</enum><text display-inline="yes-display-inline">was issued by or obtained from an academic
institution having regional accreditation;</text>
</clause><clause commented="no" display-inline="no-display-inline" id="ID391ece0595fd49c798877ac4cc1c9e48"><enum>(ii)</enum><text display-inline="yes-display-inline">meets the standards for certifications,
licenses, and professional designations outlined by the NASAA Model Rule on the
Use of Senior-Specific Certifications and Professional Designations in the Sale
of Life Insurance and Annuities, adopted by the National Association of
Insurance Commissioners (or any successor thereto); or</text>
</clause><clause commented="no" display-inline="no-display-inline" id="id5D21DAE070254E719EFCF813B0A0FA4E"><enum>(iii)</enum><text display-inline="yes-display-inline">was issued by or obtained from a
State;</text>
</clause></subparagraph></paragraph><paragraph commented="no" display-inline="no-display-inline" id="ID403028e2b5c74b84ba4983504d575845"><enum>(4)</enum><text display-inline="yes-display-inline">the term <term>misleading or fraudulent
marketing</term> means the use of a misleading designation by a person that
sells to or advises a senior in connection with the sale of a financial
product;</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="id266C4CFE90B94BBBB972C453D33FCC3D"><enum>(5)</enum><text display-inline="yes-display-inline">the term <term>NASAA</term> means the North
American Securities Administrators Association;</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="id3D941707BECC4B1CB86B9D49820EE5FD"><enum>(6)</enum><text>the term
<term>Office</term> means the Office of Financial Literacy of the Bureau;
and</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="ID8243138a35894591a0a672b83a745650"><enum>(7)</enum><text display-inline="yes-display-inline">the term <term>senior</term> means any
individual who has attained the age of 62 years or older.</text>
</paragraph></subsection><subsection commented="no" display-inline="no-display-inline" id="idC14A182B1B1D41C0B2E4D2071133E1B9"><enum>(b)</enum><header display-inline="yes-display-inline">Grants to States for enhanced protection of
seniors from being misled by false designations</header><text display-inline="yes-display-inline">The Office shall establish a program under
which the Office may make grants to States or eligible entities—</text>
<paragraph commented="no" display-inline="no-display-inline" id="ID0899fa52e13c43d5855fa61d063497c1"><enum>(1)</enum><text display-inline="yes-display-inline">to hire staff to identify, investigate, and
prosecute (through civil, administrative, or criminal enforcement actions)
cases involving misleading or fraudulent marketing;</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="ID51d98783e0c84159a1887dde5b40ffe0"><enum>(2)</enum><text display-inline="yes-display-inline">to fund technology, equipment, and training
for regulators, prosecutors, and law enforcement officers, in order to identify
salespersons and advisers who target seniors through the use of misleading
designations;</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="IDdb3f51fbe1984b3f840cb05eb9ee972f"><enum>(3)</enum><text display-inline="yes-display-inline">to fund technology, equipment, and training
for prosecutors to increase the successful prosecution of salespersons and
advisers who target seniors with the use of misleading designations;</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="ID41f1f27cb9a240c0be866207b3be2489"><enum>(4)</enum><text display-inline="yes-display-inline">to provide educational materials and
training to regulators on the appropriateness of the use of designations by
salespersons and advisers in connection with the sale and marketing of
financial products;</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="IDde17191094fd4742992aead54478019a"><enum>(5)</enum><text display-inline="yes-display-inline">to provide educational materials and
training to seniors to increase awareness and understanding of misleading or
fraudulent marketing;</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="ID847bd9192e894a1ebef2d49341442bd3"><enum>(6)</enum><text display-inline="yes-display-inline">to develop comprehensive plans to combat
misleading or fraudulent marketing of financial products to seniors; and</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="ID68ee172b9f1b4397807f154508bb9a52"><enum>(7)</enum><text display-inline="yes-display-inline">to enhance provisions of State law to
provide protection for seniors against misleading or fraudulent
marketing.</text>
</paragraph></subsection><subsection commented="no" display-inline="no-display-inline" id="ID8a8ca3b60f4f438186e78733fe0316f8"><enum>(c)</enum><header display-inline="yes-display-inline">Applications</header><text display-inline="yes-display-inline">A State or eligible entity desiring a grant
under this section shall submit an application to the Office, in such form and
in such a manner as the Office may determine, that includes—</text>
<paragraph commented="no" display-inline="no-display-inline" id="idD0FEDE6885B348829FE5EF305CE9AEA4"><enum>(1)</enum><text display-inline="yes-display-inline">a proposal for activities to protect
seniors from misleading or fraudulent marketing that are proposed to be funded
using a grant under this section, including—</text>
<subparagraph commented="no" display-inline="no-display-inline" id="IDd977695ca4814df0a95af85d69f05374"><enum>(A)</enum><text display-inline="yes-display-inline">an identification of the scope of the
problem of misleading or fraudulent marketing in the State;</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="ID33741e988c364e4b94c45f4b70059d1e"><enum>(B)</enum><text display-inline="yes-display-inline">a description of how the proposed
activities would—</text>
<clause commented="no" display-inline="no-display-inline" id="id577D15B273184EDC8A8579D5CD118163"><enum>(i)</enum><text display-inline="yes-display-inline">protect seniors from misleading or
fraudulent marketing in the sale of financial products, including by
proactively identifying victims of misleading and fraudulent marketing who are
seniors;</text>
</clause><clause commented="no" display-inline="no-display-inline" id="ID56402623255e4ed98ea3ff068b49b8a3"><enum>(ii)</enum><text display-inline="yes-display-inline">assist in the investigation and prosecution
of those using misleading or fraudulent marketing; and</text>
</clause><clause commented="no" display-inline="no-display-inline" id="ID1ea88e8b06194ec49504ec2afefa3a69"><enum>(iii)</enum><text display-inline="yes-display-inline">discourage and reduce cases of misleading
or fraudulent marketing; and</text>
</clause></subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="ID88ac66819bb64cee92c5ca6d7fab2e6a"><enum>(C)</enum><text display-inline="yes-display-inline">a description of how the proposed
activities would be coordinated with other State efforts; and</text>
</subparagraph></paragraph><paragraph commented="no" display-inline="no-display-inline" id="id8AED1C1FCCA449E082935095E119AE1A"><enum>(2)</enum><text>any other information, as
the Office determines is appropriate.</text>
</paragraph></subsection><subsection commented="no" display-inline="no-display-inline" id="ID434c86da3d9547b793b03acf59a30129"><enum>(d)</enum><header>Performance objectives
and reporting requirements</header><text display-inline="yes-display-inline">The Office may establish such performance
objectives and reporting requirements for States and eligible entities
receiving a grant under this section as the Office determines are necessary to
carry out and assess the effectiveness of the program under this
section.</text>
</subsection><subsection commented="no" display-inline="no-display-inline" id="ID3878773e6d2b42b1805bc19912e593c1"><enum>(e)</enum><header display-inline="yes-display-inline">Maximum
amount</header><text display-inline="yes-display-inline">The amount of a grant
under this section may not exceed—</text>
<paragraph commented="no" display-inline="no-display-inline" id="id8F9ACF74117B4964BD63F5C26687BF7E"><enum>(1)</enum><text display-inline="yes-display-inline">$500,000 for each of 3 consecutive fiscal
years, if the recipient is a State, or an eligible entity of a State, that has
adopted rules—</text>
<subparagraph id="ID0a7e27d209d04e5c8091719c50fa778d"><enum>(A)</enum><text display-inline="yes-display-inline">on the appropriate use of designations in
the offer or sale of securities or investment advice that meet or exceed the
minimum requirements of the NASAA Model Rule on the Use of Senior-Specific
Certifications and Professional Designations (or any successor thereto);</text>
</subparagraph><subparagraph id="idF8E41ABD20564643A67369A6C8E716DC"><enum>(B)</enum><text>on the appropriate use of
designations in the sale of insurance products that, to the extent practicable,
conform to the minimum requirements of the National Association of Insurance
Commissioners Model Regulation on the Use of Senior-Specific Certifications and
Professional Designations in the Sale of Life Insurance and Annuities (or any
successor thereto); and</text>
</subparagraph><subparagraph id="id2A67C67FA18D401EA404429082ABF60D"><enum>(C)</enum><text>with respect to fiduciary
or suitability requirements in the sale of annuities that meet or exceed the
minimum requirements established by the Suitability in Annuity Transactions
Model Regulation of the National Association of Insurance Commissioners (or any
successor thereto); and</text>
</subparagraph></paragraph><paragraph commented="no" display-inline="no-display-inline" id="id09FEB221BF1A41AC83BC1E47DF60F7D9"><enum>(2)</enum><text display-inline="yes-display-inline">$100,000 for each of 3 consecutive fiscal
years, if the recipient is a State, or an eligible entity of a State, that has
adopted—</text>
<subparagraph commented="no" display-inline="no-display-inline" id="id063A49FA6C9E429B9DF5DB9B9EF8B55B"><enum>(A)</enum><text>rules on the appropriate
use of designations in the offer or sale of securities or investment advice
that meet or exceed the minimum requirements of the NASAA Model Rule on the Use
of Senior-Specific Certifications and Professional Designations (or any
successor thereto); or</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="id073FD1C464074B4F9609AB485832AF17"><enum>(B)</enum><text>rules—</text>
<clause id="id64F8EB3CFABF45468664C7C88288498C"><enum>(i)</enum><text>on the appropriate use of
designations in the sale of insurance products that, to the extent practicable,
conform to the minimum requirements of the National Association of Insurance
Commissioners Model Regulation on the Use of Senior-Specific Certifications and
Professional Designations in the Sale of Life Insurance and Annuities (or any
successor thereto); and</text>
</clause><clause id="id235AA0F202644016B9C90B7B9322BACC"><enum>(ii)</enum><text>with respect to
fiduciary or suitability requirements in the sale of annuities that meet or
exceed the minimum requirements established by the Suitability in Annuity
Transactions Model Regulation of the National Association of Insurance
Commissioners (or any successor thereto).</text>
</clause></subparagraph></paragraph></subsection><subsection commented="no" display-inline="no-display-inline" id="id612BC8B44AC741F5B9175E0D8FA82774"><enum>(f)</enum><header>Subgrants</header><text>A
State or eligible entity that receives a grant under this section may make a
subgrant, as the State or eligible entity determines is necessary to carry out
the activities funded using a grant under this section.</text>
</subsection><subsection commented="no" display-inline="no-display-inline" id="idC7DE41438E6642A788EF0B213095C865"><enum>(g)</enum><header>Reapplication</header><text>A
State or eligible entity that receives a grant under this section may reapply
for a grant under this section, notwithstanding the limitations on grant
amounts under subsection (e).</text>
</subsection><subsection commented="no" display-inline="no-display-inline" id="ID103014e7343b470b8e2ba926f5fc5f53"><enum>(h)</enum><header display-inline="yes-display-inline">Authorization of
appropriations</header><text display-inline="yes-display-inline">There are
authorized to be appropriated to carry out this section, $8,000,000 for each of
fiscal years 2011 through 2015.</text>
</subsection></section><section commented="no" display-inline="no-display-inline" id="id50502F0C18EA409298B12DB7F7155927" section-type="subsequent-section"><enum>989B.</enum><header display-inline="yes-display-inline">Designated Federal Entity Inspectors
General Independence</header><text display-inline="no-display-inline">Section
8G of the Inspector General Act of 1978 (5 U.S.C. App.) is amended—</text>
<paragraph commented="no" display-inline="no-display-inline" id="id3969EFF47D7F42638E692D749EB98ECE"><enum>(1)</enum><text display-inline="yes-display-inline">in subsection (a)(4)—</text>
<subparagraph commented="no" display-inline="no-display-inline" id="id7B4E2D4095104E96921117E4778AF6E3"><enum>(A)</enum><text display-inline="yes-display-inline">in the matter preceding subparagraph (A),
by inserting <quote>the board or commission of the designated Federal entity,
or in the event the designated Federal entity does not have a board or
commission,</quote> after <quote>means</quote>;</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="id00F988357CC540A995E1C1085CE1A376"><enum>(B)</enum><text display-inline="yes-display-inline">in subparagraph (A), by striking
<quote>and</quote> after the semicolon; and</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="id4B2F89D2B61A423D84E749CD9C7E7661"><enum>(C)</enum><text display-inline="yes-display-inline">by adding after subparagraph (B) the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idB36F46C77F954AA68DD3470CE7E483D7" reported-display-style="italic" style="OLC">
<subparagraph commented="no" display-inline="no-display-inline" id="IDbbb99194883b4a2481425152998b04cc"><enum>(C)</enum><text display-inline="yes-display-inline">with respect to the Federal Labor Relations
Authority, such term means the members of the Authority (described under
section 7104 of title 5, United States Code);</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="ID08ca04f7b35944ee98f6a753959c2600"><enum>(D)</enum><text display-inline="yes-display-inline">with respect to the National Archives and
Records Administration, such term means the Archivist of the United
States;</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="IDb3c8644d096e496491a321baec1c9ab5"><enum>(E)</enum><text display-inline="yes-display-inline">with respect to the National Credit Union
Administration, such term means the National Credit Union Administration Board
(described under section 102 of the Federal Credit Union Act (12 U.S.C.
1752a);</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="IDb11fb40c086d4736aad99aaa120d468c"><enum>(F)</enum><text display-inline="yes-display-inline">with respect to the National Endowment of
the Arts, such term means the National Council on the Arts;</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="ID08a986d994a241b79c926a04f3f0d8e6"><enum>(G)</enum><text display-inline="yes-display-inline">with respect to the National Endowment for
the Humanities, such term means the National Council on the Humanities;
and</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="ID6603c8b73bae466e89e3423e173067c1"><enum>(H)</enum><text display-inline="yes-display-inline">with respect to the Peace Corps, such term
means the Director of the Peace Corps;</text>
</subparagraph><after-quoted-block>;
and</after-quoted-block></quoted-block>
</subparagraph></paragraph><paragraph commented="no" display-inline="no-display-inline" id="id25F31D3E340D46CBA6898B23B4EFAB62"><enum>(2)</enum><text display-inline="yes-display-inline">in subsection (h), by inserting <quote>if
the designated Federal entity is not a board or commission, include</quote>
after <quote>designated Federal entities and</quote>.</text>
</paragraph></section><section commented="no" display-inline="no-display-inline" id="id0156F9CB516D46098E731FE1FF6DEA44" section-type="subsequent-section"><enum>989C.</enum><header display-inline="yes-display-inline">Strengthening Inspector General
accountability</header><text display-inline="no-display-inline">Section 5(a) of
the Inspector General Act of 1978 (5 U.S.C. App.) is amended—</text>
<paragraph commented="no" display-inline="no-display-inline" id="id0428A2547857402E9F912B7CFADD5720"><enum>(1)</enum><text display-inline="yes-display-inline">in paragraph (12), by striking
<quote>and</quote> after the semicolon;</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="id7607F1A53C74450FB63DB9757B9239E0"><enum>(2)</enum><text display-inline="yes-display-inline">in paragraph (13), by striking the period
and inserting a semicolon; and</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="idF05C8819C09448E29D8E67AB592E76E9"><enum>(3)</enum><text display-inline="yes-display-inline">by adding at the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id2162E2479D3D47D0A9852968034B8A19" reported-display-style="italic" style="OLC">
<paragraph commented="no" display-inline="no-display-inline" id="idF5D6A3B0E8D840AA8995F815EB386EE1"><enum>(14)</enum><subparagraph commented="no" display-inline="yes-display-inline" id="idDCA377C87C2B456080B815EC41F5C1C4"><enum>(A)</enum><text display-inline="yes-display-inline">an appendix containing the results of any
peer review conducted by another Office of Inspector General during the
reporting period; or</text>
</subparagraph><subparagraph changed="added" commented="no" display-inline="no-display-inline" id="id250DC540DA44464F8D464E284E3DB6C1" indent="up1" reported-display-style="italic"><enum>(B)</enum><text display-inline="yes-display-inline">if no peer review was conducted within that
reporting period, a statement identifying the date of the last peer review
conducted by another Office of Inspector General;</text>
</subparagraph></paragraph><paragraph commented="no" display-inline="no-display-inline" id="id897BF4B321D64FF6B884162C61349C01"><enum>(15)</enum><text display-inline="yes-display-inline">a list of any outstanding recommendations
from any peer review conducted by another Office of Inspector General that have
not been fully implemented, including a statement describing the status of the
implementation and why implementation is not complete; and</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="idC31A8CC0FFB7404A9FA8F9B08A004E95"><enum>(16)</enum><text display-inline="yes-display-inline">a list of any peer reviews conducted by the
Inspector General of another Office of the Inspector General during the
reporting period, including a list of any outstanding recommendations made from
any previous peer review (including any peer review conducted before the
reporting period) that remain outstanding or have not been fully
implemented.</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></section><section commented="no" display-inline="no-display-inline" id="id23AABEE4EC974C70BE5D375B24F4FAB0" section-type="subsequent-section"><enum>989D.</enum><header display-inline="yes-display-inline">Removal of inspectors general of designated
Federal entities</header><text display-inline="no-display-inline">Section 8G(e)
of the Inspector General Act of 1978 (5 U.S.C. App.) is amended—</text>
<paragraph commented="no" display-inline="no-display-inline" id="idCD05648CE40040978A889A29B39E4672"><enum>(1)</enum><text display-inline="yes-display-inline">by redesignating the sentences following
<quote>(e)</quote> as paragraph (2); and</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="id1D1F41B9B84C47869259065E02AD03C1"><enum>(2)</enum><text display-inline="yes-display-inline">by striking <quote>(e)</quote> and
inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idC140211CB1E44559B376348DA99FBD44" reported-display-style="italic" style="OLC">
<subsection commented="no" display-inline="no-display-inline" id="id5066DF64D5904D97A95817C2E47FDDD5"><enum>(e)</enum><paragraph commented="no" display-inline="yes-display-inline" id="id48EB2029DDED48ADA4BEC50D80E5ABB6"><enum>(1)</enum><text display-inline="yes-display-inline">In the case of a designated Federal entity
for which a board or commission is the head of the designated Federal entity, a
removal under this subsection may only be made upon the written concurrence of
a <fraction>2/3</fraction> majority of the board or
commission.</text>
</paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></section><section commented="no" display-inline="no-display-inline" id="HF55228E93EFA4C2DB0F5A1D776961D6E" section-type="subsequent-section"><enum>989E.</enum><header display-inline="yes-display-inline">Additional oversight of financial
regulatory system</header>
<subsection commented="no" display-inline="no-display-inline" id="H35A009344401459B82CF07CDD487B0B9"><enum>(a)</enum><header display-inline="yes-display-inline">Council of Inspectors General on Financial
Oversight</header>
<paragraph commented="no" display-inline="no-display-inline" id="H57DD01BB3E0F42CAA1CE071FBA15605F"><enum>(1)</enum><header display-inline="yes-display-inline">Establishment and membership</header><text display-inline="yes-display-inline">There is established a Council of
Inspectors General on Financial Oversight (in this section referred to as the
<quote>Council of Inspectors General</quote>) chaired by the Inspector General
of the Department of the Treasury and composed of the inspectors general of the
following:</text>
<subparagraph commented="no" display-inline="no-display-inline" id="HB260E085F09C4972A3294CDD19525845"><enum>(A)</enum><text display-inline="yes-display-inline">The Board of Governors of the Federal
Reserve System.</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="HB7D97ABC32B64739BD1A7E52535B3996"><enum>(B)</enum><text display-inline="yes-display-inline">The Commodity Futures Trading
Commission.</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="H24787E321BF5444C9AF63F4DCB257FD7"><enum>(C)</enum><text display-inline="yes-display-inline">The Department of Housing and Urban
Development.</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="H39DA4B4B8F8F42D8AF8E834689CE25BE"><enum>(D)</enum><text display-inline="yes-display-inline">The Department of the Treasury.</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="HE04BD5CA675145838DEFBE7F25D62C38"><enum>(E)</enum><text display-inline="yes-display-inline">The Federal Deposit Insurance
Corporation.</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="HDD33A1D4FA04440489083E70E7AAB3E5"><enum>(F)</enum><text display-inline="yes-display-inline">The Federal Housing Finance Agency.</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="H7AF3D3B4CACB423EAE9252194B15EFD5"><enum>(G)</enum><text display-inline="yes-display-inline">The National Credit Union
Administration.</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="HD83803BB2947429B85FEC6FFB0E86FD5"><enum>(H)</enum><text display-inline="yes-display-inline">The Securities and Exchange
Commission.</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="H6BC67C621CB8408EA9B2A0D5621EEA6B"><enum>(I)</enum><text display-inline="yes-display-inline">The Troubled Asset Relief Program (until
the termination of the authority of the Special Inspector General for such
program under section 121(k) of the Emergency Economic Stabilization Act of
2008 (12 U.S.C. 5231(k))).</text>
</subparagraph></paragraph><paragraph commented="no" display-inline="no-display-inline" id="HD6E817F35D3A4B16A0944A74CDB21504"><enum>(2)</enum><header display-inline="yes-display-inline">Duties</header>
<subparagraph commented="no" display-inline="no-display-inline" id="H0819B9E79FB047188CFBA361DF69142C"><enum>(A)</enum><header display-inline="yes-display-inline">Meetings</header><text display-inline="yes-display-inline">The Council of Inspectors General shall
meet not less than once each quarter, or more frequently if the chair considers
it appropriate, to facilitate the sharing of information among inspectors
general and to discuss the ongoing work of each inspector general who is a
member of the Council of Inspectors General, with a focus on concerns that may
apply to the broader financial sector and ways to improve financial
oversight.</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="H41EC16BACB2545A5896AFAB0875C73E4"><enum>(B)</enum><header display-inline="yes-display-inline">Annual report</header><text display-inline="yes-display-inline">Each year the Council of Inspectors General
shall submit to the Council and to Congress a report including—</text>
<clause commented="no" display-inline="no-display-inline" id="H424A9385DC6748DAA44F441AB1E2C347"><enum>(i)</enum><text display-inline="yes-display-inline">for each inspector general who is a member
of the Council of Inspectors General, a section within the exclusive editorial
control of such inspector general that highlights the concerns and
recommendations of such inspector general in such inspector general’s ongoing
and completed work, with a focus on issues that may apply to the broader
financial sector; and</text>
</clause><clause commented="no" display-inline="no-display-inline" id="H40E090B37D2F412ABD2F8279F20BCFEE"><enum>(ii)</enum><text display-inline="yes-display-inline">a summary of the general observations of
the Council of Inspectors General based on the views expressed by each
inspector general as required by clause (i), with a focus on measures that
should be taken to improve financial oversight.</text>
</clause></subparagraph></paragraph><paragraph commented="no" display-inline="no-display-inline" id="HA905B770ACD94928A4766C038CE25B4A"><enum>(3)</enum><header display-inline="yes-display-inline">Working Groups to evaluate Council</header>
<subparagraph commented="no" display-inline="no-display-inline" id="H982633B1323148DC8F616A859B892AF3"><enum>(A)</enum><header display-inline="yes-display-inline">Convening a Working Group</header><text display-inline="yes-display-inline">The Council of Inspectors General may, by
majority vote, convene a Council of Inspectors General Working Group to
evaluate the effectiveness and internal operations of the Council.</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="HF89CDA49C1484C80986824CC1C907075"><enum>(B)</enum><header display-inline="yes-display-inline">Personnel and resources</header><text display-inline="yes-display-inline">The inspectors general who are members of
the Council of Inspectors General may detail staff and resources to a Council
of Inspectors General Working Group established under this paragraph to enable
it to carry out its duties.</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="H0399EFCDF5194EB2B27220602479F05F"><enum>(C)</enum><header display-inline="yes-display-inline">Reports</header><text display-inline="yes-display-inline">A Council of Inspectors General Working
Group established under this paragraph shall submit regular reports to the
Council and to Congress on its evaluations pursuant to this paragraph.</text>
</subparagraph></paragraph></subsection><subsection commented="no" display-inline="no-display-inline" id="HA3C9B248EDA7486F92E2A670788EAB2E"><enum>(b)</enum><header display-inline="yes-display-inline">Response to report by Council</header><text display-inline="yes-display-inline">The Council shall respond to the concerns
raised in the report of the Council of Inspectors General under subsection
(a)(2)(B) for such year.</text>
</subsection></section></subtitle><subtitle id="id12DF778279404563A689F788A021BF09"><enum>J</enum><header>Self-funding of the
Securities and Exchange Commission</header>
<section id="IDe444dd21ff6c4151a25e2ccd02cac31d"><enum>991.</enum><header>Securities and
exchange commission self-funding</header>
<subsection id="ID2390555131a74ca692042e9c3969faf9"><enum>(a)</enum><header>Self-funding
authority</header><text>Section 4 of the Securities Exchange Act of 1934 (15
U.S.C. 78d) is amended—</text>
<paragraph id="ID3c58f04fc7e84f0cb74727b177aef4e1"><enum>(1)</enum><text>in subsection (c), in the
second sentence, by striking <quote>credited to the appropriated funds of the
Commission</quote> and inserting <quote>deposited in the account described in
subsection (i)(4)</quote>;</text>
</paragraph><paragraph id="ID049af041c3d34596808fcfc7bb43d414"><enum>(2)</enum><text>in subsection (f), in the
second sentence, by striking <quote>considered a reimbursement to the
appropriated funds of the Commission</quote> and inserting <quote>deposited in
the account described in subsection (i)(4)</quote>; and</text>
</paragraph><paragraph id="ID814fa55cbaf44865957e65aeac7da469"><enum>(3)</enum><text>by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id6D22561D9C4947889F1B020EB0220CEE" reported-display-style="italic" style="OLC">
<subsection id="ID21ad091f262b4bf79aae143ce71eaf1e"><enum>(i)</enum><header>Funding of the
commission</header>
<paragraph id="ID3ee62d762da7472382e31873a5d5b6ca"><enum>(1)</enum><header>Budget</header><text>For
each fiscal year, the Chairman of the Commission shall prepare and submit to
Congress a budget to Congress. Such budget shall be submitted at the same time
the President submits a budget of the United States to Congress for such fiscal
year. The budget submitted by the Chairman of the Commission pursuant to this
paragraph shall not be considered a request for appropriations.</text>
</paragraph><paragraph id="IDed14d108c13f44bb95a30a32c6cc783e"><enum>(2)</enum><header>Treasury
payment</header>
<subparagraph id="ID2c7e53846f07470a90a58e8454017431"><enum>(A)</enum><text>On the first day of each
fiscal year, the Treasury shall pay into the account described in paragraph (4)
an amount equal to the budget submitted by the Chairman of the Commission
pursuant to paragraph (1) for such fiscal year.</text>
</subparagraph><subparagraph id="ID92239f3f027541d88daa8945f87b9f5f"><enum>(B)</enum><text>At or prior to the end of
each fiscal year, the Commission shall pay to the Treasury from fees and
assessments deposited in the account described in paragraph (4) an amount equal
to the amount paid by the Treasury pursuant to subparagraph (A) for such fiscal
year, unless there are not sufficient fees and assessments deposited in such
account at or prior to the end of the fiscal year to make such payment, in
which case the Commission shall make such payment in a subsequent fiscal
year.</text>
</subparagraph></paragraph><paragraph id="ID9a9bf84bfcd14723b8624a005ecb0907"><enum>(3)</enum><header>Obligations and
expenses</header>
<subparagraph id="idA993D6655407461FA3DB64F142DD39B0"><enum>(A)</enum><header>In
general</header><text>The Commission shall determine and prescribe the manner
in which—</text>
<clause id="idFC7ADA68751042B19649D3CD4A3051FD"><enum>(i)</enum><text>the obligations of the
Commission shall be incurred; and</text>
</clause><clause id="id087ACA3E744141CDB33D61045ACB0345"><enum>(ii)</enum><text>the disbursements and
expenses of the Commission allowed and paid.</text>
</clause></subparagraph><subparagraph id="idBFC898DE300648019569B5AA46BFC2CB"><enum>(B)</enum><header>Insufficient
funds</header><text>If, in the course of any fiscal year, the Chairman of the
Commission determines that, due to unforeseen circumstances, the obligations of
the Commission will exceed those provided for in the budget submitted under
paragraph (1), the Chairman of the Commission may notify Congress of the amount
and expected uses of the additional obligations.</text>
</subparagraph><subparagraph id="idFAA785DC301D4897B8447EE7454E94D5"><enum>(C)</enum><header>Authority to incur
excess obligations</header><text>The Commission may incur obligations in excess
of the budget submitted under paragraph (1) from amounts available in the
account described in paragraph (4).</text>
</subparagraph><subparagraph id="id104437AFF62043129FDDE775EF72546F"><enum>(D)</enum><header>Rule of
construction</header><text>Any notification to Congress under this paragraph
shall not be considered a request for appropriations.</text>
</subparagraph></paragraph><paragraph id="IDefd610fd44594a2c88040f45bc43837a"><enum>(4)</enum><header>Account</header>
<subparagraph id="id96E8889885494DF1967EDA1F47A81E32"><enum>(A)</enum><header>Establishment</header><text>Fees
and assessments collected under this title, section 6(b) of the Securities Act
of 1933 (15 U.S.C. 77f(b)), and section 24(f) of the Investment Company Act of
1940 (15 U.S.C. 80a–24(f)) and payments made by the Treasury pursuant to
paragraph (2)(A) for any fiscal year shall be deposited into an account
established at any regular Government depositary or any State or national
bank.</text>
</subparagraph><subparagraph id="idF67BF235A0B248928533901E01C165BE"><enum>(B)</enum><header>Rule of
construction</header><text>Any amounts deposited into the account established
under subparagraph (A) shall not be construed to be Government funds or
appropriated monies.</text>
</subparagraph><subparagraph id="id662FC29D96E64616A89A4D0B72C920DA"><enum>(C)</enum><header>No
apportionment</header><text>Any amounts deposited into the account established
under subparagraph (A) shall not be subject to apportionment for the purpose of
chapter 15 of title 31, United States Code, or under any other
authority.</text>
</subparagraph></paragraph><paragraph id="ID8abca11cbef643c692ef4a094e1a62cd"><enum>(5)</enum><header>Use of account
funds</header>
<subparagraph id="id8AAC4427395F4C668DDCB5F1681E5A93"><enum>(A)</enum><header>Permissible
uses</header><text>Amounts available in the account described in paragraph (4)
may be withdrawn by the Commission and used for the purposes described in
paragraphs (2) and (3).</text>
</subparagraph><subparagraph id="id59F5EA24D6054B6B81D8F8237BF17AD4"><enum>(B)</enum><header>Impermissible
use</header><text>Except as provided in paragraph (6), no amounts available in
the account described in paragraph (4) shall be deposited and credited as
general revenue of the Treasury.</text>
</subparagraph></paragraph><paragraph id="IDf6345c22d4e24374ac31710ca67cab3e"><enum>(6)</enum><header>Excess
funds</header><text>If, at the end of any fiscal year and after all payments
have been made to the Treasury pursuant to paragraph (2)(B) for such fiscal
year and all prior fiscal years, the balance of the account described in
paragraph (4) exceeds 25 percent of the budget of the Commission for the
following fiscal year, the amount by which the balance exceeds 25 percent of
such budget shall be credited as general revenue of the
Treasury.</text>
</paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="ID030c8b5999e24a9c859a89a6c0b31eee"><enum>(b)</enum><header>Conforming amendments
to transaction fee provisions</header><text>Section 31 of the Securities
Exchange Act of 1934 (15 U.S.C. 78ee) is amended—</text>
<paragraph id="ID6db6e133bad141b98798709c5a7d4915"><enum>(1)</enum><text>by amending subsection
(a) to read as follows:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idAA8E501C942B4E5DAB53A0CE28B27AE3" reported-display-style="italic" style="OLC">
<subsection id="ID417bdb680a904ad8af61e85ff47b29f4"><enum>(a)</enum><header>Recovery of costs and
expenses</header>
<paragraph id="idE303A214A11540ABBDCFB08F42A23182"><enum>(1)</enum><header>In
general</header><text>The Commission shall, in accordance with this section,
collect transaction fees and assessments that are designed—</text>
<subparagraph id="idD18B8BA8607449E39D534D2BE3A2FC08"><enum>(A)</enum><text>to recover the reasonable
costs and expenses of the Commission, as set forth in the annual budget of the
Commission; and</text>
</subparagraph><subparagraph id="idEF81101F8DF844968E431BD25D017950"><enum>(B)</enum><text>to provide funds
necessary to maintain a reserve.</text>
</subparagraph></paragraph><paragraph id="idFD114EB5EA3F40EA8E6449CDFD3B4484"><enum>(2)</enum><header>Overpayments</header><text>The
authority to collect transaction fees and assessments in accordance with this
section shall include the authority to offset from such collection any
overpayment of transaction fees or assessments, regardless of the fiscal year
in which such overpayment is
made.</text>
</paragraph></subsection><after-quoted-block>;</after-quoted-block></quoted-block>
</paragraph><paragraph id="IDd9612f83116d4d0596ae49f980026e92"><enum>(2)</enum><text>in subsection (e)(2), by
striking <quote>September 30</quote> and inserting <quote>September
25</quote>;</text>
</paragraph><paragraph id="ID5e0e8ce909b244f39560eea4674cd0f8"><enum>(3)</enum><text>in subsection (g), by
striking <quote>April 30</quote> and inserting <quote>August 31</quote>;</text>
</paragraph><paragraph id="ID1da8d6e0c1374d499492bced7bd7e0ec"><enum>(4)</enum><text>by amending subsection
(i) to read as follows:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idDC26C0CB4B814879BE8142F7EC48B61A" reported-display-style="italic" style="OLC">
<subsection id="ID2e31be3518284b7fb26341b08315f898"><enum>(i)</enum><header>Fee
collections</header><text>Fees and assessments collected pursuant to this
section shall be deposited and credited in accordance with section 4(g) of this
title.</text>
</subsection><after-quoted-block>;</after-quoted-block></quoted-block>
</paragraph><paragraph id="IDec3f82363dda41cdad680b808a49595a"><enum>(5)</enum><text>by amending subsection
(j) to read as follows:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id33CC5ADF5B744334A649DFF5B1A0E16C" reported-display-style="italic" style="OLC">
<subsection id="ID3aa3f5c886ec47eba9d82919425ad02a"><enum>(j)</enum><header>Adjustments to
transaction fee rates</header>
<paragraph id="ID4c63a570023c469e87149fe84565b492"><enum>(1)</enum><header>Annual
adjustment</header><text>For each fiscal year, the Commission shall by order
adjust each of the rates applicable under subsections (b) and (c) for such
fiscal year to a uniform adjusted rate that, when applied to the baseline
estimate of the aggregate dollar amount of sales for such fiscal year, is
reasonably likely to produce aggregate fee collections under this section
(including assessments collected under subsection (d)) that are equal to the
budget of the Commission for such fiscal year, plus amounts necessary to
maintain a reserve.</text>
</paragraph><paragraph id="ID88e68a0506f84c8595a0bc3807e67105"><enum>(2)</enum><header>Mid-year
adjustment</header><text>For each fiscal year, the Commission shall determine,
by March 1 of such fiscal year, whether, based on the actual aggregate dollar
volume of sales during the first 4 months of such fiscal year, the baseline
estimate of the aggregate dollar volume of sales used under paragraph (1) for
such fiscal year is reasonably likely to be 10 percent (or more) greater or
less than the actual aggregate dollar volume of sales for such fiscal year. If
the Commission so determines, the Commission shall by order, not later than
March 1, adjust each of the rates applicable under subsections (b) and (c) for
such fiscal year to a uniform adjusted rate that, when applied to the revised
estimate of the aggregate dollar amount of sales for the remainder of such
fiscal year, is reasonably likely to produce aggregate fee collections under
this section (including fees estimated to be collected under subsections (b)
and (c) during such fiscal year prior to the effective date of the new uniform
adjusted rate and assessments collected under subsection (d)) that are equal to
the budget of the Commission for such fiscal year, plus amounts necessary to
maintain a reserve. In making such revised estimate, the Commission shall,
after consultation with the Congressional Budget Office and the Office of
Management and Budget, use the same methodology required by paragraph
(4).</text>
</paragraph><paragraph id="IDe304600098e54f43ae06682928b598d1"><enum>(3)</enum><header>Review and effective
date</header><text>In exercising its authority under this subsection, the
Commission shall not be required to comply with the provisions of section 553
of title 5 United States Code. An adjusted rate prescribed under paragraph (1)
or (2) and published under subsection (g) shall not be subject to judicial
review. An adjusted rate prescribed under paragraph (1) shall take effect on
the first day of the fiscal year to which such rate applies. An adjusted rate
prescribed under paragraph (2) shall take effect on April 1 of the fiscal year
to which such rate applies.</text>
</paragraph><paragraph id="ID7a1f6131487143798f17676c3775e5de"><enum>(4)</enum><header>Baseline estimate of
the aggregate dollar amount of sales</header><text>For purposes of this
subsection, the baseline estimate of the aggregate dollar amount of sales for
any fiscal year is the baseline estimate of the aggregate dollar amount of
sales of securities (other than bonds, debentures, other evidences of
indebtedness, security futures products, and options on securities indexes
excluding a narrow-based security index) to be transacted on each national
securities exchange and by or through any member of each national securities
association (otherwise than on a national securities exchange) during such
fiscal year as determined by the Commission, after consultation with the
Congressional Budget Office and the Office of Management and Budget, using the
methodology required for making projections pursuant to section 907 of title
2.</text>
</paragraph></subsection><after-quoted-block>; and</after-quoted-block></quoted-block>
</paragraph><paragraph id="IDba36944651fb4a0f9e0264bed76d75ca"><enum>(6)</enum><text>by striking subsections
(k) and (l).</text>
</paragraph></subsection><subsection id="ID0453a18ebe854297891b736defb07ed3"><enum>(c)</enum><header>Conforming amendments
to registration fee provisions</header>
<paragraph id="IDa733b8603c99417fba90907b981e52fa"><enum>(1)</enum><header>Section 6(b) of the
Securities Act of 1933</header><text>Section 6(b) of the Securities Act of 1933
(15 U.S.C. 77f(b)) is amended—</text>
<subparagraph id="ID8395f56e98514fa8b05e8d561aa11087"><enum>(A)</enum><text>by striking
<quote>offsetting</quote> each place that term appears and inserting
<quote>fee</quote>;</text>
</subparagraph><subparagraph id="idD1D087FD605848C29DA7EE09D77D5BFA"><enum>(B)</enum><text>in paragraph (3), in the
paragraph heading, by striking <quote><header-in-text level="paragraph" style="OLC">Offsetting</header-in-text></quote> and inserting
<quote><header-in-text level="paragraph" style="OLC">Fee</header-in-text></quote>;</text>
</subparagraph><subparagraph id="id133D3F0F12DE4785B2F854179BD05FAB"><enum>(C)</enum><text>in paragraph (11)(A), in
the subparagraph heading, by striking <quote><header-in-text level="subparagraph" style="OLC">offsetting</header-in-text></quote> and
inserting <quote><header-in-text level="subparagraph" style="OLC">fee</header-in-text></quote>;</text>
</subparagraph><subparagraph id="IDe6a2870746164fcf97f415eb81d325e2"><enum>(D)</enum><text>by striking paragraphs
(1), (3), (4), (6), (8), and (9);</text>
</subparagraph><subparagraph id="id9B9270AD444640E2852AC1AC928C29F4"><enum>(E)</enum><text>by redesignating
paragraph (2) as paragraph (1);</text>
</subparagraph><subparagraph id="IDa54a6fa5d5af424db7af2ef9eec6e990"><enum>(F)</enum><text>in paragraph (1), as so
redesignated, by striking <quote>(5) or (6)</quote> and inserting
<quote>(3)</quote>;</text>
</subparagraph><subparagraph id="id24780D968E4742D2B9922A90969D9EF5"><enum>(G)</enum><text>by inserting after
paragraph (1), as so redesignated, the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idF3E309F711684CA3A1B590756E07DC65" reported-display-style="italic" style="OLC">
<paragraph id="IDacb7942d10fb4d11b570491bc06b2fa1"><enum>(2)</enum><header>Fee
collections</header><text>Fees collected pursuant to this subsection shall be
deposited and credited in accordance with section 4(i) of the Securities
Exchange Act of
1934.</text>
</paragraph><after-quoted-block>;</after-quoted-block></quoted-block>
</subparagraph><subparagraph id="id4B9BFA371BF240629FCE97589CB0BDB3"><enum>(H)</enum><text>by redesignating
paragraph (5) as paragraph (3);</text>
</subparagraph><subparagraph id="ID4241d58acd0743d2b05268f75bb1668e"><enum>(I)</enum><text>in paragraph (3), as
redesignated—</text>
<clause id="ID241cf4b5561f463483a65dbff5751ed2"><enum>(i)</enum><text>by striking <quote>of the
fiscal years 2003 through 2011</quote> and inserting <quote>fiscal
year</quote>; and</text>
</clause><clause id="ID3fe1d2eac6e14029a266e4448593f5b5"><enum>(ii)</enum><text>by striking
<quote>paragraph (2)</quote> and inserting <quote>paragraph (1)</quote>;</text>
</clause></subparagraph><subparagraph id="IDc853749a7113493cad3cbf71447b0935"><enum>(J)</enum><text>by redesignating
paragraph (7) as paragraph (4);</text>
</subparagraph><subparagraph id="ID5aa43c93687645bea0b1e0e8be3aff27"><enum>(K)</enum><text>by inserting after
paragraph (4), as so redesignated, the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idC979C313B99D442285D86C7B5B1F7311" reported-display-style="italic" style="OLC">
<paragraph id="ID532773dd35b74a4bb66b16977c6099b5"><enum>(5)</enum><header>Review and effective
date</header><text>In exercising its authority under this subsection, the
Commission shall not be required to comply with the provisions of section 553
of title 5, United States Code. An adjusted rate prescribed under paragraph (3)
and published under paragraph (6) shall not be subject to judicial review. An
adjusted rate prescribed under paragraph (3) shall take effect on the first day
of the fiscal year to which such rate
applies.</text>
</paragraph><after-quoted-block>;</after-quoted-block></quoted-block>
</subparagraph><subparagraph id="ID1a2d9d2114254179bf4142578c902d90"><enum>(L)</enum><text>by redesignating
paragraphs (10) and (11), as paragraphs (6) and (7);</text>
</subparagraph><subparagraph id="ID37c3b5f010dd453f866fd915463f73fa"><enum>(M)</enum><text>in paragraph (6), as
redesignated, by striking <quote>April 30</quote> and inserting <quote>August
31</quote>; and</text>
</subparagraph><subparagraph id="IDdfa282a7594a4729a52c0d0502602716"><enum>(N)</enum><text>in paragraph (7), as
redesignated—</text>
<clause id="ID0579650858f1442396a64a013f7ba282"><enum>(i)</enum><text>by striking <quote>of the
fiscal years 2002 through 2011</quote> and inserting <quote>fiscal
year</quote>; and</text>
</clause><clause id="ID8267ce3345a849ca82eae86b79b76f61"><enum>(ii)</enum><text>by inserting at the end
of the table in subparagraph (A) the following:</text>
<table align-to-level="section" blank-lines-before="1" colsep="1" frame="all" line-rules="all-gen" rowsep="1" rule-weights="4.4.4.4.4.0" table-template-name="Entry: 2 text, bold hds" table-type="">
<tgroup cols="2" grid-typeface="1.1" rowsep="1" thead-tbody-ldg-size="0.10.12"><colspec coldef="txt-no-ldr" colname="column1" colwidth="230pts" min-data-value="190"></colspec><colspec coldef="txt-no-ldr-no-spread" colname="column2" colwidth="95pts" min-data-value="95"></colspec>
<tbody>
<row><entry colname="column1" leader-modify="clr-ldr" stub-definition="txt-clr" stub-hierarchy="1"><bold>2012
and each succeeding fiscal year</bold></entry><entry colname="column2" leader-modify="clr-ldr"><bold>An amount that is equal to the target fee
collection amount for the prior fiscal year adjusted by the rate of
inflation.</bold></entry>
</row>
</tbody>
</tgroup>
</table>
</clause></subparagraph></paragraph><paragraph id="ID54e7c9e61b5c4b4c81e9907c2cae9507"><enum>(2)</enum><header>Section 13(e) of the
Securities Exchange Act of 1934</header><text>Section 13(e) of the Securities
Exchange Act of 1934 (15 U.S.C. 78m(e)) is amended—</text>
<subparagraph id="IDb359fe15e8eb414484ffc20c5fa62240"><enum>(A)</enum><text>by striking
<quote>offsetting</quote> each place that term appears and inserting
<quote>fee</quote>;</text>
</subparagraph><subparagraph id="ID17426aba720642da91d2ba8a7fd3f372"><enum>(B)</enum><text>in paragraph (3) by
striking <quote>paragraphs (5) and (6)</quote> and inserting <quote>paragraph
(5)</quote>;</text>
</subparagraph><subparagraph id="IDbbcb1a1419424aa284d8eccc70cc5092"><enum>(C)</enum><text>by amending paragraph (4)
to read as follows:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id3C3AEEB5FFB34BC5BBD82A0CB6884AD9" reported-display-style="italic" style="OLC">
<paragraph id="ID25715d77a84547b1bf459e3db97eaafa"><enum>(4)</enum><header>Fee
collections</header><text>Fees collected pursuant to this subsection shall be
deposited and credited in accordance with section 4(g) of this
title.</text>
</paragraph><after-quoted-block>;</after-quoted-block></quoted-block>
</subparagraph><subparagraph id="IDd29efae4fd33479b93c6cfc1daddfa70"><enum>(D)</enum><text>in paragraph (5), by
striking <quote>of the fiscal years 2003 through 2011</quote> and inserting
<quote>fiscal year</quote>;</text>
</subparagraph><subparagraph id="IDa74f15b1280a4ce9bc97b07c85a7edba"><enum>(E)</enum><text>by striking paragraphs
(6), (7), and (8);</text>
</subparagraph><subparagraph id="id6C5CC29EEA854F47BA5351322D01DB02"><enum>(F)</enum><text>by redesignating
paragraph (7) as paragraph (6);</text>
</subparagraph><subparagraph id="IDd1c06d5d2e8f4867b86623c1fea74aa2"><enum>(G)</enum><text>by inserting after
paragraph (6), as so redesignated, the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idFE5A19F6D88E4DCA81401911B4E867A5" reported-display-style="italic" style="OLC">
<paragraph id="IDf9658ec72a4c4e3da3c3b844b9b2ea0e"><enum>(7)</enum><header>Review and effective
date</header><text>In exercising its authority under this subsection, the
Commission shall not be required to comply with the provisions of section 553
of title 5. An adjusted rate prescribed under paragraph (5) and published under
paragraph (8) shall not be subject to judicial review. An adjusted rate
prescribed under paragraph (5) shall take effect on the first day of the fiscal
year to which such rate
applies.</text>
</paragraph><after-quoted-block>;</after-quoted-block></quoted-block>
</subparagraph><subparagraph id="id560F2CF0FAF84A40906F01FDD940B978"><enum>(H)</enum><text>by striking paragraph
(9);</text>
</subparagraph><subparagraph id="idDA67D1F73C694C95AE968C3579902E68"><enum>(I)</enum><text>by redesignating
paragraph (10) as paragraph (8); and</text>
</subparagraph><subparagraph id="ID1731e62559de493eb0cdb79d28f485c7"><enum>(J)</enum><text>in paragraph (8), as so
redesignated, by striking <quote>6(b)(10)</quote> and inserting
<quote>6(b)(6)</quote>.</text>
</subparagraph></paragraph><paragraph id="IDfaae95f5aeb549c28cc5026b7d3fe62d"><enum>(3)</enum><header>Section 14 of the
Securities Exchange Act of 1934</header><text>Section 14(g) of the Securities
Exchange Act of 1934 (15 U.S.C. 78n(g)) is amended—</text>
<subparagraph id="ID205e47c1e78645c18368e2a75358a601"><enum>(A)</enum><text>by striking the word
<quote>offsetting</quote> each time that it appears and inserting in its place
the word <quote>fee</quote>;</text>
</subparagraph><subparagraph id="IDcd81ea6fb0f34bd3b389e3191497b9a8"><enum>(B)</enum><text>in paragraph (1)(A), by
striking <quote>paragraphs (5) and (6)</quote> each time it appears and
inserting <quote>paragraph (5)</quote>;</text>
</subparagraph><subparagraph id="ID32dd1ce1895e4e6a82272e39336aed3b"><enum>(C)</enum><text>in paragraph (3), by
striking <quote>paragraphs (5) and (6)</quote> and inserting <quote>paragraph
(5)</quote>;</text>
</subparagraph><subparagraph id="ID5d76a6d88d6449eeacec1aaa51e1f0eb"><enum>(D)</enum><text>by amending paragraph (4)
to read as follows:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id3AF8BE54E0B040A992CBE6199BFA45F9" reported-display-style="italic" style="OLC">
<paragraph id="ID36bdc086e33741a683b427c1dafc1d0c"><enum>(4)</enum><header>Fee
collections</header><text>Fees collected pursuant to this subsection shall be
deposited and credited in accordance with section 4(g) of this
title.</text>
</paragraph><after-quoted-block>;</after-quoted-block></quoted-block>
</subparagraph><subparagraph id="ID04bf0b8541d3488099f8b102abfdcf8e"><enum>(E)</enum><text>in paragraph (5), by
striking <quote>of the fiscal years 2003 through 2011</quote> and inserting
<quote>fiscal year</quote>;</text>
</subparagraph><subparagraph id="ID34ff2689b1be4a08b2c047fa6dc5c79f"><enum>(F)</enum><text>by striking paragraphs
(6), (8), and (9);</text>
</subparagraph><subparagraph id="id2DBB09227BF3471CBD2EBC56E5C2A35E"><enum>(G)</enum><text>by redesignating
paragraph (7) as paragraph (6);</text>
</subparagraph><subparagraph id="IDc1a8154a921f457e83426c8ae803f36f"><enum>(H)</enum><text>by inserting after
paragraph (6), as so redesignated, the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idD646AE0872E347BA90341DE4F489FAE8" reported-display-style="italic" style="OLC">
<paragraph id="IDd39f1e8c39954e53905506281b1b1db1"><enum>(7)</enum><header>Review and effective
date</header><text>In exercising its authority under this subsection, the
Commission shall not be required to comply with the provisions of section 553
of title 5. An adjusted rate prescribed under paragraph (5) and published under
paragraph (8) shall not be subject to judicial review. An adjusted rate
prescribed under paragraph (5) shall take effect on the first day of the fiscal
year to which such rate
applies.</text>
</paragraph><after-quoted-block>;</after-quoted-block></quoted-block>
</subparagraph><subparagraph id="ID08fc3e5964604295bc4e84f300156a48"><enum>(I)</enum><text>by redesignating
paragraphs (10) and (11) as paragraphs (8) and (9), respectively; and</text>
</subparagraph><subparagraph id="ID5b32c8d6b0994739b6c5be500fb577b3"><enum>(J)</enum><text>in paragraph (9), as so
redesignated, by striking <quote>6(b)(10)</quote> and inserting
<quote>6(b)(7)</quote>.</text>
</subparagraph></paragraph></subsection><subsection id="IDe86aada7ef6f4233baa8746f7c8a02f8"><enum>(d)</enum><header>Repeal of authorization
of appropriations</header><text>Section 35 of the Securities Exchange Act of
1934 (15 U.S.C. 78kk) is repealed.</text>
</subsection><subsection id="ID994739076c5c4d75a0f4e294873527d5"><enum>(e)</enum><header>Effective date and
transition provisions</header>
<paragraph id="IDfd442d3bb2944d698bff6e6de2755f9c"><enum>(1)</enum><header>In
general</header><text>Except as provided in paragraphs (2) and (3), the
amendments made by this section shall be effective on the first day of the
fiscal year following the fiscal year in which this Act is enacted.</text>
</paragraph><paragraph id="ID2d726163305941229b2ca8d44b8b1c46"><enum>(2)</enum><header>Transition
period</header><text>For the fiscal year following the fiscal year in which
this Act is enacted, the budget of the Commission shall be deemed to be the
budget submitted by the Chairman of the Commission to the President for such
fiscal year in accordance with the provisions of section 1108 of title 31,
United States Code.</text>
</paragraph><paragraph id="ID822d904e4821443b9b07d89667df3b64"><enum>(3)</enum><header>Other
provisions</header><text>The amendments made by this section to subsections (g)
and (j)(1) of section 31 of the Securities Exchange Act of 1934 (15 U.S.C.
78ee) shall be effective on the date of enactment of this Act, and shall
require the Commission to make and publish an annual adjustment to the fee
rates applicable under subsections (b) and (c) of section 31 of the Securities
Exchange Act of 1934 (15 U.S.C. 78ee) for the fiscal year following the fiscal
year in which this Act is enacted. The adjusted rate described in the preceding
sentence shall supersede any previously published adjusted rate applicable
under subsections (b) and (c) of section 31 of the Securities Exchange Act of
1934 for the fiscal year following the fiscal year in which this Act is enacted
and shall take effect on the first day of the fiscal year following the fiscal
year in which this Act is enacted, except that, if this Act is enacted on or
after August 31 and on or prior to September 30, the adjusted rate described in
the first sentence shall be published not later than 15 days after the date of
enactment of this Act and take effect 30 days thereafter, and the Commission
shall continue to collect fees under subsections (b) and (c) of section 31 of
the Securities Exchange Act of 1934 at the rate in effect during the preceding
fiscal year until the adjusted rate is effective.</text>
</paragraph></subsection></section></subtitle><enum>X</enum><header>Bureau of Consumer
Financial Protection</header>
<section id="id9B98171A7A8E42B282E3A8E8C3FF15B8"><enum>1001.</enum><header>Short
title</header><text display-inline="no-display-inline">This title may be cited
as the <quote>Consumer Financial Protection Act of 2010</quote>.</text>
</section><section id="ID20f8ddfabe19400ab5e455bcaaa8537b"><enum>1002.</enum><header>Definitions</header><text display-inline="no-display-inline">Except as otherwise provided in this title,
for purposes of this title, the following definitions shall apply:</text>
<paragraph id="id23B22E32341645D996C3BF0B5717500A"><enum>(1)</enum><header>Affiliate</header><text>The
term <quote>affiliate</quote> means any person that controls, is controlled by,
or is under common control with another person.</text>
</paragraph><paragraph id="id6EF60D964771452F945C27CBB0F9E84C"><enum>(2)</enum><header>Bureau</header><text>The
term <quote>Bureau</quote> means the Bureau of Consumer Financial
Protection.</text>
</paragraph><paragraph id="ID665106b0c02343d7bca12cb8aad94e8c"><enum>(3)</enum><header>Business of
insurance</header><text>The term <quote>business of insurance</quote> means the
writing of insurance or the reinsuring of risks by an insurer, including all
acts necessary to such writing or reinsuring and the activities relating to the
writing of insurance or the reinsuring of risks conducted by persons who act
as, or are, officers, directors, agents, or employees of insurers or who are
other persons authorized to act on behalf of such persons.</text>
</paragraph><paragraph id="IDd89818f90c664699925c8b8183ccce80"><enum>(4)</enum><header>Consumer</header><text>The
term <term>consumer</term> means an individual or an agent, trustee, or
representative acting on behalf of an individual.</text>
</paragraph><paragraph id="ID494a3bfca17c43cea1ab7b769f983560"><enum>(5)</enum><header>Consumer financial
product or service</header><text>The term <term>consumer financial product or
service</term> means any financial product or service that is described in one
or more categories under—</text>
<subparagraph id="IDc8fbd4ca01824a51934afef0e6918e18"><enum>(A)</enum><text>paragraph (13) and is
offered or provided for use by consumers primarily for personal, family, or
household purposes; or</text>
</subparagraph><subparagraph id="ID11020b89b9174012a47e9b57bc03afe6"><enum>(B)</enum><text>clause (i), (iii), (ix),
or (x) of paragraph (13)(A), and is delivered, offered, or provided in
connection with a consumer financial product or service referred to in
subparagraph (A).</text>
</subparagraph></paragraph><paragraph id="IDc316dd64f1714d39843b3253a20b4dff"><enum>(6)</enum><header>Covered
person</header><text>The term <term>covered person</term> means—</text>
<subparagraph id="IDf669af09131a4bfd9726f8eab1952fdf"><enum>(A)</enum><text>any person that engages
in offering or providing a consumer financial product or service; and</text>
</subparagraph><subparagraph id="ID7f6803cac67c43b287818c5fbd2f58b4"><enum>(B)</enum><text>any affiliate of a person
described in subparagraph (A) if such affiliate acts as a service provider to
such person.</text>
</subparagraph></paragraph><paragraph id="IDeafb455cdc3d4e86ba6ee6b08d51f5c9"><enum>(7)</enum><header>Credit</header><text>The
term <term>credit</term> means the right granted by a person to a consumer to
defer payment of a debt, incur debt and defer its payment, or purchase property
or services and defer payment for such purchase.</text>
</paragraph><paragraph commented="no" id="IDfc2964ed60964f818fcdf7ea0fb55ea8"><enum>(8)</enum><header>Deposit-taking
activity</header><text>The term <term>deposit-taking activity</term>
means—</text>
<subparagraph commented="no" id="ID3394b5531a7f47e0ac476d39f42626e0"><enum>(A)</enum><text>the acceptance of
deposits, maintenance of deposit accounts, or the provision of services related
to the acceptance of deposits or the maintenance of deposit accounts;</text>
</subparagraph><subparagraph commented="no" id="ID2b5accded024489a881cf32cbff8f83c"><enum>(B)</enum><text>the acceptance of funds,
the provision of other services related to the acceptance of funds, or the
maintenance of member share accounts by a credit union; or</text>
</subparagraph><subparagraph commented="no" id="ID7050dd35a47c4aa39680b847bd2d17ad"><enum>(C)</enum><text>the receipt of funds or
the equivalent thereof, as the Bureau may determine by rule or order, received
or held by a covered person (or an agent for a covered person) for the purpose
of facilitating a payment or transferring funds or value of funds between a
consumer and a third party.</text>
</subparagraph></paragraph><paragraph id="ID502b221e7dea41df9c461c2c1622f9d8"><enum>(9)</enum><header>Designated transfer
date</header><text>The term <term>designated transfer date</term> means the
date established under section 1062.</text>
</paragraph><paragraph id="ID21fbc467b8a54a96b57eed606c25d294"><enum>(10)</enum><header>Director</header><text>The
term <quote>Director</quote> means the Director of the Bureau.</text>
</paragraph><paragraph id="idC43B2050FFCA4E17AA97FC1D42B57765"><enum>(11)</enum><header>Enumerated consumer
laws</header><text>The term <term>enumerated consumer laws</term> means—</text>
<subparagraph id="ID570cac5318544f9ab2ebf78fa054c3de"><enum>(A)</enum><text>the Alternative Mortgage
Transaction Parity Act of 1982 (12 U.S.C. 3801 et seq.);</text>
</subparagraph><subparagraph id="IDd6ce6c6fb4a6416b86aefa4523c35edd"><enum>(B)</enum><text>the Consumer Leasing Act
of 1976 (15 U.S.C. 1667 et seq.);</text>
</subparagraph><subparagraph id="IDb3237936a74348bbba88da065fd493ad"><enum>(C)</enum><text>the Electronic Fund
Transfer Act (15 U.S.C. 1693 et seq.);</text>
</subparagraph><subparagraph id="ID56abdaaa93d447689cd65107c11a04d7"><enum>(D)</enum><text>the Equal Credit
Opportunity Act (15 U.S.C. 1691 et seq.);</text>
</subparagraph><subparagraph id="ID67bd9efc6a2f40259e71c595515fe67c"><enum>(E)</enum><text>the Fair Credit Billing
Act (15 U.S.C. 1666 et seq.);</text>
</subparagraph><subparagraph id="ID8ff7ef09003d4ff2a172d7e8a82c0b47"><enum>(F)</enum><text>the Fair Credit Reporting
Act (15 U.S.C. 1681 et seq.), except with respect to sections 615(e) and 628 of
that Act (15 U.S.C. 1681m(e), 1681w);</text>
</subparagraph><subparagraph id="IDb9d3f8f19f54449da00339ee0bbe0e7a"><enum>(G)</enum><text>the Home Owners
Protection Act of 1998 (12 U.S.C. 4901 et seq.);</text>
</subparagraph><subparagraph id="ID71f43e6c0dce4afb8a7e45a0b5035d6f"><enum>(H)</enum><text>the Fair Debt Collection
Practices Act (15 U.S.C. 1692 et seq.);</text>
</subparagraph><subparagraph id="ID76883ddf745a4b2c9439544ac43a29fa"><enum>(I)</enum><text>subsections (b) through
(f) of section 43 of the Federal Deposit Insurance Act (12 U.S.C.
1831t(c)–(f));</text>
</subparagraph><subparagraph id="ID74485f5095484600bab22018fb010d33"><enum>(J)</enum><text>sections 502 through 509
of the Gramm-Leach-Bliley Act (15 U.S.C. 6802–6809) except for section 505 as
it applies to section 501(b);</text>
</subparagraph><subparagraph id="ID6c4d155c65ce4bf190b5e3e7b0b10e5e"><enum>(K)</enum><text>the Home Mortgage
Disclosure Act of 1975 (12 U.S.C. 2801 et seq.);</text>
</subparagraph><subparagraph id="IDc8110f0ed39b44e8b3ca86982baf37b0"><enum>(L)</enum><text>the Home Ownership and
Equity Protection Act of 1994 (15 U.S.C. 1601 note);</text>
</subparagraph><subparagraph id="ID839880daf29044a9a568adc5cca17fd8"><enum>(M)</enum><text>the Real Estate
Settlement Procedures Act of 1974 (12 U.S.C. 2601 et seq.);</text>
</subparagraph><subparagraph id="IDa890bfd98e65430c9cd326ad110ba265"><enum>(N)</enum><text>the S.A.F.E. Mortgage
Licensing Act of 2008 (12 U.S.C. 5101 et seq.);</text>
</subparagraph><subparagraph id="IDa02633bd58904c18957657e70c4b9782"><enum>(O)</enum><text>the Truth in Lending Act
(15 U.S.C. 1601 et seq.);</text>
</subparagraph><subparagraph id="ID1a0c8867a3e1441c85f911d231edaed9"><enum>(P)</enum><text>the Truth in Savings Act
(12 U.S.C. 4301 et seq.); and</text>
</subparagraph><subparagraph id="ID7CD60EC935BE4507938B22EA4D8626E2"><enum>(Q)</enum><text>section 626 of the
Omnibus Appropriations Act, 2009 (Public Law 111–8).</text>
</subparagraph></paragraph><paragraph id="ID96e2513a1a54448c92a634ae789760fd"><enum>(12)</enum><header>Federal consumer
financial law</header><text>The term <term>Federal consumer financial
law</term> means the provisions of this title, the enumerated consumer laws,
the laws for which authorities are transferred under subtitles F and H, and any
rule or order prescribed by the Bureau under this title, an enumerated consumer
law, or pursuant to the authorities transferred under subtitles F and H. The
term does not include the Federal Trade Commission Act.</text>
</paragraph><paragraph id="IDf109c26b972e4ed599e4cccd8090a5a5"><enum>(13)</enum><header>Financial product or
service</header><text>The term <term>financial product or
service</term>—</text>
<subparagraph id="idC97FD86220064BDC8D153AAEC513B473"><enum>(A)</enum><text>means—</text>
<clause id="ID9f5868874ba9470ebcea19b809e3e85d"><enum>(i)</enum><text>extending credit and
servicing loans, including acquiring, purchasing, selling, brokering, or other
extensions of credit (other than solely extending commercial credit to a person
who originates consumer credit transactions);</text>
</clause><clause id="ID5e03e0f0e7eb4d1a96cd34fa7c3e0156"><enum>(ii)</enum><text>extending or brokering
leases of personal or real property that are the functional equivalent of
purchase finance arrangements, if—</text>
<subclause id="IDb7a63a52945b4d7bafcf14a49d65b8a8"><enum>(I)</enum><text>the lease is on a
non-operating basis;</text>
</subclause><subclause id="ID73322504028345c4af5996a958c656d1"><enum>(II)</enum><text>the initial term of the
lease is at least 90 days; and</text>
</subclause><subclause id="ID7dc25ac430954f86a765fab1166bb1e7"><enum>(III)</enum><text>in the case of a lease
involving real property, at the inception of the initial lease, the transaction
is intended to result in ownership of the leased property to be transferred to
the lessee, subject to standards prescribed by the Bureau;</text>
</subclause></clause><clause id="ID7d9ff90d25d64138ac22fcfdebd1fd27"><enum>(iii)</enum><text>providing real estate
settlement services or performing appraisals of real estate or personal
property;</text>
</clause><clause id="IDc45283523d9b4b809ce0beccb6effd74"><enum>(iv)</enum><text>engaging in
deposit-taking activities, transmitting or exchanging funds, or otherwise
acting as a custodian of funds or any financial instrument for use by or on
behalf of a consumer;</text>
</clause><clause id="IDa2f9364d76a44175b42f1dd236839dd7"><enum>(v)</enum><text>selling, providing, or
issuing stored value or payment instruments, except that, in the case of a sale
of, or transaction to reload, stored value, only if the seller exercises
substantial control over the terms or conditions of the stored value provided
to the consumer where, for purposes of this clause—</text>
<subclause id="IDbf46951907c84867988ab9be4b395eaa"><enum>(I)</enum><text>a seller shall not be
found to exercise substantial control over the terms or conditions of the
stored value if the seller is not a party to the contract with the consumer for
the stored value product, and another person is principally responsible for
establishing the terms or conditions of the stored value; and</text>
</subclause><subclause id="ID5b0e8068d81742febd219cf4b7683a01"><enum>(II)</enum><text>advertising the
nonfinancial goods or services of the seller on the stored value card or device
is not in itself an exercise of substantial control over the terms or
conditions;</text>
</subclause></clause><clause id="ID70a0b052065340168e80d64ddb2514f0"><enum>(vi)</enum><text>providing check cashing,
check collection, or check guaranty services;</text>
</clause><clause id="ID97e808af8e2b4c4eb2a189bbc5b52778"><enum>(vii)</enum><text>providing payments or
other financial data processing products or services to a consumer by any
technological means, including processing or storing financial or banking data
for any payment instrument, or through any payments systems or network used for
processing payments data, including payments made through an online banking
system or mobile telecommunications network, except that a person shall not be
deemed to be a covered person with respect to financial data processing solely
because the person—</text>
<subclause id="ID33257ed140b5413281e62f582e4f5045"><enum>(I)</enum><text>unknowingly or
incidentally processes, stores, or transmits over the Internet, telephone line,
mobile network, or any other mode of transmission, as part of a stream of other
types of data, financial data in a manner that such data is undifferentiated
from other types of data of the same form that the person processes, stores, or
transmits;</text>
</subclause><subclause id="ID0d79448b33d44b2095508f0ebf308e56"><enum>(II)</enum><text>is a merchant, retailer,
or seller of any nonfinancial good or service who engages in financial data
processing by transmitting or storing payments data about a consumer
exclusively for purpose of initiating payments instructions by the consumer to
pay such person for the purchase of, or to complete a commercial transaction
for, such nonfinancial good or service sold directly by such person to the
consumer; or</text>
</subclause><subclause id="ID667452bbd7694f34a5a699ddd323eb9d"><enum>(III)</enum><text>provides access to a
host server to a person for purposes of enabling that person to establish and
maintain a website;</text>
</subclause></clause><clause id="IDdad37e96131048299a092cef53e48be1"><enum>(viii)</enum><text>providing financial
advisory services to consumers on individual financial matters or relating to
proprietary financial products or services (other than by publishing any bona
fide newspaper, news magazine, or business or financial publication of general
and regular circulation, including publishing market data, news, or data
analytics or investment information or recommendations that are not tailored to
the individual needs of a particular consumer), including—</text>
<subclause id="IDcade650072884f3093ebb1a9521ed96a"><enum>(I)</enum><text>providing credit
counseling to any consumer; and</text>
</subclause><subclause id="IDfe10b650af674d4aa974aff71dce662c"><enum>(II)</enum><text>providing services to
assist a consumer with debt management or debt settlement, modifying the terms
of any extension of credit, or avoiding foreclosure;</text>
</subclause></clause><clause id="IDa2db47bb63114c179aac07fa7425c075"><enum>(ix)</enum><text>collecting, analyzing,
maintaining, or providing consumer report information or other account
information, including information relating to the credit history of consumers,
used or expected to be used in connection with any decision regarding the
offering or provision of a consumer financial product or service, except to the
extent that—</text>
<subclause id="ID049aee256ee348aca37da0baf256ce55"><enum>(I)</enum><text>a person—</text>
<item id="ID82b08cb2013a4dd1ba7f1f9cc5e4f2ee"><enum>(aa)</enum><text>collects, analyzes, or
maintains information that relates solely to the transactions between a
consumer and such person; or</text>
</item><item id="ID9d9459ad129f4f9793daa48f371c290e"><enum>(bb)</enum><text>provides the information
described in item (aa) to an affiliate of such person; and</text>
</item></subclause><subclause id="ID9b2b004e33d2445ab288b4ac0edc8aed"><enum>(II)</enum><text>the information
described in subclause (I)(aa) is not used by such person or affiliate in
connection with any decision regarding the offering or provision of a consumer
financial product or service to the consumer, other than credit described in
section 1027(a)(2)(A);</text>
</subclause></clause><clause id="IDed401f00d17b4ddf8ac34ef29770aa34"><enum>(x)</enum><text>collecting debt related
to any consumer financial product or service; and</text>
</clause><clause id="ID7c62bc2d6c3a4905b8f9c412eceaef97"><enum>(xi)</enum><text>such other financial
product or service as may be defined by the Bureau, by regulation, for purposes
of this title, if the Bureau finds that such financial product or service
is—</text>
<subclause id="IDdd476370a0c648c3847ec21ba4edeee7"><enum>(I)</enum><text>entered into or conducted
as a subterfuge or with a purpose to evade any Federal consumer financial law;
or</text>
</subclause><subclause id="IDdd58f46515b04485a1c2463e8b2f2f8e"><enum>(II)</enum><text>permissible for a bank
or for a financial holding company to offer or to provide under any provision
of a Federal law or regulation applicable to a bank or a financial holding
company, and has, or likely will have, a material impact on consumers;
and</text>
</subclause></clause></subparagraph><subparagraph id="ID977961a14e984bd49187947b6c9ffa9a"><enum>(B)</enum><text>does not include the
business of insurance.</text>
</subparagraph></paragraph><paragraph id="ID9424d357759e4e43af97678941ef417f"><enum>(14)</enum><header>Foreign
exchange</header><text>The term <term>foreign exchange</term> means the
exchange, for compensation, of currency of the United States or of a foreign
government for currency of another government.</text>
</paragraph><paragraph id="id40C813F3B5F044A4AB84A8C9B9B59618"><enum>(15)</enum><header>Insured credit
union</header><text>The term <term>insured credit union</term> has the same
meaning as in section 101 of the Federal Credit Union Act (12 U.S.C.
1752).</text>
</paragraph><paragraph id="ID3494416a559e412ab6769af8d609e2ca"><enum>(16)</enum><header>Payment
instrument</header><text>The term <term>payment instrument</term> means a
check, draft, warrant, money order, traveler’s check, electronic instrument, or
other instrument, payment of funds, or monetary value (other than
currency).</text>
</paragraph><paragraph id="ID7e0bfe73cf3444c082ddf229362e4f0d"><enum>(17)</enum><header>Person</header><text>The
term <term>person</term> means an individual, partnership, company,
corporation, association (incorporated or unincorporated), trust, estate,
cooperative organization, or other entity.</text>
</paragraph><paragraph id="IDb62c0f2da7bc42d5ad1f987553d3befb"><enum>(18)</enum><header>Person regulated by
the commodity futures trading commission</header><text>The term <term>person
regulated by the Commodity Futures Trading Commission</term> means any person
that is registered, or required by statute or regulation to be registered, with
the Commodity Futures Trading Commission, but only to the extent that the
activities of such person are subject to the jurisdiction of the Commodity
Futures Trading Commission under the Commodity Exchange Act.</text>
</paragraph><paragraph id="ID52d2de3eb714494eb9fd80abc8df71ab"><enum>(19)</enum><header>Person regulated by
the commission</header><text>The term <term>person regulated by the
Commission</term> means a person who is—</text>
<subparagraph id="IDa9149d4965e2464e94868c10ec7a4bf8"><enum>(A)</enum><text>a broker or dealer that
is required to be registered under the Securities Exchange Act of 1934;</text>
</subparagraph><subparagraph id="ID0f1ecd82bc9c4a21b94e4d9555e74422"><enum>(B)</enum><text>an investment adviser
that is registered under the Investment Advisers Act of 1940;</text>
</subparagraph><subparagraph id="ID2bd27b3261fc4396bebc1775d7df0cca"><enum>(C)</enum><text>an investment company
that is required to be registered under the Investment Company Act of 1940, and
any company that has elected to be regulated as a business development company
under that Act;</text>
</subparagraph><subparagraph id="idF0F4B400AA6747BBADBF5777C1FD8E0F"><enum>(D)</enum><text>a national securities
exchange that is required to be registered under the Securities Exchange Act of
1934;</text>
</subparagraph><subparagraph id="id5CBC762A3A5245CCB749BCF591F501BA"><enum>(E)</enum><text>a transfer agent that is
required to be registered under the Securities Exchange Act of 1934;</text>
</subparagraph><subparagraph id="id800CE9FB37BE4D7695C253D8E4609428"><enum>(F)</enum><text>a clearing corporation
that is required to be registered under the Securities Exchange Act of
1934;</text>
</subparagraph><subparagraph id="ID30260dae76814d15807c0d30aa6c52e3"><enum>(G)</enum><text>any self-regulatory
organization that is required to be registered with the Commission;</text>
</subparagraph><subparagraph id="IDfa5bdd88b9264d5ba157c98feb930159"><enum>(H)</enum><text>any nationally recognized
statistical rating organization that is required to be registered with the
Commission;</text>
</subparagraph><subparagraph id="ID13cd55476a854f4ba475d1a1305f4cfb"><enum>(I)</enum><text>any securities
information processor that is required to be registered with the
Commission;</text>
</subparagraph><subparagraph id="ID7a0144fe7f6c4fd79324dc76b009322a"><enum>(J)</enum><text>any municipal securities
dealer that is required to be registered with the Commission;</text>
</subparagraph><subparagraph id="ID097f25612abd4a77b5564c8111c1ee0d"><enum>(K)</enum><text>any other person that is
required to be registered with the Commission under the Securities Exchange Act
of 1934; and</text>
</subparagraph><subparagraph id="idDDF55F4C954B46CE809CEF1ABC35524C"><enum>(L)</enum><text>any employee, agent, or
contractor acting on behalf of, registered with, or providing services to, any
person described in any of subparagraphs (A) through (K), but only to the
extent that any person described in any of subparagraphs (A) through (K), or
the employee, agent, or contractor of such person, acts in a regulated
capacity.</text>
</subparagraph></paragraph><paragraph id="ID8a510d88cdde4970879969eb5497c14b"><enum>(20)</enum><header>Person regulated by a
State insurance regulator</header><text>The term <term>person regulated by a
State insurance regulator</term> means any person that is engaged in the
business of insurance and subject to regulation by any State insurance
regulator, but only to the extent that such person acts in such
capacity.</text>
</paragraph><paragraph id="IDa5dc92047db546c5b126f58e6ec2b42f"><enum>(21)</enum><header>Person that performs
income tax preparation activities for consumers</header><text>The term
<term>person that performs income tax preparation activities for
consumers</term> means—</text>
<subparagraph id="ID03c4bbe0d9694f18b7f4a2d10528e012"><enum>(A)</enum><text>any tax return preparer
(as defined in section 7701(a)(36) of the Internal Revenue Code of 1986),
regardless of whether compensated, but only to the extent that the person acts
in such capacity;</text>
</subparagraph><subparagraph id="ID6213ce6d738e4057ab6b661dda5ec535"><enum>(B)</enum><text>any person regulated by
the Secretary under section 330 of title 31, United States Code, but only to
the extent that the person acts in such capacity; and</text>
</subparagraph><subparagraph id="ID9e15e0cb175b43aea828d3634d5f38aa"><enum>(C)</enum><text>any authorized IRS e-file
Providers (as defined for purposes of section 7216 of the Internal Revenue Code
of 1986), but only to the extent that the person acts in such capacity.</text>
</subparagraph></paragraph><paragraph id="IDcb805c650d964053850fe9c48b4adf56"><enum>(22)</enum><header>Prudential
regulator</header><text>The term <term>prudential regulator</term>
means—</text>
<subparagraph id="ID7c2849ddb0b24960820cc4d765c0d187"><enum>(A)</enum><text>in the case of an insured
depository institution, the appropriate Federal banking agency, as that term is
defined in section 3 of the Federal Deposit Insurance Act; and</text>
</subparagraph><subparagraph commented="no" id="ID9b6883453c54442da49f2ce72384b5a1"><enum>(B)</enum><text>in the case of an insured
credit union, the National Credit Union Administration.</text>
</subparagraph></paragraph><paragraph id="ID42b5c464d69a498d9ba731a7c48d37b6"><enum>(23)</enum><header>Related
person</header><text>The term <quote>related person</quote>—</text>
<subparagraph id="id42E6684C288F4974B9345BA6732FCF0B"><enum>(A)</enum><text>shall apply only with
respect to a covered person that is not a bank holding company (as that term is
defined in section 2 of the Bank Holding Company Act of 1956), credit union, or
depository institution;</text>
</subparagraph><subparagraph id="IDe5def503bc6046929851662d2495653d"><enum>(B)</enum><text>shall be deemed to mean a
covered person for all purposes of any provision of Federal consumer financial
law; and</text>
</subparagraph><subparagraph id="id139433C5D2C3400B9D49E24F88262C68"><enum>(C)</enum><text>means—</text>
<clause id="IDf5ec5dc72522487f97b167c3880d66aa"><enum>(i)</enum><text>any director, officer, or
employee charged with managerial responsibility for, or controlling shareholder
of, or agent for, such covered person;</text>
</clause><clause id="ID6747fb383ba04687b24d7b6dded8ba8e"><enum>(ii)</enum><text>any shareholder,
consultant, joint venture partner, or other person, as determined by the Bureau
(by rule or on a case-by-case basis) who materially participates in the conduct
of the affairs of such covered person; and</text>
</clause><clause id="ID66beb15f1f5b4ac2886f92e59e95673f"><enum>(iii)</enum><text>any independent
contractor (including any attorney, appraiser, or accountant) who knowingly or
recklessly participates in any—</text>
<subclause id="ID06c6b5a75e564d76b168ff33334b2f82"><enum>(I)</enum><text>violation of any
provision of law or regulation; or</text>
</subclause><subclause id="IDda38e502661b42dba283a34412c81ca8"><enum>(II)</enum><text>breach of a fiduciary
duty.</text>
</subclause></clause></subparagraph></paragraph><paragraph id="ID22a3a881c59042b5bf8490c6ffa59e14"><enum>(24)</enum><header>Service
provider</header>
<subparagraph id="ID9fbd3fa00def462ea4625c4de08ed289"><enum>(A)</enum><header>In
general</header><text>The term <term>service provider</term> means any person
that provides a material service to a covered person in connection with the
offering or provision by such covered person of a consumer financial product or
service, including a person that—</text>
<clause id="IDb403bba321894cb1925e155a4f70632d"><enum>(i)</enum><text>participates in
designing, operating, or maintaining the consumer financial product or service;
or</text>
</clause><clause id="ID0bc7f161028d42d4aa1e82f2f19d4716"><enum>(ii)</enum><text>processes transactions
relating to the consumer financial product or service (other than unknowingly
or incidentally transmitting or processing financial data in a manner that such
data is undifferentiated from other types of data of the same form as the
person transmits or processes).</text>
</clause></subparagraph><subparagraph id="IDdbb758d7801247ffbd719668228ad31c"><enum>(B)</enum><header>Exceptions</header><text>The
term <term>service provider</term> does not include a person solely by virtue
of such person offering or providing to a covered person—</text>
<clause id="IDcd7ce29d6ece4b7dbcf11db261f6ba93"><enum>(i)</enum><text>a support service of a
type provided to businesses generally or a similar ministerial service;
or</text>
</clause><clause id="ID9a1633ab75b14ef3955475b54e0c6274"><enum>(ii)</enum><text>time or space for an
advertisement for a consumer financial product or service through print,
newspaper, or electronic media.</text>
</clause></subparagraph><subparagraph id="ID46f04b585dc04669bdb6e9b51dd3be5a"><enum>(C)</enum><header>Rule of
construction</header><text>A person that is a service provider shall be deemed
to be a covered person to the extent that such person engages in the offering
or provision of its own consumer financial product or service.</text>
</subparagraph></paragraph><paragraph commented="no" id="id4DA17E110991429B8E5D046EA8AAD6DB"><enum>(25)</enum><header>State</header><text>The
term <term>State</term> means any State, territory, or possession of the United
States, the District of Columbia, the Commonwealth of Puerto Rico, the
Commonwealth of the Northern Mariana Islands, Guam, American Samoa, or the
United States Virgin Islands or any federally recognized Indian tribe, as
defined by the Secretary of the Interior under section 104(a) of the Federally
Recognized Indian Tribe List Act of 1994 (25 U.S.C. 479a–1(a)).</text>
</paragraph><paragraph id="IDafccf75118d64e9da5e355472aecd35a"><enum>(26)</enum><header>Stored
value</header><text>The term <term>stored value</term> means funds or monetary
value represented in any electronic format, whether or not specially encrypted,
and stored or capable of storage on electronic media in such a way as to be
retrievable and transferred electronically, and includes a prepaid debit card
or product, or any other similar product, regardless of whether the amount of
the funds or monetary value may be increased or reloaded.</text>
</paragraph><paragraph id="IDbcb3142afcd84c1db537c71655bf165c"><enum>(27)</enum><header>Transmitting or
exchanging funds</header><text>The term <term>transmitting or exchanging
funds</term> means receiving currency, monetary value, or payment instruments
from a consumer for the purpose of exchanging or transmitting the same by any
means, including transmission by wire, facsimile, electronic transfer, courier,
the Internet, or through bill payment services or through other businesses that
facilitate third-party transfers within the United States or to or from the
United States.</text>
</paragraph></section><subtitle id="idB3E8D8653CA24FB2A4C9B56C53850E1A"><enum>A</enum><header>Bureau of Consumer
Financial Protection</header>
<section id="idC94FC6B231224DA7B0F340DA432343B1"><enum>1011.</enum><header>Establishment of the
Bureau</header>
<subsection id="ID4b82e901768f46a895ab74cc3eac9f4a"><enum>(a)</enum><header>Bureau
established</header><text>There is established in the Federal Reserve System
the Bureau of Consumer Financial Protection, which shall regulate the offering
and provision of consumer financial products or services under the Federal
consumer financial laws.</text>
</subsection><subsection id="ID4b50f93708184c8083dd9a129a63409a"><enum>(b)</enum><header>Director and deputy
director</header>
<paragraph id="ID2af81cc46b3c4d14bb19bb94190e7e0c"><enum>(1)</enum><header>In
general</header><text>There is established the position of the Director, who
shall serve as the head of the Bureau.</text>
</paragraph><paragraph id="ID64c2ff9d1a6c41268b3f4924c11d518b"><enum>(2)</enum><header>Appointment</header><text>Subject
to paragraph (3), the Director shall be appointed by the President, by and with
the advice and consent of the Senate.</text>
</paragraph><paragraph id="ID3dbdb9bbcbd346f2b7b82bd225da80c4"><enum>(3)</enum><header>Qualification</header><text>The
President shall nominate the Director from among individuals who are citizens
of the United States.</text>
</paragraph><paragraph id="ID9019aaa3837043519112a82ee48ae56a"><enum>(4)</enum><header>Compensation</header><text>The
Director shall be compensated at the rate prescribed for level II of the
Executive Schedule under section 5313 of title 5, United States Code.</text>
</paragraph><paragraph id="id69EAFA330BDB4477A32E2BDCF16AB7A4"><enum>(5)</enum><header>Deputy
director</header><text>There is established the position of Deputy Director,
who shall—</text>
<subparagraph id="id9BA62FB135254BE8BCE21F58B7708E44"><enum>(A)</enum><text>be appointed by the
Director; and</text>
</subparagraph><subparagraph id="id0A15E3E7495D4BE7952F00B6C7ECA0E1"><enum>(B)</enum><text>serve as acting Director
in the absence or unavailability of the Director.</text>
</subparagraph></paragraph></subsection><subsection id="ID97c26754636d4fde982c133456aa25f5"><enum>(c)</enum><header>Term</header>
<paragraph id="ID3c05ec0e684242e7b0143355f07b2034"><enum>(1)</enum><header>In
general</header><text>The Director shall serve for a term of 5 years.</text>
</paragraph><paragraph id="ID3bc5a89f40ab4832b0d83e866fc35ac5"><enum>(2)</enum><header>Expiration of
term</header><text>An individual may serve as Director after the expiration of
the term for which appointed, until a successor has been appointed and
qualified.</text>
</paragraph><paragraph id="IDac51c9d01cc144888b01ff71ba748d85"><enum>(3)</enum><header>Removal for
cause</header><text>The President may remove the Director for inefficiency,
neglect of duty, or malfeasance in office.</text>
</paragraph></subsection><subsection id="IDbf1bfd0d92d443ab829b5fb234ee40d6"><enum>(d)</enum><header>Service
restriction</header><text>No Director or Deputy Director may hold any office,
position, or employment in any Federal reserve bank, Federal home loan bank,
covered person, or service provider during the period of service of such person
as Director or Deputy Director.</text>
</subsection><subsection id="ID3d0545193a404b65a8a38aaf053f9db3"><enum>(e)</enum><header>Offices</header><text>The
principal office of the Bureau shall be in the District of Columbia. The
Director may establish regional offices of the Bureau, including in cities in
which the Federal reserve banks, or branches of such banks, are located, in
order to carry out the responsibilities assigned to the Bureau under the
Federal consumer financial laws.</text>
</subsection></section><section id="IDc5eea95a6d364624974448ce3d0848ec"><enum>1012.</enum><header>Executive and
administrative powers</header>
<subsection id="ID30227b4d1edf4f86afd67aa7f075539a"><enum>(a)</enum><header>Powers of the
bureau</header><text>The Bureau is authorized to establish the general policies
of the Bureau with respect to all executive and administrative functions,
including—</text>
<paragraph id="IDd1f81bc4c2cb4b10aae521a5de24a97a"><enum>(1)</enum><text>the establishment of
rules for conducting the general business of the Bureau, in a manner not
inconsistent with this title;</text>
</paragraph><paragraph id="ID5af7d69fbfaf42f5a319d756b8faffec"><enum>(2)</enum><text>to bind the Bureau and
enter into contracts;</text>
</paragraph><paragraph id="IDc2db786210eb416da5c62b6d1dffcdfb"><enum>(3)</enum><text>directing the
establishment and maintenance of divisions or other offices within the Bureau,
in order to carry out the responsibilities under the Federal consumer financial
laws, and to satisfy the requirements of other applicable law;</text>
</paragraph><paragraph id="IDa5d22d64c9b7447ba6a4e95270ead1b7"><enum>(4)</enum><text>to coordinate and oversee
the operation of all administrative, enforcement, and research activities of
the Bureau;</text>
</paragraph><paragraph id="ID3ab0e0f410b24b93982f5ec507adfe88"><enum>(5)</enum><text>to adopt and use a
seal;</text>
</paragraph><paragraph id="ID3a23ba7a8dae4886acce1175e88fc152"><enum>(6)</enum><text>to determine the
character of and the necessity for the obligations and expenditures of the
Bureau;</text>
</paragraph><paragraph id="IDe2272a30091f4bf5974e8e0b7d1b3407"><enum>(7)</enum><text>the appointment and
supervision of personnel employed by the Bureau;</text>
</paragraph><paragraph id="IDf5107cd8736640a5a0e777287d726c14"><enum>(8)</enum><text>the distribution of
business among personnel appointed and supervised by the Director and among
administrative units of the Bureau;</text>
</paragraph><paragraph id="ID3f7b1d560f3745fdb33a46cbe43443d1"><enum>(9)</enum><text>the use and expenditure
of funds;</text>
</paragraph><paragraph id="ID355b7079d95c4957887241f766c1a2dd"><enum>(10)</enum><text>implementing the Federal
consumer financial laws through rules, orders, guidance, interpretations,
statements of policy, examinations, and enforcement actions; and</text>
</paragraph><paragraph id="IDdd9f03e44e3342f9a3c464ad84ba0ec1"><enum>(11)</enum><text>performing such other
functions as may be authorized or required by law.</text>
</paragraph></subsection><subsection id="id407447668C25497EB70A778CBEB431A7"><enum>(b)</enum><header>Delegation of
authority</header><text>The Director of the Bureau may delegate to any duly
authorized employee, representative, or agent any power vested in the Bureau by
law.</text>
</subsection><subsection id="IDfe2ee6d7df024a2395795c97a47c6c9e"><enum>(c)</enum><header>Autonomy of the
bureau</header>
<paragraph id="ID680d0c6df65043ddb34716b2fa650dfa"><enum>(1)</enum><header>Coordination with the
board of governors</header><text>Notwithstanding section 18 of the Federal
Trade Commission Act (15 U.S.C. 57a) and any other provision of law applicable
to the supervision or examination of persons with respect to Federal consumer
financial laws, the Board of Governors may delegate to the Bureau the
authorities to examine persons subject to the jurisdiction of the Board of
Governors for compliance with the Federal consumer financial laws.</text>
</paragraph><paragraph id="ID67575bc250ba4a0184a0f6e8ed84aa37"><enum>(2)</enum><header>Autonomy</header><text>Notwithstanding
the authorities granted to the Board of Governors under the Federal Reserve
Act, the Board of Governors may not—</text>
<subparagraph id="IDdfe48d1714864e75ae99d933f731dabe"><enum>(A)</enum><text>intervene in any matter
or proceeding before the Director, including examinations or enforcement
actions, unless otherwise specifically provided by law;</text>
</subparagraph><subparagraph id="IDc9723db061f844f19031aa59ab64cf69"><enum>(B)</enum><text>appoint, direct, or
remove any officer or employee of the Bureau; or</text>
</subparagraph><subparagraph id="ID37b8d6e44e72498e86a02c9538e65502"><enum>(C)</enum><text>merge or consolidate the
Bureau, or any of the functions or responsibilities of the Bureau, with any
division or office of the Board of Governors or the Federal reserve
banks.</text>
</subparagraph></paragraph><paragraph id="IDb25485fae5834a7785c91c4d7fd2f533"><enum>(3)</enum><header>Rules and
orders</header><text>No rule or order of the Bureau shall be subject to
approval or review by the Board of Governors. The Board of Governors may not
delay or prevent the issuance of any rule or order of the Bureau.</text>
</paragraph><paragraph id="IDfd5a630450d3469c896ef21629262d93"><enum>(4)</enum><header>Recommendations and
testimony</header><text>No officer or agency of the United States shall have
any authority to require the Director or any other officer of the Bureau to
submit legislative recommendations, or testimony or comments on legislation, to
any officer or agency of the United States for approval, comments, or review
prior to the submission of such recommendations, testimony, or comments to the
Congress, if such recommendations, testimony, or comments to the Congress
include a statement indicating that the views expressed therein are those of
the Director or such officer, and do not necessarily reflect the views of the
Board of Governors or the President.</text>
</paragraph></subsection></section><section id="ID7ff0badfe8184b3abecf0a8fc9a82b00"><enum>1013.</enum><header>Administration</header>
<subsection id="ID0aee77b4bf4a444fa33343f72781e82e"><enum>(a)</enum><header>Personnel</header>
<paragraph id="IDf15c8db214f94e8fad8c802bae630477"><enum>(1)</enum><header>Appointment</header>
<subparagraph id="IDbc579ff15b0644f493f5654fe85d41f8"><enum>(A)</enum><header>In
general</header><text>The Director may fix the number of, and appoint and
direct, all employees of the Bureau.</text>
</subparagraph><subparagraph id="IDfee4e96f69354db4bd52032d9e87bb35"><enum>(B)</enum><header>Employees of the
bureau</header><text>The Director is authorized to employ attorneys, compliance
examiners, compliance supervision analysts, economists, statisticians, and
other employees as may be deemed necessary to conduct the business of the
Bureau. Notwithstanding any other provision of law, all such employees shall be
appointed and compensated on terms and conditions that are consistent with the
terms and conditions set forth in section 11(l) of the Federal Reserve Act (12
U.S.C. 248(l)).</text>
</subparagraph></paragraph><paragraph id="ID4d2574021b45488095bf81cf65fc4acc"><enum>(2)</enum><header>Compensation</header><text>The
Director shall at all times provide compensation and benefits to each class of
employees that, at a minimum, are equivalent to the compensation and benefits
then being provided by the Board of Governors for the corresponding class of
employees.</text>
</paragraph></subsection><subsection id="IDcd7cca5a4dda43c4a57b916c5ebfc06e"><enum>(b)</enum><header>Specific functional
units</header>
<paragraph id="ID55bfde660f3547188549b4fbb27a21be"><enum>(1)</enum><header>Research</header><text>The
Director shall establish a unit whose functions shall include researching,
analyzing, and reporting on—</text>
<subparagraph id="IDc90f218c47f047b38d5725d8e9fb57a1"><enum>(A)</enum><text>developments in markets
for consumer financial products or services, including market areas of
alternative consumer financial products or services with high growth rates and
areas of risk to consumers;</text>
</subparagraph><subparagraph id="ID28b0aa60abc9471d82f4933b6ad91aa1"><enum>(B)</enum><text>access to fair and
affordable credit for traditionally underserved communities;</text>
</subparagraph><subparagraph id="ID425e708a0a3e432d9c5f6fe97206de9d"><enum>(C)</enum><text>consumer awareness,
understanding, and use of disclosures and communications regarding consumer
financial products or services;</text>
</subparagraph><subparagraph id="ID7e2986d7f63b45798a0a88982adfc610"><enum>(D)</enum><text>consumer awareness and
understanding of costs, risks, and benefits of consumer financial products or
services; and</text>
</subparagraph><subparagraph id="ID65e9f17e1e9944ee921a55d093fd9ed1"><enum>(E)</enum><text>consumer behavior with
respect to consumer financial products or services.</text>
</subparagraph></paragraph><paragraph id="ID5c508f72495b4b15ba26ca3161d6184a"><enum>(2)</enum><header>Community
affairs</header><text>The Director shall establish a unit whose functions shall
include providing information, guidance, and technical assistance regarding the
offering and provision of consumer financial products or services to
traditionally underserved consumers and communities.</text>
</paragraph><paragraph id="ID75e994ccd76f43e58c8d18626fc22fae"><enum>(3)</enum><header>Collecting and tracking
complaints</header>
<subparagraph id="IDb8bd4ec142be49d4b1bd10269e37114c"><enum>(A)</enum><header>In
general</header><text>The Director shall establish a unit whose functions shall
include establishing a single, toll-free telephone number, a website, and a
database or utilizing an existing database to facilitate the centralized
collection of, monitoring of, and response to consumer complaints regarding
consumer financial products or services. The Director shall coordinate with the
Federal Trade Commission or other Federal agencies to route complaints to such
agencies, where appropriate.</text>
</subparagraph><subparagraph id="ID8226831626e3491da844506d8aee97a4"><enum>(B)</enum><header>Routing calls to
States</header><text>To the extent practicable, State agencies may receive
appropriate complaints from the systems established under subparagraph (A),
if—</text>
<clause id="ID809d195322204639ae98eecf59465fff"><enum>(i)</enum><text>the State agency system
has the functional capacity to receive calls or electronic reports routed by
the Bureau systems; and</text>
</clause><clause id="ID4a39ab0884c64b3d84f55d8377c0929c"><enum>(ii)</enum><text>the State agency has
satisfied any conditions of participation in the system that the Bureau may
establish, including treatment of personally identifiable information and
sharing of information on complaint resolution or related compliance procedures
and resources.</text>
</clause></subparagraph><subparagraph id="IDe9bab39f8a8c431592a498975211af29"><enum>(C)</enum><header>Reports to the
congress</header><text>The Director shall present an annual report to Congress
not later than March 31 of each year on the complaints received by the Bureau
in the prior year regarding consumer financial products and services. Such
report shall include information and analysis about complaint numbers,
complaint types, and, where applicable, information about resolution of
complaints.</text>
</subparagraph><subparagraph id="ID2cab4ca4210945f3a09938d62bc8509b"><enum>(D)</enum><header>Data sharing
required</header><text>To facilitate preparation of the reports required under
subparagraph (C), supervision and enforcement activities, and monitoring of the
market for consumer financial products and services, the Bureau shall share
consumer complaint information with prudential regulators, the Federal Trade
Commission, other Federal agencies, and State agencies, consistent with Federal
law applicable to personally identifiable information. The prudential
regulators, the Federal Trade Commission, and other Federal agencies shall
share data relating to consumer complaints regarding consumer financial
products and services with the Bureau, consistent with Federal law applicable
to personally identifiable information.</text>
</subparagraph></paragraph></subsection><subsection id="H9D27D66A50A24C809E6F3F04FC6AA26A"><enum>(c)</enum><header>Office of Fair Lending
and Equal Opportunity</header>
<paragraph id="H36BD81E4FB7B4DCBA1C6FEE987B7250D"><enum>(1)</enum><header>Establishment</header><text display-inline="yes-display-inline">The Director shall establish within the
Bureau the Office of Fair Lending and Equal Opportunity.</text>
</paragraph><paragraph id="HF070AF02B7FD48C29714E74202EF2509"><enum>(2)</enum><header>Functions</header><text display-inline="yes-display-inline">The Office of Fair Lending and Equal
Opportunity shall have such powers and duties as the Director may delegate to
the Office, including—</text>
<subparagraph id="H8A2C287511AF4E058DB9E81AC0CFC3BF"><enum>(A)</enum><text>providing oversight and
enforcement of Federal laws intended to ensure the fair, equitable, and
nondiscriminatory access to credit for both individuals and communities that
are enforced by the Bureau, including the Equal Credit Opportunity Act and the
Home Mortgage Disclosure Act;</text>
</subparagraph><subparagraph id="HF4664D917AE143ACA513FA753C36FE35"><enum>(B)</enum><text>coordinating fair lending
and fair housing efforts of the Bureau with other Federal agencies and State
regulators, as appropriate, to promote consistent, efficient, and effective
enforcement of Federal fair lending laws;</text>
</subparagraph><subparagraph id="H5E58EBD4CF1A45D9942A67724EE035FB"><enum>(C)</enum><text>working with private
industry, fair lending, civil rights, consumer and community advocates on the
promotion of fair lending compliance and education; and</text>
</subparagraph><subparagraph id="H97B6D46C36954AADB9E67C565A4FF8D9"><enum>(D)</enum><text>providing annual reports
to Congress on the efforts of the Bureau to fulfill its fair lending
mandate.</text>
</subparagraph></paragraph><paragraph id="HF1227C41F3874B53A99BA9EB6DFA26B3"><enum>(3)</enum><header>Administration of
office</header><text>There is established the position of Assistant Director of
the Bureau for Fair Lending and Equal Opportunity, who—</text>
<subparagraph id="HFBE388E7DD724E4192E6D6F59DF81264"><enum>(A)</enum><text>shall be appointed by the
Director; and</text>
</subparagraph><subparagraph id="HBBB137A5AFBE48C4BA689A7240ACE2C8"><enum>(B)</enum><text display-inline="yes-display-inline">shall carry out such duties as the Director
may delegate to such Assistant Director.</text>
</subparagraph></paragraph></subsection><subsection id="id1B7DC9F4D76E4E6AB94A035EEAFE70E3"><enum>(d)</enum><header>Office of Financial
Literacy</header>
<paragraph id="idA1A8728320C6426DB842487C90A2803F"><enum>(1)</enum><header>Establishment</header><text display-inline="yes-display-inline">The Director shall establish an Office of
Financial Literacy, which shall be responsible for developing and implementing
initiatives intended to educate and empower consumers to make better informed
financial decisions.</text>
</paragraph><paragraph id="idE2FE627221EE490C9649C77A9C8EC9E4"><enum>(2)</enum><header>Other
Duties</header><text>The Office of Financial Literacy shall develop and
implement a strategy to improve the financial literacy of consumers that
includes measurable goals and objectives, in consultation with the Financial
Literacy and Education Commission, consistent with the National Strategy for
Financial Education, through activities including providing opportunities for
consumers to access—</text>
<subparagraph id="IDcbc40a3dfbbe40a8b7d086ccd2447ad3"><enum>(A)</enum><text>financial
counseling;</text>
</subparagraph><subparagraph id="IDc6c6d9d18588493b91323196f296f448"><enum>(B)</enum><text>information to assist
with the evaluation of credit products and the understanding of credit
histories and scores;</text>
</subparagraph><subparagraph id="IDda6ed27455a24e0789180ccae1b34125"><enum>(C)</enum><text>savings, borrowing, and
other services found at mainstream financial institutions;</text>
</subparagraph><subparagraph id="ID09bdf84049ce4968a532ea68db8abbb6"><enum>(D)</enum><text>activities intended
to—</text>
<clause id="idB65C3E8304ED4CAE95B8FE5B473DF03F"><enum>(i)</enum><text>prepare the consumer for
educational expenses and the submission of financial aid applications, and
other major purchases;</text>
</clause><clause id="idDC65236AAF63482F9F387F35870FF44B"><enum>(ii)</enum><text>reduce debt; and</text>
</clause><clause id="idB0E63D551A374DA490C59B24279E9599"><enum>(iii)</enum><text>improve the financial
situation of the consumer;</text>
</clause></subparagraph><subparagraph id="IDdd16c5703b88461a97a16f52e0f0d163"><enum>(E)</enum><text>assistance in developing
long-term savings strategies; and</text>
</subparagraph><subparagraph id="ID6a43b936e45d48dda5dafa9e09f02a99"><enum>(F)</enum><text>wealth building and
financial services during the preparation process to claim earned income tax
credits and Federal benefits.</text>
</subparagraph></paragraph><paragraph id="ID79744dd608f347bebca943eaa8c4a8b7"><enum>(3)</enum><header>Coordination</header><text>The
Office of Financial Literacy shall coordinate with other units within the
Bureau in carrying out its functions, including—</text>
<subparagraph id="IDa74c074dcfd740efac1137d3788130a7"><enum>(A)</enum><text>working with the
Community Affairs Office to implement the strategy to improve financial
literacy of consumers; and</text>
</subparagraph><subparagraph id="ID3c41020963ea4d36b679bfa293c78fb8"><enum>(B)</enum><text>working with the research
unit established by the Director to conduct research related to consumer
financial education and counseling.</text>
</subparagraph></paragraph><paragraph id="ID36a06b20bfa8445998d23655dfe12dab"><enum>(4)</enum><header>Report</header><text>Not
later than 24 months after the designated transfer date, and annually
thereafter, the Director shall submit a report on its financial literacy
activities and strategy to improve financial literacy of consumers to—</text>
<subparagraph id="IDf8ea3a122ff84c7c93746e2754b813b1"><enum>(A)</enum><text>the Committee on Banking,
Housing, and Urban Affairs of the Senate; and</text>
</subparagraph><subparagraph id="ID91fd762f935544b5940c276332865294"><enum>(B)</enum><text>the Committee on
Financial Services of the House of Representatives.</text>
</subparagraph></paragraph><paragraph commented="no" id="ID3f567137b94d415682d7fd8ed2126029"><enum>(5)</enum><header>Membership In Financial
Literacy And Education Commission</header><text display-inline="yes-display-inline">Section 513(c)(1) of the Financial Literacy
and Education Improvement Act (20 U.S.C. 9702(c)(1)) is amended—</text>
<subparagraph commented="no" id="IDb38cb1c8aac94ccdb6e62c7aa948fc56"><enum>(A)</enum><text>in subparagraph (B), by
striking <quote>and</quote> at the end;</text>
</subparagraph><subparagraph commented="no" id="IDdc3e83674d994eae9b451bf2c576e524"><enum>(B)</enum><text>by redesignating
subparagraph (C) as subparagraph (D); and</text>
</subparagraph><subparagraph commented="no" id="IDacfc0c745ae34df892c9e8bb5c90ed87"><enum>(C)</enum><text>by inserting after
subparagraph (B) the following new subparagraph:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idF39F11F8B9B746F6B3C5A21F066B3AD1" reported-display-style="italic" style="OLC">
<subparagraph commented="no" id="id90D4B0ED1D9B4E14836D65D333CB621C"><enum>(C)</enum><text>the Director of the
Bureau of Consumer Financial Protection;
and</text>
</subparagraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subparagraph></paragraph><paragraph id="IDf274793f935e48338f54aa9ce2304972"><enum>(6)</enum><header>Conforming
amendment</header><text>Section 513(d) of the Financial Literacy and Education
Improvement Act (20 U.S.C. 9702(d)) is amended by adding at the end the
following: <quote>The Director of the Bureau of Consumer Financial Protection
shall serve as the Vice Chairman.</quote>.</text>
</paragraph></subsection><subsection id="ID4dec7385428a4b6c8c9b8e8a00bdc8b3"><enum>(e)</enum><header>Office of Service
Member Affairs</header>
<paragraph id="ID333c963e24f248a39228e98696967bc5"><enum>(1)</enum><header>In
general</header><text>The Director shall establish an Office of Service Member
Affairs, which shall be responsible for developing and implementing initiatives
for service members and their families intended to—</text>
<subparagraph id="ID9caf1f99837d4639bc0c5c69473451b9"><enum>(A)</enum><text>educate and empower
service members and their families to make better informed decisions regarding
consumer financial products and services;</text>
</subparagraph><subparagraph id="IDf6ca1a73c2104bca8018475b909f0a02"><enum>(B)</enum><text>coordinate with the unit
of the Bureau established under subsection (b)(3), in order to monitor
complaints by service members and their families and responses to those
complaints by the Bureau or other appropriate Federal or State agency;
and</text>
</subparagraph><subparagraph id="ID66ab92885f7f45d89b58777df4d2017a"><enum>(C)</enum><text>coordinate efforts among
Federal and State agencies, as appropriate, regarding consumer protection
measures relating to consumer financial products and services offered to, or
used by, service members and their families.</text>
</subparagraph></paragraph><paragraph id="ID41cc9d7d6124432cb3e52cf665988715"><enum>(2)</enum><header>Coordination</header>
<subparagraph id="IDfc84413b18484ec28e6fdfad0f676582"><enum>(A)</enum><header>Regional
services</header><text>The Director is authorized to assign employees of the
Bureau as may be deemed necessary to conduct the business of the Office of
Service Member Affairs, including by establishing and maintaining the functions
of the Office in regional offices of the Bureau located near military bases,
military treatment facilities, or other similar military facilities.</text>
</subparagraph><subparagraph id="ID98961cf912114378b5f2732e81dccab4"><enum>(B)</enum><header>Agreements</header><text>The
Director is authorized to enter into memoranda of understanding and similar
agreements with the Department of Defense, including any branch or agency as
authorized by the department, in order to carry out the business of the Office
of Service Member Affairs.</text>
</subparagraph></paragraph><paragraph id="IDb3b76f83702e45b0b89da62cd80e3407"><enum>(3)</enum><header>Definition</header><text>As
used in this subsection, the term <quote>service member</quote> means any
member of the United States Armed Forces and any member of the National Guard
or Reserves.</text>
</paragraph></subsection></section><section id="IDc15a5fa0f12f49f6803370b21077d7d2"><enum>1014.</enum><header>Consumer Advisory
Board</header>
<subsection id="IDd3a708d9e48a4bc784177dd3051bdf3c"><enum>(a)</enum><header>Establishment
required</header><text>The Director shall establish a Consumer Advisory Board
to advise and consult with the Bureau in the exercise of its functions under
the Federal consumer financial laws, and to provide information on emerging
practices in the consumer financial products or services industry, including
regional trends, concerns, and other relevant information.</text>
</subsection><subsection id="IDb9debc6f26074fa09ce62f2d5bed02ee"><enum>(b)</enum><header>Membership</header><text>In
appointing the members of the Consumer Advisory Board, the Director shall seek
to assemble experts in consumer protection, financial services, community
development, fair lending, and consumer financial products or services and seek
representation of the interests of covered persons and consumers, without
regard to party affiliation. Not fewer than 6 members shall be appointed upon
the recommendation of the regional Federal Reserve Bank Presidents, on a
rotating basis.</text>
</subsection><subsection id="ID084bb6c6ff6d47dfa5a1e85b9d30eacf"><enum>(c)</enum><header>Meetings</header><text>The
Consumer Advisory Board shall meet from time to time at the call of the
Director, but, at a minimum, shall meet at least twice in each year.</text>
</subsection><subsection id="ID9de6e0ce77844975adb5e373ef9deaa8"><enum>(d)</enum><header>Compensation and travel
expenses</header><text>Members of the Consumer Advisory Board who are not
full-time employees of the United States shall—</text>
<paragraph id="ID559ece366e564b1baf515bca0e8980fb"><enum>(1)</enum><text>be entitled to receive
compensation at a rate fixed by the Director while attending meetings of the
Consumer Advisory Board, including travel time; and</text>
</paragraph><paragraph id="IDdb3dcd116ed44282801a4e0c0d802ada"><enum>(2)</enum><text>be allowed travel
expenses, including transportation and subsistence, while away from their homes
or regular places of business.</text>
</paragraph></subsection></section><section id="IDedbfac2002c9428dbdfc99fb38d7825f"><enum>1015.</enum><header>Coordination</header><text display-inline="no-display-inline">The Bureau shall coordinate with the
Commission, the Commodity Futures Trading Commission, the Federal Trade
Commission, and other Federal agencies and State regulators, as appropriate, to
promote consistent regulatory treatment of consumer financial and investment
products and services.</text>
</section><section id="ID1b031083993d4b9190932dc89fe0accd"><enum>1016.</enum><header>Appearances before
and reports to Congress</header>
<subsection id="ID6b85227b331d49d48ea3316dcaa6df95"><enum>(a)</enum><header>Appearances before
congress</header><text>The Director of the Bureau shall appear before the
Committee on Banking, Housing, and Urban Affairs of the Senate and the
Committee on Financial Services of the House of Representatives at semi-annual
hearings regarding the reports required under subsection (b).</text>
</subsection><subsection id="ID9db5c093852449f0aafb2b9d934d50f0"><enum>(b)</enum><header>Reports
required</header><text>The Bureau shall, concurrent with each semi-annual
hearing referred to in subsection (a), prepare and submit to the President and
to the Committee on Banking, Housing, and Urban Affairs of the Senate and the
Committee on Financial Services of the House of Representatives, a report,
beginning with the session following the designated transfer date.</text>
</subsection><subsection id="ID0eb24f33d7284a1d903a9b0fdde89c44"><enum>(c)</enum><header>Contents</header><text>The
reports required by subsection (b) shall include—</text>
<paragraph id="IDedb728a9235e4feb8e16b45dcb6e6b3c"><enum>(1)</enum><text>a discussion of the
significant problems faced by consumers in shopping for or obtaining consumer
financial products or services;</text>
</paragraph><paragraph id="id88A1C0986ECC4019B7DD075A9F5B6C2C"><enum>(2)</enum><text>a justification of the
budget request of the previous year;</text>
</paragraph><paragraph id="ID1d1fd08eaefe4dd980378491aa3994b4"><enum>(3)</enum><text>a list of the significant
rules and orders adopted by the Bureau, as well as other significant
initiatives conducted by the Bureau, during the preceding year and the plan of
the Bureau for rules, orders, or other initiatives to be undertaken during the
upcoming period;</text>
</paragraph><paragraph id="ID7ca531f325b44afcbee6596fe66666cc"><enum>(4)</enum><text>an analysis of complaints
about consumer financial products or services that the Bureau has received and
collected in its central database on complaints during the preceding
year;</text>
</paragraph><paragraph id="IDdf2feed6ab854da7b6da38996a955a5b"><enum>(5)</enum><text>a list, with a brief
statement of the issues, of the public supervisory and enforcement actions to
which the Bureau was a party during the preceding year;</text>
</paragraph><paragraph id="IDa81de0d3a67e4c4ba034018f639e402b"><enum>(6)</enum><text>the actions taken
regarding rules, orders, and supervisory actions with respect to covered
persons which are not credit unions or depository institutions;</text>
</paragraph><paragraph id="IDea1cebf5a48546d9a4b8a321c33bffcb"><enum>(7)</enum><text>an assessment of
significant actions by State attorneys general or State regulators relating to
Federal consumer financial law; and</text>
</paragraph><paragraph id="ID50fd0bb9a203441fae11001d317e258d"><enum>(8)</enum><text>an analysis of the
efforts of the Bureau to fulfill the fair lending mission of the Bureau.</text>
</paragraph></subsection></section><section id="IDce478e362910433889e92dbbd4f9285e"><enum>1017.</enum><header>Funding; penalties
and fines</header>
<subsection id="IDe2be18a908cd465f818ab1aa8e537778"><enum>(a)</enum><header>Transfer of funds from
Board Of Governors</header>
<paragraph id="ID41acdcfa2726459bb34a3e24dee7688f"><enum>(1)</enum><header>In
general</header><text>Each year (or quarter of such year), beginning on the
designated transfer date, and each quarter thereafter, the Board of Governors
shall transfer to the Bureau from the combined earnings of the Federal Reserve
System, the amount determined by the Director to be reasonably necessary to
carry out the authorities of the Bureau under Federal consumer financial law,
taking into account such other sums made available to the Bureau from the
preceding year (or quarter of such year).</text>
</paragraph><paragraph id="ID144aa7cc36d642b08776747762c12ed6"><enum>(2)</enum><header>Funding cap</header>
<subparagraph id="id007ADB070DC94521ADA5D1BE685F8C1D"><enum>(A)</enum><header>In
general</header><text>Notwithstanding paragraph (1), and in accordance with
this paragraph, the amount that shall be transferred to the Bureau in each
fiscal year shall not exceed a fixed percentage of the total operating expenses
of the Federal Reserve System, as reported in the Annual Report, 2009, of the
Board of Governors, equal to—</text>
<clause id="ID5516c8dd09e149f0a60872d373ade654"><enum>(i)</enum><text>10 percent of such
expenses in fiscal year 2011;</text>
</clause><clause id="ID61da24d3b52645b2a84ecf781d26f9b2"><enum>(ii)</enum><text>11 percent of such
expenses in fiscal year 2012; and</text>
</clause><clause id="IDdfe1b123e5d74e299ee31387ddc3082c"><enum>(iii)</enum><text>12 percent of such
expenses in fiscal year 2013, and in each year thereafter.</text>
</clause></subparagraph><subparagraph id="ID4cb56fdf9648442280190d10f99d8ef5"><enum>(B)</enum><header>Amount adjusted for
inflation</header><text>The dollar amount referred to in subparagraph (A)(iii)
shall be adjusted annually, using the percent by which the average urban
consumer price index for the quarter preceding the date of the payment differs
from the average of that index for the same quarter in the prior year.</text>
</subparagraph></paragraph><paragraph id="ID9c197cdc55fd4c33b162021dec7adad0"><enum>(3)</enum><header>Transition
period</header><text>Beginning on the date of enactment of this Act and until
the designated transfer date, the Board of Governors shall transfer to the
Bureau the amount estimated by the Secretary needed to carry out the
authorities granted to the Bureau under Federal consumer financial law, from
the date of enactment of this Act until the designated transfer date.</text>
</paragraph><paragraph id="ID710c201a831741bda840143f3aed02ec"><enum>(4)</enum><header>Budget and financial
management</header>
<subparagraph id="ID10456e6bfcbb4b1092a2bb6fb74062c6"><enum>(A)</enum><header>Financial operating
plans and forecasts</header><text>The Director shall provide to the Director of
the Office of Management and Budget copies of the financial operating plans and
forecasts of the Director, as prepared by the Director in the ordinary course
of the operations of the Bureau, and copies of the quarterly reports of the
financial condition and results of operations of the Bureau, as prepared by the
Director in the ordinary course of the operations of the Bureau.</text>
</subparagraph><subparagraph id="ID0c3ad001135d46cfb32ee97af0948f15"><enum>(B)</enum><header>Financial
statements</header><text>The Bureau shall prepare annually a statement
of—</text>
<clause id="IDdaea7d6da9ac418b984234e8d80a0af6"><enum>(i)</enum><text>assets and liabilities
and surplus or deficit;</text>
</clause><clause id="ID8ccd96c87b8146c29095615bcd50e721"><enum>(ii)</enum><text>income and expenses;
and</text>
</clause><clause id="IDd932f350abfb47e5b7569c55f44ea769"><enum>(iii)</enum><text>sources and application
of funds.</text>
</clause></subparagraph><subparagraph id="IDa67abc6876c24996ae3f87db0f19a5e9"><enum>(C)</enum><header>Financial management
systems</header><text>The Bureau shall implement and maintain financial
management systems that comply substantially with Federal financial management
systems requirements and applicable Federal accounting standards.</text>
</subparagraph><subparagraph id="ID9fbe2f2d36004bd1913a4563f5e21e96"><enum>(D)</enum><header>Assertion of internal
controls</header><text>The Director shall provide to the Comptroller General of
the United States an assertion as to the effectiveness of the internal controls
that apply to financial reporting by the Bureau, using the standards
established in section 3512(c) of title 31, United States Code.</text>
</subparagraph><subparagraph id="IDbf399e736e04414db1030446fb4d02ad"><enum>(E)</enum><header>Rule of
construction</header><text>This subsection may not be construed as implying any
obligation on the part of the Director to consult with or obtain the consent or
approval of the Director of the Office of Management and Budget with respect to
any report, plan, forecast, or other information referred to in subparagraph
(A) or any jurisdiction or oversight over the affairs or operations of the
Bureau.</text>
</subparagraph></paragraph><paragraph id="IDb90546cb0353492295cc88d4f95e1e8e"><enum>(5)</enum><header>Audit of the
bureau</header>
<subparagraph id="ID7f6d52aea885497f86dfbb52a722a3bc"><enum>(A)</enum><header>In
general</header><text>The Comptroller General shall annually audit the
financial transactions of the Bureau in accordance with the United States
generally accepted government auditing standards, as may be prescribed by the
Comptroller General of the United States. The audit shall be conducted at the
place or places where accounts of the Bureau are normally kept. The
representatives of the Government Accountability Office shall have access to
the personnel and to all books, accounts, documents, papers, records (including
electronic records), reports, files, and all other papers, automated data,
things, or property belonging to or under the control of or used or employed by
the Bureau pertaining to its financial transactions and necessary to facilitate
the audit, and such representatives shall be afforded full facilities for
verifying transactions with the balances or securities held by depositories,
fiscal agents, and custodians. All such books, accounts, documents, records,
reports, files, papers, and property of the Bureau shall remain in possession
and custody of the Bureau. The Comptroller General may obtain and duplicate any
such books, accounts, documents, records, working papers, automated data and
files, or other information relevant to such audit without cost to the
Comptroller General, and the right of access of the Comptroller General to such
information shall be enforceable pursuant to section 716(c) of title 31, United
States Code.</text>
</subparagraph><subparagraph id="ID6ce22707557a4f458a97127fe17c67d1"><enum>(B)</enum><header>Report</header><text>The
Comptroller General shall submit to the Congress a report of each annual audit
conducted under this subsection. The report to the Congress shall set forth the
scope of the audit and shall include the statement of assets and liabilities
and surplus or deficit, the statement of income and expenses, the statement of
sources and application of funds, and such comments and information as may be
deemed necessary to inform Congress of the financial operations and condition
of the Bureau, together with such recommendations with respect thereto as the
Comptroller General may deem advisable. A copy of each report shall be
furnished to the President and to the Bureau at the time submitted to the
Congress.</text>
</subparagraph><subparagraph id="IDa364ab514e3e41a38486d87861268c8d"><enum>(C)</enum><header>Assistance and
costs</header><text>For the purpose of conducting an audit under this
subsection, the Comptroller General may, in the discretion of the Comptroller
General, employ by contract, without regard to section 3709 of the Revised
Statutes of the United States (41 U.S.C. 5), professional services of firms and
organizations of certified public accountants for temporary periods or for
special purposes. Upon the request of the Comptroller General, the Director of
the Bureau shall transfer to the Government Accountability Office from funds
available, the amount requested by the Comptroller General to cover the full
costs of any audit and report conducted by the Comptroller General. The
Comptroller General shall credit funds transferred to the account established
for salaries and expenses of the Government Accountability Office, and such
amount shall be available upon receipt and without fiscal year limitation to
cover the full costs of the audit and report.</text>
</subparagraph></paragraph></subsection><subsection commented="no" id="IDf77577d70ee34a1d8e7b988b686067e6"><enum>(b)</enum><header>Consumer Financial
Protection Fund</header>
<paragraph commented="no" id="ID8d327ee4fe554a0995356622a39c97cc"><enum>(1)</enum><header>Separate fund in
Federal Reserve Board established</header><text>There is established in the
Federal Reserve Board a separate fund, to be known as the <quote>Consumer
Financial Protection Fund</quote> (referred to in this section as the
<quote>Bureau Fund</quote>).</text>
</paragraph><paragraph commented="no" id="ID1703cc4ee5804bcc9008bab09f38630b"><enum>(2)</enum><header>Fund
receipts</header><text>All amounts transferred to the Bureau under subsection
(a) shall be deposited into the Bureau Fund.</text>
</paragraph><paragraph commented="no" id="IDa81d64f1b5f9400092caf59d275e6468"><enum>(3)</enum><header>Investment
authority</header>
<subparagraph commented="no" id="ID6f82e13c5d9e48f384f75c74ab5eba41"><enum>(A)</enum><header>Amounts in Bureau fund
may be invested</header><text>The Bureau may request the Board of Governors to
invest the portion of the Bureau Fund that is not, in the judgment of the
Bureau, required to meet the current needs of the Bureau.</text>
</subparagraph><subparagraph commented="no" id="ID78fd53a9aafb435d887937c989f03f4e"><enum>(B)</enum><header>Eligible
investments</header><text>Investments authorized by this paragraph shall be
made by the Board of Governors in obligations of the United States or
obligations that are guaranteed as to principal and interest by the United
States, with maturities suitable to the needs of the Bureau Fund, as determined
by the Bureau.</text>
</subparagraph><subparagraph commented="no" id="ID20b64e913e414ea6baf3ff79ef8d5a82"><enum>(C)</enum><header>Interest and proceeds
credited</header><text>The interest on, and the proceeds from the sale or
redemption of, any obligations held in the Bureau Fund shall be credited to the
Bureau Fund.</text>
</subparagraph></paragraph></subsection><subsection id="ID6d02c2e21ac141f881bd92816d3e713e"><enum>(c)</enum><header>Use of Funds</header>
<paragraph id="IDdba1bcf4d8cb4725b8aac133c67da969"><enum>(1)</enum><header>In
general</header><text>Funds obtained by, transferred to, or credited to the
Bureau Fund shall be immediately available to the Bureau and under the control
of the Director, and shall remain available until expended, to pay the expenses
of the Bureau in carrying out its duties and responsibilities. The compensation
of the Director and other employees of the Bureau and all other expenses
thereof may be paid from, obtained by, transferred to, or credited to the
Bureau Fund under this section.</text>
</paragraph><paragraph id="IDb6c6c7fb75934761b17a4638c30f8877"><enum>(2)</enum><header>Funds that are not
government funds</header><text>Funds obtained by or transferred to the Bureau
Fund shall not be construed to be Government funds or appropriated
monies.</text>
</paragraph><paragraph id="ID931b0ec2c70543c5aa1f7ecf74a192b1"><enum>(3)</enum><header>Amounts not subject to
apportionment</header><text>Notwithstanding any other provision of law, amounts
in the Bureau Fund and in the Civil Penalty Fund established under subsection
(d) shall not be subject to apportionment for purposes of chapter 15 of title
31, United States Code, or under any other authority.</text>
</paragraph></subsection><subsection id="IDff0441276ca449d49d754aecae1e7439"><enum>(d)</enum><header>Penalties and
Fines</header>
<paragraph id="ID8c7d1c28539a413ea489018199979342"><enum>(1)</enum><header>Establishment of
victims relief fund</header><text>There is established in the Federal Reserve
Board a fund to be known as the <quote>Consumer Financial Protection Civil
Penalty Fund</quote> (referred to in this subsection as the <quote>Civil
Penalty Fund</quote>). If the Bureau obtains a civil penalty against any person
in any judicial or administrative action under Federal consumer financial laws,
the Bureau shall deposit into the Civil Penalty Fund, the amount of the penalty
collected.</text>
</paragraph><paragraph id="ID40a2d32ac6b34ad1894cf36d8943d1b7"><enum>(2)</enum><header>Payment to
victims</header><text>Amounts in the Civil Penalty Fund shall be available to
the Bureau, without fiscal year limitation, for payments to the victims of
activities for which civil penalties have been imposed under the Federal
consumer financial laws. To the extent such victims cannot be located or such
payments are otherwise not practicable, the Bureau may use such funds for the
purpose of consumer education and financial literacy programs.</text>
</paragraph></subsection></section><section id="IDd028b766cf1c439d85dfbd7b56db88ae"><enum>1018.</enum><header>Effective
date</header><text display-inline="no-display-inline">This subtitle shall
become effective on the date of enactment of this Act.</text>
</section></subtitle><subtitle id="id6742674548234A429DA638829EF10015"><enum>B</enum><header>General Powers of the
Bureau</header>
<section id="ID77f659008bb0423f9d809ff90bfca563"><enum>1021.</enum><header>Purpose, objectives,
and functions</header>
<subsection id="IDa91ba62e5c8a428d84c7ea6ba73a79ba"><enum>(a)</enum><header>Purpose</header><text>The
Bureau shall seek to implement and, where applicable, enforce Federal consumer
financial law consistently for the purpose of ensuring that markets for
consumer financial products and services are fair, transparent, and
competitive.</text>
</subsection><subsection id="ID8f501251f7e94d7b898fe3b5df4408d8"><enum>(b)</enum><header>Objectives</header><text>The
Bureau is authorized to exercise its authorities under Federal consumer
financial law for the purposes of ensuring that, with respect to consumer
financial products and services—</text>
<paragraph id="ID45a87d11a1ee4cf09476df82bc91c0d5"><enum>(1)</enum><text>consumers are provided
with timely and understandable information to make responsible decisions about
financial transactions;</text>
</paragraph><paragraph id="ID0dcec289e4e3489caa47c3cb43267b0c"><enum>(2)</enum><text>consumers are protected
from unfair, deceptive, or abusive acts and practices and from
discrimination;</text>
</paragraph><paragraph id="ID1676987906fe4c73943454e71f7454da"><enum>(3)</enum><text>outdated, unnecessary, or
unduly burdensome regulations are regularly identified and addressed in order
to reduce unwarranted regulatory burdens;</text>
</paragraph><paragraph id="ID76f723987c7d4ff6a4e646a2dda87ac7"><enum>(4)</enum><text>Federal consumer
financial law is enforced consistently, without regard to the status of a
person as a depository institution, in order to promote fair competition;
and</text>
</paragraph><paragraph id="IDe0c5dd41c23249888e8c9e29d3d679af"><enum>(5)</enum><text>markets for consumer
financial products and services operate transparently and efficiently to
facilitate access and innovation.</text>
</paragraph></subsection><subsection id="ID3618b7d02b5340598bf9487eec19899d"><enum>(c)</enum><header>Functions</header><text>The
primary functions of the Bureau are—</text>
<paragraph id="IDe42633f4ebd7450bb0d2615dd2a3cb34"><enum>(1)</enum><text>conducting financial
education programs;</text>
</paragraph><paragraph id="IDf9ea15a838da438c87094b354877d7d5"><enum>(2)</enum><text>collecting,
investigating, and responding to consumer complaints;</text>
</paragraph><paragraph id="IDff11c7e489dd4cfebf42f2dcbea856fa"><enum>(3)</enum><text>collecting, researching,
monitoring, and publishing information relevant to the functioning of markets
for consumer financial products and services to identify risks to consumers and
the proper functioning of such markets;</text>
</paragraph><paragraph id="IDf9b7f5cf40c848d391357156ce261a8b"><enum>(4)</enum><text>subject to sections 1024
through 1026, supervising covered persons for compliance with Federal consumer
financial law, and taking appropriate enforcement action to address violations
of Federal consumer financial law;</text>
</paragraph><paragraph id="id0D0AA4176B7140B8A9A8BA27A8136F4C"><enum>(5)</enum><text>issuing rules, orders,
and guidance implementing Federal consumer financial law; and</text>
</paragraph><paragraph id="IDde0ff1cc949c472daa18f4dea3a30a71"><enum>(6)</enum><text>performing such support
activities as may be necessary or useful to facilitate the other functions of
the Bureau.</text>
</paragraph></subsection></section><section id="IDf9e9b305e531450d9f9ed4fafda559ba"><enum>1022.</enum><header>Rulemaking
authority</header>
<subsection id="ID36ccbb1b589648c49ffb6fb40dd7dbe9"><enum>(a)</enum><header>In
general</header><text>The Bureau is authorized to exercise its authorities
under Federal consumer financial law to administer, enforce, and otherwise
implement the provisions of Federal consumer financial law.</text>
</subsection><subsection id="ID020ec3d019494b1b8b245c0035a66837"><enum>(b)</enum><header>Rulemaking, orders, and
guidance</header>
<paragraph id="id295E0C5DDA1146D9B2C6586A1674E950"><enum>(1)</enum><header>General
authority</header><text>The Director may prescribe rules and issue orders and
guidance, as may be necessary or appropriate to enable the Bureau to administer
and carry out the purposes and objectives of the Federal consumer financial
laws, and to prevent evasions thereof.</text>
</paragraph><paragraph id="ID68a136ad1d3747e79ba9826365251dff"><enum>(2)</enum><header>Standards for
rulemaking</header><text>In prescribing a rule under the Federal consumer
financial laws—</text>
<subparagraph id="ID0ade772b1e3b48d097e93cc901df2e70"><enum>(A)</enum><text>the Bureau shall consider
the potential benefits and costs to consumers and covered persons, including
the potential reduction of access by consumers to consumer financial products
or services resulting from such rule;</text>
</subparagraph><subparagraph id="ID9bb56df0d9044e898786a3617ec1d008"><enum>(B)</enum><text>the Bureau shall consult
with the appropriate prudential regulators or other Federal agencies prior to
proposing a rule and during the comment process regarding consistency with
prudential, market, or systemic objectives administered by such agencies;
and</text>
</subparagraph><subparagraph id="ID5d94adb8fcce4497beacd3355105985f"><enum>(C)</enum><text>if, during the
consultation process described in subparagraph (B), a prudential regulator
provides the Bureau with a written objection to the proposed rule of the Bureau
or a portion thereof, the Bureau shall include in the adopting release a
description of the objection and the basis for the Bureau decision, if any,
regarding such objection, except that nothing in this clause shall be construed
as altering or limiting the procedures under section 1023 that may apply to any
rule prescribed by the Bureau.</text>
</subparagraph></paragraph><paragraph id="IDfa4de16248a8487ab2949fb445f7c4ab"><enum>(3)</enum><header>Exemptions</header>
<subparagraph id="ID4f80c77437ce427ab7a9b43e49920dec"><enum>(A)</enum><header>In
general</header><text>The Bureau, by rule, may conditionally or unconditionally
exempt any class of covered persons, service providers, or consumer financial
products or services, from any provision of this title, or from any rule issued
under this title, as the Bureau determines necessary or appropriate to carry
out the purposes and objectives of this title, taking into consideration the
factors in subparagraph (B).</text>
</subparagraph><subparagraph id="ID310d0f17bd134d2cbaae47b17c7f9475"><enum>(B)</enum><header>Factors</header><text>In
issuing an exemption, as permitted under subparagraph (A), the Bureau shall, as
appropriate, take into consideration—</text>
<clause id="IDd92496b11b5249a0916e252658740979"><enum>(i)</enum><text>the total assets of the
class of covered persons;</text>
</clause><clause id="IDcf121ecffc6f4f0682080d758a354b54"><enum>(ii)</enum><text>the volume of
transactions involving consumer financial products or services in which the
class of covered persons engages; and</text>
</clause><clause id="ID88b734ce60fd4c09a4dfe4b86e16e419"><enum>(iii)</enum><text>existing provisions of
law which are applicable to the consumer financial product or service and the
extent to which such provisions provide consumers with adequate
protections.</text>
</clause></subparagraph></paragraph><paragraph id="idD1B19BE2484148878B28C1BA3B5FB916"><enum>(4)</enum><header>Exclusive rulemaking
authority</header><text>Notwithstanding any other provisions of Federal law and
except as provided in section 1061(b)(5), to the extent that a provision of
Federal consumer financial law authorizes the Bureau and another Federal agency
to issue regulations under that provision of law for purposes of assuring
compliance with Federal consumer financial law and any regulations thereunder,
the Bureau shall have the exclusive authority to prescribe rules subject to
those provisions of law.</text>
</paragraph></subsection><subsection id="ID5b37fe3d1eff4535ae1fb0a48145f95f"><enum>(c)</enum><header>Monitoring</header>
<paragraph id="ID1c3e1f45ff0844beab30d9f7c40184cc"><enum>(1)</enum><header>In
general</header><text>In order to support its rulemaking and other functions,
the Bureau shall monitor for risks to consumers in the offering or provision of
consumer financial products or services, including developments in markets for
such products or services.</text>
</paragraph><paragraph id="id82F99D03E09F4D0CA963B3A7E9B15A9F"><enum>(2)</enum><header>Considerations</header><text>In
allocating its resources to perform the monitoring required by this section,
the Bureau may consider, among other factors—</text>
<subparagraph id="ID7d69bedda0954f549ec1114e2cc064a0"><enum>(A)</enum><text>likely risks and costs to
consumers associated with buying or using a type of consumer financial product
or service;</text>
</subparagraph><subparagraph id="ID08c484b1c6d740b8bcd04abe97268699"><enum>(B)</enum><text>understanding by
consumers of the risks of a type of consumer financial product or
service;</text>
</subparagraph><subparagraph id="IDdb2bc700cfd546a796079371512e212d"><enum>(C)</enum><text>the legal protections
applicable to the offering or provision of a consumer financial product or
service, including the extent to which the law is likely to adequately protect
consumers;</text>
</subparagraph><subparagraph id="ID1fbea91f8560497ab5ec9971a6d78b81"><enum>(D)</enum><text>rates of growth in the
offering or provision of a consumer financial product or service;</text>
</subparagraph><subparagraph id="ID3797a55b97314df989f2676df1a19d56"><enum>(E)</enum><text>the extent, if any, to
which the risks of a consumer financial product or service may
disproportionately affect traditionally underserved consumers; or</text>
</subparagraph><subparagraph id="IDc14403c3cd6846c7ab769044597e10aa"><enum>(F)</enum><text>the types, number, and
other pertinent characteristics of covered persons that offer or provide the
consumer financial product or service.</text>
</subparagraph></paragraph><paragraph id="ID9184d86ece1e4de2807595f39f7ac5f3"><enum>(3)</enum><header>Reports</header><text>The
Bureau shall publish not fewer than 1 report of significant findings of its
monitoring required by this subsection in each calendar year, beginning with
the first calendar year that begins at least 1 year after the designated
transfer date.</text>
</paragraph><paragraph commented="no" id="IDd95c779838ac49a081384bda8af275ac"><enum>(4)</enum><header>Collection of
information</header><text>In conducting research on the offering and provision
of consumer financial products or services, the Bureau shall have the authority
to gather information from time to time regarding the organization, business
conduct, markets, and activities of persons operating in consumer financial
services markets. In order to gather such information, the Bureau may—</text>
<subparagraph commented="no" id="IDc101c1cffce84c00ba0c5c91f8c1a90d"><enum>(A)</enum><text>gather and compile
information from examination reports concerning covered persons or service
providers, assessment of consumer complaints, surveys, and interviews of
covered persons and consumers, and review of available databases;</text>
</subparagraph><subparagraph commented="no" id="ID448f6f2f674e4740abbaedd4ab0e1cbf"><enum>(B)</enum><text>require persons to file
with the Bureau, under oath or otherwise, in such form and within such
reasonable period of time as the Bureau may prescribe, by rule or order, annual
or special reports, or answers in writing to specific questions, furnishing
such information as the Bureau may require; and</text>
</subparagraph><subparagraph commented="no" id="IDa515cea7c7274a17b65bf62cf13917a2"><enum>(C)</enum><text>make public such
information obtained by the Bureau under this section, as is in the public
interest in reports or otherwise in the manner best suited for public
information and use.</text>
</subparagraph></paragraph><paragraph commented="no" id="IDaaa424ebec0c47b6a982e978ce444865"><enum>(5)</enum><header>Confidentiality
rules</header><text>The Bureau shall prescribe rules regarding the confidential
treatment of information obtained from persons in connection with the exercise
of its authorities under Federal consumer financial law.</text>
<subparagraph commented="no" id="ID708f03526a42445f824df364fad1eb72"><enum>(A)</enum><header>Access by the bureau to
reports of other regulators</header>
<clause commented="no" id="ID278d09afbf904983a35a3112ae983e5e"><enum>(i)</enum><header>Examination and
financial condition reports</header><text>Upon providing reasonable assurances
of confidentiality, the Bureau shall have access to any report of examination
or financial condition made by a prudential regulator or other Federal agency
having jurisdiction over a covered person or service provider, and to all
revisions made to any such report.</text>
</clause><clause commented="no" id="IDc4d6e0aa96774d5880cfafcc7c816a1c"><enum>(ii)</enum><header>Provision of other
reports to the bureau</header><text>In addition to the reports described in
clause (i), a prudential regulator or other Federal agency having jurisdiction
over a covered person or service provider may, in its discretion, furnish to
the Bureau any other report or other confidential supervisory information
concerning any insured depository institution, credit union, or other entity
examined by such agency under authority of any provision of Federal law.</text>
</clause></subparagraph><subparagraph commented="no" id="ID9c2ab6d5d9b947408c1d095b783aa44c"><enum>(B)</enum><header>Access by other
regulators to reports of the bureau</header>
<clause commented="no" id="IDd50d182840784cc499e0095f10e846f8"><enum>(i)</enum><header>Examination
reports</header><text>Upon providing reasonable assurances of confidentiality,
a prudential regulator, a State regulator, or any other Federal agency having
jurisdiction over a covered person or service provider shall have access to any
report of examination made by the Bureau with respect to such person, and to
all revisions made to any such report.</text>
</clause><clause commented="no" id="ID4ebd29f2869e4683af77ec4415aeefef"><enum>(ii)</enum><header>Provision of other
reports to other regulators</header><text>In addition to the reports described
in clause (i), the Bureau may, in its discretion, furnish to a prudential
regulator or other agency having jurisdiction over a covered person or service
provider any other report or other confidential supervisory information
concerning such person examined by the Bureau under the authority of any other
provision of Federal law.</text>
</clause></subparagraph></paragraph><paragraph commented="no" id="ID4f4ef43cf8c641e68d3e80fe5f7aea1d"><enum>(6)</enum><header>Privacy
considerations</header><text>In collecting information from any person,
publicly releasing information held by the Bureau, or requiring covered persons
to publicly report information, the Bureau shall take steps to ensure that
proprietary, personal, or confidential consumer information that is protected
from public disclosure under section 552(b) or 552a of title 5, United States
Code, or any other provision of law, is not made public under this
title.</text>
</paragraph></subsection><subsection id="ID5cbd5474fd5945aa83e54495deaca720"><enum>(d)</enum><header>Assessment of
significant rules</header>
<paragraph id="ID6ae17ef0dcc74c99b87b138502f14f79"><enum>(1)</enum><header>In
general</header><text>The Bureau shall conduct an assessment of each
significant rule or order adopted by the Bureau under Federal consumer
financial law. The assessment shall address, among other relevant factors, the
effectiveness of the rule or order in meeting the purposes and objectives of
this title and the specific goals stated by the Bureau. The assessment shall
reflect available evidence and any data that the Bureau reasonably may
collect.</text>
</paragraph><paragraph id="ID7a36168ceefa41b495972bab7151c6fb"><enum>(2)</enum><header>Reports</header><text>The
Bureau shall publish a report of its assessment under this subsection not later
than 5 years after the effective date of the subject rule or order.</text>
</paragraph><paragraph id="ID151439914f1b4ae6a2a50b117c381489"><enum>(3)</enum><header>Public comment
required</header><text>Before publishing a report of its assessment, the Bureau
shall invite public comment on recommendations for modifying, expanding, or
eliminating the newly adopted significant rule or order.</text>
</paragraph></subsection><subsection id="ID2039490fef1145db8ad2275461cd1563"><enum>(e)</enum><header>Information
gathering</header><text>In conducting any monitoring or assessment required by
this section, the Bureau may gather information through a variety of methods,
including by conducting surveys or interviews of consumers.</text>
</subsection></section><section commented="no" id="IDe34d36e16fa5412f9e759014605bd2d3"><enum>1023.</enum><header>Review of Bureau
Regulations</header>
<subsection commented="no" id="ID39a1614ef8dd41888ebc79901f516221"><enum>(a)</enum><header>Review of bureau
regulations</header><text>On the petition of a member agency of the Council,
the Council may set aside a final regulation prescribed by the Bureau, or any
provision thereof, if the Council decides, in accordance with subsection (c),
that the regulation or provision would put the safety and soundness of the
United States banking system or the stability of the financial system of the
United States at risk.</text>
</subsection><subsection commented="no" id="IDe4e23248fa7647e6ac8a76518706386a"><enum>(b)</enum><header>Petition</header>
<paragraph commented="no" id="ID1ee0eabc32fa4a61bd4def534a636610"><enum>(1)</enum><header>Procedure</header><text>An
agency represented by a member of the Council may petition the Council, in
writing, and in accordance with rules prescribed pursuant to subsection (f), to
stay the effectiveness of, or set aside, a regulation if the member agency
filing the petition—</text>
<subparagraph commented="no" id="ID331a811e1af641de98262aa800711a2c"><enum>(A)</enum><text>has in good faith
attempted to work with the Bureau to resolve concerns regarding the effect of
the rule on the safety and soundness of the United States banking system or the
stability of the financial system of the United States; and</text>
</subparagraph><subparagraph commented="no" id="IDda9a60dd6c154662b6776c55ad8ef73a"><enum>(B)</enum><text>files the petition with
the Council not later than 10 days after the date on which the regulation has
been published in the Federal Register.</text>
</subparagraph></paragraph><paragraph commented="no" id="ID001f15cc3ff144a9b8b85dd1e194f9c8"><enum>(2)</enum><header>Publication</header><text>Any
petition filed with the Council under this section shall be published in the
Federal Register and transmitted contemporaneously with filing to the Committee
on Banking, Housing, and Urban Affairs of the Senate and the Committee on
Financial Services of the House of Representatives.</text>
</paragraph></subsection><subsection commented="no" id="IDe993ae41fc3e4b76a1d70de2bab40576"><enum>(c)</enum><header>Stays and set
asides</header>
<paragraph commented="no" id="id4435A0A2F0054F0388F5AF1D4F50B194"><enum>(1)</enum><header>Stay</header>
<subparagraph commented="no" id="id55B701869B1E419D95881C7891E24D80"><enum>(A)</enum><header>In
general</header><text>Upon the request of any member agency, the Chairperson of
the Council may stay the effectiveness of a regulation for the purpose of
allowing appropriate consideration of the petition by the Council.</text>
</subparagraph><subparagraph commented="no" id="idA306CD44D8374BAA8B997D294687F4DD"><enum>(B)</enum><header>Expiration</header><text>A
stay issued under this paragraph shall expire on the earlier of—</text>
<clause commented="no" id="idB307684C40DA414A80F7AC64AC26670A"><enum>(i)</enum><text>90 days after the date of
filing of the petition under subsection (b); or</text>
</clause><clause commented="no" id="id3A086BA2193442E6ADA6CADF6AFC390C"><enum>(ii)</enum><text>the date on which the
Council makes a decision under paragraph (3).</text>
</clause></subparagraph></paragraph><paragraph commented="no" id="idDF91B1A7F69742668724E4447D269D1E"><enum>(2)</enum><header>No adverse
inference</header><text>After the expiration of any stay imposed under this
section, no inference shall be drawn regarding the validity or enforceability
of a regulation which was the subject of the petition.</text>
</paragraph><paragraph commented="no" id="IDd49457cf941e48a7a42adf8387929f26"><enum>(3)</enum><header>Vote</header>
<subparagraph commented="no" id="ID791a7771664f4c8792c7f8700fc13912"><enum>(A)</enum><header>In
general</header><text>The decision to issue a stay of, or set aside, any
regulation under this section shall be made only with the affirmative vote in
accordance with subparagraph (B) of <fraction>2/3</fraction> of the members of
the Council then serving.</text>
</subparagraph><subparagraph commented="no" id="ID44cde2e202374612989342da429103d4"><enum>(B)</enum><header>Authorization to
vote</header><text>A member of the Council may vote to stay the effectiveness
of, or set aside, a final regulation prescribed by the Bureau only if the
agency or department represented by that member has—</text>
<clause commented="no" id="IDebf47ddadbad4751927edc02abe8a021"><enum>(i)</enum><text>considered any relevant
information provided by the agency submitting the petition and by the Bureau;
and</text>
</clause><clause commented="no" id="ID515994188a694cdfa88772d98a9827f3"><enum>(ii)</enum><text>made an official
determination, at a public meeting where applicable, that the regulation which
is the subject of the petition would put the safety and soundness of the United
States banking system or the stability of the financial system of the United
States at risk.</text>
</clause></subparagraph></paragraph><paragraph commented="no" id="ID2167c7ecbb5f43ceb23b42a060eae646"><enum>(4)</enum><header>Decisions to set
aside</header>
<subparagraph commented="no" id="IDc6f1f0f23bc249398552eb68950debb6"><enum>(A)</enum><header>Effect of
decision</header><text>A decision by the Council to set aside a regulation
prescribed by the Bureau, or provision thereof, shall render such regulation,
or provision thereof, unenforceable.</text>
</subparagraph><subparagraph commented="no" id="ID844fbd967c154b27898f3b7b4dbc0132"><enum>(B)</enum><header>Timely action
required</header><text>The Council may not issue a decision to set aside a
regulation, or provision thereof, which is the subject of a petition under this
section after the expiration of the later of—</text>
<clause commented="no" id="ID92295ef5e42c463bbe280fd43a5ffeeb"><enum>(i)</enum><text>45 days following the
date of filing of the petition, unless a stay is issued under paragraph (1);
or</text>
</clause><clause commented="no" id="ID87fd9cee842b4e2c853e0866338f3b03"><enum>(ii)</enum><text>the expiration of a stay
issued by the Council under this section.</text>
</clause></subparagraph><subparagraph commented="no" id="IDb9b195f8e74c4c1faea24c93b2977ebb"><enum>(C)</enum><header>Separate
authority</header><text>The issuance of a stay under this section does not
affect the authority of the Council to set aside a regulation.</text>
</subparagraph></paragraph><paragraph commented="no" id="ID62be481eb54144e7a5aa2bc3ed6cd4f7"><enum>(5)</enum><header>Dismissal due to
inaction</header><text>A petition under this section shall be deemed dismissed
if the Council has not issued a decision to set aside a regulation, or
provision thereof, within the period for timely action under paragraph
(4)(B).</text>
</paragraph><paragraph commented="no" id="ID80e264ddd47b4c93b341012311d58871"><enum>(6)</enum><header>Publication of
decision</header><text>Any decision under this subsection to issue a stay of,
or set aside, a regulation or provision thereof shall be published by the
Council in the Federal Register as soon as practicable after the decision is
made, with an explanation of the reasons for the decision.</text>
</paragraph><paragraph commented="no" id="IDc2b5ccd2d12a4da99df6b08ffe6a3f51"><enum>(7)</enum><header>Rulemaking procedures
inapplicable</header><text>The notice and comment procedures under section 553
of title 5, United States Code, shall not apply to any decision under this
section of the Council to issue a stay of, or set aside, a regulation.</text>
</paragraph><paragraph commented="no" id="ID5dabab4fa04f4599a31751b6694967be"><enum>(8)</enum><header>Judicial review of
decisions by the council</header><text>A decision by the Council to set aside a
regulation prescribed by the Bureau, or provision thereof, shall be subject to
review under chapter 7 of title 5, United States Code.</text>
</paragraph></subsection><subsection commented="no" id="ID16bb1ee6d4c04477a22c24c4b28eccd3"><enum>(d)</enum><header>Application of other
law</header><text>Nothing in this section shall be construed as altering,
limiting, or restricting the application of any other provision of law, except
as otherwise specifically provided in this section, including chapter 5 and
chapter 7 of title 5, United States Code, to a regulation which is the subject
of a petition filed under this section.</text>
</subsection><subsection commented="no" id="ID1ea96adf5ab34a1d9d3a1c904962d5c6"><enum>(e)</enum><header>Savings
clause</header><text>Nothing in this section shall be construed as limiting or
restricting the Bureau from engaging in a rulemaking in accordance with
applicable law.</text>
</subsection><subsection commented="no" id="ID91a2d21c56064ba98f6830be44ec06e7"><enum>(f)</enum><header>Implementing
rules</header><text>The Council shall prescribe procedural rules to implement
this section.</text>
</subsection></section><section id="ID85c8b227e10e436483257967a1bbfee7"><enum>1024.</enum><header>Supervision of
nondepository covered persons</header>
<subsection id="ID6a7f8d41a13a4ec3890014a716b65d16"><enum>(a)</enum><header>Scope of
coverage</header>
<paragraph id="IDe6f333944a614c488933dc8e7b8d9560"><enum>(1)</enum><header>Applicability</header><text>Notwithstanding
any other provision of this title, and except as provided in paragraph (3),
this section shall apply to any covered person who—</text>
<subparagraph id="idC171BE98C0E040A48F73FB483D0E1ACB"><enum>(A)</enum><text>offers or provides
origination, brokerage, or servicing of loans secured by real estate for use by
consumers primarily for personal, family, or household purposes, or loan
modification or foreclosure relief services in connection with such loans;
or</text>
</subparagraph><subparagraph id="id36E8D35972E44314B44645D1E1A98C7A"><enum>(B)</enum><text>is a larger participant
of a market for other consumer financial products or services, as defined by
rule in accordance with paragraph (2).</text>
</subparagraph></paragraph><paragraph id="idBAD89F37AB654D7F847CC98ACC2F0E87"><enum>(2)</enum><header>Rulemaking to define
covered persons subject to this section</header><text>The Bureau shall consult
with the Federal Trade Commission prior to issuing a rule to define covered
persons subject to this section, in accordance with paragraph (1)(B). The
Bureau shall issue its initial rule within 1 year of the designated transfer
date.</text>
</paragraph><paragraph commented="no" id="IDce0f254014134dc99995e9b8621906aa"><enum>(3)</enum><header>Rules of
construction</header>
<subparagraph commented="no" id="idA6B8B2BB3D3547AC93A65A571B333299"><enum>(A)</enum><header>Certain persons
excluded</header><text>This section shall not apply to persons described in
section 1025(a) or 1026(a).</text>
</subparagraph><subparagraph commented="no" id="idC3C73FB99A3A46A7965DE6DE595C3638"><enum>(B)</enum><header>Activity
levels</header><text>For purposes of computing activity levels under paragraph
(1) or rules issued thereunder, activities of affiliated companies (other than
insured depository institutions or insured credit unions) shall be
aggregated.</text>
</subparagraph></paragraph></subsection><subsection id="ID46ee580df85c4112ad0661abcac96f61"><enum>(b)</enum><header>Supervision</header>
<paragraph id="ID40ec92463ab440aa98ecc2783d82710d"><enum>(1)</enum><header>In
general</header><text>The Bureau shall require reports and conduct examinations
on a periodic basis of persons described in subsection (a)(1) for purposes
of—</text>
<subparagraph id="id00742545BB4F40E0BF813C10157239FC"><enum>(A)</enum><text>assessing compliance with
the requirements of Federal consumer financial law;</text>
</subparagraph><subparagraph id="idEB006CBD0EA540088F79651492100265"><enum>(B)</enum><text>obtaining information
about the activities and compliance systems or procedures of such person;
and</text>
</subparagraph><subparagraph id="idE86A03AD4EBD4B01BECFBE67664C56DC"><enum>(C)</enum><text>detecting and assessing
risks to consumers and to markets for consumer financial products and
services.</text>
</subparagraph></paragraph><paragraph id="ID163330a1cb594458be4bfb9504631953"><enum>(2)</enum><header>Risk-based supervision
program</header><text>The Bureau shall exercise its authority under paragraph
(1) in a manner designed to ensure that such exercise, with respect to persons
described in subsection (a)(1), is based on the assessment by the Bureau of the
risks posed to consumers in the relevant product markets and geographic
markets, and taking into consideration, as applicable—</text>
<subparagraph id="ID7e327eaace84477ab8cb2579c218d90e"><enum>(A)</enum><text>the asset size of the
covered person;</text>
</subparagraph><subparagraph id="ID2557462d1d244db98d83c5576f37d621"><enum>(B)</enum><text>the volume of
transactions involving consumer financial products or services in which the
covered person engages;</text>
</subparagraph><subparagraph id="ID4a7df0574f024c16a2261b5841546695"><enum>(C)</enum><text>the risks to consumers
created by the provision of such consumer financial products or
services;</text>
</subparagraph><subparagraph id="IDa4fdb4d6390d4387b45385a08e5daf72"><enum>(D)</enum><text>the extent to which such
institutions are subject to oversight by State authorities for consumer
protection; and</text>
</subparagraph><subparagraph id="IDdd476cc33d6e44d88d3fb7ea5bfba5c3"><enum>(E)</enum><text>any other factors that
the Bureau determines to be relevant to a class of covered persons.</text>
</subparagraph></paragraph><paragraph id="IDe794eabd2b1b4b80b94b63a74f306e32"><enum>(3)</enum><header>Coordination</header><text>To
minimize regulatory burden, the Bureau shall coordinate its supervisory
activities with the supervisory activities conducted by prudential regulators
and the State bank regulatory authorities, including establishing their
respective schedules for examining persons described in subsection (a)(1) and
requirements regarding reports to be submitted by such persons.</text>
</paragraph><paragraph id="id2AEE2CE095B740A8BA3BFC2FB69559F9"><enum>(4)</enum><header>Use of existing
reports</header><text>The Bureau shall, to the fullest extent possible,
use—</text>
<subparagraph id="id73F0A416006A40299976D870FE5BB222"><enum>(A)</enum><text>reports pertaining to
persons described in subsection (a)(1) that have been provided or required to
have been provided to a Federal or State agency; and</text>
</subparagraph><subparagraph id="id218C4582D34140C2B77D6B1EACB53007"><enum>(B)</enum><text>information that has been
reported publicly.</text>
</subparagraph></paragraph><paragraph id="IDe4b3e6b9fd3c41588f919f6bc5fb5c4b"><enum>(5)</enum><header>Preservation of
authority</header><text>Nothing in this title may be construed as limiting the
authority of the Director to require reports from persons described in
subsection (a)(1), as permitted under paragraph (1), regarding information
owned or under the control of such person, regardless of whether such
information is maintained, stored, or processed by another person.</text>
</paragraph><paragraph id="ID14ffd0e5af344109b8e9bd2bd62a41c2"><enum>(6)</enum><header>Reports of tax law
noncompliance</header><text>The Bureau shall provide the Commissioner of
Internal Revenue with any report of examination or related information
identifying possible tax law noncompliance.</text>
</paragraph><paragraph id="IDde1ac262c8ec4c20b10db705ecda6b70"><enum>(7)</enum><header>Registration,
recordkeeping, and other requirements for certain persons</header>
<subparagraph id="ID859ee0b3c9f64679b57dfbb1d4e249ec"><enum>(A)</enum><header>In
general</header><text>The Bureau shall prescribe rules to facilitate
supervision of persons described in subsection (a)(1) and assessment and
detection of risks to consumers.</text>
</subparagraph><subparagraph id="ID605b629f52924724972063b69ece6d54"><enum>(B)</enum><header>Registration</header>
<clause id="ID386012209da9492fba2abd143f599408"><enum>(i)</enum><header>In
general</header><text>The Bureau shall prescribe rules regarding registration
requirements for persons described in subsection (a)(1).</text>
</clause><clause id="ID6c177810ecbc43f6a2bb3bee74a5b2ca"><enum>(ii)</enum><header>Exception for related
persons</header><text>The Bureau may not impose requirements under this section
regarding the registration of a related person.</text>
</clause><clause id="ID54187542089347a1844e1d8b299d1a43"><enum>(iii)</enum><header>Registration
information</header><text>Subject to rules prescribed by the Bureau, the Bureau
shall publicly disclose the registration information about persons described in
subsection (a)(1) to facilitate the ability of consumers to identify persons
described in subsection (a)(1) registered with the Bureau.</text>
</clause></subparagraph><subparagraph id="IDc3ace444b59d45cebb98333cb7c6e026"><enum>(C)</enum><header>Recordkeeping</header><text>The
Bureau may require a person described in subsection (a)(1), to generate,
provide, or retain records for the purposes of facilitating supervision of such
persons and assessing and detecting risks to consumers.</text>
</subparagraph><subparagraph id="IDf730742d02274315bd9e7351a219f256"><enum>(D)</enum><header>Requirements concerning
obligations</header><text>The Bureau may prescribe rules regarding a person
described in subsection (a)(1), to ensure that such persons are legitimate
entities and are able to perform their obligations to consumers. Such
requirements may include background checks for principals, officers, directors,
or key personnel and bonding or other appropriate financial
requirements.</text>
</subparagraph><subparagraph id="IDd99ddf1ef2ac497685e4cf5669358f31"><enum>(E)</enum><header>Consultation with State
agencies</header><text>In developing and implementing requirements under this
paragraph, the Bureau shall consult with State agencies regarding requirements
or systems (including coordinated or combined systems for registration), where
appropriate.</text>
</subparagraph></paragraph></subsection><subsection id="ID7796a957bdf6415b8598bd176d10d713"><enum>(c)</enum><header>Enforcement
authority</header>
<paragraph id="ID4c028d678acc4d78ac067a4a6f274d6c"><enum>(1)</enum><header>The Bureau to have
enforcement authority</header><text>Except as provided in paragraph (3) and
section 1061(b)(5), with respect to any person described in subsection (a)(1),
to the extent that Federal law authorizes the Bureau and another Federal agency
to enforce Federal consumer financial law, the Bureau shall have exclusive
authority to enforce that Federal consumer financial law.</text>
</paragraph><paragraph id="ID8b072dcf164b4f4883243f5a29ee8764"><enum>(2)</enum><header>Referral</header><text>Any
Federal agency authorized to enforce a Federal consumer financial law described
in paragraph (1) may recommend in writing to the Bureau that the Bureau
initiate an enforcement proceeding, as the Bureau is authorized by that Federal
law or by this title.</text>
</paragraph><paragraph id="ID4293be6200cf481682da791d652f8dc8"><enum>(3)</enum><header>Coordination with the
Federal trade commission</header>
<subparagraph id="IDB52FC0F7B2634C7EB3809C8FD7084661"><enum>(A)</enum><header>In
general</header><text>The Bureau and the Federal Trade Commission shall
negotiate an agreement for coordinating with respect to enforcement actions by
each agency regarding the offering or provision of consumer financial products
or services by any covered person that is described in subsection (a)(1), or
service providers thereto. The agreement shall include procedures for notice to
the other agency, where feasible, prior to initiating a civil action to enforce
any Federal law regarding the offering or provision of consumer financial
products or services.</text>
</subparagraph><subparagraph id="IDff560882aa624dc4acb89485c1090d9b"><enum>(B)</enum><header>Civil
actions</header><text>Whenever a civil action has been filed by, or on behalf
of, the Bureau or the Federal Trade Commission for any violation of any
provision of Federal law described in subparagraph (A), or any regulation
prescribed under such provision of law—</text>
<clause id="ID8bb86b33d14d4125901534e54274cafd"><enum>(i)</enum><text>the other agency may not,
during the pendency of that action, institute a civil action under such
provision of law against any defendant named in the complaint in such pending
action for any violation alleged in the complaint; and</text>
</clause><clause id="ID5f0ead2f727b41e1a39c5dd5af530810"><enum>(ii)</enum><text>the Bureau or the
Federal Trade Commission may intervene as a party in any such action brought by
the other agency, and, upon intervening—</text>
<subclause id="ID624608b5fd864f499a78f165d0a7bf6b"><enum>(I)</enum><text>be heard on all matters
arising in such enforcement action; and</text>
</subclause><subclause id="ID60a394912fdf400195dab05c4ac48047"><enum>(II)</enum><text>file petitions for
appeal in such actions.</text>
</subclause></clause></subparagraph><subparagraph id="ID5c3fe9fc12ef4836bf9264cb4a48b44f"><enum>(C)</enum><header>Agreement
terms</header><text>The terms of any agreement negotiated under subparagraph
(A) may modify or supersede the provisions of subparagraph (B).</text>
</subparagraph><subparagraph id="ID3049211d617e4782838407e8e16ba816"><enum>(D)</enum><header>Deadline</header><text>The
agencies shall reach the agreement required under subparagraph (A) not later
than 6 months after the designated transfer date.</text>
</subparagraph></paragraph></subsection><subsection id="ID60293f0a5ee6413da343416fec9549d4"><enum>(d)</enum><header>Exclusive rulemaking
and examination authority</header><text>Notwithstanding any other provision of
Federal law and except as provided in section 1061(b)(5), to the extent that
Federal law authorizes the Bureau and another Federal agency to issue
regulations or guidance, conduct examinations, or require reports from a person
described in subsection (a)(1) under such law for purposes of assuring
compliance with Federal consumer financial law and any regulations thereunder,
the Bureau shall have the exclusive authority to prescribe rules, issue
guidance, conduct examinations, require reports, or issue exemptions with
regard to a person described in subsection (a)(1), subject to those provisions
of law.</text>
</subsection><subsection id="IDd081d963bae644ce92155b9ed4193553"><enum>(e)</enum><header>Service
providers</header><text>A service provider to a person described in subsection
(a)(1) shall be subject to the authority of the Bureau under this section, to
the same extent as if such service provider were engaged in a service
relationship with a bank, and the Bureau were an appropriate Federal banking
agency under section 7(c) of the Bank Service Company Act (12 U.S.C. 1867(c)).
In conducting any examination or requiring any report from a service provider
subject to this subsection, the Bureau shall coordinate with the appropriate
prudential regulator, as applicable.</text>
</subsection><subsection id="idC6B1B406D63D47718DF22B5F0D4C8D8D"><enum>(f)</enum><header>Preservation of farm
credit administration authority</header><text>No provision of this title may be
construed as modifying, limiting, or otherwise affecting the authority of the
Farm Credit Administration.</text>
</subsection></section><section id="ID3a5a291100df41c19db5a578fce30c16"><enum>1025.</enum><header>Supervision of very
large banks, savings associations, and credit unions</header>
<subsection id="ID088bea83158a4a1db7bf53c9dbfe2c42"><enum>(a)</enum><header>Scope of
coverage</header>
<paragraph id="idA36814CBDE3D40128D9F8D9F0231EAFA"><enum>(1)</enum><header>Applicability</header><text>This
section shall apply to any covered person that is—</text>
<subparagraph id="ID2fbd2d253ac84380bfe328e3a5248f34"><enum>(A)</enum><text>an insured depository
institution with total assets of more than $10,000,000,000 and any affiliate
thereof; or</text>
</subparagraph><subparagraph id="IDc6b5bd737d3d494796a4465c409f7fe2"><enum>(B)</enum><text>an insured credit union
with total assets of more than $10,000,000,000 and any affiliate
thereof.</text>
</subparagraph></paragraph><paragraph id="id9DB5855FB31A4541BC1BB2C97D35D148"><enum>(2)</enum><header>Rule of
construction</header><text>For purposes of determining total assets under this
section and section 1026, the Bureau shall rely on the same regulations and
interim methodologies specified in section 312(e).</text>
</paragraph></subsection><subsection id="ID4da88155f6e046ae8d1ac1a0b35b22af"><enum>(b)</enum><header>Supervision</header>
<paragraph id="ID93c9e21cee534f5aa1421a9fbe2b2f15"><enum>(1)</enum><header>In
general</header><text>The Bureau shall require reports and conduct examinations
on a periodic basis of persons described in subsection (a) for purposes
of—</text>
<subparagraph id="ID53bc4003292f49d6845bd92ac2c2d3d3"><enum>(A)</enum><text>assessing compliance with
the requirements of Federal consumer financial laws;</text>
</subparagraph><subparagraph id="IDba805ecd7c9e4435a751fe4419d42465"><enum>(B)</enum><text>obtaining information
about the activities and compliance systems or procedures of such persons;
and</text>
</subparagraph><subparagraph id="ID1bc5ffed89a945b39762c033650fb651"><enum>(C)</enum><text>detecting and assessing
risks to consumers and to markets for consumer financial products and
services.</text>
</subparagraph></paragraph><paragraph id="ID69dcdf1b01d6497bb2595c1e1f55270c"><enum>(2)</enum><header>Coordination</header><text>To
minimize regulatory burden, the Bureau shall coordinate its supervisory
activities with the supervisory activities conducted by prudential regulators
and the State bank regulatory authorities, including establishing their
respective schedules for examining such persons described in subsection (a) and
requirements regarding reports to be submitted by such persons.</text>
</paragraph><paragraph id="id87E52689882A4BEF9FD7C9C111A81A71"><enum>(3)</enum><header>Use of existing
reports</header><text>The Bureau shall, to the fullest extent possible,
use—</text>
<subparagraph id="id25F0205A18B447D492FE5752416567ED"><enum>(A)</enum><text>reports pertaining to a
person described in subsection (a) that have been provided or required to have
been provided to a Federal or State agency; and</text>
</subparagraph><subparagraph id="id84D4CE7702274D35A64827C324C9C0D5"><enum>(B)</enum><text>information that has been
reported publicly.</text>
</subparagraph></paragraph><paragraph id="IDa247c1cb36ad406bb19cfea030cf0c88"><enum>(4)</enum><header>Preservation of
authority</header><text>Nothing in this title may be construed as limiting the
authority of the Director to require reports from a person described in
subsection (a), as permitted under paragraph (1), regarding information owned
or under the control of such person, regardless of whether such information is
maintained, stored, or processed by another person.</text>
</paragraph><paragraph id="IDb7684586d03147848999479445916fed"><enum>(5)</enum><header>Reports of tax law
noncompliance</header><text>The Bureau shall provide the Commissioner of
Internal Revenue with any report of examination or related information
identifying possible tax law noncompliance.</text>
</paragraph></subsection><subsection id="ID107d2bbe385d42bd8a831b8c77bfd915"><enum>(c)</enum><header>Primary enforcement
authority</header>
<paragraph id="ID16ba27deab604d239e1484c31425a35a"><enum>(1)</enum><header>The bureau to have
primary enforcement authority</header><text>To the extent that the Bureau and
another Federal agency are authorized to enforce a Federal consumer financial
law, the Bureau shall have primary authority to enforce that Federal consumer
financial law with respect to any person described in subsection (a).</text>
</paragraph><paragraph id="IDc0fa0df2bf874f948c7880e3811f491c"><enum>(2)</enum><header>Referral</header><text>Any
Federal agency, other than the Federal Trade Commission, that is authorized to
enforce a Federal consumer financial law may recommend, in writing, to the
Bureau that the Bureau initiate an enforcement proceeding with respect to a
person described in subsection (a), as the Bureau is authorized to do by that
Federal consumer financial law.</text>
</paragraph><paragraph id="IDd9ed44ce420e4cd3b65c753482a53ce3"><enum>(3)</enum><header>Backup enforcement
authority of other Federal agency</header><text>If the Bureau does not, before
the end of the 120-day period beginning on the date on which the Bureau
receives a recommendation under paragraph (2), initiate an enforcement
proceeding, the other agency referred to in paragraph (2) may initiate an
enforcement proceeding, as permitted by the subject provision of Federal
law.</text>
</paragraph></subsection><subsection id="ID635126c9f3f94269b9588d42e0ec2394"><enum>(d)</enum><header>Service
providers</header><text>A service provider to a person described in subsection
(a) shall be subject to the authority of the Bureau under this section, to the
same extent as if the Bureau were an appropriate Federal banking agency under
section 7(c) of the Bank Service Company Act 12 U.S.C. 1867(c). In conducting
any examination or requiring any report from a service provider subject to this
subsection, the Bureau shall coordinate with the appropriate prudential
regulator.</text>
</subsection><subsection display-inline="no-display-inline" id="HA154952DB72547F5BF1BC14E2BA0BD2B"><enum>(e)</enum><header>Simultaneous and
coordinated supervisory action</header>
<paragraph id="HA5EF58DE75414690806090E19B510DCB"><enum>(1)</enum><header>Examinations</header><text display-inline="yes-display-inline">A prudential regulator and the Bureau
shall, with respect to each insured depository institution, insured credit
union, or other covered person described in subsection (a) that is supervised
by the prudential regulator and the Bureau, respectively—</text>
<subparagraph id="HE5712181247C4F48A370710D7BA2FB75"><enum>(A)</enum><text>coordinate the scheduling
of examinations of the insured depository institution, insured credit union, or
other covered person described in subsection (a);</text>
</subparagraph><subparagraph id="HAA739031011C4639AE1ADBE3D1828A62"><enum>(B)</enum><text display-inline="yes-display-inline">conduct simultaneous examinations of each
insured depository institution, insured credit union, or other covered person
described in subsection (a), unless such institution requests examinations to
be conducted separately;</text>
</subparagraph><subparagraph id="HEC367E4C856845F2B765C984861D0EAD"><enum>(C)</enum><text>share each draft report
of examination with the other agency and permit the receiving agency a
reasonable opportunity (which shall not be less than a period of 30 days after
the date of receipt) to comment on the draft report before such report is made
final; and</text>
</subparagraph><subparagraph id="H42DC6620D980456D8C74FB0591FFB0F8"><enum>(D)</enum><text>prior to issuing a final
report of examination or taking supervisory action, take into consideration
concerns, if any, raised in the comments made by the other agency.</text>
</subparagraph></paragraph><paragraph display-inline="no-display-inline" id="H817CD0776C2D403889999BCF374D7786"><enum>(2)</enum><header>Coordination with State
bank supervisors</header><text>The Bureau shall pursue arrangements and
agreements with State bank supervisors to coordinate examinations, consistent
with paragraph (1).</text>
</paragraph><paragraph id="IDe690147969a546918655747cfd11870c"><enum>(3)</enum><header>Avoidance of conflict
in supervision</header>
<subparagraph id="ID1eac39fea9694a7e823b9f472cc3d039"><enum>(A)</enum><header>Request</header><text>If
the proposed supervisory determinations of the Bureau and a prudential
regulator (in this section referred to collectively as the
<quote>agencies</quote>) are conflicting, an insured depository institution,
insured credit union, or other covered person described in subsection (a) may
request the agencies to coordinate and present a joint statement of coordinated
supervisory action.</text>
</subparagraph><subparagraph id="IDa0618d6a719d40639970d70f63c32701"><enum>(B)</enum><header>Joint
statement</header><text>The agencies shall provide a joint statement under
subparagraph (A), not later than 30 days after the date of receipt of the
request of the insured depository institution, credit union, or covered person
described in subsection (a).</text>
</subparagraph></paragraph><paragraph id="ID2adce54268e54078aaade7d53922fe4a"><enum>(4)</enum><header>Appeals to governing
panel</header>
<subparagraph id="idD56C3D5A76C04C778F11F073EA8D0C28"><enum>(A)</enum><header>In
general</header><text>If the agencies do not resolve the conflict or issue a
joint statement required by subparagraph (B), or if either of the agencies
takes or attempts to take any supervisory action relating to the request for
the joint statement without the consent of the other agency, an insured
depository institution, insured credit union, or other covered person described
in subsection (a) may institute an appeal to a governing panel, as provided in
this subsection, not later than 30 days after the expiration of the period
during which a joint statement is required to be filed under paragraph
(3)(B).</text>
</subparagraph><subparagraph id="ID8c064af7cab148dd97cc8571c63bc962"><enum>(B)</enum><header>Composition of
governing panel</header><text>The governing panel for an appeal under this
paragraph shall be composed of—</text>
<clause id="ID5a1f4bf96fe14064a05c8bfe26f90ab8"><enum>(i)</enum><text>a representative from the
Bureau and a representative of the prudential regulator, both of whom—</text>
<subclause id="ID69d890efd5b649569516e51a08024c91"><enum>(I)</enum><text>have not participated in
the material supervisory determinations under appeal; and</text>
</subclause><subclause id="IDfdf07f1737c74b73a3ab17f13d481f46"><enum>(II)</enum><text>do not directly or
indirectly report to the person who participated materially in the supervisory
determinations under appeal; and</text>
</subclause></clause><clause id="IDed12e5f8f4284978a757c52d844f8df2"><enum>(ii)</enum><text>one individual
representative, to be determined on a rotating basis, from among the Board of
Governors, the Corporation, the National Credit Union Administration, and the
Office of the Comptroller of the Currency, other than any agency involved in
the subject dispute.</text>
</clause></subparagraph><subparagraph id="ID72c093dd7d13410f811a7059c27e51ca"><enum>(C)</enum><header>Conduct of
appeal</header><text>In an appeal under this paragraph—</text>
<clause id="ID153a5256f5c74474a8e3c97d47b99d69"><enum>(i)</enum><text>the insured depository
institution, insured credit union, or other covered person described in
subsection (a)—</text>
<subclause id="id3DE9A5EB7F5349FEB617C086B88800BB"><enum>(I)</enum><text>shall include in its
appeal all the facts and legal arguments pertaining to the matter; and</text>
</subclause><subclause id="IDecf07dc4036b40db9274bf1d10a52b92"><enum>(II)</enum><text>may, through counsel,
employees, or representatives, appear before the governing panel in person or
by telephone; and</text>
</subclause></clause><clause id="ID22b7d470ebdd4eb1a2d04ff2511f3393"><enum>(ii)</enum><text>the governing
panel—</text>
<subclause id="id9BABA26AE4914058AA3E009D52F73A49"><enum>(I)</enum><text>may request the insured
depository institution, insured credit union, or other covered person described
in subsection (a), the Bureau, or the prudential regulator to produce
additional information relevant to the appeal; and</text>
</subclause><subclause id="ID06570a8ef2ab4c7b948efb878c55a91d"><enum>(II)</enum><text>by a majority vote of
its members, shall provide a final determination, in writing, not later than 30
days after the date of filing of an informationally complete appeal, or such
longer period as the panel and the insured depository institution, insured
credit union, or other covered person described in subsection (a) may jointly
agree.</text>
</subclause></clause></subparagraph><subparagraph id="id0584AA29968548C6A34D4960D20039E0"><enum>(D)</enum><header>Public availability of
determinations</header><text>A governing panel shall publish all information
contained in a determination by the governing panel, with appropriate
redactions of information that would be subject to an exemption from disclosure
under section 552 of title 5, United States Code.</text>
</subparagraph><subparagraph id="ID14acac157f9e4cb1abe271d5ad58a210"><enum>(E)</enum><header>Prohibition against
retaliation</header><text>The Bureau and the prudential regulators shall
prescribe rules to provide safeguards from retaliation against the insured
depository institution, insured credit union, or other covered person described
in subsection (a) instituting an appeal under this paragraph, as well as their
officers and employees.</text>
</subparagraph><subparagraph id="ID9d3ddc55ee354f22bf8512bfdced53b5"><enum>(F)</enum><header>Limitation</header><text>The
process provided in this paragraph shall not apply to a determination by a
prudential regulator to appoint a conservator or receiver for an insured
depository institution or a liquidating agent for an insured credit union, as
the case may be, or a decision to take action pursuant to section 38 of the
Federal Deposit Insurance Act (12 U.S.C. 1831o) or section 212 of the Federal
Credit Union Act (112 U.S.C. 1790a), as applicable.</text>
</subparagraph><subparagraph id="IDe0305108622244ed97f1c1c7051fa03b"><enum>(G)</enum><header>Effect on other
authority</header><text>Nothing in this section shall modify or limit the
authority of the Bureau to interpret, or take enforcement action under, any
Federal consumer financial law.</text>
</subparagraph></paragraph></subsection></section><section id="ID971b05380e80478c9e85ba60e2fbf3a2"><enum>1026.</enum><header>Other banks, savings
associations, and credit unions</header>
<subsection id="IDe2a46cbe56df4b798d41df3b45848017"><enum>(a)</enum><header>Scope of
coverage</header><text>This section shall apply to any covered person that
is—</text>
<paragraph id="ID38c383266ff4460aa4189c9de954c35a"><enum>(1)</enum><text>an insured depository
institution with total assets of $10,000,000,000 or less; or</text>
</paragraph><paragraph id="ID462ae74635d94677a7144164077e6e04"><enum>(2)</enum><text>an insured credit union
with total assets of $10,000,000,000 or less.</text>
</paragraph></subsection><subsection commented="no" id="id83FF6577E10E45B18E3284076BAB6B84"><enum>(b)</enum><header>Reports</header><text>The
Director may require reports from a person described in subsection (a), as
necessary to support the role of the Bureau in implementing Federal consumer
financial law, to support its examination activities under subsection (c), and
to assess and detect risks to consumers and consumer financial markets.</text>
<paragraph commented="no" id="IDe3270bb6733a486ebc32d6d2aabcf3c6"><enum>(1)</enum><header>Use of existing
reports</header><text>The Bureau shall, to the fullest extent possible,
use—</text>
<subparagraph commented="no" id="ID67235679ca1a4ca688a0b51b22419ce3"><enum>(A)</enum><text>reports pertaining to a
person described in subsection (a) that have been provided or required to have
been provided to a Federal or State agency; and</text>
</subparagraph><subparagraph commented="no" id="ID240e0a1d632f44cd8fb513b8e871210f"><enum>(B)</enum><text>information that has been
reported publicly.</text>
</subparagraph></paragraph><paragraph commented="no" id="ID9e36917e4ac947b3b9f2cf6e2c004964"><enum>(2)</enum><header>Preservation of
authority</header><text>Nothing in this subsection may be construed as limiting
the authority of the Director from requiring from a person described in
subsection (a), as permitted under paragraph (1), information owned or under
the control of such person, regardless of whether such information is
maintained, stored, or processed by another person.</text>
</paragraph><paragraph commented="no" id="IDc8012984d4a842b680b2da94a23596ac"><enum>(3)</enum><header>Reports of tax law
noncompliance</header><text>The Bureau shall provide the Commissioner of
Internal Revenue with any report of examination or related information
identifying possible tax law noncompliance.</text>
</paragraph></subsection><subsection commented="no" id="ID88dc2af98494486fb901aeef84851c29"><enum>(c)</enum><header>Examinations</header>
<paragraph commented="no" id="ID2fbd227c8d5e479b9729b4ab98341181"><enum>(1)</enum><header>In
general</header><text>The Bureau may, at its discretion, include examiners on a
sampling basis of the examinations performed by the prudential regulator of
persons described in subsection (a).</text>
</paragraph><paragraph commented="no" id="ID74e0b93ca41b42e0a3d586d913b4273c"><enum>(2)</enum><header>Agency
coordination</header><text>The prudential regulator shall—</text>
<subparagraph commented="no" id="idE22E2F162E8F489BB5503B98028B5F9D"><enum>(A)</enum><text>provide all reports,
records, and documentation related to the examination process for any
institution included in the sample referred to in paragraph (1) to the Bureau
on a timely and continual basis;</text>
</subparagraph><subparagraph commented="no" id="id829DFFDF87A643AC89E3B898C0AE54C0"><enum>(B)</enum><text>involve such Bureau
examiner in the entire examination process for such person; and</text>
</subparagraph><subparagraph commented="no" id="idC665DF60311A4901B3C50EB2CF3AB6EA"><enum>(C)</enum><text>consider input of the
Bureau concerning the scope of an examination, conduct of the examination, the
contents of the examination report, the designation of matters requiring
attention, and examination ratings.</text>
</subparagraph></paragraph></subsection><subsection commented="no" id="idA3AB12962C8F4839B87DA98356FCCB45"><enum>(d)</enum><header>Enforcement</header>
<paragraph commented="no" id="ID9c756b460b1f470297fc5b6d15487cea"><enum>(1)</enum><header>In
general</header><text>Except for requiring reports under subsection (b), the
prudential regulator shall have exclusive authority to enforce compliance with
respect to a person described in subsection (a).</text>
</paragraph><paragraph commented="no" id="IDb0c2cb659e954531b035f326fb245645"><enum>(2)</enum><header>Coordination with
prudential regulator</header>
<subparagraph commented="no" id="IDc296a9bbbfbc47a2b567667e865a983d"><enum>(A)</enum><header>Referral</header><text>When
the Bureau has reason to believe that a person described in subsection (a) has
engaged in a material violation of a Federal consumer financial law, the Bureau
shall notify the prudential regulator in writing and recommend appropriate
action to respond.</text>
</subparagraph><subparagraph commented="no" id="ID8b01976166d94351b19db3894ebe194b"><enum>(B)</enum><header>Response</header><text>Upon
receiving a recommendation under subparagraph (A), the prudential regulator
shall provide a written response to the Bureau not later than 60 days
thereafter.</text>
</subparagraph></paragraph></subsection><subsection commented="no" id="idF0468CDFA2D24467950E8F72893AA210"><enum>(e)</enum><header>Service
providers</header><text>A service provider to a substantial number of persons
described in subsection (a) shall be subject to the authority of the Bureau
under section 1025 to the same extent as if the Bureau were an appropriate
Federal bank agency under section 7(c) of the Bank Service Company Act (12
U.S.C. 1867(c)). When conducting any examination or requiring any report from a
service provider subject to this subsection, the Bureau shall coordinate with
the appropriate prudential regulator.</text>
</subsection></section><section id="IDa74bc0d50e074f2fbd7603e9d13cce74"><enum>1027.</enum><header>Limitations on
authorities of the Bureau; preservation of authorities</header>
<subsection id="ID64424d1b2d7c460daa494ab92bdba599"><enum>(a)</enum><header>Exclusion for
merchants, retailers, and other sellers of nonfinancial goods or
services</header>
<paragraph id="IDf479ac13a5e640c2aae554640f917248"><enum>(1)</enum><header>Sale or brokerage of
nonfinancial good or service</header><text>The Bureau may not exercise any
rulemaking, supervisory, enforcement or other authority under this title with
respect to a person who is a merchant, retailer, or seller of any nonfinancial
good or service and is engaged in the sale or brokerage of such nonfinancial
good or service, except to the extent that such person is engaged in offering
or providing any consumer financial product or service, or is otherwise subject
to any enumerated consumer law or any law for which authorities are transferred
under subtitle F or H.</text>
</paragraph><paragraph id="ID5d4130b2e6f24576ad4d61c9249cba9f"><enum>(2)</enum><header>Offering or provision
of certain consumer financial products or services in connection with the sale
or brokerage of nonfinancial good or service</header>
<subparagraph id="id21D73EC800AD457BB676172112C26264"><enum>(A)</enum><header>In
general</header><text>Except as provided in subparagraph (B), and subject to
subparagraph (C), the Bureau may not exercise any rulemaking, supervisory,
enforcement, or other authority under this title with respect to a merchant,
retailer, or seller of nonfinancial goods or services, but only to the extent
that such person—</text>
<clause id="IDc8e78371cb274d7dbd27b03e309e1009"><enum>(i)</enum><text>extends credit directly
to a consumer, in a case in which the good or service being provided is not
itself a consumer financial product or service (other than credit described in
this subparagraph), exclusively for the purpose of enabling that consumer to
purchase such nonfinancial good or service directly from the merchant,
retailer, or seller;</text>
</clause><clause id="IDd178e312737a48398a1f4d4efd835684"><enum>(ii)</enum><text>directly, or through an
agreement with another person, collects debt arising from credit extended as
described in clause (i); or</text>
</clause><clause id="IDd3b0aa946fd4454c8d1b6dcfbc5add56"><enum>(iii)</enum><text>sells or conveys debt
described in clause (i) that is delinquent or otherwise in default.</text>
</clause></subparagraph><subparagraph id="IDcb84f0425c3541518d46f560495323f5"><enum>(B)</enum><header>Applicability</header><text>Subparagraph
(A) does not apply to any credit transaction or collection of debt, other than
as described in subparagraph (C)(i), arising from a transaction described in
subparagraph (A)—</text>
<clause id="ID603636288d0447ec9773f33910650f80"><enum>(i)</enum><text>in which the merchant,
retailer, or seller of nonfinancial goods or services assigns, sells or
otherwise conveys to another person such debt owed by the consumer (except for
a sale of debt that is delinquent or otherwise in default, as described in
subparagraph (A)(iii));</text>
</clause><clause id="ID8e9e807f83e048b981ba40e63bf78619"><enum>(ii)</enum><text>in which the credit
extended exceeds the market value of the nonfinancial good or service provided,
or the Bureau otherwise finds that the sale of the nonfinancial good or service
is done as a subterfuge, so as to evade or circumvent the provisions of this
title; or</text>
</clause><clause id="ID8150866e609d474ea9b510126435db11"><enum>(iii)</enum><text>in which the merchant,
retailer, or seller of nonfinancial goods or services regularly extends credit
and the credit is subject to a finance charge.</text>
</clause></subparagraph><subparagraph commented="no" id="id222FE19AD1CC4DB29531252377D41119"><enum>(C)</enum><header>Limitations</header><text></text>
<clause commented="no" display-inline="no-display-inline" id="id7ADFD84C6E8D4F3A83F43B66AA28F09B"><enum>(i)</enum><header display-inline="yes-display-inline">In general</header><text display-inline="yes-display-inline">Notwithstanding subparagraph (B), and
except as provided in clause (ii), the Bureau may not exercise any rulemaking,
supervisory, enforcement, or other authority under this title with respect to a
merchant, retailer, or seller of nonfinancial goods or services that is not
engaged significantly in offering or providing consumer financial products or
services.</text>
</clause><clause commented="no" display-inline="no-display-inline" id="ID8b2d7fe61a9f4b188dbf0e4b698d0226"><enum>(ii)</enum><header display-inline="yes-display-inline">Exception</header><text display-inline="yes-display-inline">Subparagraph (A) and clause (i) of this
subparagraph do not apply to any merchant, retailer, or seller of nonfinancial
goods or services, to the extent that such person is subject to any enumerated
consumer law or any law for which authorities are transferred under subtitle F
or H.</text>
</clause></subparagraph><subparagraph id="ID33e0a632adad40da965e89786f862f8f"><enum>(D)</enum><header>Rules</header>
<clause commented="no" display-inline="no-display-inline" id="id1F6B0FB2386A4895A4AF94C2AC08A2B7"><enum>(i)</enum><header display-inline="yes-display-inline">Authority of other agencies</header><text display-inline="yes-display-inline">No provision of this title shall be
construed as modifying, limiting, or superseding the supervisory or enforcement
authority of the Federal Trade Commission or any other agency (other than the
Bureau) with respect to credit extended, or the collection of debt arising from
such extension, directly by a merchant or retailer to a consumer exclusively
for the purpose of enabling that consumer to purchase nonfinancial goods or
services directly from the merchant or retailer.</text>
</clause><clause id="IDfcf1ed50fb20487c95774b796375f435"><enum>(ii)</enum><header>Small
businesses</header><text>A merchant, retailer, or seller of nonfinancial goods
or services that would otherwise be subject to the authority of the Bureau
solely by virtue of the application of subparagraph (B)(iii) shall be deemed
not to be engaged significantly in offering or providing consumer financial
products or services under subparagraph (C)(i), if such person—</text>
<subclause id="ID6aff73d2541f4626b3b0782a8a22baf5"><enum>(I)</enum><text>only extends credit for
the sale of nonfinancial goods or services, as described in subparagraph
(A)(i);</text>
</subclause><subclause id="IDfa38d83ba612400badd8cb2729466099"><enum>(II)</enum><text>retains such credit on
its own accounts (except to sell or convey such debt that is delinquent or
otherwise in default); and</text>
</subclause><subclause id="IDceeed3046c8c42c1b6efb95524633203"><enum>(III)</enum><text>meets the relevant
industry size threshold to be a small business concern, based on annual
receipts, pursuant to section 3 of the Small Business Act (15 U.S.C. 632) and
the implementing rules thereunder.</text>
</subclause></clause><clause id="idF43690848C7C4F3DA0308963BA1255CC"><enum>(iii)</enum><header>Initial
year</header><text>A merchant, retailer, or seller of nonfinancial goods or
services shall be deemed to meet the relevant industry size threshold described
in clause (ii)(III) during the first year of operations of that business
concern if, during that year, the receipts of that business concern reasonably
are expected to meet that size threshold.</text>
</clause></subparagraph><subparagraph id="ID435ae5ad4f1247ebb539a47fa8eb7b25"><enum>(E)</enum><header>Exception from State
enforcement</header><text>To the extent that the Bureau may not exercise
authority under this subsection with respect to a merchant, retailer, or seller
of nonfinancial goods or services, no action by a State attorney general or
State regulator with respect to a claim made under this title may be brought
under subsection 1042(a), with respect to an activity described in any of
clauses (i) through (iii) of subparagraph (A) by such merchant, retailer, or
seller of nonfinancial goods or services.</text>
</subparagraph></paragraph></subsection><subsection id="id7A94191EDEA34B32B28A9EFDF8B11664"><enum>(b)</enum><header>Exclusion for real
estate brokerage activities</header>
<paragraph id="idD55DB6183478491591BA1967BDF5EEC3"><enum>(1)</enum><header>Real estate brokerage
activities excluded</header><text>Without limiting subsection (a), and except
as permitted in paragraph (2), the Bureau may not exercise any rulemaking,
supervisory, enforcement, or other authority under this title with respect to a
person that is licensed or registered as a real estate broker or real estate
agent, in accordance with State law, to the extent that such person—</text>
<subparagraph id="ID243cca8374e647a69f6d0c27f58d402b"><enum>(A)</enum><text>acts as a real estate
agent or broker for a buyer, seller, lessor, or lessee of real property;</text>
</subparagraph><subparagraph id="IDf26668d0b4ca4cd18819b181f87ff117"><enum>(B)</enum><text>brings together parties
interested in the sale, purchase, lease, rental, or exchange of real
property;</text>
</subparagraph><subparagraph id="IDdcaa1a223fd34fb1a00102472224903e"><enum>(C)</enum><text>negotiates, on behalf of
any party, any portion of a contract relating to the sale, purchase, lease,
rental, or exchange of real property (other than in connection with the
provision of financing with respect to any such transaction); or</text>
</subparagraph><subparagraph id="ID537758bea6454f0b95afed0099ea4fe1"><enum>(D)</enum><text>offers to engage in any
activity, or act in any capacity, described in subparagraph (A), (B), or
(C).</text>
</subparagraph></paragraph><paragraph id="IDea3fabe6c050481794efc3b247e322f5"><enum>(2)</enum><header>Description of
activities</header><text>Paragraph (1) shall not apply to any person to the
extent that such person is engaged in the offering or provision of any consumer
financial product or service or is otherwise subject to any enumerated consumer
law or any law for which authorities are transferred under subtitle F or
H.</text>
</paragraph></subsection><subsection commented="no" display-inline="no-display-inline" id="H056E70F7129E421C9F6EE68CC2FCBDFA"><enum>(c)</enum><header display-inline="yes-display-inline">Exclusion for manufactured home retailers
and modular home retailers</header>
<paragraph commented="no" display-inline="no-display-inline" id="H23BE29DD3BFD40C7BCA54929049B7E31"><enum>(1)</enum><header display-inline="yes-display-inline">In general</header><text display-inline="yes-display-inline">The Director may not exercise any
rulemaking, supervisory, enforcement, or other authority over a person to the
extent that—</text>
<subparagraph commented="no" display-inline="no-display-inline" id="id420198A0A7E649ECB8CD0AA229A27E31"><enum>(A)</enum><text display-inline="yes-display-inline">such person is not described in paragraph
(2); and</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="HA323B9BB117B4E89863FDDCF990AF919"><enum>(B)</enum><text display-inline="yes-display-inline">such person—</text>
<clause commented="no" display-inline="no-display-inline" id="id65F9B9747A3043DD80179CE1624D9E42"><enum>(i)</enum><text display-inline="yes-display-inline">acts as an agent or broker for a buyer or
seller of a manufactured home or a modular home;</text>
</clause><clause commented="no" display-inline="no-display-inline" id="H889E6126FD7347589A323F61F9C18C48"><enum>(ii)</enum><text display-inline="yes-display-inline">facilitates the purchase by a consumer of a
manufactured home or modular home, by negotiating the purchase price or terms
of the sales contract (other than providing financing with respect to such
transaction); or</text>
</clause><clause commented="no" display-inline="no-display-inline" id="H3665691C991440C2935CD3035EEB7A4E"><enum>(iii)</enum><text display-inline="yes-display-inline">offers to engage in any activity described
in clause (i) or (ii).</text>
</clause></subparagraph></paragraph><paragraph commented="no" display-inline="no-display-inline" id="H960F479D0FBA4EF4A7F05A64AD9B8B28"><enum>(2)</enum><header display-inline="yes-display-inline">Description of activities</header><text display-inline="yes-display-inline">A person is described in this paragraph to
the extent that such person is engaged in the offering or provision of any
consumer financial product or service or is otherwise subject to any enumerated
consumer law or any law for which authorities are transferred under subtitle F
or H.</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="HFEADA82CB1EC42759CD8D3C10D322291"><enum>(3)</enum><header display-inline="yes-display-inline">Definitions</header><text display-inline="yes-display-inline">For purposes of this subsection, the
following definitions shall apply:</text>
<subparagraph commented="no" display-inline="no-display-inline" id="HDB18DA97D32F46E4A4F331E458D8AF29"><enum>(A)</enum><header display-inline="yes-display-inline">Manufactured home</header><text display-inline="yes-display-inline">The term <term>manufactured home</term> has
the same meaning as in section 603 of the National Manufactured Housing
Construction and Safety Standards Act of 1974 (42 U.S.C. 5402).</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="HB2D2F9803475452794DC8AB24CB32D4E"><enum>(B)</enum><header display-inline="yes-display-inline">Modular home</header><text display-inline="yes-display-inline">The term <term>modular home</term> means a
house built in a factory in 2 or more modules that meet the State or local
building codes where the house will be located, and where such modules are
transported to the building site, installed on foundations, and
completed.</text>
</subparagraph></paragraph></subsection><subsection id="IDf2cc820f427949cd89e33752ac4c82e8"><enum>(d)</enum><header>Exclusion for
accountants and tax preparers</header>
<paragraph id="ID90b75661d2d3435ebac345dbaa29b3cd"><enum>(1)</enum><header>In
general</header><text>Except as permitted in paragraph (2), the Bureau may not
exercise any rulemaking, supervisory, enforcement, or other authority
over—</text>
<subparagraph id="IDbacc5115e86840f798633152b27c4106"><enum>(A)</enum><text>any person that is a
certified public accountant, permitted to practice as a certified public
accounting firm, or certified or licensed for such purpose by a State, or any
individual who is employed by or holds an ownership interest with respect to a
person described in this subparagraph, when such person is performing or
offering to perform—</text>
<clause id="idCFF52FB4869649F8813E7B813F09A1D1"><enum>(i)</enum><text>customary and usual
accounting activities, including the provision of accounting, tax, advisory, or
other services that are subject to the regulatory authority of a State board of
accountancy or a Federal authority; or</text>
</clause><clause id="id80A54C2CAA65459CA6586B8F996F1F11"><enum>(ii)</enum><text>other services that are
incidental to such customary and usual accounting activities, to the extent
that such incidental services are not offered or provided—</text>
<subclause id="id43D58D0E9A664D1CA8B3E2BE6D05B79A"><enum>(I)</enum><text>by the person separate
and apart from such customary and usual accounting activities; or</text>
</subclause><subclause id="idBA715EE0D37B43939263CC51E2B37699"><enum>(II)</enum><text>to consumers who are not
receiving such customary and usual accounting activities; or</text>
</subclause></clause></subparagraph><subparagraph id="IDf123c13147364032a827f0a44a2c5d39"><enum>(B)</enum><text>any person, other than a
person described in subparagraph (A) that performs income tax preparation
activities for consumers.</text>
</subparagraph></paragraph><paragraph id="ID0cfd8b2d61a3476a85c23bbf9bd35cef"><enum>(2)</enum><header>Description of
activities</header>
<subparagraph id="ID1fcfc24d8ad349099c79060f5e702539"><enum>(A)</enum><header>In
general</header><text>Paragraph (1) shall not apply to any person described in
paragraph (1)(A) or (1)(B) to the extent that such person is engaged in any
activity which is not a customary and usual accounting activity described in
paragraph (1)(A) or incidental thereto but which is the offering or provision
of any consumer financial product or service, except to the extent that a
person described in paragraph (1)(A) is engaged in an activity which is a
customary and usual accounting activity described in paragraph (1)(A), or
incidental thereto.</text>
</subparagraph><subparagraph id="IDd85f08b040c94c8abe6c030dd5312d7a"><enum>(B)</enum><header>Not a customary and
usual accounting activity</header><text>For purposes of this subsection,
extending or brokering credit is not a customary and usual accounting activity,
or incidental thereto.</text>
</subparagraph><subparagraph id="ID5b2a454cfb3d4bbbb28653d234536dcb"><enum>(C)</enum><header>Rule of
construction</header><text>For purposes of subparagraphs (A) and (B), a person
described in paragraph (1)(A) shall not be deemed to be extending credit, if
such person is only extending credit directly to a consumer, exclusively for
the purpose of enabling such consumer to purchase services described in clause
(i) or (ii) of paragraph (1)(A) directly from such person, and such credit
is—</text>
<clause id="ID8c5f3136c8e64b5187c00544efc95fc6"><enum>(i)</enum><text>not subject to a finance
charge; and</text>
</clause><clause id="IDd417ea3979b94055bf9776e8c07c9710"><enum>(ii)</enum><text>not payable by written
agreement in more than 4 installments.</text>
</clause></subparagraph><subparagraph id="IDa893616c63db4001a3d69ffe49946274"><enum>(D)</enum><header>Other
limitations</header><text>Paragraph (1) does not apply to any person described
in paragraph (1)(A) or (1)(B) that is otherwise subject to any enumerated
consumer law or any law for which authorities are transferred under subtitle F
or H.</text>
</subparagraph></paragraph></subsection><subsection id="ID225dc031d90e4f3791daf34de86fb2bc"><enum>(e)</enum><header>Exclusion for
attorneys</header>
<paragraph id="IDc2bac4648df8462abf9d595f7b39406e"><enum>(1)</enum><header>In
general</header><text>The Bureau may not exercise any authority to conduct
examinations of an attorney licensed by a State, to the extent that the
attorney is engaged in the practice of law under the laws of such State.</text>
</paragraph><paragraph id="ID068e28bd25d141e7992cf61ba5367714"><enum>(2)</enum><header>Exception for
enumerated consumer laws and transferred authorities</header><text>Paragraph
(1) shall not apply to an attorney who is engaged in the offering or provision
of any consumer financial product or service, or is otherwise subject to any
enumerated consumer law or any law for which authorities are transferred under
subtitle F or H.</text>
</paragraph></subsection><subsection id="idBE285D6497134556995BBE20E16BB279"><enum>(f)</enum><header>Exclusion for persons
regulated by a State insurance regulator</header>
<paragraph id="idD5A9E6621E5046F2BAF43C93601D6D2F"><enum>(1)</enum><header>In
general</header><text>No provision of this title shall be construed as
altering, amending, or affecting the authority of any State insurance regulator
to adopt rules, initiate enforcement proceedings, or take any other action with
respect to a person regulated by a State insurance regulator. Except as
provided in paragraph (2), the Bureau shall have no authority to exercise any
power to enforce this title with respect to a person regulated by a State
insurance regulator.</text>
</paragraph><paragraph id="idBA8A33272D2348DD991BB979E0BD5995"><enum>(2)</enum><header>Description of
activities</header><text>Paragraph (1) does not apply to any person described
in such paragraph to the extent that such person is engaged in the offering or
provision of any consumer financial product or service or is otherwise subject
to any enumerated consumer law or any law for which authorities are transferred
under subtitle F or H.</text>
</paragraph></subsection><subsection id="IDa26ddc80e6db44cbb39b889ed9ab118b"><enum>(g)</enum><header>Exclusion for employee
benefit and compensation plans and certain other arrangements under the
Internal Revenue Code of 1986</header>
<paragraph id="ID7be45b54f8d744f9b2b84b28b0d7e004"><enum>(1)</enum><header>Preservation of
authority of other agencies</header><text>No provision of this title shall be
construed as altering, amending, or affecting the authority of the Secretary of
the Treasury, the Secretary of Labor, or the Commissioner of Internal Revenue
to adopt regulations, initiate enforcement proceedings, or take any actions
with respect to any specified plan or arrangement.</text>
</paragraph><paragraph id="ID5f02c1006e4141fa8ce6f51b0b1b34de"><enum>(2)</enum><header>Activities not
constituting the offering or provision of any consumer financial product or
service</header><text>For purposes of this title, a person shall not be treated
as having engaged in the offering or provision of any consumer financial
product or service solely because such person is a specified plan or
arrangement, or is engaged in the activity of establishing or maintaining, for
the benefit of employees of such person (or for members of an employee
organization), any specified plan or arrangement.</text>
</paragraph><paragraph id="ID563aad119367455ca45950f3aedb8d9c"><enum>(3)</enum><header>Limitation on bureau
authority</header>
<subparagraph id="IDe0e488386c7842228403e7af1a36da80"><enum>(A)</enum><header>In
general</header><text>Except as provided under subparagraphs (B) and (C), the
Bureau may not exercise any rulemaking or enforcement authority with respect to
products or services that relate to any specified plan or arrangement.</text>
</subparagraph><subparagraph id="IDcc9d2bea4268461b814ae44e24a18494"><enum>(B)</enum><header>Bureau action only
pursuant to agency request</header><text>The Secretary and the Secretary of
Labor may jointly issue a written request to the Bureau regarding
implementation of appropriate consumer protection standards under this title
with respect to the provision of services relating to any specified plan or
arrangement. Subject to a request made under this subparagraph, the Bureau may
exercise rulemaking authority, and may act to enforce a rule prescribed
pursuant to such request, in accordance with the provisions of this title. A
request made by the Secretary and the Secretary of Labor under this
subparagraph shall describe the basis for, and scope of, appropriate consumer
protection standards to be implemented under this title with respect to the
provision of services relating to any specified plan or arrangement.</text>
</subparagraph><subparagraph id="ID41cda247d63f4cfc90e0ab1bfaaed5fd"><enum>(C)</enum><header>Description of products
or services</header><text>To the extent that a person engaged in providing
products or services relating to any specified plan or arrangement is subject
to any enumerated consumer law or any law for which authorities are transferred
under subtitle F or H, subparagraph (A) shall not apply with respect to that
law.</text>
</subparagraph></paragraph><paragraph id="ID88595de3bb2d4dd59967dadaccbec811"><enum>(4)</enum><header>Specified plan or
arrangement</header><text>For purposes of this subsection, the term
<quote>specified plan or arrangement</quote> means any plan, account, or
arrangement described in section 220, 223, 401(a), 403(a), 403(b), 408, 408A,
529, or 530 of the Internal Revenue Code of 1986, or any employee benefit or
compensation plan or arrangement, including a plan that is subject to title I
of the Employee Retirement Income Security Act of 1974.</text>
</paragraph></subsection><subsection id="IDf71d60d9b74d4dbe953d45c6f08bd5fa"><enum>(h)</enum><header>Persons regulated by a
State securities commission</header>
<paragraph id="IDfcbd38f1ee93430892013dca89aa7592"><enum>(1)</enum><header>In
general</header><text>No provision of this title shall be construed as
altering, amending, or affecting the authority of any securities commission (or
any agency or office performing like functions) of any State to adopt rules,
initiate enforcement proceedings, or take any other action with respect to a
person regulated by any securities commission (or any agency or office
performing like functions) of any State. Except as permitted in paragraph (2)
and subsection (f), the Bureau shall have no authority to exercise any power to
enforce this title with respect to a person regulated by any securities
commission (or any agency or office performing like functions) of any State,
but only to the extent that the person acts in such regulated capacity.</text>
</paragraph><paragraph id="IDe541c16ab4ab4f7f9b0479d76486ffdf"><enum>(2)</enum><header>Description of
activities</header><text>Paragraph (1) shall not apply to any person to the
extent such person is engaged in the offering or provision of any consumer
financial product or service, or is otherwise subject to any enumerated
consumer law or any law for which authorities are transferred under subtitle F
or H.</text>
</paragraph></subsection><subsection id="ID8691877c4ebf46ca8a18a6d684894af5"><enum>(i)</enum><header>Exclusion for persons
regulated by the commission</header>
<paragraph id="IDf2db6287ab4d483795143dfb38d7abca"><enum>(1)</enum><header>In
general</header><text>No provision of this title may be construed as altering,
amending, or affecting the authority of the Commission to adopt rules, initiate
enforcement proceedings, or take any other action with respect to a person
regulated by the Commission. The Bureau shall have no authority to exercise any
power to enforce this title with respect to a person regulated by the
Commission.</text>
</paragraph><paragraph id="ID4f06cc931be841a081958482cb4539cb"><enum>(2)</enum><header>Consultation and
coordination</header><text>Notwithstanding paragraph (1), the Commission shall
consult and coordinate, where feasible, with the Bureau with respect to any
rule (including any advance notice of proposed rulemaking) regarding an
investment product or service that is the same type of product as, or that
competes directly with, a consumer financial product or service that is subject
to the jurisdiction of the Bureau under this title or under any other law. In
carrying out this paragraph, the agencies shall negotiate an agreement to
establish procedures for such coordination, including procedures for providing
advance notice to the Bureau when the Commission is initiating a
rulemaking.</text>
</paragraph></subsection><subsection id="ID164ef976ef5e4b5e9c272ec92918ff6a"><enum>(j)</enum><header>Exclusion for persons
regulated by the commodity futures trading commission</header>
<paragraph id="ID7de9858435c44aa7bcc1ce0eee0ab9fe"><enum>(1)</enum><header>In
general</header><text>No provision of this title shall be construed as
altering, amending, or affecting the authority of the Commodity Futures Trading
Commission to adopt rules, initiate enforcement proceedings, or take any other
action with respect to a person regulated by the Commodity Futures Trading
Commission. The Bureau shall have no authority to exercise any power to enforce
this title with respect to a person regulated by the Commodity Futures Trading
Commission.</text>
</paragraph><paragraph id="ID784867517d324f6ab615d7da64730fa6"><enum>(2)</enum><header>Consultation and
coordination</header><text>Notwithstanding paragraph (1), the Commodity Futures
Trading Commission shall consult and coordinate with the Bureau with respect to
any rule (including any advance notice of proposed rulemaking) regarding a
product or service that is the same type of product as, or that competes
directly with, a consumer financial product or service that is subject to the
jurisdiction of the Bureau under this title or under any other law.</text>
</paragraph></subsection><subsection id="id8691FD88B47E459283E97507FEAA655E"><enum>(k)</enum><header>Exclusion for Persons
regulated by the farm credit administration</header>
<paragraph id="ID0ba2e94028f74f018528c9bbd46561ae"><enum>(1)</enum><header>In
general</header><text>No provision of this title shall be construed as
altering, amending, or affecting the authority of the Farm Credit
Administration to adopt rules, initiate enforcement proceedings, or take any
other action with respect to a person regulated by the Farm Credit
Administration. The Bureau shall have no authority to exercise any power to
enforce this title with respect to a person regulated by the Farm Credit
Administration.</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="ID4975cf8206264db389b97446020f7289"><enum>(2)</enum><header>Definition</header><text>For
purposes of this subsection, the term <quote>person regulated by the Farm
Credit Administration</quote> means any Farm Credit System institution that is
chartered and subject to the provisions of the Farm Credit Act of 1971 (12
U.S.C. 2001 et seq.).</text>
</paragraph></subsection><subsection id="id79FC8C7982094EEFABB2E5E415C8AC2E"><enum>(l)</enum><header>Exclusion for
activities relating to charitable contributions</header>
<paragraph id="idA1CC60DC3AA34D719F0666021EE89F78"><enum>(1)</enum><header>In
general</header><text>The Director and the Bureau may not exercise any
rulemaking, supervisory, enforcement, or other authority, including authority
to order penalties, over any activities related to the solicitation or making
of voluntary contributions to a tax-exempt organization as recognized by the
Internal Revenue Service, by any agent, volunteer, or representative of such
organizations to the extent the organization, agent, volunteer, or
representative thereof is soliciting or providing advice, information,
education, or instruction to any donor or potential donor relating to a
contribution to the organization.</text>
</paragraph><paragraph id="idC5962B4EF8CA4227956F46B0DA342775"><enum>(2)</enum><header>Limitation</header><text>The
exclusion in paragraph (1) does not apply to other activities not described in
paragraph (1) that are the offering or provision of any consumer financial
product or service, or are otherwise subject to any enumerated consumer law or
any law for which authorities are transferred under subtitle F or H.</text>
</paragraph></subsection><subsection id="IDf59fc306d42e47bfb1e16e0803e4faf8"><enum>(m)</enum><header>Insurance</header><text>The
Bureau may not define as a financial product or service, by regulation or
otherwise, engaging in the business of insurance.</text>
</subsection><subsection id="ID8538750f205542979e463fa3cd0103d5"><enum>(n)</enum><header>Limited authority of
the bureau</header><text>Notwithstanding subsections (a) through (h) and (l), a
person subject to or described in one or more of such subsections—</text>
<paragraph commented="no" id="ID072c17c6f84a499586dea198614cafba"><enum>(1)</enum><text>may be a service
provider; and</text>
</paragraph><paragraph id="IDb281f80b31fc47cd93708184a8e3deed"><enum>(2)</enum><text>may be subject to
requests from, or requirements imposed by, the Bureau regarding information in
order to carry out the responsibilities and functions of the Bureau and in
accordance with section 1022, 1052, or 1053.</text>
</paragraph></subsection><subsection id="ID9a64cae1e2234c4488d03495ad94152f"><enum>(o)</enum><header>No authority To impose
usury limit</header><text>No provision of this title shall be construed as
conferring authority on the Bureau to establish a usury limit applicable to an
extension of credit offered or made by a covered person to a consumer, unless
explicitly authorized by law.</text>
</subsection><subsection id="ID066df33095ad41bfa5f01e4efd7147e4"><enum>(p)</enum><header>Attorney
general</header><text>No provision of this title, including section 1024(c)(1),
shall affect the authorities of the Attorney General under otherwise applicable
provisions of law.</text>
</subsection><subsection id="ID70464ead3f8c43baaa736ff3df9ff002"><enum>(q)</enum><header>Secretary of the
treasury</header><text>No provision of this title shall affect the authorities
of the Secretary, including with respect to prescribing rules, initiating
enforcement proceedings, or taking other actions with respect to a person that
performs income tax preparation activities for consumers.</text>
</subsection><subsection id="ID6d9fefc83d524c7ca73fb1e7db11c19c"><enum>(r)</enum><header>Deposit insurance and
share insurance</header><text>Nothing in this title shall affect the authority
of the Corporation under the Federal Deposit Insurance Act or the National
Credit Union Administration Board under the Federal Credit Union Act as to
matters related to deposit insurance and share insurance, respectively.</text>
</subsection></section><section id="ID9e6e6eadace6404a8bcc9cbf65d3721e"><enum>1028.</enum><header>Authority to restrict
mandatory pre-dispute arbitration</header>
<subsection id="IDa75a2d9b74f34e45b9518545485e2439"><enum>(a)</enum><header>Study and
report</header><text>The Bureau shall conduct a study of, and shall provide a
report to Congress concerning, the use of agreements providing for arbitration
of any future dispute between covered persons and consumers in connection with
the offering or providing of consumer financial products or services.</text>
</subsection><subsection id="id94E358CFDFD9494FB301814C8EDFABCB"><enum>(b)</enum><header>Further
authority</header><text>The Bureau, by regulation, may prohibit or impose
conditions or limitations on the use of an agreement between a covered person
and a consumer for a consumer financial product or service providing for
arbitration of any future dispute between the parties, if the Bureau finds that
such a prohibition or imposition of conditions or limitations is in the public
interest and for the protection of consumers. The findings in such rule shall
be consistent with the study conducted under subsection (a).</text>
</subsection><subsection id="idA9D9F6FC927C46C4A0A574158572E1F5"><enum>(c)</enum><header>Limitation</header><text>The
authority described in subsection (b) may not be construed to prohibit or
restrict a consumer from entering into a voluntary arbitration agreement with a
covered person after a dispute has arisen.</text>
</subsection><subsection id="ID79bbed96799342f6a44afd7a03e4a224"><enum>(d)</enum><header>Effective
date</header><text>Notwithstanding any other provision of law, any regulation
prescribed by the Bureau under subsection (a) shall apply, consistent with the
terms of the regulation, to any agreement between a consumer and a covered
person entered into after the end of the 180-day period beginning on the
effective date of the regulation, as established by the Bureau.</text>
</subsection></section><section id="ID9de2c19a62c74535bca0bbd537dfa548"><enum>1029.</enum><header>Effective
date</header><text display-inline="no-display-inline">This subtitle shall
become effective on the designated transfer date.</text>
</section></subtitle><subtitle id="id5788D71B4490410685993B0EDC1C8218"><enum>C</enum><header>Specific Bureau
Authorities</header>
<section id="idFF83FC5C598344A2891985A7FF6ADF73"><enum>1031.</enum><header>Prohibiting unfair,
deceptive, or abusive acts or practices</header>
<subsection id="IDa544a60cf31e4bd6be9354f823a4bdb0"><enum>(a)</enum><header>In
general</header><text>The Bureau may take any action authorized under subtitle
E to prevent a covered person or service provider from committing or engaging
in an unfair, deceptive, or abusive act or practice under Federal law in
connection with any transaction with a consumer for a consumer financial
product or service, or the offering of a consumer financial product or
service.</text>
</subsection><subsection id="ID1cbe54210f5e4cc9aa21feaa04b7b3ee"><enum>(b)</enum><header>Rulemaking</header><text>The
Bureau may prescribe rules applicable to a covered person or service provider
identifying as unlawful unfair, deceptive, or abusive acts or practices in
connection with any transaction with a consumer for a consumer financial
product or service, or the offering of a consumer financial product or service.
Rules under this section may include requirements for the purpose of preventing
such acts or practices.</text>
</subsection><subsection id="IDe8ac99f59fa7466fbf1cfce993c6563a"><enum>(c)</enum><header>Unfairness</header>
<paragraph id="id9557CD6F6B794C84B68FC02362286CD8"><enum>(1)</enum><header>In
general</header><text>The Bureau shall have no authority under this section to
declare an act or practice in connection with a transaction with a consumer for
a consumer financial product or service, or the offering of a consumer
financial product or service, to be unlawful on the grounds that such act or
practice is unfair, unless the Bureau has a reasonable basis to conclude
that—</text>
<subparagraph id="id80111E6F03B64A5884F78C623DF18346"><enum>(A)</enum><text>the act or practice
causes or is likely to cause substantial injury to consumers which is not
reasonably avoidable by consumers; and</text>
</subparagraph><subparagraph id="id316610CE7D174344B264D6FE2EF4560B"><enum>(B)</enum><text>such substantial injury
is not outweighed by countervailing benefits to consumers or to
competition.</text>
</subparagraph></paragraph><paragraph id="idD19E7CC31F5348E78213B37131CA2466"><enum>(2)</enum><header>Consideration of public
policies</header><text>In determining whether an act or practice is unfair, the
Bureau may consider established public policies as evidence to be considered
with all other evidence. Such public policy considerations may not serve as a
primary basis for such determination.</text>
</paragraph></subsection><subsection id="IDd6332f40d8114c339aa4e3f89d951760"><enum>(d)</enum><header>Abusive</header><text>The
Bureau shall have no authority under this section to declare an act or practice
abusive in connection with the provision of a consumer financial product or
service, unless the act or practice—</text>
<paragraph id="ID699ca429f7154d18af5b6aff4b21e37f"><enum>(1)</enum><text>materially interferes
with the ability of a consumer to understand a term or condition of a consumer
financial product or service; or</text>
</paragraph><paragraph commented="no" id="IDd5337c64d30d43328a7229b01143c763"><enum>(2)</enum><text>takes unreasonable
advantage of—</text>
<subparagraph commented="no" id="idAF9C7123EE1D46229A2E004DEDE1B4FC"><enum>(A)</enum><text>a lack of understanding
on the part of the consumer of the material risks, costs, or conditions of the
product or service;</text>
</subparagraph><subparagraph commented="no" id="id3F85699CB43C4A22957BC47D88023C6F"><enum>(B)</enum><text>the inability of the
consumer to protect the interests of the consumer in selecting or using a
consumer financial product or service; or</text>
</subparagraph><subparagraph commented="no" id="idA3B4E3C6E3ED4E648DF905473CA7635F"><enum>(C)</enum><text>the reasonable reliance
by the consumer on a covered person to act in the interests of the
consumer.</text>
</subparagraph></paragraph></subsection><subsection id="ID64d75598ed284b739c310da1e491b752"><enum>(e)</enum><header>Consultation</header><text>In
prescribing rules under this section, the Bureau shall consult with the Federal
banking agencies, or other Federal agencies, as appropriate, concerning the
consistency of the proposed rule with prudential, market, or systemic
objectives administered by such agencies.</text>
</subsection><subsection id="ID3486f97961244d1ea121364d16c22915"><enum>(f)</enum><header>Consideration of
seasonal income</header><text>The rules of the Bureau under this section shall
provide, with respect to an extension of credit secured by residential real
estate or a dwelling, if documented income of the borrower, including income
from a small business, is a repayment source for an extension of credit secured
by residential real estate or a dwelling, the creditor may consider the
seasonality and irregularity of such income in the underwriting of and
scheduling of payments for such credit.</text>
</subsection></section><section id="ID8df3019826214c00bce58c65f21b86e2"><enum>1032.</enum><header>Disclosures</header>
<subsection id="ID370569a747604f249c5df52f3e109d1f"><enum>(a)</enum><header>In
general</header><text>The Bureau may prescribe rules to ensure that the
features of any consumer financial product or service, both initially and over
the term of the product or service, are fully, accurately, and effectively
disclosed to consumers in a manner that permits consumers to understand the
costs, benefits, and risks associated with the product or service, in light of
the facts and circumstances.</text>
</subsection><subsection id="ID3b240791b86b4d93804c36dbececa82d"><enum>(b)</enum><header>Model
disclosures</header>
<paragraph id="ID0175c3135958495a99338286d2b54e9e"><enum>(1)</enum><header>In
general</header><text>Any final rule prescribed by the Bureau under this
section requiring disclosures may include a model form that may be used at the
option of the covered person for provision of the required disclosures.</text>
</paragraph><paragraph id="IDdbaa24137863419991020b28d215a547"><enum>(2)</enum><header>Format</header><text>A
model form issued pursuant to paragraph (1) shall contain a clear and
conspicuous disclosure that, at a minimum—</text>
<subparagraph id="IDc76d1be06472476db5744896fc4324e2"><enum>(A)</enum><text>uses plain language
comprehensible to consumers;</text>
</subparagraph><subparagraph id="ID7baa68bbca714ce58a2519677a26cc53"><enum>(B)</enum><text>contains a clear format
and design, such as an easily readable type font; and</text>
</subparagraph><subparagraph id="IDafdd07564081481fb249404ec20eb336"><enum>(C)</enum><text>succinctly explains the
information that must be communicated to the consumer.</text>
</subparagraph></paragraph><paragraph id="IDabf02ec6e5aa46c78fbae9f35e75f939"><enum>(3)</enum><header>Consumer
testing</header><text>Any model form issued pursuant to this subsection shall
be validated through consumer testing.</text>
</paragraph></subsection><subsection id="ID92b06122366644e491601f76310f21d9"><enum>(c)</enum><header>Basis for
rulemaking</header><text>In prescribing rules under this section, the Bureau
shall consider available evidence about consumer awareness, understanding of,
and responses to disclosures or communications about the risks, costs, and
benefits of consumer financial products or services.</text>
</subsection><subsection id="IDd3b0549e174945db91357561e73da09f"><enum>(d)</enum><header>Safe
harbor</header><text>Any covered person that uses a model form included with a
rule issued under this section shall be deemed to be in compliance with the
disclosure requirements of this section with respect to such model form.</text>
</subsection><subsection id="ID411d65e4f581458e980306b67297c957"><enum>(e)</enum><header>Trial disclosure
programs</header>
<paragraph id="ID271388d6dce84e668aeb7ab2daa3d54e"><enum>(1)</enum><header>In
general</header><text>The Bureau may permit a covered person to conduct a trial
program that is limited in time and scope, subject to specified standards and
procedures, for the purpose of providing trial disclosures to consumers that
are designed to improve upon any model form issued pursuant to subsection
(b)(1), or any other model form issued to implement an enumerated statute, as
applicable.</text>
</paragraph><paragraph id="ID380c0ba15bb546088bf61268a2468395"><enum>(2)</enum><header>Safe
harbor</header><text>The standards and procedures issued by the Bureau shall be
designed to encourage covered persons to conduct trial disclosure programs. For
the purposes of administering this subsection, the Bureau may establish a
limited period during which a covered person conducting a trial disclosure
program shall be deemed to be in compliance with, or may be exempted from, a
requirement of a rule or an enumerated consumer law.</text>
</paragraph><paragraph id="IDddd60815b65242af944ddafbdfcbbd56"><enum>(3)</enum><header>Public
disclosure</header><text>The rules of the Bureau shall provide for public
disclosure of trial disclosure programs, which public disclosure may be
limited, to the extent necessary to encourage covered persons to conduct
effective trials.</text>
</paragraph></subsection><subsection id="ID1a58797066874f3685b91947c5d0a69e"><enum>(f)</enum><header>Combined mortgage loan
disclosure</header><text>Not later than 1 year after the designated transfer
date, the Bureau shall propose for public comment rules and model disclosures
that combine the disclosures required under the Truth in Lending Act and the
Real Estate Settlement Procedures Act of 1974, into a single, integrated
disclosure for mortgage loan transactions covered by those laws, unless the
Bureau determines that any proposal issued by the Board of Governors and the
Secretary of Housing and Urban Development carries out the same purpose.</text>
</subsection></section><section id="ID497461e358f04ddd8ec1b8d3b944b389"><enum>1033.</enum><header>Consumer rights to
access information</header>
<subsection id="ID0bf8736efe5047fd958f96d23a623bec"><enum>(a)</enum><header>In
general</header><text>Subject to rules prescribed by the Bureau, a covered
person shall make available to a consumer, upon request, information in the
control or possession of the covered person concerning the consumer financial
product or service that the consumer obtained from such covered person,
including information relating to any transaction, series of transactions, or
to the account including costs, charges and usage data. The information shall
be made available in an electronic form usable by consumers.</text>
</subsection><subsection id="ID4c023e3cc7474c6ca2cf0f95aabca44f"><enum>(b)</enum><header>Exceptions</header><text>A
covered person may not be required by this section to make available to the
consumer—</text>
<paragraph id="ID9d8e739100a34725af681bce634067e8"><enum>(1)</enum><text>any confidential
commercial information, including an algorithm used to derive credit scores or
other risk scores or predictors;</text>
</paragraph><paragraph id="ID56de86c1f3a9497eaf96f0c536c2ea56"><enum>(2)</enum><text>any information collected
by the covered person for the purpose of preventing fraud or money laundering,
or detecting, or making any report regarding other unlawful or potentially
unlawful conduct;</text>
</paragraph><paragraph id="ID828fa9bc20f240a7988b04f51d3833a7"><enum>(3)</enum><text>any information required
to be kept confidential by any other provision of law; or</text>
</paragraph><paragraph id="ID06be4bafc6ea473e967950c3595e1d04"><enum>(4)</enum><text>any information that the
covered person cannot retrieve in the ordinary course of its business with
respect to that information.</text>
</paragraph></subsection><subsection id="ID1c000da2c20e4e848bdaa14a1eb10707"><enum>(c)</enum><header>No duty To maintain
records</header><text>Nothing in this section shall be construed to impose any
duty on a covered person to maintain or keep any information about a
consumer.</text>
</subsection><subsection id="ID1a4814b1737741afb090e73cb27d7b33"><enum>(d)</enum><header>Standardized formats
for data</header><text>The Bureau, by rule, shall prescribe standards
applicable to covered persons to promote the development and use of
standardized formats for information, including through the use of machine
readable files, to be made available to consumers under this section.</text>
</subsection><subsection id="IDe85218275cb344bbaa2fed1246cacb04"><enum>(e)</enum><header>Consultation</header><text>The
Bureau shall, when prescribing any rule under this section, consult with the
Federal banking agencies and the Federal Trade Commission to ensure, to the
extent appropriate, that the rules—</text>
<paragraph id="IDc1bd2afe52b84c159c413066ce893a18"><enum>(1)</enum><text>impose substantively
similar requirements on covered persons;</text>
</paragraph><paragraph id="IDd4ab0aeebdfd4762a846c2b9e01504b6"><enum>(2)</enum><text>take into account
conditions under which covered persons do business both in the United States
and in other countries; and</text>
</paragraph><paragraph id="ID04f13b17e38249ee845b514ddb6a5bda"><enum>(3)</enum><text>do not require or promote
the use of any particular technology in order to develop systems for
compliance.</text>
</paragraph></subsection></section><section id="ID7307cd45b05a409d8ac6662bd286f455"><enum>1034.</enum><header>Response to consumer
complaints and inquiries</header>
<subsection id="IDf63e8f5146db4117bb1edec1892b71ab"><enum>(a)</enum><header>Timely regulator
response to consumers</header><text>The Bureau shall establish, in consultation
with the appropriate Federal regulatory agencies, reasonable procedures to
provide a timely response to consumers, in writing where appropriate, to
complaints against, or inquiries concerning, a covered person,
including—</text>
<paragraph id="ID68090bdd9937437c9901fdf02c75da5a"><enum>(1)</enum><text>steps that have been
taken by the regulator in response to the complaint or inquiry of the
consumer;</text>
</paragraph><paragraph id="IDaafcbf8ea86046ea8453651b42b28bcf"><enum>(2)</enum><text>any responses received by
the regulator from the covered person; and</text>
</paragraph><paragraph id="IDad2f7c8acfa04c2496209556c6b4058d"><enum>(3)</enum><text>any follow-up actions or
planned follow-up actions by the regulator in response to the complaint or
inquiry of the consumer.</text>
</paragraph></subsection><subsection id="IDe669558220b146828b04f07e82d3c035"><enum>(b)</enum><header>Timely response to
regulator by covered person</header><text>A covered person subject to
supervision and primary enforcement by the Bureau pursuant to section 1025
shall provide a timely response, in writing where appropriate, to the Bureau,
the prudential regulators, and any other agency having jurisdiction over such
covered person concerning a consumer complaint or inquiry, including—</text>
<paragraph id="ID96a5665b73b643398fca27ade0e86b0f"><enum>(1)</enum><text>steps that have been
taken by the covered person to respond to the complaint or inquiry of the
consumer;</text>
</paragraph><paragraph id="IDe44d105f324d4c72abd82f35a535447c"><enum>(2)</enum><text>responses received by the
covered person from the consumer; and</text>
</paragraph><paragraph id="ID50f8e911a21b4d7d9bbe6c4a5e072056"><enum>(3)</enum><text>follow-up actions or
planned follow-up actions by the covered person to respond to the complaint or
inquiry of the consumer.</text>
</paragraph></subsection><subsection id="IDe620f4c05cff4dc58ec47a41fc785947"><enum>(c)</enum><header>Provision of
information to consumers</header>
<paragraph id="ID9be94f55114f4ca0a2c8ac377b7bd7fc"><enum>(1)</enum><header>In
general</header><text>A covered person subject to supervision and primary
enforcement by the Bureau pursuant to section 1025 shall, in a timely manner,
comply with a consumer request for information in the control or possession of
such covered person concerning the consumer financial product or service that
the consumer obtained from such covered person, including supporting written
documentation, concerning the account of the consumer.</text>
</paragraph><paragraph id="IDb0fd48995fe74d689cddf3d2606a753a"><enum>(2)</enum><header>Exceptions</header><text>A
covered person subject to supervision and primary enforcement by the Bureau
pursuant to section 1025, a prudential regulator, and any other agency having
jurisdiction over a covered person subject to supervision and primary
enforcement by the Bureau pursuant to section 1025 may not be required by this
section to make available to the consumer—</text>
<subparagraph id="ID9c91ed4b8417476bb4082247637b4b98"><enum>(A)</enum><text>any confidential
commercial information, including an algorithm used to derive credit scores or
other risk scores or predictors;</text>
</subparagraph><subparagraph id="ID6c37355a2c6c4fd79af17ceeb170c347"><enum>(B)</enum><text>any information collected
by the covered person for the purpose of preventing fraud or money laundering,
or detecting or making any report regarding other unlawful or potentially
unlawful conduct;</text>
</subparagraph><subparagraph id="IDe2dbb2836f234e4ba0f9a7660aa3afb1"><enum>(C)</enum><text>any information required
to be kept confidential by any other provision of law; or</text>
</subparagraph><subparagraph id="ID080d55011d1a4498bfc18e8512b1a849"><enum>(D)</enum><text>any nonpublic or
confidential information, including confidential supervisory
information.</text>
</subparagraph></paragraph></subsection><subsection id="ID152075ff2e4747dd87c589354102a944"><enum>(d)</enum><header>Agreements with other
agencies</header><text>The Bureau shall enter into a memorandum of
understanding with any affected Federal regulatory agency regarding procedures
by which any covered person, and the prudential regulators, and any other
agency having jurisdiction over a covered person, including the Secretary of
the Department of Housing and Urban Development and the Secretary of Education,
shall comply with this section.</text>
</subsection></section><section id="IDd5e64773ae124d55b742a73a80d781eb"><enum>1035.</enum><header>Private education
loan ombudsman</header>
<subsection id="ID052a1153cfc94b9fa846e6c5906e5978"><enum>(a)</enum><header>Establishment</header><text>The
Secretary, in consultation with the Director, shall designate a Private
Education Loan Ombudsman (in this section referred to as the
<quote>Ombudsman</quote>) within the Bureau, to provide timely assistance to
borrowers of private education loans.</text>
</subsection><subsection id="ID9073fcc987fa4795a36132eb4fc9cc42"><enum>(b)</enum><header>Public
information</header><text>The Secretary and the Director shall disseminate
information about the availability and functions of the Ombudsman to borrowers
and potential borrowers, as well as institutions of higher education, lenders,
guaranty agencies, loan servicers, and other participants in private education
student loan programs.</text>
</subsection><subsection id="ID93aac0a5c2404c8d9bcbdce5ea9c266f"><enum>(c)</enum><header>Functions of
ombudsman</header><text>The Ombudsman designated under this subsection
shall—</text>
<paragraph id="IDbd7220a5a904446f9dafeba4f079fe89"><enum>(1)</enum><text>in accordance with
regulations of the Director, receive, review, and attempt to resolve informally
complaints from borrowers of loans described in subsection (a), including, as
appropriate, attempts to resolve such complaints in collaboration with the
Department of Education and with institutions of higher education, lenders,
guaranty agencies, loan servicers, and other participants in private education
loan programs;</text>
</paragraph><paragraph id="ID1cfbdd7ccb6f4a4b921639cfcc72e65f"><enum>(2)</enum><text>not later than 90 days
after the designated transfer date, establish a memorandum of understanding
with the student loan ombudsman established under section 141(f) of the Higher
Education Act of 1965 (20 U.S.C. 1018(f)), to ensure coordination in providing
assistance to and serving borrowers seeking to resolve complaints related to
their private education or Federal student loans;</text>
</paragraph><paragraph id="ID5a4e05ed188d46c58950a9956b6057a2"><enum>(3)</enum><text>compile and analyze data
on borrower complaints regarding private education loans; and</text>
</paragraph><paragraph id="IDda95d4e27cc644a895b80cdf9b032278"><enum>(4)</enum><text>make appropriate
recommendations to the Director, the Secretary, the Secretary of Education, the
Committee on Banking, Housing, and Urban Affairs and the Committee on Health,
Education, Labor, and Pensions of the Senate and the Committee on Financial
Services and the Committee on Education and Labor of the House of
Representatives.</text>
</paragraph></subsection><subsection id="ID4c15ce37674e425fbe49940da2f69073"><enum>(d)</enum><header>Annual reports</header>
<paragraph id="IDea142cdfcff04fc7aca5c70aa960b08d"><enum>(1)</enum><header>In
general</header><text>The Ombudsman shall prepare an annual report that
describes the activities, and evaluates the effectiveness of the Ombudsman
during the preceding year.</text>
</paragraph><paragraph id="ID444e58ef9a6b428e88a5fdc23bb72d9e"><enum>(2)</enum><header>Submission</header><text>The
report required by paragraph (1) shall be submitted on the same date annually
to the Secretary, the Secretary of Education, the Committee on Banking,
Housing, and Urban Affairs and the Committee on Health, Education, Labor, and
Pensions of the Senate and the Committee on Financial Services and the
Committee on Education and Labor of the House of Representatives.</text>
</paragraph></subsection><subsection id="ID96fc3280baf14ee790fb44a28e42a2bc"><enum>(e)</enum><header>Definitions</header><text>For
purposes of this section, the terms <quote>private education loan</quote> and
<quote>institution of higher education</quote> have the same meanings as in
section 140 of the Truth in Lending Act (15 U.S.C. 1650).</text>
</subsection></section><section id="ID717c19f21b7e4e58af63c7e29e01adf1"><enum>1036.</enum><header>Prohibited
acts</header><text display-inline="no-display-inline">It shall be unlawful for
any person—</text>
<paragraph id="id8C6F6FCAFCEC4446A54F502C3CE4956C"><enum>(1)</enum><text>to—</text>
<subparagraph id="idFF814029DDC54075ABD514F7B50B0ED9"><enum>(A)</enum><text>advertise, market, offer,
or sell a consumer financial product or service not in conformity with this
title or applicable rules or orders issued by the Bureau;</text>
</subparagraph><subparagraph id="id1FEF1F17AD544C86B19987D3041703CB"><enum>(B)</enum><text>enforce, or attempt to
enforce, any agreement with a consumer (including any term or change in terms
in respect of such agreement), or impose, or attempt to impose, any fee or
charge on a consumer in connection with a consumer financial product or service
that is not in conformity with this title or applicable rules or orders issued
by the Bureau; or</text>
</subparagraph><subparagraph id="idE2AA0FECF1AD45CCB3855356AD31D40F"><enum>(C)</enum><text>engage in any unfair,
deceptive, or abusive act or practice,</text>
<continuation-text continuation-text-level="subparagraph">except that no person shall be held to
have violated this paragraph solely by virtue of providing or selling time or
space to a person placing an advertisement;</continuation-text></subparagraph></paragraph><paragraph id="ID8e0bef5069194dd5b76bbcfd1d1c16d3"><enum>(2)</enum><text>to fail or refuse, as
required by Federal consumer financial law, or any rule or order issued by the
Bureau thereunder—</text>
<subparagraph id="IDf60c0a52c81e4efcbf00f0565464b833"><enum>(A)</enum><text>to permit access to or
copying of records;</text>
</subparagraph><subparagraph id="ID9fb9d74fecc14f479cec1dbbd4b638ed"><enum>(B)</enum><text>to establish or maintain
records; or</text>
</subparagraph><subparagraph id="ID46d671e8706b4a8583299c514d9402e8"><enum>(C)</enum><text>to make reports or
provide information to the Bureau; or</text>
</subparagraph></paragraph><paragraph id="IDd86f4d96d45c4dad9b1d5d2f8b97cbb3"><enum>(3)</enum><text>knowingly or recklessly
to provide substantial assistance to another person in violation of the
provisions of section 1031, or any rule or order issued thereunder, and
notwithstanding any provision of this title, the provider of such substantial
assistance shall be deemed to be in violation of that section to the same
extent as the person to whom such assistance is provided.</text>
</paragraph></section><section id="id2011B02078AA4C8EA206242F0DC29FF7"><enum>1037.</enum><header>Effective
date</header><text display-inline="no-display-inline">This subtitle shall take
effect on the designated transfer date.</text>
</section></subtitle><subtitle id="id3B5C177F3BEC44A9AEC31F37C329FE00"><enum>D</enum><header>Preservation of State
law</header>
<section id="id0B56578A14EE48D2AA8452A7AAFADC08"><enum>1041.</enum><header>Relation to State
law</header>
<subsection id="ID4d1d4cd88140405c8edf0328b12899ba"><enum>(a)</enum><header>In general</header>
<paragraph id="ID3972eef9d1204644ac85947af0d5be14"><enum>(1)</enum><header>Rule of
construction</header><text>This title, other than sections 1044 through 1048,
may not be construed as annulling, altering, or affecting, or exempting any
person subject to the provisions of this title from complying with, the
statutes, regulations, orders, or interpretations in effect in any State,
except to the extent that any such provision of law is inconsistent with the
provisions of this title, and then only to the extent of the
inconsistency.</text>
</paragraph><paragraph id="IDbcc9adfb875845f19b95df604d0a9b12"><enum>(2)</enum><header>Greater protection
under State law</header><text>For purposes of this subsection, a statute,
regulation, order, or interpretation in effect in any State is not inconsistent
with the provisions of this title if the protection that such statute,
regulation, order, or interpretation affords to consumers is greater than the
protection provided under this title. A determination regarding whether a
statute, regulation, order, or interpretation in effect in any State is
inconsistent with the provisions of this title may be made by the Bureau on its
own motion or in response to a nonfrivolous petition initiated by any
interested person.</text>
</paragraph></subsection><subsection id="IDfeffdd746e7c42a6959beff977247350"><enum>(b)</enum><header>Relation to other
provisions of enumerated consumer laws that relate to State
law</header><text>No provision of this title, except as provided in section
1083, shall be construed as modifying, limiting, or superseding the operation
of any provision of an enumerated consumer law that relates to the application
of a law in effect in any State with respect to such Federal law.</text>
</subsection><subsection id="ID60cc6740d8c841f5a5c70c304890f05f"><enum>(c)</enum><header>Additional consumer
protection regulations in response to State action</header>
<paragraph id="ID925be4a26acf405ea98a833aa011581d"><enum>(1)</enum><header>Notice of proposed rule
required</header><text>The Bureau shall issue a notice of proposed rulemaking
whenever a majority of the States has enacted a resolution in support of the
establishment or modification of a consumer protection regulation by the
Bureau.</text>
</paragraph><paragraph id="IDc02270887be24ec3977d0850ba2820b3"><enum>(2)</enum><header>Bureau considerations
required for issuance of final regulation</header><text>Before prescribing a
final regulation based upon a notice issued pursuant to paragraph (1), the
Bureau shall take into account whether—</text>
<subparagraph id="ID77d4a04d931a4971baabc86519a031ba"><enum>(A)</enum><text>the proposed regulation
would afford greater protection to consumers than any existing
regulation;</text>
</subparagraph><subparagraph id="ID8509127937a44e0080fd0712740de5c0"><enum>(B)</enum><text>the intended benefits of
the proposed regulation for consumers would outweigh any increased costs or
inconveniences for consumers, and would not discriminate unfairly against any
category or class of consumers; and</text>
</subparagraph><subparagraph id="ID472de049de6c4089bd54fd40bc29a7de"><enum>(C)</enum><text>a Federal banking agency
has advised that the proposed regulation is likely to present an unacceptable
safety and soundness risk to insured depository institutions.</text>
</subparagraph></paragraph><paragraph id="ID2c6ab1291c4b4aa7b46776ae8184b806"><enum>(3)</enum><header>Explanation of
considerations</header><text>The Bureau—</text>
<subparagraph id="IDde452b67a5054db3970e44aa45fba856"><enum>(A)</enum><text>shall include a
discussion of the considerations required in paragraph (2) in the Federal
Register notice of a final regulation prescribed pursuant to this subsection;
and</text>
</subparagraph><subparagraph id="IDde99712d4bb34ab0bdcd2c3b376936e9"><enum>(B)</enum><text>whenever the Bureau
determines not to prescribe a final regulation, shall publish an explanation of
such determination in the Federal Register, and provide a copy of such
explanation to each State that enacted a resolution in support of the proposed
regulation, the Committee on Financial Services of the House of
Representatives, and the Committee on Banking, Housing, and Urban Affairs of
the Senate.</text>
</subparagraph></paragraph><paragraph id="ID14e2399e768a4595a15bf466fac0dafb"><enum>(4)</enum><header>Reservation of
authority</header><text>No provision of this subsection shall be construed as
limiting or restricting the authority of the Bureau to enhance consumer
protection standards established pursuant to this title in response to its own
motion or in response to a request by any other interested person.</text>
</paragraph><paragraph id="IDce269703da1149789da386ffc54857de"><enum>(5)</enum><header>Rule of
construction</header><text>No provision of this subsection shall be construed
as exempting the Bureau from complying with subchapter II of chapter 5 of title
5, United States Code.</text>
</paragraph><paragraph id="ID82b342e46ccd4c5c843a8d7600409e72"><enum>(6)</enum><header>Definition</header><text>For
purposes of this subsection, the term <term>consumer protection
regulation</term> means a regulation that the Bureau is authorized to prescribe
under the Federal consumer financial laws.</text>
</paragraph></subsection></section><section id="idAEFFDDFDD4BC48E0A241FFDD85C623DF"><enum>1042.</enum><header>Preservation of
enforcement powers of States</header>
<subsection id="ID43bc5c33604b4a878625e73fe15ce711"><enum>(a)</enum><header>In general</header>
<paragraph id="IDc09786acd8ac494097e7db31cf3d6ebd"><enum>(1)</enum><header>Action by
State</header><text>Except as provided in paragraph (2), the attorney general
(or the equivalent thereof) of any State may bring a civil action in the name
of such State in any district court of the United States in that State or in
State court that is located in that State and that has jurisdiction over the
defendant, to enforce provisions of this title or regulations issued under this
title, and to secure remedies under provisions of this title or remedies
otherwise provided under other law. A State regulator may bring a civil action
or other appropriate proceeding to enforce the provisions of this title or
regulations issued under this title with respect to any entity that is
State-chartered, incorporated, licensed, or otherwise authorized to do business
under State law (except as provided in paragraph (2)), and to secure remedies
under provisions of this title or remedies otherwise provided under other
provisions of law with respect to such an entity.</text>
</paragraph><paragraph id="IDabc4a9d22458489ca13ecfe4debb1fb9"><enum>(2)</enum><header>Action by State against
national bank or Federal savings association to enforce rules</header>
<subparagraph id="IDc347ee3dfbc3454b9eb39f33c2314e3b"><enum>(A)</enum><header>In
general</header><text>Except as permitted under subparagraph (B), the attorney
general (or equivalent thereof) of any State may not bring a civil action in
the name of such State against a national bank or Federal savings association
with respect to an act or omission that would be a violation of a provision of
this title.</text>
</subparagraph><subparagraph id="IDc63c842e88c647f18ee5a1954739af5d"><enum>(B)</enum><header>Enforcement of rules
permitted</header><text>The attorney general (or the equivalent thereof) of any
State may bring a civil action in the name of such State against a national
bank or Federal savings association in any district court of the United States
in the State or in State court that is located in that State and that has
jurisdiction over the defendant to enforce a regulation prescribed by the
Bureau under a provision of this title and to secure remedies under provisions
of this title or remedies otherwise provided under other law.</text>
</subparagraph></paragraph><paragraph id="ID65467178e35f442ca2a00a06266e0dd5"><enum>(3)</enum><header>Rule of
construction</header><text>No provision of this title shall be construed as
modifying, limiting, or superseding the operation of any provision of an
enumerated consumer law that relates to the authority of a State attorney
general or State regulator to enforce such Federal law.</text>
</paragraph></subsection><subsection id="ID238ecb1730494ef495df6b8ad2585bb1"><enum>(b)</enum><header>Consultation
required</header>
<paragraph id="ID65e653a12e1643c095492c93cd374bfe"><enum>(1)</enum><header>Notice</header>
<subparagraph id="IDc5fa5bf881974efe93b9de70b7981301"><enum>(A)</enum><header>In
general</header><text>Before initiating any action in a court or other
administrative or regulatory proceeding against any covered person as
authorized by subsection (a) to enforce any provision of this title, including
any regulation prescribed by the Bureau under this title, a State attorney
general or State regulator shall timely provide a copy of the complete
complaint to be filed and written notice describing such action or proceeding
to the Bureau and the prudential regulator, if any, or the designee
thereof.</text>
</subparagraph><subparagraph id="ID6004d5b29d4b423880d6660a4486b518"><enum>(B)</enum><header>Emergency
action</header><text>If prior notice is not practicable, the State attorney
general or State regulator shall provide a copy of the complete complaint and
the notice to the Bureau and the prudential regulator, if any, immediately upon
instituting the action or proceeding.</text>
</subparagraph><subparagraph id="IDad7862e29a404c728ed38b8ae540f5d4"><enum>(C)</enum><header>Contents of
notice</header><text>The notification required under this paragraph shall, at a
minimum, describe—</text>
<clause id="IDa20de36c75e0429abc631f81f5912d81"><enum>(i)</enum><text>the identity of the
parties;</text>
</clause><clause id="ID479bb94905c54eacaf757fff41d2d7d4"><enum>(ii)</enum><text>the alleged facts
underlying the proceeding; and</text>
</clause><clause id="ID2be929a2b28347b69996076e5c303f38"><enum>(iii)</enum><text>whether there may be a
need to coordinate the prosecution of the proceeding so as not to interfere
with any action, including any rulemaking, undertaken by the Bureau, a
prudential regulator, or another Federal agency.</text>
</clause></subparagraph></paragraph><paragraph id="ID86aa9dc9c20a4215a8308821b149114c"><enum>(2)</enum><header>Bureau
response</header><text>In any action described in paragraph (1), the Bureau
may—</text>
<subparagraph id="ID3a82413f62454e7496875abc9765dcfc"><enum>(A)</enum><text>intervene in the action
as a party;</text>
</subparagraph><subparagraph id="IDf5f1048635be45d0b729d1807b3bc8d3"><enum>(B)</enum><text>upon intervening—</text>
<clause id="ID31349c64f1544985ad28939d3812b998"><enum>(i)</enum><text>remove the action to the
appropriate United States district court, if the action was not originally
brought there; and</text>
</clause><clause id="ID7939d4d260f14bde9869e4852b91b3fc"><enum>(ii)</enum><text>be heard on all matters
arising in the action; and</text>
</clause></subparagraph><subparagraph id="ID043f5aa6d6324dd3993fe2abfa98c7fe"><enum>(C)</enum><text>appeal any order or
judgment, to the same extent as any other party in the proceeding may.</text>
</subparagraph></paragraph></subsection><subsection id="ID6d788f207d784dbd91c1346c7d6c6a17"><enum>(c)</enum><header>Regulations</header><text>The
Bureau shall prescribe regulations to implement the requirements of this
section and, from time to time, provide guidance in order to further coordinate
actions with the State attorneys general and other regulators.</text>
</subsection><subsection id="IDda3e4e8cdb1c4be58d10d8ba2e1fc9ae"><enum>(d)</enum><header>Preservation of State
authority</header>
<paragraph id="IDaab4679f63284408a7fded40cc1abe2e"><enum>(1)</enum><header>State
claims</header><text>No provision of this section shall be construed as
altering, limiting, or affecting the authority of a State attorney general or
any other regulatory or enforcement agency or authority to bring an action or
other regulatory proceeding arising solely under the law in effect in that
State.</text>
</paragraph><paragraph id="ID64d32c8e18ee4f8792cd7937e8f2665e"><enum>(2)</enum><header>State securities
regulators</header><text>No provision of this title shall be construed as
altering, limiting, or affecting the authority of a State securities commission
(or any agency or office performing like functions) under State law to adopt
rules, initiate enforcement proceedings, or take any other action with respect
to a person regulated by such commission or authority.</text>
</paragraph><paragraph id="ID51975e4abceb4249a450d8750a3e9b3e"><enum>(3)</enum><header>State insurance
regulators</header><text>No provision of this title shall be construed as
altering, limiting, or affecting the authority of a State insurance commission
or State insurance regulator under State law to adopt rules, initiate
enforcement proceedings, or take any other action with respect to a person
regulated by such commission or regulator.</text>
</paragraph></subsection></section><section commented="no" id="ID9bea9afb485b401cb890b3e062243c28"><enum>1043.</enum><header>Preservation of
existing contracts</header><text display-inline="no-display-inline">This title,
and regulations, orders, guidance, and interpretations prescribed, issued, or
established by the Bureau, shall not be construed to alter or affect the
applicability of any regulation, order, guidance, or interpretation prescribed,
issued, and established by the Comptroller of the Currency or the Director of
the Office of Thrift Supervision regarding the applicability of State law under
Federal banking law to any contract entered into on or before the date of
enactment of this Act, by national banks, Federal savings associations, or
subsidiaries thereof that are regulated and supervised by the Comptroller of
the Currency or the Director of the Office of Thrift Supervision,
respectively.</text>
</section><section id="ID1746ef06aa4342a48c05fb3fc2a4bfd6"><enum>1044.</enum><header>State law preemption
standards for national banks and subsidiaries clarified</header>
<subsection id="id1194B224C3B84DE5AB4BCFA307AC7879"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">Chapter one of title
LXII of the Revised Statutes of the United States (12 U.S.C. 21 et seq.) is
amended by inserting after section 5136B the following new section:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id98F250250E77450B80BD5307DF5B1C32" reported-display-style="italic" style="OLC">
<section id="IDf4a72e96d9a54e40b6cf5cf79c2be340"><enum>5136C.</enum><header>State law preemption
standards for national banks and subsidiaries clarified</header>
<subsection id="idACBD9384C86A4153BA868FB16580103C"><enum>(a)</enum><header>Definitions</header><text display-inline="yes-display-inline">For purposes of this section, the following
definitions shall apply:</text>
<paragraph id="ID392ac747d1e44e7e8af498b03066b231"><enum>(1)</enum><header>National
bank</header><text>The term <term>national bank</term> includes—</text>
<subparagraph id="ID78ee905306dd4b0ebfb80568b3f37ce5"><enum>(A)</enum><text>any bank organized under
the laws of the United States; and</text>
</subparagraph><subparagraph id="ID50adebfb40fd4a0ca3e3365b5250b5b8"><enum>(B)</enum><text>any Federal branch
established in accordance with the International Banking Act of 1978.</text>
</subparagraph></paragraph><paragraph id="ID1b616b3e3ac246bfb1dd8cc299952a21"><enum>(2)</enum><header>State consumer
financial laws</header><text>The term <term>State consumer financial law</term>
means a State law that does not directly or indirectly discriminate against
national banks and that directly and specifically regulates the manner,
content, or terms and conditions of any financial transaction (as may be
authorized for national banks to engage in), or any account related thereto,
with respect to a consumer.</text>
</paragraph><paragraph id="IDbdb2f1459318462cb9d94dd3f77d2096"><enum>(3)</enum><header>Other
definitions</header><text>The terms <term>affiliate</term>,
<term>subsidiary</term>, <term>includes</term>, and <term>including</term> have
the same meanings as in section 3 of the Federal Deposit Insurance Act.</text>
</paragraph></subsection><subsection id="ID873d3a8ce5a44d18b79f2e526fd4e131"><enum>(b)</enum><header>Preemption
standard</header>
<paragraph id="ID07e5e60b8b65441fa86d09aaf1556274"><enum>(1)</enum><header>In
general</header><text>State consumer financial laws are preempted, only
if—</text>
<subparagraph id="ID4bf39377410748019dba6e05752dfb58"><enum>(A)</enum><text>application of a State
consumer financial law would have a discriminatory effect on national banks, in
comparison with the effect of the law on a bank chartered by that State;</text>
</subparagraph><subparagraph id="ID10ceec476f084226847bffbafdad8258"><enum>(B)</enum><text>the State consumer
financial law is preempted in accordance with the legal standard of the
decision of the Supreme Court of the United States in Barnett Bank of Marion
County, N.A. v. Nelson, Florida Insurance Commissioner, et al., 517 U.S. 25
(1996), and any preemption determination under this subparagraph may be made by
a court, or by regulation or order of the Comptroller of the Currency on a
case-by-case basis, in accordance with applicable law; or</text>
</subparagraph><subparagraph id="IDcfd62b5db5d34a2d91c59b24d908c1c4"><enum>(C)</enum><text>the State consumer
financial law is preempted by a provision of Federal law other than this
title.</text>
</subparagraph></paragraph><paragraph id="ID32aacb86f3fc4e3eb80af903d5f85e32"><enum>(2)</enum><header>Savings
clause</header><text>This title and section 24 of the Federal Reserve Act (12
U.S.C. 371) do not preempt, annul, or affect the applicability of any State law
to any subsidiary or affiliate of a national bank (other than a subsidiary or
affiliate that is chartered as a national bank).</text>
</paragraph><paragraph id="ID575d9110290b4eddbad7e0b42cec8c8a"><enum>(3)</enum><header>Case-by-case
basis</header>
<subparagraph id="IDc1c1d09b9ff14155bf3902e2e6d9d4c0"><enum>(A)</enum><header>Definition</header><text>As
used in this section the term <term>case-by-case basis</term> refers to a
determination pursuant to this section made by the Comptroller concerning the
impact of a particular State consumer financial law on any national bank that
is subject to that law, or the law of any other State with substantively
equivalent terms.</text>
</subparagraph><subparagraph id="IDbdad9ab26c334c3f8504b7768e24fea4"><enum>(B)</enum><header>Consultation</header><text>When
making a determination on a case-by-case basis that a State consumer financial
law of another State has substantively equivalent terms as one that the
Comptroller is preempting, the Comptroller shall first consult with the Bureau
of Consumer Financial Protection and shall take the views of the Bureau into
account when making the determination.</text>
</subparagraph></paragraph><paragraph id="ID39e59fce998145ec80dfc9610a80694b"><enum>(4)</enum><header>Rule of
construction</header><text>This title does not occupy the field in any area of
State law.</text>
</paragraph><paragraph id="IDf1502a8c385640ce94c670999bc69ae8"><enum>(5)</enum><header>Standards of
review</header>
<subparagraph id="IDc82252adbbec445b88b41dc48c047254"><enum>(A)</enum><header>Preemption</header><text>A
court reviewing any determinations made by the Comptroller regarding preemption
of a State law by this title or section 24 of the Federal Reserve Act (12
U.S.C. 371) shall assess the validity of such determinations, depending upon
the thoroughness evident in the consideration of the agency, the validity of
the reasoning of the agency, the consistency with other valid determinations
made by the agency, and other factors which the court finds persuasive and
relevant to its decision.</text>
</subparagraph><subparagraph id="ID6ac399c3874b40ba8f3b91f00c15261a"><enum>(B)</enum><header>Savings
clause</header><text>Except as provided in subparagraph (A), nothing in this
section shall affect the deference that a court may afford to the Comptroller
in making determinations regarding the meaning or interpretation of title LXII
of the Revised Statutes of the United States or other Federal laws.</text>
</subparagraph></paragraph><paragraph id="IDb83b6463ccbf48b89c0dac3d43793560"><enum>(6)</enum><header>Comptroller
determination not delegable</header><text>Any regulation, order, or
determination made by the Comptroller of the Currency under paragraph (1)(B)
shall be made by the Comptroller, and shall not be delegable to another officer
or employee of the Comptroller of the Currency.</text>
</paragraph></subsection><subsection id="IDa5513e2fbb38475cbc0798d6a246e681"><enum>(c)</enum><header>Substantial
evidence</header><text>No regulation or order of the Comptroller of the
Currency prescribed under subsection (b)(1)(B), shall be interpreted or applied
so as to invalidate, or otherwise declare inapplicable to a national bank, the
provision of the State consumer financial law, unless substantial evidence,
made on the record of the proceeding, supports the specific finding regarding
the preemption of such provision in accordance with the legal standard of the
decision of the Supreme Court of the United States in Barnett Bank of Marion
County, N.A. v. Nelson, Florida Insurance Commissioner, et al., 517 U.S. 25
(1996).</text>
</subsection><subsection id="IDca242a435e4c4613bbf61e924cb73ec4"><enum>(d)</enum><header>Periodic review of
preemption determinations</header>
<paragraph id="IDde94bdcb0d0848969a968b1401fd4fde"><enum>(1)</enum><header>In
general</header><text>The Comptroller of the Currency shall periodically
conduct a review, through notice and public comment, of each determination that
a provision of Federal law preempts a State consumer financial law. The agency
shall conduct such review within the 5-year period after prescribing or
otherwise issuing such determination, and at least once during each 5-year
period thereafter. After conducting the review of, and inspecting the comments
made on, the determination, the agency shall publish a notice in the Federal
Register announcing the decision to continue or rescind the determination or a
proposal to amend the determination. Any such notice of a proposal to amend a
determination and the subsequent resolution of such proposal shall comply with
the procedures set forth in subsections (a) and (b) of section 5244 of the
Revised Statutes of the United States (12 U.S.C. 43 (a), (b)).</text>
</paragraph><paragraph id="ID4f39d09abc8b4491b09a172d90d537c8"><enum>(2)</enum><header>Reports to
Congress</header><text>At the time of issuing a review conducted under
paragraph (1), the Comptroller of the Currency shall submit a report regarding
such review to the Committee on Financial Services of the House of
Representatives and the Committee on Banking, Housing, and Urban Affairs of the
Senate. The report submitted to the respective committees shall address whether
the agency intends to continue, rescind, or propose to amend any determination
that a provision of Federal law preempts a State consumer financial law, and
the reasons therefor.</text>
</paragraph></subsection><subsection id="ID661af4c37c7844cdb4686465f7983b81"><enum>(e)</enum><header>Application of State
consumer financial law to subsidiaries and
affiliates</header><text>Notwithstanding any provision of this title or section
24 of Federal Reserve Act (12 U.S.C. 371), a State consumer financial law shall
apply to a subsidiary or affiliate of a national bank (other than a subsidiary
or affiliate that is chartered as a national bank) to the same extent that the
State consumer financial law applies to any person, corporation, or other
entity subject to such State law.</text>
</subsection><subsection id="IDfd1bb48fa27648fe9bf43c9c967efd7a"><enum>(f)</enum><header>Preservation of powers
related to charging interest</header><text>No provision of this title shall be
construed as altering or otherwise affecting the authority conferred by section
5197 of the Revised Statutes of the United States (12 U.S.C. 85) for the
charging of interest by a national bank at the rate allowed by the laws of the
State, territory, or district where the bank is located, including with respect
to the meaning of <quote>interest</quote> under such provision.</text>
</subsection><subsection id="IDd493cd3d627342eebc9b2330607f0650"><enum>(g)</enum><header>Transparency of OCC
preemption determinations</header><text>The Comptroller of the Currency shall
publish and update no less frequently than quarterly, a list of preemption
determinations by the Comptroller of the Currency then in effect that
identifies the activities and practices covered by each determination and the
requirements and constraints determined to be
preempted.</text>
</subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="IDeae30f374ec4405cbf707b1bcfe7bf2e"><enum>(b)</enum><header>Clerical
amendment</header><text>The table of sections for chapter one of title LXII of
the Revised Statutes of the United States is amended by inserting after the
item relating to section 5136B the following new item:</text>
<quoted-block changed="added" id="id61501783-0a7f-4224-82ba-b20108c785b8" reported-display-style="italic" style="OLC">
<toc changed="added" reported-display-style="italic">
<toc-entry level="section">Sec. 5136C. State law preemption standards for
national banks and subsidiaries
clarified.</toc-entry>
</toc>
<after-quoted-block>.</after-quoted-block></quoted-block>
</subsection></section><section id="IDdeb2b775c448445d864ff20d3437f728"><enum>1045.</enum><header>Clarification of law
applicable to nondepository institution subsidiaries</header><text display-inline="no-display-inline">Section 5136C of the Revised Statutes of the
United States (as added by this subtitle) is amended by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idB72A17E8B1F740588D388A7B55C44064" reported-display-style="italic" style="OLC">
<subsection id="ID1ff8ecd1d0c74ff89d23f9c6f93a5b39"><enum>(h)</enum><header>Clarification of law
applicable to nondepository institution subsidiaries and affiliates of national
banks</header>
<paragraph id="ID2164f62342084ba6b19d4977f17efe39"><enum>(1)</enum><header>Definitions</header><text>For
purposes of this subsection, the terms <term>depository institution</term>,
<term>subsidiary</term>, and <term>affiliate</term> have the same meanings as
in section 3 of the Federal Deposit Insurance Act.</text>
</paragraph><paragraph id="IDaa77274b384948499b99484964b5306b"><enum>(2)</enum><header>Rule of
construction</header><text>No provision of this title or section 24 of the
Federal Reserve Act (12 U.S.C. 371) shall be construed as preempting,
annulling, or affecting the applicability of State law to any subsidiary,
affiliate, or agent of a national bank (other than a subsidiary, affiliate, or
agent that is chartered as a national
bank).</text>
</paragraph></subsection><after-quoted-block>.
</after-quoted-block></quoted-block>
</section><section id="ID074aa9329d854e9e8131e5b655415afe"><enum>1046.</enum><header>State law preemption
standards for Federal savings associations and subsidiaries clarified</header>
<subsection id="IDdee508ad386a452aa0425c4f78d75d00"><enum>(a)</enum><header>In
general</header><text>The Home Owners’ Loan Act (12 U.S.C. 1461 et seq.) is
amended by inserting after section 5 the following new section:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id3581830D79D34F2B9F474CE5D3CD37C7" reported-display-style="italic" style="OLC">
<section id="ID84a94dedd7924e78be8ff18cb1cad256"><enum>6.</enum><header>State law preemption
standards for Federal savings associations clarified</header>
<subsection id="ID45cba2ad0ab74d26a66dc27e8a467570"><enum>(a)</enum><header>In
general</header><text>Any determination by a court or by the Director or any
successor officer or agency regarding the relation of State law to a provision
of this Act or any regulation or order prescribed under this Act shall be made
in accordance with the laws and legal standards applicable to national banks
regarding the preemption of State law.</text>
</subsection><subsection id="IDc8203e53d4ec402aa806c71f8d61e76a"><enum>(b)</enum><header>Principles of conflict
preemption applicable</header><text>Notwithstanding the authorities granted
under sections 4 and 5, this Act does not occupy the field in any area of State
law.</text>
</subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="IDb87405c65d214df684f6c6583bdde09c"><enum>(b)</enum><header>Clerical
amendment</header><text>The table of sections for the Home Owners' Loan Act (12
U.S.C. 1461 et seq.) is amended by striking the item relating to section 6 and
inserting the following new item:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idF246563C312E47C68469A08353B3DF8D" reported-display-style="italic" style="OLC">
<toc changed="added" reported-display-style="italic">
<toc-entry bold="off" level="paragraph">Sec. 6. State law preemption standards for
Federal savings associations and subsidiaries
clarified.</toc-entry>
</toc>
<after-quoted-block>.</after-quoted-block></quoted-block>
</subsection></section><section id="IDc2dcbd669dc141499a14b6a2c38616fd"><enum>1047.</enum><header>Visitorial standards
for national banks and savings associations</header>
<subsection id="id4ED2C02996524EBBA8F82DBA1FC5CDE9"><enum>(a)</enum><header>National
banks</header><text display-inline="yes-display-inline">Section 5136C of the
Revised Statutes of the United States (as added by this subtitle) is amended by
adding at the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idEE7BD092A3074C67917C18A8467EB6EB" reported-display-style="italic" style="OLC">
<subsection id="ID30af49a494d8402ca9d910fe4e4deeb0"><enum>(i)</enum><header>Visitorial
powers</header>
<paragraph id="ID9d4b2c8457f847e1bac11f07c59b91b3"><enum>(1)</enum><header>In
general</header><text>In accordance with the decision of the Supreme Court of
the United States in Cuomo v. Clearing House Assn., L. L. C. (129 S. Ct. 2710
(2009)), no provision of this title which relates to visitorial powers or
otherwise limits or restricts the visitorial authority to which any national
bank is subject shall be construed as limiting or restricting the authority of
any attorney general (or other chief law enforcement officer) of any State to
bring an action against a national bank in a court of appropriate jurisdiction
to enforce an applicable law and to seek relief as authorized by such
law.</text>
</paragraph></subsection><subsection commented="no" display-inline="no-display-inline" id="IDa8941f245e864b29b019c810881873dd"><enum>(j)</enum><header display-inline="yes-display-inline">Enforcement actions</header><text display-inline="yes-display-inline">The ability of the Comptroller of the
Currency to bring an enforcement action under this title or section 5 of the
Federal Trade Commission Act does not preclude any private party from enforcing
rights granted under Federal or State law in the
courts.</text>
</subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="id49D2328493684FC8A66F9F645774D553"><enum>(b)</enum><header>Savings
associations</header><text>Section 6 of the Home Owners’ Loan Act (as added by
this title) is amended by adding at the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idD257EC287A4F46009271E13EDCE7B4B6" reported-display-style="italic" style="OLC">
<subsection id="ID82ba7869895f4ef59c17497fc743ba3d"><enum>(c)</enum><header>Visitorial
powers</header><text>The provisions of sections 5136C(i) of the Revised
Statutes of the United States shall apply to Federal savings associations, and
any subsidiary thereof, to the same extent and in the same manner as if such
savings associations, or subsidiaries thereof, were national banks or
subsidiaries of national banks,
respectively.</text>
</subsection><after-quoted-block></after-quoted-block></quoted-block>
<quoted-block changed="added" display-inline="no-display-inline" id="id8A3565B94EB54F81809449CE950000EF" reported-display-style="italic" style="OLC">
<subsection id="ID48bdc6077b754dcf967fb1df3b1671b5"><enum>(d)</enum><header>Enforcement
actions</header><text>The ability of the Comptroller of the Currency to bring
an enforcement action under this Act or section 5 of the Federal Trade
Commission Act does not preclude any private party from enforcing rights
granted under Federal or State law in the
courts.</text>
</subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection></section><section id="ID1634c29185b6470db7de6d0d85d8bba2"><enum>1048.</enum><header>Effective
date</header><text display-inline="no-display-inline">This subtitle shall
become effective on the designated transfer date.</text>
</section></subtitle><subtitle id="idB76D2F4BB4E7419E88FD0B903D56F1E9"><enum>E</enum><header>Enforcement
Powers</header>
<section id="idB367482AC2CC44C98B5FCB25A3E15CD6"><enum>1051.</enum><header>Definitions</header><text display-inline="no-display-inline">For purposes of this subtitle, the following
definitions shall apply:</text>
<paragraph id="IDdcea6bf707e44ae68e86c4e6a7ef0792"><enum>(1)</enum><header>Bureau
investigation</header><text>The term <term>Bureau investigation</term> means
any inquiry conducted by a Bureau investigator for the purpose of ascertaining
whether any person is or has been engaged in any conduct that is a violation,
as defined in this section.</text>
</paragraph><paragraph id="IDfe4ec6ed215b481c8e2846811cf9f449"><enum>(2)</enum><header>Bureau
investigator</header><text>The term <term>Bureau investigator</term> means any
attorney or investigator employed by the Bureau who is charged with the duty of
enforcing or carrying into effect any Federal consumer financial law.</text>
</paragraph><paragraph id="IDe9ba86d96f5c4a9fb8d25ab58d706e79"><enum>(3)</enum><header>Civil investigative
demand and demand</header><text>The terms <term>civil investigative
demand</term> and <term>demand</term> mean any demand issued by the
Bureau.</text>
</paragraph><paragraph id="ID80f4f83243d0484a91a4b644a6dd7bdc"><enum>(4)</enum><header>Custodian</header><text>The
term <term>custodian</term> means the custodian or any deputy custodian
designated by the Bureau.</text>
</paragraph><paragraph id="IDfba0779da78c4ac6bbd1824eee0db988"><enum>(5)</enum><header>Documentary
material</header><text>The term <term>documentary material</term> includes the
original or any copy of any book, document, record, report, memorandum, paper,
communication, tabulation, chart, logs, electronic files, or other data or data
compilations stored in any medium.</text>
</paragraph><paragraph id="ID104824c6c82f4d21806965053eed3a37"><enum>(6)</enum><header>Violation</header><text>The
term <term>violation</term> means any act or omission that, if proved, would
constitute a violation of any provision of Federal consumer financial
law.</text>
</paragraph></section><section id="IDc95caf673049478ca327ccd532c76c45"><enum>1052.</enum><header>Investigations and
administrative discovery</header>
<subsection id="IDaac40daa06bc41979e2a8d9b78588687"><enum>(a)</enum><header>Joint
investigations</header>
<paragraph id="ID7d2152b89fe441edb1d7782db77eadf0"><enum>(1)</enum><header>In
general</header><text>The Bureau or, where appropriate, a Bureau investigator,
may engage in joint investigations and requests for information, as authorized
under this title.</text>
</paragraph><paragraph id="IDc005833d72b94d2eb2433a6de1297c57"><enum>(2)</enum><header>Fair
lending</header><text>The authority under paragraph (1) includes matters
relating to fair lending, and where appropriate, joint investigations with, and
requests for information from, the Secretary of Housing and Urban Development,
the Attorney General of the United States, or both.</text>
</paragraph></subsection><subsection id="ID5b7d01feb8304aa2b32982783b70e673"><enum>(b)</enum><header>Subpoenas</header>
<paragraph id="ID21f9152c0d7649a6ba68d0ba4421bf24"><enum>(1)</enum><header>In
general</header><text>The Bureau or a Bureau investigator may issue subpoenas
for the attendance and testimony of witnesses and the production of relevant
papers, books, documents, or other material in connection with hearings under
this title.</text>
</paragraph><paragraph id="IDb5e7a57e08d0480986f8a05e51d6dd4a"><enum>(2)</enum><header>Failure to
obey</header><text>In the case of contumacy or refusal to obey a subpoena
issued pursuant to this paragraph and served upon any person, the district
court of the United States for any district in which such person is found,
resides, or transacts business, upon application by the Bureau or a Bureau
investigator and after notice to such person, may issue an order requiring such
person to appear and give testimony or to appear and produce documents or other
material.</text>
</paragraph><paragraph id="ID861e6ffe0562437ca55c724f6a136abd"><enum>(3)</enum><header>Contempt</header><text>Any
failure to obey an order of the court under this subsection may be punished by
the court as a contempt thereof.</text>
</paragraph></subsection><subsection id="ID9008952e3cc24bc99fcb1d87f0d2de92"><enum>(c)</enum><header>Demands</header>
<paragraph id="IDe2873ee7bdd14c6698cdaaa3b2e2a1e6"><enum>(1)</enum><header>In
general</header><text>Whenever the Bureau has reason to believe that any person
may be in possession, custody, or control of any documentary material or
tangible things, or may have any information, relevant to a violation, the
Bureau may, before the institution of any proceedings under the Federal
consumer financial law, issue in writing, and cause to be served upon such
person, a civil investigative demand requiring such person to—</text>
<subparagraph id="ID9872c2e286c14bb49e776ff5299653c3"><enum>(A)</enum><text>produce such documentary
material for inspection and copying or reproduction in the form or medium
requested by the Bureau;</text>
</subparagraph><subparagraph id="ID0a2450cfd16045659f54ee2b8d7708a1"><enum>(B)</enum><text>submit such tangible
things;</text>
</subparagraph><subparagraph id="IDec1af37feac54681898c1f4913ce7896"><enum>(C)</enum><text>file written reports or
answers to questions;</text>
</subparagraph><subparagraph id="IDfd2b411ea0a44dc5bc88b88f863c4c9c"><enum>(D)</enum><text>give oral testimony
concerning documentary material, tangible things, or other information;
or</text>
</subparagraph><subparagraph id="ID4191e01a8a3b4ec6b15dbf8304dd92b9"><enum>(E)</enum><text>furnish any combination
of such material, answers, or testimony.</text>
</subparagraph></paragraph><paragraph id="ID0fa7f4a4ce75474ca65ebcedb4022c23"><enum>(2)</enum><header>Requirements</header><text>Each
civil investigative demand shall state the nature of the conduct constituting
the alleged violation which is under investigation and the provision of law
applicable to such violation.</text>
</paragraph><paragraph id="ID8dc49d2f768a4a85836f5f43d8a8bc38"><enum>(3)</enum><header>Production of
documents</header><text>Each civil investigative demand for the production of
documentary material shall—</text>
<subparagraph id="ID740f6a4520e44d2e84bbe07efaf180da"><enum>(A)</enum><text>describe each class of
documentary material to be produced under the demand with such definiteness and
certainty as to permit such material to be fairly identified;</text>
</subparagraph><subparagraph id="ID9baa86c0717c4a3f8636b83266384e1a"><enum>(B)</enum><text>prescribe a return date
or dates which will provide a reasonable period of time within which the
material so demanded may be assembled and made available for inspection and
copying or reproduction; and</text>
</subparagraph><subparagraph id="ID85e43dbff3624d64b07fa220058305ef"><enum>(C)</enum><text>identify the custodian to
whom such material shall be made available.</text>
</subparagraph></paragraph><paragraph id="IDe6b5d25f1713472cb51223506d4e68b1"><enum>(4)</enum><header>Production of
things</header><text>Each civil investigative demand for the submission of
tangible things shall—</text>
<subparagraph id="ID7cc71eb18af947138ce1dac0a8cd9f32"><enum>(A)</enum><text>describe each class of
tangible things to be submitted under the demand with such definiteness and
certainty as to permit such things to be fairly identified;</text>
</subparagraph><subparagraph id="ID5d2657fd231c4dab9f9beb5c3bec117a"><enum>(B)</enum><text>prescribe a return date
or dates which will provide a reasonable period of time within which the things
so demanded may be assembled and submitted; and</text>
</subparagraph><subparagraph id="IDaaf2f0178f8e4dd593e0581bd0eabdac"><enum>(C)</enum><text>identify the custodian to
whom such things shall be submitted.</text>
</subparagraph></paragraph><paragraph id="IDd6f6eb14d1f54440979d480d836a5dce"><enum>(5)</enum><header>Demand for written
reports or answers</header><text>Each civil investigative demand for written
reports or answers to questions shall—</text>
<subparagraph id="ID1f8c0d60eafb4c21b1f58b460d285436"><enum>(A)</enum><text>propound with
definiteness and certainty the reports to be produced or the questions to be
answered;</text>
</subparagraph><subparagraph id="ID6c424992ef8a45f69ba7c8aaffe2e56a"><enum>(B)</enum><text>prescribe a date or dates
at which time written reports or answers to questions shall be submitted;
and</text>
</subparagraph><subparagraph id="IDdc5d725d31174b89acf740a61b9c2c80"><enum>(C)</enum><text>identify the custodian to
whom such reports or answers shall be submitted.</text>
</subparagraph></paragraph><paragraph id="ID6af88e719d24431799d48645901d0991"><enum>(6)</enum><header>Oral
testimony</header><text>Each civil investigative demand for the giving of oral
testimony shall—</text>
<subparagraph id="ID07542080820b4689a279f42fa3bd6908"><enum>(A)</enum><text>prescribe a date, time,
and place at which oral testimony shall be commenced; and</text>
</subparagraph><subparagraph id="IDd04f4f831bbb41f996ed6bd569fe67dc"><enum>(B)</enum><text>identify a Bureau
investigator who shall conduct the investigation and the custodian to whom the
transcript of such investigation shall be submitted.</text>
</subparagraph></paragraph><paragraph id="ID9793feab75de48f089850a0a3a753e95"><enum>(7)</enum><header>Service</header><text>Any
civil investigative demand and any enforcement petition filed under this
section may be served—</text>
<subparagraph id="ID6d313a4ab9cb477ba90030592e5565f2"><enum>(A)</enum><text>by any Bureau
investigator at any place within the territorial jurisdiction of any court of
the United States; and</text>
</subparagraph><subparagraph id="ID997aa700929046539b9a6b1120101165"><enum>(B)</enum><text>upon any person who is
not found within the territorial jurisdiction of any court of the United
States—</text>
<clause id="idB7147BC1B2DD4EE7BAB35EEB65778281"><enum>(i)</enum><text>in such manner as the
Federal Rules of Civil Procedure prescribe for service in a foreign nation;
and</text>
</clause><clause id="IDd8f77489288746ada4b5406c7741fc58"><enum>(ii)</enum><text>to the extent that the
courts of the United States have authority to assert jurisdiction over such
person, consistent with due process, the United States District Court for the
District of Columbia shall have the same jurisdiction to take any action
respecting compliance with this section by such person that such district court
would have if such person were personally within the jurisdiction of such
district court.</text>
</clause></subparagraph></paragraph><paragraph id="IDd28ed9443d494352900c2d1abe0aa95a"><enum>(8)</enum><header>Method of
service</header><text>Service of any civil investigative demand or any
enforcement petition filed under this section may be made upon a person,
including any legal entity, by—</text>
<subparagraph id="IDf955cd04434d4476a1ce22c128f2d1a8"><enum>(A)</enum><text>delivering a duly
executed copy of such demand or petition to the individual or to any partner,
executive officer, managing agent, or general agent of such person, or to any
agent of such person authorized by appointment or by law to receive service of
process on behalf of such person;</text>
</subparagraph><subparagraph id="IDeb8fcf9acfa04aeeaa981544edb0543b"><enum>(B)</enum><text>delivering a duly
executed copy of such demand or petition to the principal office or place of
business of the person to be served; or</text>
</subparagraph><subparagraph id="ID3720e7e9b1ae431f84bd40d64b349a41"><enum>(C)</enum><text>depositing a duly
executed copy in the United States mails, by registered or certified mail,
return receipt requested, duly addressed to such person at the principal office
or place of business of such person.</text>
</subparagraph></paragraph><paragraph id="ID027b873ed3a4487580c454491cac79ef"><enum>(9)</enum><header>Proof of
service</header>
<subparagraph id="IDece89f70f3d7486487742a2ef0064025"><enum>(A)</enum><header>In
general</header><text>A verified return by the individual serving any civil
investigative demand or any enforcement petition filed under this section
setting forth the manner of such service shall be proof of such service.</text>
</subparagraph><subparagraph id="ID546f9eb58e7c45058e11ca99551bb09b"><enum>(B)</enum><header>Return
receipts</header><text>In the case of service by registered or certified mail,
such return shall be accompanied by the return post office receipt of delivery
of such demand or enforcement petition.</text>
</subparagraph></paragraph><paragraph id="ID051c00dc131c480f8f4ba3cf08975613"><enum>(10)</enum><header>Production of
documentary material</header><text>The production of documentary material in
response to a civil investigative demand shall be made under a sworn
certificate, in such form as the demand designates, by the person, if a natural
person, to whom the demand is directed or, if not a natural person, by any
person having knowledge of the facts and circumstances relating to such
production, to the effect that all of the documentary material required by the
demand and in the possession, custody, or control of the person to whom the
demand is directed has been produced and made available to the
custodian.</text>
</paragraph><paragraph id="IDd395debcb957423b8cb54503341419d4"><enum>(11)</enum><header>Submission of tangible
things</header><text>The submission of tangible things in response to a civil
investigative demand shall be made under a sworn certificate, in such form as
the demand designates, by the person to whom the demand is directed or, if not
a natural person, by any person having knowledge of the facts and circumstances
relating to such production, to the effect that all of the tangible things
required by the demand and in the possession, custody, or control of the person
to whom the demand is directed have been submitted to the custodian.</text>
</paragraph><paragraph id="ID599979d441414f10b4df0f8f132d01d7"><enum>(12)</enum><header>Separate
answers</header><text>Each reporting requirement or question in a civil
investigative demand shall be answered separately and fully in writing under
oath, unless it is objected to, in which event the reasons for the objection
shall be stated in lieu of an answer, and it shall be submitted under a sworn
certificate, in such form as the demand designates, by the person, if a natural
person, to whom the demand is directed or, if not a natural person, by any
person responsible for answering each reporting requirement or question, to the
effect that all information required by the demand and in the possession,
custody, control, or knowledge of the person to whom the demand is directed has
been submitted.</text>
</paragraph><paragraph id="ID70281487653b4c91b350640ab44bed00"><enum>(13)</enum><header>Testimony</header>
<subparagraph id="IDbdd5b6c8c89443329e5299531635cccf"><enum>(A)</enum><header>In general</header>
<clause id="id7C022B9F99E6415095126C37F35AD6AA"><enum>(i)</enum><header>Oath or
affirmation</header><text>Any Bureau investigator before whom oral testimony is
to be taken shall put the witness under oath or affirmation, and shall
personally, or by any individual acting under the direction of and in the
presence of the Bureau investigator, record the testimony of the
witness.</text>
</clause><clause id="ID832a98ec3bcb419c856b197bdfd94663"><enum>(ii)</enum><header>Transcription</header><text>The
testimony shall be taken stenographically and transcribed.</text>
</clause><clause id="IDb0fb6915114f4182a7a493d8b61a7143"><enum>(iii)</enum><header>Transmission to
custodian</header><text>After the testimony is fully transcribed, the Bureau
investigator before whom the testimony is taken shall promptly transmit a copy
of the transcript of the testimony to the custodian.</text>
</clause></subparagraph><subparagraph id="ID37b8874b32d84007a8b73c373eda25a6"><enum>(B)</enum><header>Parties
present</header><text>Any Bureau investigator before whom oral testimony is to
be taken shall exclude from the place where the testimony is to be taken all
other persons, except the person giving the testimony, the attorney of that
person, the officer before whom the testimony is to be taken, and any
stenographer taking such testimony.</text>
</subparagraph><subparagraph id="ID7d9b9c28b89446e3a6c4a7ea0524d8d1"><enum>(C)</enum><header>Location</header><text>The
oral testimony of any person taken pursuant to a civil investigative demand
shall be taken in the judicial district of the United States in which such
person resides, is found, or transacts business, or in such other place as may
be agreed upon by the Bureau investigator before whom the oral testimony of
such person is to be taken and such person.</text>
</subparagraph><subparagraph id="ID614ddbb7af1445deb7d4734ff287af7c"><enum>(D)</enum><header>Attorney
representation</header>
<clause id="IDe07915ccab344c3b8c9aa9c1fc904c86"><enum>(i)</enum><header>In
general</header><text>Any person compelled to appear under a civil
investigative demand for oral testimony pursuant to this section may be
accompanied, represented, and advised by an attorney.</text>
</clause><clause id="IDd4c35773fec14fe39621cd9b1452530e"><enum>(ii)</enum><header>Authority</header><text>The
attorney may advise a person described in clause (i), in confidence, either
upon the request of such person or upon the initiative of the attorney, with
respect to any question asked of such person.</text>
</clause><clause id="IDa886548c2918483382a2f2250445abc7"><enum>(iii)</enum><header>Objections</header><text>A
person described in clause (i), or the attorney for that person, may object on
the record to any question, in whole or in part, and such person shall briefly
state for the record the reason for the objection. An objection may properly be
made, received, and entered upon the record when it is claimed that such person
is entitled to refuse to answer the question on grounds of any constitutional
or other legal right or privilege, including the privilege against
self-incrimination, but such person shall not otherwise object to or refuse to
answer any question, and such person or attorney shall not otherwise interrupt
the oral examination.</text>
</clause><clause id="IDc4c9210995cb4488aace8be25b5e1c27"><enum>(iv)</enum><header>Refusal to
answer</header><text>If a person described in clause (i) refuses to answer any
question—</text>
<subclause id="idDAB6584B37574C7A9B819AD8105BADFE"><enum>(I)</enum><text>the Bureau may petition
the district court of the United States pursuant to this section for an order
compelling such person to answer such question; and</text>
</subclause><subclause id="IDc39a6cda4e6f4610bee5c574493596e0"><enum>(II)</enum><text>on grounds of the
privilege against self-incrimination, the testimony of such person may be
compelled in accordance with the provisions of section 6004 of title 18, United
States Code.</text>
</subclause></clause></subparagraph><subparagraph id="ID8701642ab1d548febe362c67b55b2ddd"><enum>(E)</enum><header>Transcripts</header><text>For
purposes of this subsection—</text>
<clause id="IDed66fbca9a65451eb152a548b5bf2174"><enum>(i)</enum><text>after the testimony of
any witness is fully transcribed, the Bureau investigator shall afford the
witness (who may be accompanied by an attorney) a reasonable opportunity to
examine the transcript;</text>
</clause><clause id="ID54ffcc93ff4d455c8fc5578e0a08ee9f"><enum>(ii)</enum><text>the transcript shall be
read to or by the witness, unless such examination and reading are waived by
the witness;</text>
</clause><clause id="ID6eb5877faf4841668ee6c0bd25caca89"><enum>(iii)</enum><text>any changes in form or
substance which the witness desires to make shall be entered and identified
upon the transcript by the Bureau investigator, with a statement of the reasons
given by the witness for making such changes;</text>
</clause><clause id="IDadc6cad7122641729384703534867d85"><enum>(iv)</enum><text>the transcript shall be
signed by the witness, unless the witness in writing waives the signing, is
ill, cannot be found, or refuses to sign; and</text>
</clause><clause id="ID509fa4ae7de44be4a9d32814d0e53125"><enum>(v)</enum><text>if the transcript is not
signed by the witness during the 30-day period following the date on which the
witness is first afforded a reasonable opportunity to examine the transcript,
the Bureau investigator shall sign the transcript and state on the record the
fact of the waiver, illness, absence of the witness, or the refusal to sign,
together with any reasons given for the failure to sign.</text>
</clause></subparagraph><subparagraph id="ID8bb4a4ba5653436b832aac8ecef4819a"><enum>(F)</enum><header>Certification by
investigator</header><text>The Bureau investigator shall certify on the
transcript that the witness was duly sworn by him or her and that the
transcript is a true record of the testimony given by the witness, and the
Bureau investigator shall promptly deliver the transcript or send it by
registered or certified mail to the custodian.</text>
</subparagraph><subparagraph id="ID455c96db09a54ede8a824a3a8edfc6d9"><enum>(G)</enum><header>Copy of
transcript</header><text>The Bureau investigator shall furnish a copy of the
transcript (upon payment of reasonable charges for the transcript) to the
witness only, except that the Bureau may for good cause limit such witness to
inspection of the official transcript of his testimony.</text>
</subparagraph><subparagraph id="ID13cadecd482d47828d93c2bad5f4405c"><enum>(H)</enum><header>Witness
fees</header><text>Any witness appearing for the taking of oral testimony
pursuant to a civil investigative demand shall be entitled to the same fees and
mileage which are paid to witnesses in the district courts of the United
States.</text>
</subparagraph></paragraph></subsection><subsection id="ID4b932c92f355420fa9478cb5e1e2a89e"><enum>(d)</enum><header>Confidential treatment
of demand material</header>
<paragraph id="ID5c24056abdc1473988ed174c489fa52b"><enum>(1)</enum><header>In
general</header><text>Documentary materials and tangible things received as a
result of a civil investigative demand shall be subject to requirements and
procedures regarding confidentiality, in accordance with rules established by
the Bureau.</text>
</paragraph><paragraph id="ID5f0fbfe5e1b24d46b2907c5939fac4e9"><enum>(2)</enum><header>Disclosure to
congress</header><text>No rule established by the Bureau regarding the
confidentiality of materials submitted to, or otherwise obtained by, the Bureau
shall be intended to prevent disclosure to either House of Congress or to an
appropriate committee of the Congress, except that the Bureau is permitted to
adopt rules allowing prior notice to any party that owns or otherwise provided
the material to the Bureau and had designated such material as
confidential.</text>
</paragraph></subsection><subsection id="ID61f420546b8640bb8b87cab902a77c1e"><enum>(e)</enum><header>Petition for
enforcement</header>
<paragraph id="IDd17c16014872482b86adce9297b8c1ee"><enum>(1)</enum><header>In
general</header><text>Whenever any person fails to comply with any civil
investigative demand duly served upon him under this section, or whenever
satisfactory copying or reproduction of material requested pursuant to the
demand cannot be accomplished and such person refuses to surrender such
material, the Bureau, through such officers or attorneys as it may designate,
may file, in the district court of the United States for any judicial district
in which such person resides, is found, or transacts business, and serve upon
such person, a petition for an order of such court for the enforcement of this
section.</text>
</paragraph><paragraph id="ID8b3ed4fe8c3a47329e3e66652db411c8"><enum>(2)</enum><header>Service of
process</header><text>All process of any court to which application may be made
as provided in this subsection may be served in any judicial district.</text>
</paragraph></subsection><subsection id="ID8499ea81480049feab51c7cb1fb59526"><enum>(f)</enum><header>Petition for order
modifying or setting aside demand</header>
<paragraph id="ID4b616bf71ebd4a14ac475aa379b0cb66"><enum>(1)</enum><header>In
general</header><text>Not later than 20 days after the service of any civil
investigative demand upon any person under subsection (b), or at any time
before the return date specified in the demand, whichever period is shorter, or
within such period exceeding 20 days after service or in excess of such return
date as may be prescribed in writing, subsequent to service, by any Bureau
investigator named in the demand, such person may file with the Bureau a
petition for an order by the Bureau modifying or setting aside the
demand.</text>
</paragraph><paragraph id="IDb994b6e6c0934d2ab2c6d1e4ed52cfa2"><enum>(2)</enum><header>Compliance during
pendency</header><text>The time permitted for compliance with the demand in
whole or in part, as determined proper and ordered by the Bureau, shall not run
during the pendency of a petition under paragraph (1) at the Bureau, except
that such person shall comply with any portions of the demand not sought to be
modified or set aside.</text>
</paragraph><paragraph id="IDdae5287d1df14409b72240acd77798fe"><enum>(3)</enum><header>Specific
grounds</header><text>A petition under paragraph (1) shall specify each ground
upon which the petitioner relies in seeking relief, and may be based upon any
failure of the demand to comply with the provisions of this section, or upon
any constitutional or other legal right or privilege of such person.</text>
</paragraph></subsection><subsection id="ID2c772296dd0349dd9395a660cd6e8553"><enum>(g)</enum><header>Custodial
control</header><text>At any time during which any custodian is in custody or
control of any documentary material, tangible things, reports, answers to
questions, or transcripts of oral testimony given by any person in compliance
with any civil investigative demand, such person may file, in the district
court of the United States for the judicial district within which the office of
such custodian is situated, and serve upon such custodian, a petition for an
order of such court requiring the performance by such custodian of any duty
imposed upon him by this section or rule promulgated by the Bureau.</text>
</subsection><subsection id="ID88a7350673784cfb800b44914cb1d6e3"><enum>(h)</enum><header>Jurisdiction of
court</header>
<paragraph id="ID63cb9dcd5ea549a7be90dd9ca7ac5d24"><enum>(1)</enum><header>In
general</header><text>Whenever any petition is filed in any district court of
the United States under this section, such court shall have jurisdiction to
hear and determine the matter so presented, and to enter such order or orders
as may be required to carry out the provisions of this section.</text>
</paragraph><paragraph id="IDe70e4b28de1145f68c595588a3dbecc8"><enum>(2)</enum><header>Appeal</header><text>Any
final order entered as described in paragraph (1) shall be subject to appeal
pursuant to section 1291 of title 28, United States Code.</text>
</paragraph></subsection></section><section id="ID3ce12e1fef8a41dcb33565042a165ae0"><enum>1053.</enum><header>Hearings and
adjudication proceedings</header>
<subsection id="ID94fcccb198114827a73df7c9d87d2915"><enum>(a)</enum><header>In
general</header><text>The Bureau is authorized to conduct hearings and
adjudication proceedings with respect to any person in the manner prescribed by
chapter 5 of title 5, United States Code in order to ensure or enforce
compliance with—</text>
<paragraph id="ID473b29baaf9b47a8b80c991abbc6feaf"><enum>(1)</enum><text>the provisions of this
title, including any rules prescribed by the Bureau under this title;
and</text>
</paragraph><paragraph id="ID2a80f1e4d5ca41bab5930cdce05940b8"><enum>(2)</enum><text>any other Federal law
that the Bureau is authorized to enforce, including an enumerated consumer law,
and any regulations or order prescribed thereunder, unless such Federal law
specifically limits the Bureau from conducting a hearing or adjudication
proceeding and only to the extent of such limitation.</text>
</paragraph></subsection><subsection id="IDfe914ff34bd543e7a722c2e7d2457984"><enum>(b)</enum><header>Special rules for
cease-and-desist proceedings</header>
<paragraph id="ID9ea2101bc58f402e8f29cd7522df6360"><enum>(1)</enum><header>Orders
authorized</header>
<subparagraph id="id5DFEDE54F7D14E669A409818B60F379D"><enum>(A)</enum><header>In
general</header><text>If, in the opinion of the Bureau, any covered person or
service provider is engaging or has engaged in an activity that violates a law,
rule, or any condition imposed in writing on the person by the Bureau, the
Bureau may, subject to sections 1024, 1025, and 1026, issue and serve upon the
covered person or service provider a notice of charges in respect
thereof.</text>
</subparagraph><subparagraph id="idE79EA1E24CC247AEB23D367C00941C40"><enum>(B)</enum><header>Content of
notice</header><text>The notice under subparagraph (A) shall contain a
statement of the facts constituting the alleged violation or violations, and
shall fix a time and place at which a hearing will be held to determine whether
an order to cease and desist should issue against the covered person or service
provider, such hearing to be held not earlier than 30 days nor later than 60
days after the date of service of such notice, unless an earlier or a later
date is set by the Bureau, at the request of any party so served.</text>
</subparagraph><subparagraph id="idBD8A07B6EA6E4EE4B9530F5B3CE81198"><enum>(C)</enum><header>Consent</header><text>Unless
the party or parties served under subparagraph (B) appear at the hearing
personally or by a duly authorized representative, such person shall be deemed
to have consented to the issuance of the cease-and-desist order.</text>
</subparagraph><subparagraph id="id3C586394780A4BEC90DE00C933A4CEFA"><enum>(D)</enum><header>Procedure</header><text>In
the event of consent under subparagraph (C), or if, upon the record, made at
any such hearing, the Bureau finds that any violation specified in the notice
of charges has been established, the Bureau may issue and serve upon the
covered person or service provider an order to cease and desist from the
violation or practice. Such order may, by provisions which may be mandatory or
otherwise, require the covered person or service provider to cease and desist
from the subject activity, and to take affirmative action to correct the
conditions resulting from any such violation.</text>
</subparagraph></paragraph><paragraph id="IDaa8f8dbfd4fd4e518891669f1a1e7a8b"><enum>(2)</enum><header>Effectiveness of
order</header><text>A cease-and-desist order shall become effective at the
expiration of 30 days after the date of service of an order under paragraph (1)
upon the covered person or service provider concerned (except in the case of a
cease-and-desist order issued upon consent, which shall become effective at the
time specified therein), and shall remain effective and enforceable as provided
therein, except to such extent as the order is stayed, modified, terminated, or
set aside by action of the Bureau or a reviewing court.</text>
</paragraph><paragraph id="ID71ed9624be6a42b6bf5aa21d8d7b9ca2"><enum>(3)</enum><header>Decision and
appeal</header><text>Any hearing provided for in this subsection shall be held
in the Federal judicial district or in the territory in which the residence or
principal office or place of business of the person is located unless the
person consents to another place, and shall be conducted in accordance with the
provisions of chapter 5 of title 5 of the United States Code. After such
hearing, and within 90 days after the Bureau has notified the parties that the
case has been submitted to the Bureau for final decision, the Bureau shall
render its decision (which shall include findings of fact upon which its
decision is predicated) and shall issue and serve upon each party to the
proceeding an order or orders consistent with the provisions of this section.
Judicial review of any such order shall be exclusively as provided in this
subsection. Unless a petition for review is timely filed in a court of appeals
of the United States, as provided in paragraph (4), and thereafter until the
record in the proceeding has been filed as provided in paragraph (4), the
Bureau may at any time, upon such notice and in such manner as the Bureau shall
determine proper, modify, terminate, or set aside any such order. Upon filing
of the record as provided, the Bureau may modify, terminate, or set aside any
such order with permission of the court.</text>
</paragraph><paragraph id="ID87dba78b049c499c8c521a227326b696"><enum>(4)</enum><header>Appeal to court of
appeals</header><text>Any party to any proceeding under this subsection may
obtain a review of any order served pursuant to this subsection (other than an
order issued with the consent of the person concerned) by the filing in the
court of appeals of the United States for the circuit in which the principal
office of the covered person is located, or in the United States Court of
Appeals for the District of Columbia Circuit, within 30 days after the date of
service of such order, a written petition praying that the order of the Bureau
be modified, terminated, or set aside. A copy of such petition shall be
forthwith transmitted by the clerk of the court to the Bureau, and thereupon
the Bureau shall file in the court the record in the proceeding, as provided in
section 2112 of title 28 of the United States Code. Upon the filing of such
petition, such court shall have jurisdiction, which upon the filing of the
record shall except as provided in the last sentence of paragraph (3) be
exclusive, to affirm, modify, terminate, or set aside, in whole or in part, the
order of the Bureau. Review of such proceedings shall be had as provided in
chapter 7 of title 5 of the United States Code. The judgment and decree of the
court shall be final, except that the same shall be subject to review by the
Supreme Court of the United States, upon certiorari, as provided in section
1254 of title 28 of the United States Code.</text>
</paragraph><paragraph id="ID63aeac18acbe4c1fad01de52028a37c6"><enum>(5)</enum><header>No
stay</header><text>The commencement of proceedings for judicial review under
paragraph (4) shall not, unless specifically ordered by the court, operate as a
stay of any order issued by the Bureau.</text>
</paragraph></subsection><subsection id="ID4022fbc81d91494faa62dfa0a313d7e0"><enum>(c)</enum><header>Special rules for
temporary cease-and-desist proceedings</header>
<paragraph id="ID4fb5cced50c742e6b8f74fa3549392a3"><enum>(1)</enum><header>In
general</header><text>Whenever the Bureau determines that the violation
specified in the notice of charges served upon a person, including a service
provider, pursuant to subsection (b), or the continuation thereof, is likely to
cause the person to be insolvent or otherwise prejudice the interests of
consumers before the completion of the proceedings conducted pursuant to
subsection (b), the Bureau may issue a temporary order requiring the person to
cease and desist from any such violation or practice and to take affirmative
action to prevent or remedy such insolvency or other condition pending
completion of such proceedings. Such order may include any requirement
authorized under this subtitle. Such order shall become effective upon service
upon the person and, unless set aside, limited, or suspended by a court in
proceedings authorized by paragraph (2), shall remain effective and enforceable
pending the completion of the administrative proceedings pursuant to such
notice and until such time as the Bureau shall dismiss the charges specified in
such notice, or if a cease-and-desist order is issued against the person, until
the effective date of such order.</text>
</paragraph><paragraph id="ID22a78135d611412e92d078d41e1d4598"><enum>(2)</enum><header>Appeal</header><text>Not
later than 10 days after the covered person or service provider concerned has
been served with a temporary cease-and-desist order, the person may apply to
the United States district court for the judicial district in which the
residence or principal office or place of business of the person is located, or
the United States District Court for the District of Columbia, for an
injunction setting aside, limiting, or suspending the enforcement, operation,
or effectiveness of such order pending the completion of the administrative
proceedings pursuant to the notice of charges served upon the person under
subsection (b), and such court shall have jurisdiction to issue such
injunction.</text>
</paragraph><paragraph id="ID3cddc4ac943e4e389083fae3976939c2"><enum>(3)</enum><header>Incomplete or
inaccurate records</header>
<subparagraph id="ID551f8a7625d94855b2ff9884b98045fc"><enum>(A)</enum><header>Temporary
order</header><text>If a notice of charges served under subsection (b)
specifies, on the basis of particular facts and circumstances, that the books
and records of a covered person or service provider are so incomplete or
inaccurate that the Bureau is unable to determine the financial condition of
that person or the details or purpose of any transaction or transactions that
may have a material effect on the financial condition of that person, the
Bureau may issue a temporary order requiring—</text>
<clause id="ID6ef64412b6ff491f980e729d4557d1b9"><enum>(i)</enum><text>the cessation of any
activity or practice which gave rise, whether in whole or in part, to the
incomplete or inaccurate state of the books or records; or</text>
</clause><clause id="IDe62c207ecd9f45eb838a78eb5bd82641"><enum>(ii)</enum><text>affirmative action to
restore such books or records to a complete and accurate state, until the
completion of the proceedings under subsection (b)(1).</text>
</clause></subparagraph><subparagraph id="ID941575a079b842c39f6a583b7c4c4f13"><enum>(B)</enum><header>Effective
period</header><text>Any temporary order issued under subparagraph (A)—</text>
<clause id="IDce3fbd21898146ddb6f937c98cddf136"><enum>(i)</enum><text>shall become effective
upon service; and</text>
</clause><clause id="ID86694052498b4fbfb597cec67f1d7240"><enum>(ii)</enum><text>unless set aside,
limited, or suspended by a court in proceedings under paragraph (2), shall
remain in effect and enforceable until the earlier of—</text>
<subclause id="IDfee20ac0bc3949d1b2d9ee946cbded95"><enum>(I)</enum><text>the completion of the
proceeding initiated under subsection (b) in connection with the notice of
charges; or</text>
</subclause><subclause id="ID6e3f34c85ed74b239a3247ff645b93ad"><enum>(II)</enum><text>the date the Bureau
determines, by examination or otherwise, that the books and records of the
covered person or service provider are accurate and reflect the financial
condition thereof.</text>
</subclause></clause></subparagraph></paragraph></subsection><subsection id="ID3f61bc022eb243539881e05936df3de0"><enum>(d)</enum><header>Special rules for
enforcement of orders</header>
<paragraph id="ID5a4eb84e4b7c42109a6ec23d2c7401be"><enum>(1)</enum><header>In
general</header><text>The Bureau may in its discretion apply to the United
States district court within the jurisdiction of which the principal office or
place of business of the person is located, for the enforcement of any
effective and outstanding notice or order issued under this section, and such
court shall have jurisdiction and power to order and require compliance
herewith.</text>
</paragraph><paragraph id="ID9a12792db8e54b38b50cd0b6a7ecb22d"><enum>(2)</enum><header>Exception</header><text>Except
as otherwise provided in this subsection, no court shall have jurisdiction to
affect by injunction or otherwise the issuance or enforcement of any notice or
order or to review, modify, suspend, terminate, or set aside any such notice or
order.</text>
</paragraph></subsection><subsection id="ID219016e8ca934a0aa800eb9dd2c10438"><enum>(e)</enum><header>Rules</header><text>The
Bureau shall prescribe rules establishing such procedures as may be necessary
to carry out this section.</text>
</subsection></section><section id="IDb438ae6b95fb42d2b42c661c77b04a14"><enum>1054.</enum><header>Litigation
authority</header>
<subsection id="ID7b6cff77abdc47359819aa559a116e4d"><enum>(a)</enum><header>In
general</header><text>If any person violates a Federal consumer financial law,
the Bureau may, subject to sections 1024, 1025, and 1026, commence a civil
action against such person to impose a civil penalty or to seek all appropriate
legal and equitable relief including a permanent or temporary injunction as
permitted by law.</text>
</subsection><subsection id="ID20ea06e59b1a4e42b27ee6b8e2ff8562"><enum>(b)</enum><header>Representation</header><text>The
Bureau may act in its own name and through its own attorneys in enforcing any
provision of this title, rules thereunder, or any other law or regulation, or
in any action, suit, or proceeding to which the Bureau is a party.</text>
</subsection><subsection id="IDa72266dce57c4747a18647e3dee5be9c"><enum>(c)</enum><header>Compromise of
actions</header><text>The Bureau may compromise or settle any action if such
compromise is approved by the court.</text>
</subsection><subsection id="ID9d62ee0ec806437fadf1cb9ad662eda9"><enum>(d)</enum><header>Notice to the attorney
general</header><text>When commencing a civil action under Federal consumer
financial law, or any rule thereunder, the Bureau shall notify the Attorney
General and, with respect to a civil action against an insured depository
institution or insured credit union, the appropriate prudential
regulator.</text>
</subsection><subsection id="ID5aeaf013a44749b5b2641b79364dcadd"><enum>(e)</enum><header>Appearance before the
supreme court</header><text>The Bureau may represent itself in its own name
before the Supreme Court of the United States, provided that the Bureau makes a
written request to the Attorney General within the 10-day period which begins
on the date of entry of the judgment which would permit any party to file a
petition for writ of certiorari, and the Attorney General concurs with such
request or fails to take action within 60 days of the request of the
Bureau.</text>
</subsection><subsection id="ID17d4644747cb4f91b41fa086c1a0d95e"><enum>(f)</enum><header>Forum</header><text>Any
civil action brought under this title may be brought in a United States
district court or in any court of competent jurisdiction of a state in a
district in which the defendant is located or resides or is doing business, and
such court shall have jurisdiction to enjoin such person and to require
compliance with any Federal consumer financial law.</text>
</subsection><subsection id="ID03439f2d2ce94a629691b2239227a15c"><enum>(g)</enum><header>Time for bringing
action</header>
<paragraph id="IDa6c2dabbd8a54b63abe6de82279e990e"><enum>(1)</enum><header>In
general</header><text>Except as otherwise permitted by law or equity, no action
may be brought under this title more than 3 years after the date of discovery
of the violation to which an action relates.</text>
</paragraph><paragraph id="IDffc5c09213f7498b8baf207d7cc3fb45"><enum>(2)</enum><header>Limitations under other
Federal laws</header>
<subparagraph id="IDd0d0d4454225480d8996197de19ca8fa"><enum>(A)</enum><header>In
general</header><text>For purposes of this subsection, an action arising under
this title does not include claims arising solely under enumerated consumer
laws.</text>
</subparagraph><subparagraph id="IDa614830c52f047b58762770b1d0954cc"><enum>(B)</enum><header>Bureau
authority</header><text>In any action arising solely under an enumerated
consumer law, the Bureau may commence, defend, or intervene in the action in
accordance with the requirements of that provision of law, as
applicable.</text>
</subparagraph><subparagraph id="ID901361df1b624fa3afb61c04085a2855"><enum>(C)</enum><header>Transferred
authority</header><text>In any action arising solely under laws for which
authorities were transferred under subtitles F and H, the Bureau may commence,
defend, or intervene in the action in accordance with the requirements of that
provision of law, as applicable.</text>
</subparagraph></paragraph></subsection></section><section id="IDac48e18aab964e2ba1b63b5cbbc38074"><enum>1055.</enum><header>Relief
available</header>
<subsection id="ID55870bc7f6f3429897acd4e3cb273410"><enum>(a)</enum><header>Administrative
proceedings or court actions</header>
<paragraph id="ID6df8ded7a2c04d6b9d5ed8b2d2284b96"><enum>(1)</enum><header>Jurisdiction</header><text>The
court (or the Bureau, as the case may be) in an action or adjudication
proceeding brought under Federal consumer financial law, shall have
jurisdiction to grant any appropriate legal or equitable relief with respect to
a violation of Federal consumer financial law, including a violation of a rule
or order prescribed under a Federal consumer financial law.</text>
</paragraph><paragraph id="IDe0ed7373448c4a7a945cbc3926403530"><enum>(2)</enum><header>Relief</header><text>Relief
under this section may include, without limitation—</text>
<subparagraph id="ID4f9c8569e5d246bca8bc1c0941697ddc"><enum>(A)</enum><text>rescission or reformation
of contracts;</text>
</subparagraph><subparagraph id="ID29253fd3a16f4187924f7c77691f2436"><enum>(B)</enum><text>refund of moneys or
return of real property;</text>
</subparagraph><subparagraph id="IDfaa854a19dd944a8a10db5218f6898be"><enum>(C)</enum><text>restitution;</text>
</subparagraph><subparagraph id="IDffc54a82d79f4b13a395b9264591499e"><enum>(D)</enum><text>disgorgement or
compensation for unjust enrichment;</text>
</subparagraph><subparagraph id="ID802b4b06f9ab4c14a42c0730a62b56ee"><enum>(E)</enum><text>payment of damages or
other monetary relief;</text>
</subparagraph><subparagraph id="ID756eaaa802d44760b6057a5280c60d14"><enum>(F)</enum><text>public notification
regarding the violation, including the costs of notification;</text>
</subparagraph><subparagraph id="ID382c14ba4f594e998586842d1a2efeca"><enum>(G)</enum><text>limits on the activities
or functions of the person; and</text>
</subparagraph><subparagraph id="IDc3a84c01665243bd9b31ac27581d8a17"><enum>(H)</enum><text>civil money penalties, as
set forth more fully in subsection (c).</text>
</subparagraph></paragraph><paragraph id="ID3d970fb131b644838d7326ea85c92c11"><enum>(3)</enum><header>No exemplary or
punitive damages</header><text>Nothing in this subsection shall be construed as
authorizing the imposition of exemplary or punitive damages.</text>
</paragraph></subsection><subsection id="ID480325e4e9fb4f5d8da32572f6c0901c"><enum>(b)</enum><header>Recovery of
costs</header><text>In any action brought by the Bureau, a State attorney
general, or any State regulator to enforce any Federal consumer financial law,
the Bureau, the State attorney general, or the State regulator may recover its
costs in connection with prosecuting such action if the Bureau, the State
attorney general, or the State regulator is the prevailing party in the
action.</text>
</subsection><subsection id="ID8b78ffdf48734becaf5c0b8f4b8bdb6a"><enum>(c)</enum><header>Civil money penalty in
court and administrative actions</header>
<paragraph id="ID8a20bb41063448ceb85485f0829345aa"><enum>(1)</enum><header>In
general</header><text>Any person that violates, through any act or omission,
any provision of Federal consumer financial law shall forfeit and pay a civil
penalty pursuant to this subsection.</text>
</paragraph><paragraph id="id7FFAF1AB9216445F8A74E22707EFD794"><enum>(2)</enum><header>Penalty
amounts</header>
<subparagraph id="IDd5ebc13b24194d10a58b7c87753bc366"><enum>(A)</enum><header>First
tier</header><text>For any violation of a law, rule, or final order or
condition imposed in writing by the Bureau, a civil penalty may not exceed
$5,000 for each day during which such violation or failure to pay
continues.</text>
</subparagraph><subparagraph id="IDabbf220567644746a5ffac61e24a8a14"><enum>(B)</enum><header>Second
tier</header><text>Notwithstanding paragraph (A), for any person that
recklessly engages in a violation of a Federal consumer financial law, a civil
penalty may not exceed $25,000 for each day during which such violation
continues.</text>
</subparagraph><subparagraph id="ID74589e17fad04a52b91e0db981b92d33"><enum>(C)</enum><header>Third
tier</header><text>Notwithstanding subparagraphs (A) and (B), for any person
that knowingly violates a Federal consumer financial law, a civil penalty may
not exceed $1,000,000 for each day during which such violation
continues.</text>
</subparagraph></paragraph><paragraph id="ID58235d1c4e054edc94b7719296a90383"><enum>(3)</enum><header>Mitigating
factors</header><text>In determining the amount of any penalty assessed under
paragraph (2), the Bureau or the court shall take into account the
appropriateness of the penalty with respect to—</text>
<subparagraph id="ID972deba7309f427e9d6f56e0d388eab0"><enum>(A)</enum><text>the size of financial
resources and good faith of the person charged;</text>
</subparagraph><subparagraph id="IDe10998f7d54b4dab94562146829bdbc1"><enum>(B)</enum><text>the gravity of the
violation or failure to pay;</text>
</subparagraph><subparagraph id="ID9138c3508f7f4f6fa39700adb0e1bc37"><enum>(C)</enum><text>the severity of the risks
to or losses of the consumer, which may take into account the number of
products or services sold or provided;</text>
</subparagraph><subparagraph id="ID84a4b748518543658d25d740cbe11867"><enum>(D)</enum><text>the history of previous
violations; and</text>
</subparagraph><subparagraph id="ID66f8a6067a3343679cdd9319451d5e88"><enum>(E)</enum><text>such other matters as
justice may require.</text>
</subparagraph></paragraph><paragraph id="ID130340ad0ffb4751b70abcc1575bab98"><enum>(4)</enum><header>Authority to modify or
remit penalty</header><text>The Bureau may compromise, modify, or remit any
penalty which may be assessed or had already been assessed under paragraph (2).
The amount of such penalty, when finally determined, shall be exclusive of any
sums owed by the person to the United States in connection with the costs of
the proceeding, and may be deducted from any sums owing by the United States to
the person charged.</text>
</paragraph><paragraph id="IDc25dee44126c4ba2987b3d51b0bc80dc"><enum>(5)</enum><header>Notice and
hearing</header><text>No civil penalty may be assessed under this subsection
with respect to a violation of any Federal consumer financial law,
unless—</text>
<subparagraph id="IDe9ed77d3ffb445fdab50816283b7fb43"><enum>(A)</enum><text>the Bureau gives notice
and an opportunity for a hearing to the person accused of the violation;
or</text>
</subparagraph><subparagraph id="ID1948581dc2ac474e9c11dd3df0664a4d"><enum>(B)</enum><text>the appropriate court has
ordered such assessment and entered judgment in favor of the Bureau.</text>
</subparagraph></paragraph></subsection></section><section id="IDa65a25f5e064442dbe3473adad3232bc"><enum>1056.</enum><header>Referrals for
criminal proceedings</header><text display-inline="no-display-inline">If the
Bureau obtains evidence that any person, domestic or foreign, has engaged in
conduct that may constitute a violation of Federal criminal law, the Bureau
shall have the power to transmit such evidence to the Attorney General of the
United States, who may institute criminal proceedings under appropriate law.
Nothing in this section affects any other authority of the Bureau to disclose
information.</text>
</section><section id="ID2f622de2fe46427f83945a447e5ce51b"><enum>1057.</enum><header>Employee
protection</header>
<subsection id="ID747698a2a64c4e8c87b6e1b9aed7a6b8"><enum>(a)</enum><header>In
general</header><text>No covered person or service provider shall terminate or
in any other way discriminate against, or cause to be terminated or
discriminated against, any covered employee or any authorized representative of
covered employees by reason of the fact that such employee or representative,
whether at the initiative of the employee or in the ordinary course of the
duties of the employee (or any person acting pursuant to a request of the
employee), has—</text>
<paragraph id="ID69018123379844768c8723403ca31dc2"><enum>(1)</enum><text>provided, caused to be
provided, or is about to provide or cause to be provided, information to the
employer, the Bureau, or any other State, local, or Federal, government
authority or law enforcement agency relating to any violation of, or any act or
omission that the employee reasonably believes to be a violation of, any
provision of this title or any other provision of law that is subject to the
jurisdiction of the Bureau, or any rule, order, standard, or prohibition
prescribed by the Bureau;</text>
</paragraph><paragraph id="ID250aad43af004ca7a271caeb1e9de6c6"><enum>(2)</enum><text>testified or will testify
in any proceeding resulting from the administration or enforcement of any
provision of this title or any other provision of law that is subject to the
jurisdiction of the Bureau, or any rule, order, standard, or prohibition
prescribed by the Bureau;</text>
</paragraph><paragraph id="ID7fc1e857f270425db11cd1fb3ad2d49a"><enum>(3)</enum><text>filed, instituted, or
caused to be filed or instituted any proceeding under any Federal consumer
financial law; or</text>
</paragraph><paragraph id="ID0be1361074b54dea9634dfd5ddf8ed8d"><enum>(4)</enum><text>objected to, or refused
to participate in, any activity, policy, practice, or assigned task that the
employee (or other such person) reasonably believed to be in violation of any
law, rule, order, standard, or prohibition, subject to the jurisdiction of, or
enforceable by, the Bureau.</text>
</paragraph></subsection><subsection id="ID2cb90ea58b094d76af67f8a3cdb5d5cf"><enum>(b)</enum><header>Definition of covered
employee</header><text>For the purposes of this section, the term <term>covered
employee</term> means any individual performing tasks related to the offering
or provision of a consumer financial product or service.</text>
</subsection><subsection id="IDeae5c6dc739045db86596e70ce60a1db"><enum>(c)</enum><header>Procedures and
Timetables</header>
<paragraph id="ID6b6b40e9a1554b9fb5446d2837984350"><enum>(1)</enum><header>Complaint</header>
<subparagraph id="idA6313751A8B743F3A4C4E023BCA1DBB2"><enum>(A)</enum><header>In
general</header><text>A person who believes that he or she has been discharged
or otherwise discriminated against by any person in violation of subsection (a)
may, not later than 180 days after the date on which such alleged violation
occurs, file (or have any person file on his or her behalf) a complaint with
the Secretary of Labor alleging such discharge or discrimination and
identifying the person responsible for such act.</text>
</subparagraph><subparagraph id="idF7D3E0B05228409AA05DD485120978D0"><enum>(B)</enum><header>Actions of secretary of
labor</header><text>Upon receipt of such a complaint, the Secretary of Labor
shall notify, in writing, the person named in the complaint who is alleged to
have committed the violation, of—</text>
<clause id="IDd043238f14aa4934831ea325deb1c5cb"><enum>(i)</enum><text>the filing of the
complaint;</text>
</clause><clause id="IDd2a2295af5c949498817b88d75e25bd1"><enum>(ii)</enum><text>the allegations
contained in the complaint;</text>
</clause><clause id="IDc298f73c26fb4c0a8849a75de5e570de"><enum>(iii)</enum><text>the substance of
evidence supporting the complaint; and</text>
</clause><clause id="IDed673ce6b98644c0955a3fcbab050cf0"><enum>(iv)</enum><text>opportunities that will
be afforded to such person under paragraph (2).</text>
</clause></subparagraph></paragraph><paragraph id="ID58c69b432ef04443906a85375b4b5d08"><enum>(2)</enum><header>Investigation by
Secretary of Labor</header>
<subparagraph id="id15317B22A12642C190A03EE21747E1C3"><enum>(A)</enum><header>In
general</header><text>Not later than 60 days after the date of receipt of a
complaint filed under paragraph (1), and after affording the complainant and
the person named in the complaint who is alleged to have committed the
violation that is the basis for the complaint an opportunity to submit to the
Secretary of Labor a written response to the complaint and an opportunity to
meet with a representative of the Secretary of Labor to present statements from
witnesses, the Secretary of Labor shall—</text>
<clause id="id7931F186A2B84F01AE59B6895FFB68BD"><enum>(i)</enum><text>initiate an investigation
and determine whether there is reasonable cause to believe that the complaint
has merit; and</text>
</clause><clause id="idCDA478053C8A4813B4C64EF3E41D52D4"><enum>(ii)</enum><text>notify the complainant
and the person alleged to have committed the violation of subsection (a), in
writing, of such determination.</text>
</clause></subparagraph><subparagraph id="idDA957F50C02448299B9D37A7408DCD46"><enum>(B)</enum><header>Notice of relief
available</header><text>If the Secretary of Labor concludes that there is
reasonable cause to believe that a violation of subsection (a) has occurred,
the Secretary of Labor shall, together with the notice under subparagraph
(A)(ii), issue a preliminary order providing the relief prescribed by paragraph
(4)(B).</text>
</subparagraph><subparagraph id="idD6168C1DECC5480781D49953F40DD099"><enum>(C)</enum><header>Request for
hearing</header><text>Not later than 30 days after the date of receipt of
notification of a determination of the Secretary of Labor under this paragraph,
either the person alleged to have committed the violation or the complainant
may file objections to the findings or preliminary order, or both, and request
a hearing on the record. The filing of such objections shall not operate to
stay any reinstatement remedy contained in the preliminary order. Any such
hearing shall be conducted expeditiously, and if a hearing is not requested in
such 30-day period, the preliminary order shall be deemed a final order that is
not subject to judicial review.</text>
</subparagraph></paragraph><paragraph id="id28F0C361F68241329EFD806691ED61C6"><enum>(3)</enum><header>Grounds for
determination of complaints</header>
<subparagraph id="idD0D7DB08BA6D4C30AD56918BD72DE817"><enum>(A)</enum><header>In
general</header><text>The Secretary of Labor shall dismiss a complaint filed
under this subsection, and shall not conduct an investigation otherwise
required under paragraph (2), unless the complainant makes a prima facie
showing that any behavior described in paragraphs (1) through (4) of subsection
(a) was a contributing factor in the unfavorable personnel action alleged in
the complaint.</text>
</subparagraph><subparagraph id="id2E450687F8604992A4EAB1CF5368C285"><enum>(B)</enum><header>Rebuttal
evidence</header><text>Notwithstanding a finding by the Secretary of Labor that
the complainant has made the showing required under subparagraph (A), no
investigation otherwise required under paragraph (2) shall be conducted, if the
employer demonstrates, by clear and convincing evidence, that the employer
would have taken the same unfavorable personnel action in the absence of that
behavior.</text>
</subparagraph><subparagraph id="id8CDE49BF2BB3456D8A97CBCA0DD8A78A"><enum>(C)</enum><header>Evidentiary
standards</header><text>The Secretary of Labor may determine that a violation
of subsection (a) has occurred only if the complainant demonstrates that any
behavior described in paragraphs (1) through (4) of subsection (a) was a
contributing factor in the unfavorable personnel action alleged in the
complaint. Relief may not be ordered under subparagraph (A) if the employer
demonstrates by clear and convincing evidence that the employer would have
taken the same unfavorable personnel action in the absence of that
behavior.</text>
</subparagraph></paragraph><paragraph id="IDca106db11e60440dbcc4599380118596"><enum>(4)</enum><header>Issuance of final
orders; review procedures</header>
<subparagraph id="idA9330B24465F46B1B194351F57C156ED"><enum>(A)</enum><header>Timing</header><text>Not
later than 120 days after the date of conclusion of any hearing under paragraph
(2), the Secretary of Labor shall issue a final order providing the relief
prescribed by this paragraph or denying the complaint. At any time before
issuance of a final order, a proceeding under this subsection may be terminated
on the basis of a settlement agreement entered into by the Secretary of Labor,
the complainant, and the person alleged to have committed the violation.</text>
</subparagraph><subparagraph id="id670FC948F1034C6D8D5AA2A285D659B5"><enum>(B)</enum><header>Penalties</header>
<clause id="id7A5C00C4B7C841E28235B17DBC83FD4A"><enum>(i)</enum><header>Order of Secretary of
labor</header><text>If, in response to a complaint filed under paragraph (1),
the Secretary of Labor determines that a violation of subsection (a) has
occurred, the Secretary of Labor shall order the person who committed such
violation—</text>
<subclause id="id5F7933B6310C4AACAD14EFD2139D9F7F"><enum>(I)</enum><text>to take affirmative
action to abate the violation;</text>
</subclause><subclause id="idCC38C839BDFB48F5B838E1647D8ED16E"><enum>(II)</enum><text>to reinstate the
complainant to his or her former position, together with compensation
(including back pay) and restore the terms, conditions, and privileges
associated with his or her employment; and</text>
</subclause><subclause id="id63BD772DEFDD450AB4BB094AECB26368"><enum>(III)</enum><text>to provide compensatory
damages to the complainant.</text>
</subclause></clause><clause id="id69B05038B8154446A20D9D06C51E7EB5"><enum>(ii)</enum><header>Penalty</header><text>If
an order is issued under clause (i), the Secretary of Labor, at the request of
the complainant, shall assess against the person against whom the order is
issued, a sum equal to the aggregate amount of all costs and expenses
(including attorney fees and expert witness fees) reasonably incurred, as
determined by the Secretary of Labor, by the complainant for, or in connection
with, the bringing of the complaint upon which the order was issued.</text>
</clause></subparagraph><subparagraph id="id39F82D1594224ABDB85EABC8C77F7784"><enum>(C)</enum><header>Penalty for frivolous
claims</header><text>If the Secretary of Labor finds that a complaint under
paragraph (1) is frivolous or has been brought in bad faith, the Secretary of
Labor may award to the prevailing employer a reasonable attorney fee, not
exceeding $1,000, to be paid by the complainant.</text>
</subparagraph><subparagraph id="idB226191AE16A4C84ACF437E26E27DE61"><enum>(D)</enum><header>De novo review</header>
<clause id="id9D7AAEAC7AF441C5996123B5A41ED77D"><enum>(i)</enum><header>Failure of the
Secretary to act</header><text>If the Secretary of Labor has not issued a final
order within 210 days after the date of filing of a complaint under this
subsection, or within 90 days after the date of receipt of a written
determination, the complainant may bring an action at law or equity for de novo
review in the appropriate district court of the United States having
jurisdiction, which shall have jurisdiction over such an action without regard
to the amount in controversy, and which action shall, at the request of either
party to such action, be tried by the court with a jury.</text>
</clause><clause id="idA87217C196D24956BFCFCC65ADBF873B"><enum>(ii)</enum><header>Procedures</header><text>A
proceeding under clause (i) shall be governed by the same legal burdens of
proof specified in paragraph (3). The court shall have jurisdiction to grant
all relief necessary to make the employee whole, including injunctive relief
and compensatory damages, including—</text>
<subclause id="ID35188efc656e4a699ea2e3d97c70d663"><enum>(I)</enum><text>reinstatement with the
same seniority status that the employee would have had, but for the discharge
or discrimination;</text>
</subclause><subclause id="ID998d7872a2384a68943157c88cd10dc5"><enum>(II)</enum><text>the amount of back pay,
with interest; and</text>
</subclause><subclause id="ID64457c7a26b74e0c8dc6fa261b441c10"><enum>(III)</enum><text>compensation for any
special damages sustained as a result of the discharge or discrimination,
including litigation costs, expert witness fees, and reasonable attorney
fees.</text>
</subclause></clause></subparagraph><subparagraph id="id83564C817A3E44D8815960957F8470F7"><enum>(E)</enum><header>Other
appeals</header><text>Unless the complainant brings an action under
subparagraph (D), any person adversely affected or aggrieved by a final order
issued under subparagraph (A) may file a petition for review of the order in
the United States Court of Appeals for the circuit in which the violation with
respect to which the order was issued, allegedly occurred or the circuit in
which the complainant resided on the date of such violation, not later than 60
days after the date of the issuance of the final order of the Secretary of
Labor under subparagraph (A). Review shall conform to chapter 7 of title 5,
United States Code. The commencement of proceedings under this subparagraph
shall not, unless ordered by the court, operate as a stay of the order. An
order of the Secretary of Labor with respect to which review could have been
obtained under this subparagraph shall not be subject to judicial review in any
criminal or other civil proceeding.</text>
</subparagraph></paragraph><paragraph id="ID630d083be4fa4211af70b1e4ca81048b"><enum>(5)</enum><header>Failure to comply with
order</header>
<subparagraph id="id41DBB05CB95E4571AF0BF50EF119B4B9"><enum>(A)</enum><header>Actions by the
secretary</header><text>If any person has failed to comply with a final order
issued under paragraph (4), the Secretary of Labor may file a civil action in
the United States district court for the district in which the violation was
found to have occurred, or in the United States district court for the District
of Columbia, to enforce such order. In actions brought under this paragraph,
the district courts shall have jurisdiction to grant all appropriate relief
including injunctive relief and compensatory damages.</text>
</subparagraph><subparagraph id="id669A8F099C42472490B13F0F27883333"><enum>(B)</enum><header>Civil actions to compel
compliance</header><text>A person on whose behalf an order was issued under
paragraph (4) may commence a civil action against the person to whom such order
was issued to require compliance with such order. The appropriate United States
district court shall have jurisdiction, without regard to the amount in
controversy or the citizenship of the parties, to enforce such order.</text>
</subparagraph><subparagraph id="id4A3B52DE9E3945659D36F0F650C4CE7E"><enum>(C)</enum><header>Award of costs
authorized</header><text>The court, in issuing any final order under this
paragraph, may award costs of litigation (including reasonable attorney and
expert witness fees) to any party, whenever the court determines such award is
appropriate.</text>
</subparagraph><subparagraph id="idAE6E1EE40E744F5192D3E30D7C9C0165"><enum>(D)</enum><header>Mandamus
proceedings</header><text>Any nondiscretionary duty imposed by this section
shall be enforceable in a mandamus proceeding brought under section 1361 of
title 28, United States Code.</text>
</subparagraph></paragraph></subsection><subsection id="IDf75f4d4961104d08b1410b7064b2a7a3"><enum>(d)</enum><header>Unenforceability of
certain agreements</header>
<paragraph id="IDba97bdbb6f7145acbdfe266a5ce0e3c5"><enum>(1)</enum><header>No waiver of rights and
remedies</header><text>Except as provided under paragraph (3), and
notwithstanding any other provision of law, the rights and remedies provided
for in this section may not be waived by any agreement, policy, form, or
condition of employment, including by any predispute arbitration
agreement.</text>
</paragraph><paragraph id="IDf5a7d65437d04ec18db475ae71ec7005"><enum>(2)</enum><header>No Predispute
arbitration agreements</header><text>Except as provided under paragraph (3),
and notwithstanding any other provision of law, no predispute arbitration
agreement shall be valid or enforceable to the extent that it requires
arbitration of a dispute arising under this section.</text>
</paragraph><paragraph id="ID269e1c8a50de404b8ae276e005987b1a"><enum>(3)</enum><header>Exception</header><text>Notwithstanding
paragraphs (1) and (2), an arbitration provision in a collective bargaining
agreement shall be enforceable as to disputes arising under subsection (a)(4),
unless the Bureau determines, by rule, that such provision is inconsistent with
the purposes of this title.</text>
</paragraph></subsection></section><section id="IDb91c59b88c9d43c191daf2b3949f02f5"><enum>1058.</enum><header>Effective
date</header><text display-inline="no-display-inline">This subtitle shall
become effective on the designated transfer date.</text>
</section></subtitle><subtitle id="id6011340F08554451A1909329DDE194E9"><enum>F</enum><header>Transfer of Functions and
Personnel; Transitional Provisions</header>
<section id="id001A428045BF44DCA31B2107B799897A"><enum>1061.</enum><header>Transfer of consumer
financial protection functions</header>
<subsection id="ID39395c01000042a9ad91d7aff112d662"><enum>(a)</enum><header>Defined
terms</header><text>For purposes of this subtitle—</text>
<paragraph id="idEE3C73AD1D5C433EB7229F41BED81322"><enum>(1)</enum><text>the term <quote>consumer
financial protection functions</quote> means research, rulemaking, issuance of
orders or guidance, supervision, examination, and enforcement activities,
powers, and duties relating to the offering or provision of consumer financial
products or services; and</text>
</paragraph><paragraph commented="no" id="id56F70C15EC8E469AAA98BB96B12BF903"><enum>(2)</enum><text>the terms
<quote>transferor agency</quote> and <quote>transferor agencies</quote> mean,
respectively—</text>
<subparagraph commented="no" id="idD623DBA7EDD74E5B82BEF235DA8BA34D"><enum>(A)</enum><text>the Board of Governors
(and any Federal reserve bank, as the context requires), the Federal Deposit
Insurance Corporation, the Federal Trade Commission, the National Credit Union
Administration, the Office of the Comptroller of the Currency, the Office of
Thrift Supervision, and the Department of Housing and Urban Development, and
the heads of those agencies; and</text>
</subparagraph><subparagraph commented="no" id="id4785EBE3CD1B4EF5BA022674453FCB15"><enum>(B)</enum><text>the agencies listed in
subparagraph (A), collectively.</text>
</subparagraph></paragraph></subsection><subsection id="IDd44c9559a0bf44b6a59e7a81c5deb772"><enum>(b)</enum><header>In
general</header><text>Except as provided in subsection (c), consumer financial
protection functions are transferred as follows:</text>
<paragraph id="ID8bf7c2b7e04b42c2b8a958a1728ae2bb"><enum>(1)</enum><header>Board of
governors</header>
<subparagraph id="ID22ce5c5364b04e54891c843af8c8e3cf"><enum>(A)</enum><header>Transfer of
functions</header><text>All consumer financial protection functions of the
Board of Governors are transferred to the Bureau.</text>
</subparagraph><subparagraph id="ID2d008f5be4e542ffb2c098f2f4148623"><enum>(B)</enum><header>Board of governors
authority</header><text>The Bureau shall have all powers and duties that were
vested in the Board of Governors, relating to consumer financial protection
functions, on the day before the designated transfer date.</text>
</subparagraph></paragraph><paragraph id="IDe627ad9b9ddd4a3190d7be24c1c93f03"><enum>(2)</enum><header>Comptroller of the
currency</header>
<subparagraph id="ID57e80cbb779c4c8b9bdfc56d09d7b51b"><enum>(A)</enum><header>Transfer of
functions</header><text>All consumer financial protection functions of the
Comptroller of the Currency are transferred to the Bureau.</text>
</subparagraph><subparagraph id="ID9856eba0269445c493f32ede85b18969"><enum>(B)</enum><header>Comptroller
authority</header><text>The Bureau shall have all powers and duties that were
vested in the Comptroller of the Currency, relating to consumer financial
protection functions, on the day before the designated transfer date.</text>
</subparagraph></paragraph><paragraph id="ID7b70a949c1ef4b74975b8cb354887505"><enum>(3)</enum><header>Director of the office
of thrift supervision</header>
<subparagraph id="ID43e6be864e7b4deb8c5600012b1ca73b"><enum>(A)</enum><header>Transfer of
functions</header><text>All consumer financial protection functions of the
Director of the Office of Thrift Supervision are transferred to the
Bureau.</text>
</subparagraph><subparagraph id="ID81b0afe9390548b7885738522eda3286"><enum>(B)</enum><header>Director
authority</header><text>The Bureau shall have all powers and duties that were
vested in the Director of the Office of Thrift Supervision, relating to
consumer financial protection functions, on the day before the designated
transfer date.</text>
</subparagraph></paragraph><paragraph id="ID9933f9e2a7024a7b8d41e9cc45bdf2fa"><enum>(4)</enum><header>Federal deposit
insurance corporation</header>
<subparagraph id="IDe672162123534872889050a6a891ab97"><enum>(A)</enum><header>Transfer of
functions</header><text>All consumer financial protection functions of the
Federal Deposit Insurance Corporation are transferred to the Bureau.</text>
</subparagraph><subparagraph id="IDb01d29a334c040298b7a3753b2de1209"><enum>(B)</enum><header>Corporation
authority</header><text>The Bureau shall have all powers and duties that were
vested in the Federal Deposit Insurance Corporation, relating to consumer
financial protection functions, on the day before the designated transfer
date.</text>
</subparagraph></paragraph><paragraph id="IDc76dd208e256405287615400205cfbff"><enum>(5)</enum><header>Federal trade
commission</header>
<subparagraph id="ID2B96D0033ECA4D89AB5773C87FC7B1A1"><enum>(A)</enum><header>Transfer of
functions</header><text>The authority of the Federal Trade Commission under an
enumerated consumer law to prescribe rules, issue guidelines, or conduct a
study or issue a report mandated under such law shall be transferred to the
Bureau on the designated transfer date. Nothing in this title shall be
construed to require a mandatory transfer of any employee of the Federal Trade
Commission.</text>
</subparagraph><subparagraph id="ID1031AD67B9AD41C8BC9957CE998351B6"><enum>(B)</enum><header>Bureau
authority</header>
<clause id="ID6ED2A2B922A840C6901EA78E2BAB4DC1"><enum>(i)</enum><header>In
general</header><text>The Bureau shall have all powers and duties under the
enumerated consumer laws to prescribe rules, issue guidelines, or to conduct
studies or issue reports mandated by such laws, that were vested in the Federal
Trade Commission on the day before the designated transfer date.</text>
</clause><clause id="ID58E56CFE028B400DB651D35F28F81763"><enum>(ii)</enum><header>Federal Trade
Commission Act</header><text>Subject to subtitle B, the Bureau may enforce a
rule prescribed under the <act-name parsable-cite="FTCA">Federal Trade
Commission Act</act-name> by the Federal Trade Commission with respect to an
unfair or deceptive act or practice to the extent that such rule applies to a
covered person or service provider with respect to the offering or provision of
a consumer financial product or service as if it were a rule prescribed under
section 1031 of this title.</text>
</clause></subparagraph><subparagraph id="ID4F724E11605A4BDCB240831DBBD0F4CF"><enum>(C)</enum><header>Authority of the
federal trade commission</header>
<clause id="IDDB8313CBE76A4C048C97B71DAD2E33CB"><enum>(i)</enum><header>In
general</header><text>No provision of this title shall be construed as
modifying, limiting, or otherwise affecting the authority of the Federal Trade
Commission under the <act-name parsable-cite="FTCA">Federal Trade Commission
Act</act-name> or any other law, other than the authority under an enumerated
consumer law to prescribe rules, issue official guidelines, or conduct a study
or issue a report mandated under such law.</text>
</clause><clause id="ID30201141D7734619AC00373EEB1A2D71"><enum>(ii)</enum><header>Commission authority
relating to rules prescribed by the bureau</header><text>Subject to subtitle B,
the Federal Trade Commission shall have authority to enforce under the
<act-name parsable-cite="FTCA">Federal Trade Commission Act</act-name> (15
U.S.C. 41 et seq.) a rule prescribed by the Bureau under this title with
respect to a covered person subject to the jurisdiction of the Federal Trade
Commission under that Act, and a violation of such a rule by such a person
shall be treated as a violation of a rule issued under section 18 of that Act
(15 U.S.C. 57a) with respect to unfair or deceptive acts or practices.</text>
</clause></subparagraph><subparagraph id="ID46383768DF0048B9A0C20F40C57BCE70"><enum>(D)</enum><header>Coordination</header><text>To
avoid duplication of or conflict between rules prescribed by the Bureau under
section 1031 of this title and the Federal Trade Commission under section
18(a)(1)(B) of the <act-name parsable-cite="FTCA">Federal Trade Commission
Act</act-name> that apply to a covered person or service provider with respect
to the offering or provision of consumer financial products or services, the
agencies shall negotiate an agreement with respect to rulemaking by each
agency, including consultation with the other agency prior to proposing a rule
and during the comment period.</text>
</subparagraph><subparagraph id="IDBE314C3D46324F3AAE76CBFD83347F57"><enum>(E)</enum><header>Deference</header><text>No
provision of this title shall be construed as altering, limiting, expanding, or
otherwise affecting the deference that a court affords to the—</text>
<clause id="ID95BC023BD7BF4F7599F3169E0A001F20"><enum>(i)</enum><text>Federal Trade Commission
in making determinations regarding the meaning or interpretation of any
provision of the <act-name parsable-cite="FTCA">Federal Trade Commission
Act</act-name>, or of any other Federal law for which the Commission has
authority to prescribe rules; or</text>
</clause><clause id="IDE10F7D291FEA47829B7595C272635DF2"><enum>(ii)</enum><text>Bureau in making
determinations regarding the meaning or interpretation of any provision of a
Federal consumer financial law (other than any law described in clause
(i)).</text>
</clause></subparagraph></paragraph><paragraph id="ID826746b9fe3e4e8dbb9e3d5988a0454c"><enum>(6)</enum><header>National credit union
administration</header>
<subparagraph id="ID2bfc0903a49945a28ec5cab23373de51"><enum>(A)</enum><header>Transfer of
functions</header><text>All consumer financial protection functions of the
National Credit Union Administration are transferred to the Bureau.</text>
</subparagraph><subparagraph id="ID50e3072ccea640f19ceed62bcb73c511"><enum>(B)</enum><header>National credit union
administration authority</header><text>The Bureau shall have all powers and
duties that were vested in the National Credit Union Administration, relating
to consumer financial protection functions, on the day before the designated
transfer date.</text>
</subparagraph></paragraph><paragraph id="ID501584669b714631acba18dbce2a1d6f"><enum>(7)</enum><header>Department of housing
and urban development</header>
<subparagraph id="IDaeac2a8da31e4a45a1da6282bf9bb2ea"><enum>(A)</enum><header>Transfer of
functions</header><text>All consumer protection functions of the Secretary of
the Department of Housing and Urban Development relating to the Real Estate
Settlement Procedures Act of 1974 (12 U.S.C. 2601 et seq.) and the Secure and
Fair Enforcement for Mortgage Licensing Act of 2008 (12 U.S.C. 5102 et seq.)
are transferred to the Bureau.</text>
</subparagraph><subparagraph id="ID9582ed65a3894e509a336a0573d8d002"><enum>(B)</enum><header>Authority of the
Department of housing and urban development</header><text>The Bureau shall have
all powers and duties that were vested in the Secretary of the Department of
Housing and Urban Development relating to the Real Estate Settlement Procedures
Act of 1974 (12 U.S.C. 2601 et seq.), and the Secure and Fair Enforcement for
Mortgage Licensing Act of 2008 (12 U.S.C. 5101 et seq.), on the day before the
designated transfer date.</text>
</subparagraph></paragraph></subsection><subsection id="IDfa26d4c47d324bccad25a7a00e713ddf"><enum>(c)</enum><header>Transfers of functions
subject to examination and enforcement authority remaining with transferor
agencies</header><text>The transfers of functions in subsection (b) do not
affect the authority of the agencies identified in subsection (b) from
conducting examinations or initiating and maintaining enforcement proceedings,
including performing appropriate supervisory and support functions relating
thereto, in accordance with sections 1024, 1025, and 1026.</text>
</subsection><subsection id="IDc3dd72d73cd240e19b83032489d3c758"><enum>(d)</enum><header>Effective
date</header><text>Subsections (b) and (c) shall become effective on the
designated transfer date.</text>
</subsection></section><section id="ID73c67bf6466a48a29ea797fc8c25427c"><enum>1062.</enum><header>Designated transfer
date</header>
<subsection id="ID341969510749424eae9de5d75c688447"><enum>(a)</enum><header>In
general</header><text>Not later than 60 days after the date of enactment of
this Act, the Secretary shall—</text>
<paragraph id="IDdceb7c99e44a4a1fb7ff3534ed79d78a"><enum>(1)</enum><text>in consultation with the
Chairman of the Board of Governors, the Chairperson of the Corporation, the
Chairman of the Federal Trade Commission, the Chairman of the National Credit
Union Administration Board, the Comptroller of the Currency, the Director of
the Office of Thrift Supervision, the Secretary of the Department of Housing
and Urban Development, and the Director of the Office of Management and Budget,
designate a single calendar date for the transfer of functions to the Bureau
under section 1061; and</text>
</paragraph><paragraph id="ID55ac30a082764111a64e525a0409252f"><enum>(2)</enum><text>publish notice of that
designated date in the Federal Register.</text>
</paragraph></subsection><subsection id="ID1d07b35ff120456d9afddce89aaaf448"><enum>(b)</enum><header>Changing
designation</header><text>The Secretary—</text>
<paragraph id="IDb62b4cdabb64489a95862af4bfd134e9"><enum>(1)</enum><text>may, in consultation with
the Chairman of the Board of Governors, the Chairperson of the Federal Deposit
Insurance Corporation, the Chairman of the Federal Trade Commission, the
Chairman of the National Credit Union Administration Board, the Comptroller of
the Currency, the Director of the Office of Thrift Supervision, the Secretary
of the Department of Housing and Urban Development, and the Director of the
Office of Management and Budget, change the date designated under subsection
(a); and</text>
</paragraph><paragraph id="ID7c62fa53ac644bc88835bff51e273adc"><enum>(2)</enum><text>shall publish notice of
any changed designated date in the Federal Register.</text>
</paragraph></subsection><subsection id="ID6c5c6724a2c648e0b61c0664deded4bd"><enum>(c)</enum><header>Permissible
dates</header>
<paragraph id="ID079e32f5fc724c62a29f09cfa30c7071"><enum>(1)</enum><header>In
general</header><text>Except as provided in paragraph (2), any date designated
under this section shall be not earlier than 180 days, nor later than 18
months, after the date of enactment of this Act.</text>
</paragraph><paragraph id="ID428e9d42a8164cb99f27a7ebe4d6a826"><enum>(2)</enum><header>Extension of
time</header><text>The Secretary may designate a date that is later than 18
months after the date of enactment of this Act if the Secretary transmits to
appropriate committees of Congress—</text>
<subparagraph id="IDdedf06de40c6451dac0258063dfc4865"><enum>(A)</enum><text>a written determination
that orderly implementation of this title is not feasible before the date that
is 18 months after the date of enactment of this Act;</text>
</subparagraph><subparagraph id="IDe13ee438b92747d9985573434eccc854"><enum>(B)</enum><text>an explanation of why an
extension is necessary for the orderly implementation of this title; and</text>
</subparagraph><subparagraph id="IDd346ac006ca54ad1a6502fed16e3fd1e"><enum>(C)</enum><text>a description of the
steps that will be taken to effect an orderly and timely implementation of this
title within the extended time period.</text>
</subparagraph></paragraph><paragraph id="ID5eb29c8642344c46a25565798f22ef87"><enum>(3)</enum><header>Extension
limited</header><text>In no case may any date designated under this section be
later than 24 months after the date of enactment of this Act.</text>
</paragraph></subsection></section><section id="ID240c2e53b09549158ac0159d71cb491e"><enum>1063.</enum><header>Savings
provisions</header>
<subsection id="IDd81de25e0a9241e8a5a678a26bc05104"><enum>(a)</enum><header>Board of
governors</header>
<paragraph id="ID0a9be625c8aa41ceb5c6e2c409e4bbe8"><enum>(1)</enum><header>Existing rights,
duties, and obligations not affected</header><text>Section 1061(b)(1) does not
affect the validity of any right, duty, or obligation of the United States, the
Board of Governors (or any Federal reserve bank), or any other person
that—</text>
<subparagraph id="IDfc5e70e97e424d358be527437bfeaef6"><enum>(A)</enum><text>arises under any
provision of law relating to any consumer financial protection function of the
Board of Governors transferred to the Bureau by this title; and</text>
</subparagraph><subparagraph id="ID0aec0c34c0664c7b849674703cca0bd0"><enum>(B)</enum><text>existed on the day before
the designated transfer date.</text>
</subparagraph></paragraph><paragraph id="IDbd41aec2982443238504f6551dbdaaab"><enum>(2)</enum><header>Continuation of
suits</header><text>No provision of this Act shall abate any proceeding
commenced by or against the Board of Governors (or any Federal reserve bank)
before the designated transfer date with respect to any consumer financial
protection function of the Board of Governors (or any Federal reserve bank)
transferred to the Bureau by this title, except that the Bureau, subject to
sections 1024, 1025, and 1026, shall be substituted for the Board of Governors
(or Federal reserve bank) as a party to any such proceeding as of the
designated transfer date.</text>
</paragraph></subsection><subsection id="IDa15957ae738f43c4b4e8439b839441b6"><enum>(b)</enum><header>Federal deposit
insurance corporation</header>
<paragraph id="ID01fdb53564754b4dbbae057b15b93beb"><enum>(1)</enum><header>Existing rights,
duties, and obligations not affected</header><text>Section 1061(b)(4) does not
affect the validity of any right, duty, or obligation of the United States, the
Federal Deposit Insurance Corporation, the Board of Directors of that
Corporation, or any other person, that—</text>
<subparagraph id="ID2c8a6af17109405e8209e1c2a099a8e5"><enum>(A)</enum><text>arises under any
provision of law relating to any consumer financial protection function of the
Federal Deposit Insurance Corporation transferred to the Bureau by this title;
and</text>
</subparagraph><subparagraph id="IDdafe895e29334dbb98d3b5676ba8083a"><enum>(B)</enum><text>existed on the day before
the designated transfer date.</text>
</subparagraph></paragraph><paragraph id="ID35b2845a135a4413a984c056235cc637"><enum>(2)</enum><header>Continuation of
suits</header><text>No provision of this Act shall abate any proceeding
commenced by or against the Federal Deposit Insurance Corporation (or the Board
of Directors of that Corporation) before the designated transfer date with
respect to any consumer financial protection function of the Federal Deposit
Insurance Corporation transferred to the Bureau by this title, except that the
Bureau, subject to sections 1024, 1025, and 1026, shall be substituted for the
Federal Deposit Insurance Corporation (or Board of Directors) as a party to any
such proceeding as of the designated transfer date.</text>
</paragraph></subsection><subsection id="ID47C1EDD31CD54629A740C947EE9A14AC"><enum>(c)</enum><header>Federal trade
commission</header><text display-inline="yes-display-inline">Section 1061(b)(5)
does not affect the validity of any right, duty, or obligation of the United
States, the Federal Trade Commission, or any other person, that—</text>
<paragraph id="ID89380C1D5A72433E888735A792E39D3E"><enum>(1)</enum><text>arises under any
provision of law relating to any consumer financial protection function of the
Federal Trade Commission transferred to the Bureau by this title; and</text>
</paragraph><paragraph id="ID672D6F9D69524931A49E3CF77ADE70A4"><enum>(2)</enum><text>existed on the day before
the designated transfer date.</text>
</paragraph></subsection><subsection id="IDda4563e9890f43beb341153b5e36820d"><enum>(d)</enum><header>National credit union
administration</header>
<paragraph id="ID3467a113fa2144208be62605bddfb690"><enum>(1)</enum><header>Existing rights,
duties, and obligations not affected</header><text>Section 1061(b)(6) does not
affect the validity of any right, duty, or obligation of the United States, the
National Credit Union Administration, the National Credit Union Administration
Board, or any other person, that—</text>
<subparagraph id="ID293dbb2f682c4b979cbdf246ba482505"><enum>(A)</enum><text>arises under any
provision of law relating to any consumer financial protection function of the
National Credit Union Administration transferred to the Bureau by this title;
and</text>
</subparagraph><subparagraph id="IDea005d1d22984394989da32052add663"><enum>(B)</enum><text>existed on the day before
the designated transfer date.</text>
</subparagraph></paragraph><paragraph id="ID27b9c90f58c74dc6a5f26e48d7609f65"><enum>(2)</enum><header>Continuation of
suits</header><text>No provision of this Act shall abate any proceeding
commenced by or against the National Credit Union Administration (or the
National Credit Union Administration Board) before the designated transfer date
with respect to any consumer financial protection function of the National
Credit Union Administration transferred to the Bureau by this title, except
that the Bureau, subject to sections 1024, 1025, and 1026, shall be substituted
for the National Credit Union Administration (or National Credit Union
Administration Board) as a party to any such proceeding as of the designated
transfer date.</text>
</paragraph></subsection><subsection id="ID87deeaca722741daba31d631b1334d68"><enum>(e)</enum><header>Office of the
comptroller of the currency</header>
<paragraph id="IDc449c1b081de4ce18d176e4a8287448c"><enum>(1)</enum><header>Existing rights,
duties, and obligations not affected</header><text>Section 1061(b)(2) does not
affect the validity of any right, duty, or obligation of the United States, the
Comptroller of the Currency, the Office of the Comptroller of the Currency, or
any other person, that—</text>
<subparagraph id="ID42fd2d86f0f8437a8571deca8e7388bd"><enum>(A)</enum><text>arises under any
provision of law relating to any consumer financial protection function of the
Comptroller of the Currency transferred to the Bureau by this title; and</text>
</subparagraph><subparagraph id="ID6947aaa901134f878fa1f04c8c445292"><enum>(B)</enum><text>existed on the day before
the designated transfer date.</text>
</subparagraph></paragraph><paragraph id="ID432ba88238c84294ba59d4df3833677d"><enum>(2)</enum><header>Continuation of
suits</header><text>No provision of this Act shall abate any proceeding
commenced by or against the Comptroller of the Currency (or the Office of the
Comptroller of the Currency) with respect to any consumer financial protection
function of the Comptroller of the Currency transferred to the Bureau by this
title before the designated transfer date, except that the Bureau, subject to
sections 1024, 1025, and 1026, shall be substituted for the Comptroller of the
Currency (or the Office of the Comptroller of the Currency) as a party to any
such proceeding as of the designated transfer date.</text>
</paragraph></subsection><subsection id="ID2f8eda22d4724191a454dfedbfc12ffe"><enum>(f)</enum><header>Office of thrift
supervision</header>
<paragraph id="ID93643d0cc064430fb699781d730cb779"><enum>(1)</enum><header>Existing rights,
duties, and obligations not affected</header><text>Section 1061(b)(3) does not
affect the validity of any right, duty, or obligation of the United States, the
Director of the Office of Thrift Supervision, the Office of Thrift Supervision,
or any other person, that—</text>
<subparagraph id="ID22a35b2993324183960f4544ff87e08f"><enum>(A)</enum><text>arises under any
provision of law relating to any consumer financial protection function of the
Director of the Office of Thrift Supervision transferred to the Bureau by this
title; and</text>
</subparagraph><subparagraph id="ID7bced18b01414c598a1dbe1859e5e7b8"><enum>(B)</enum><text>that existed on the day
before the designated transfer date.</text>
</subparagraph></paragraph><paragraph id="IDa811100995744a09bccf84218122d6ca"><enum>(2)</enum><header>Continuation of
suits</header><text>No provision of this Act shall abate any proceeding
commenced by or against the Director of the Office of Thrift Supervision (or
the Office of Thrift Supervision) with respect to any consumer financial
protection function of the Director of the Office of Thrift Supervision
transferred to the Bureau by this title before the designated transfer date,
except that the Bureau, subject to sections 1024, 1025, and 1026, shall be
substituted for the Director (or the Office of Thrift Supervision) as a party
to any such proceeding as of the designated transfer date.</text>
</paragraph></subsection><subsection id="ID6a90d4ae04be42f5bfcda1163c3ad2f6"><enum>(g)</enum><header>Department of housing
and urban development</header>
<paragraph id="ID051f8ecab7ea42358c6c44ef3df16819"><enum>(1)</enum><header>Existing rights,
duties, and obligations not affected</header><text>Section 1061(b)(7) shall not
affect the validity of any right, duty, or obligation of the United States, the
Secretary of the Department of Housing and Urban Development (or the Department
of Housing and Urban Development), or any other person, that—</text>
<subparagraph id="IDa2fad2ce6ced4ff385b67f6b9ae00050"><enum>(A)</enum><text>arises under any
provision of law relating to any function of the Secretary of the Department of
Housing and Urban Development with respect to the Real Estate Settlement
Procedures Act of 1974 (12 U.S.C. 2601 et seq.) or the Secure and Fair
Enforcement for Mortgage Licensing Act of 2008 (12 U.S.C. 5102 et seq.)
transferred to the Bureau by this title; and</text>
</subparagraph><subparagraph id="ID4c9a5ded652a404dab0b1586b8502964"><enum>(B)</enum><text>existed on the day before
the designated transfer date.</text>
</subparagraph></paragraph><paragraph id="ID9d55ff6a785d47538e66ab9dc836224d"><enum>(2)</enum><header>Continuation of
suits</header><text>This title shall not abate any proceeding commenced by or
against the Secretary of the Department of Housing and Urban Development (or
the Department of Housing and Urban Development) with respect to any consumer
financial protection function of the Secretary of the Department of Housing and
Urban Development transferred to the Bureau by this title before the designated
transfer date, except that the Bureau, subject to sections 1024, 1025, and
1026, shall be substituted for the Secretary of the Department of Housing and
Urban Development (or the Department of Housing and Urban Development) as a
party to any such proceeding as of the designated transfer date.</text>
</paragraph></subsection><subsection id="ID2a8cd2b0507645269f945af1a812438b"><enum>(h)</enum><header>Continuation of
existing orders, rules, determinations, agreements, and
resolutions</header><text>All orders, resolutions, determinations, agreements,
and rules that have been issued, made, prescribed, or allowed to become
effective by any transferor agency or by a court of competent jurisdiction, in
the performance of consumer financial protection functions that are transferred
by this title and that are in effect on the day before the designated transfer
date, shall continue in effect according to the terms of those orders,
resolutions, determinations, agreements, and rules, and shall not be
enforceable by or against the Bureau.</text>
</subsection><subsection id="IDda40385a48f548fdb6fed22626951a2b"><enum>(i)</enum><header>Identification of rules
continued</header><text>Not later than the designated transfer date, the
Bureau—</text>
<paragraph id="ID826f21e43f1d42a9be72344f7ca0e4cb"><enum>(1)</enum><text>shall, after consultation
with the head of each transferor agency, identify the rules continued under
subsection (h) that will be enforced by the Bureau; and</text>
</paragraph><paragraph id="ID09f4b9fbfa52439299748fe95be1df3c"><enum>(2)</enum><text>shall publish a list of
such rules in the Federal Register.</text>
</paragraph></subsection><subsection id="ID8c39f285912641b597e264bf1528c1ec"><enum>(j)</enum><header>Status of rules
proposed or not yet effective</header>
<paragraph id="IDa6ba726a24c4427688f589cd470e7e17"><enum>(1)</enum><header>Proposed
rules</header><text>Any proposed rule of a transferor agency which that agency,
in performing consumer financial protection functions transferred by this
title, has proposed before the designated transfer date, but has not been
published as a final rule before that date, shall be deemed to be a proposed
rule of the Bureau.</text>
</paragraph><paragraph id="IDd03563176d9a417e8103f3879d3d6952"><enum>(2)</enum><header>Rules not yet
effective</header><text>Any interim or final rule of a transferor agency which
that agency, in performing consumer financial protection functions transferred
by this title, has published before the designated transfer date, but which has
not become effective before that date, shall become effective as a rule of the
Bureau according to its terms.</text>
</paragraph></subsection></section><section id="ID74612a8713084eb39103fdbf7536731d"><enum>1064.</enum><header>Transfer of certain
personnel</header>
<subsection id="ID95f70203376646cf80693235ad3699a1"><enum>(a)</enum><header>In general</header>
<paragraph id="ID071071419848487bb6dc2a3976106771"><enum>(1)</enum><header>Certain Federal reserve
system employees transferred</header>
<subparagraph id="IDe790ddcc9d47436d839810f73591f998"><enum>(A)</enum><header>Identifying employees
for transfer</header><text>The Bureau and the Board of Governors shall—</text>
<clause id="IDe84c8171ca2f4fcdbf913825def11ddd"><enum>(i)</enum><text>jointly determine the
number of employees of the Board of Governors necessary to perform or support
the consumer financial protection functions of the Board of Governors that are
transferred to the Bureau by this title; and</text>
</clause><clause id="ID7712e57fa72a486991397d766cff4d01"><enum>(ii)</enum><text>consistent with the
number determined under clause (i), jointly identify employees of the Board of
Governors for transfer to the Bureau, in a manner that the Bureau and the Board
of Governors, in their sole discretion, determine equitable.</text>
</clause></subparagraph><subparagraph id="ID528ed76b584d4c8d9ebe94652a195880"><enum>(B)</enum><header>Identified employees
transferred</header><text>All employees of the Board of Governors identified
under subparagraph (A)(ii) shall be transferred to the Bureau for
employment.</text>
</subparagraph><subparagraph id="IDd1881cabae594ccd86cdbfcd46d419f0"><enum>(C)</enum><header>Federal reserve bank
employees</header><text>Employees of any Federal reserve bank who, on the day
before the designated transfer date, are performing consumer financial
protection functions on behalf of the Board of Governors shall be treated as
employees of the Board of Governors for purposes of subparagraphs (A) and
(B).</text>
</subparagraph></paragraph><paragraph id="ID17dbae3550a0444eb70622a54757ac72"><enum>(2)</enum><header>Certain fdic employees
transferred</header>
<subparagraph id="ID37adc893606e4f75b7b732e9027dbc29"><enum>(A)</enum><header>Identifying employees
for transfer</header><text>The Bureau and the Board of Directors of the Federal
Deposit Insurance Corporation shall—</text>
<clause id="ID0fa12334e8a24522bdba8ec2d0b2cf8f"><enum>(i)</enum><text>jointly determine the
number of employees of that Corporation necessary to perform or support the
consumer financial protection functions of the Corporation that are transferred
to the Bureau by this title; and</text>
</clause><clause id="ID54b400d67721428aa90aafb0b69212c1"><enum>(ii)</enum><text>consistent with the
number determined under clause (i), jointly identify employees of the
Corporation for transfer to the Bureau, in a manner that the Bureau and the
Board of Directors of the Corporation, in their sole discretion, determine
equitable.</text>
</clause></subparagraph><subparagraph id="ID02b6232207134dbd9e5d178f2e9a5365"><enum>(B)</enum><header>Identified employees
transferred</header><text>All employees of the Corporation identified under
subparagraph (A)(ii) shall be transferred to the Bureau for employment.</text>
</subparagraph></paragraph><paragraph id="id7EE5EC03672E4304A65D27EF57D0F750"><enum>(3)</enum><header>Certain ncua employees
transferred</header>
<subparagraph id="ID06d88122a38a492db4e99d48fea71d5c"><enum>(A)</enum><header>Identifying employees
for transfer</header><text>The Bureau and the National Credit Union
Administration Board shall—</text>
<clause id="ID38ca9a76e5274fbd9d430a471344d9dd"><enum>(i)</enum><text>jointly determine the
number of employees of the National Credit Union Administration necessary to
perform or support the consumer financial protection functions of the National
Credit Union Administration that are transferred to the Bureau by this title;
and</text>
</clause><clause id="ID52dabccd703645b8a16c308c342fb419"><enum>(ii)</enum><text>consistent with the
number determined under clause (i), jointly identify employees of the National
Credit Union Administration for transfer to the Bureau, in a manner that the
Bureau and the National Credit Union Administration Board, in their sole
discretion, determine equitable.</text>
</clause></subparagraph><subparagraph id="ID53f08d6bfb7745908eb361f0829b6e43"><enum>(B)</enum><header>Identified employees
transferred</header><text>All employees of the National Credit Union
Administration identified under subparagraph (A)(ii) shall be transferred to
the Bureau for employment.</text>
</subparagraph></paragraph><paragraph id="idDAF327FAD5E94923802DD5AB867F1528"><enum>(4)</enum><header>Certain Office of the
Comptroller of the Currency Employees Transferred</header>
<subparagraph id="id393BA15E8B2547C6863ABB3336FBE483"><enum>(A)</enum><header>Identifying employees
for transfer</header><text>The Bureau and the Comptroller of the Currency
shall—</text>
<clause id="ID23a2437216024f068e674952ab7da011"><enum>(i)</enum><text>jointly determine the
number of employees of the Office of the Comptroller of the Currency necessary
to perform or support the consumer financial protection functions of the Office
of the Comptroller of the Currency that are transferred to the Bureau by this
title; and</text>
</clause><clause id="IDe1359bf4f1de4942bac679246e04116e"><enum>(ii)</enum><text>consistent with the
number determined under clause (i), jointly identify employees of the Office of
the Comptroller of the Currency for transfer to the Bureau, in a manner that
the Bureau and the Office of the Comptroller of the Currency, in their sole
discretion, determine equitable.</text>
</clause></subparagraph><subparagraph id="id51B8A7201AC84C51BB95751C7A4751E2"><enum>(B)</enum><header>Identified employees
transferred</header><text>All employees of the Office of the Comptroller of the
Currency identified under subparagraph (A)(ii) shall be transferred to the
Bureau for employment.</text>
</subparagraph></paragraph><paragraph id="idE90BC3A37A44444C91B552C3A66CEBF8"><enum>(5)</enum><header>Certain Office of
Thrift Supervision Employees Transferred</header>
<subparagraph id="id079FAF5FD53A402CB789A4EF6BD788E3"><enum>(A)</enum><header>Identifying employees
for transfer</header><text>The Bureau and the Director of the Office of Thrift
Supervision shall—</text>
<clause id="id2ECFBCF2AC1F4D119E4E59ACA7A8528D"><enum>(i)</enum><text>jointly determine the
number of employees of the Office of Thrift Supervision necessary to perform or
support the consumer financial protection functions of the Office of Thrift
Supervision that are transferred to the Bureau by this title; and</text>
</clause><clause id="ID7fc19c37c9714f55875f340d56213153"><enum>(ii)</enum><text>consistent with the
number determined under clause (i), jointly identify employees of the Office of
Thrift Supervision for transfer to the Bureau, in a manner that the Bureau and
the Office of Thrift Supervision, in their sole discretion, determine
equitable.</text>
</clause></subparagraph><subparagraph id="ID5c2c19f948804a49a652fcc9d0f7c6d6"><enum>(B)</enum><header>Identified employees
transferred</header><text>All employees of the Office of Thrift Supervision
identified under subparagraph (A)(ii) shall be transferred to the Bureau for
employment.</text>
</subparagraph></paragraph><paragraph id="ID356cf02d4c0f4a0ab5cbbc265bb8f32e"><enum>(6)</enum><header>Certain employees of
department of housing and urban development transferred</header>
<subparagraph id="IDc65c9660d5c94dafa42c3ea1d4faa193"><enum>(A)</enum><header>Identifying employees
for transfer</header><text>The Bureau and the Secretary of the Department of
Housing and Urban Development shall—</text>
<clause id="ID3d46deced70e42b08c9e28f5806b8928"><enum>(i)</enum><text>jointly determine the
number of employees of the Department of Housing and Urban Development
necessary to perform or support the consumer protection functions of the
Department that are transferred to the Bureau by this title; and</text>
</clause><clause id="ID446644d5ad3a41c4a275c36c91f0da79"><enum>(ii)</enum><text>consistent with the
number determined under clause (i), jointly identify employees of the
Department of Housing and Urban Development for transfer to the Bureau in a
manner that the Bureau and the Secretary of the Department of Housing and Urban
Development, in their sole discretion, deem equitable.</text>
</clause></subparagraph><subparagraph id="ID163735c49227483cad471f25cadbf841"><enum>(B)</enum><header>Identified employees
transferred</header><text>All employees of the Department of Housing and Urban
Development identified under subparagraph (A)(ii) shall be transferred to the
Bureau for employment.</text>
</subparagraph></paragraph><paragraph id="IDd4815147a12f45329991c81d14864794"><enum>(7)</enum><header>Appointment authority
for excepted service and senior executive service transferred</header>
<subparagraph id="IDcbd69197bf814e6f909bdaf6d8d68553"><enum>(A)</enum><header>In
general</header><text>In the case of an employee occupying a position in the
excepted service or the Senior Executive Service, any appointment authority
established pursuant to law or regulations of the Office of Personnel
Management for filling such positions shall be transferred, subject to
subparagraph (B).</text>
</subparagraph><subparagraph id="IDe686abcd6a104ec381b49c2654506218"><enum>(B)</enum><header>Declining transfers
allowed</header><text>An agency or entity may decline to make a transfer of
authority under subparagraph (A) (and the employees appointed pursuant thereto)
to the extent that such authority relates to positions excepted from the
competitive service because of their confidential, policy-making,
policy-determining, or policy-advocating character, and non-career positions in
the Senior Executive Service (within the meaning of section 3132(a)(7) of title
5, United States Code).</text>
</subparagraph></paragraph></subsection><subsection id="ID81c382e417ba4016bc457e3377af929d"><enum>(b)</enum><header>Timing of transfers and
position assignments</header><text>Each employee to be transferred under this
section shall—</text>
<paragraph id="ID4375a16a3bb2469b878d05562da1dd0b"><enum>(1)</enum><text>be transferred not later
than 90 days after the designated transfer date; and</text>
</paragraph><paragraph id="ID01760f3103ae485391764e45c923d9a1"><enum>(2)</enum><text>receive notice of a
position assignment not later than 120 days after the effective date of his or
her transfer.</text>
</paragraph></subsection><subsection id="ID76dfd6647e2c4f02b99f124b70555257"><enum>(c)</enum><header>Transfer of
function</header>
<paragraph id="IDf63ab7a2ce1f428687f31242d957979a"><enum>(1)</enum><header>In
general</header><text>Notwithstanding any other provision of law, the transfer
of employees shall be deemed a transfer of functions for the purpose of section
3503 of title 5, United States Code.</text>
</paragraph><paragraph id="IDd8ea811d1da94343bc34c68ee64df44d"><enum>(2)</enum><header>Priority of this
title</header><text>If any provisions of this title conflict with any
protection provided to transferred employees under section 3503 of title 5,
United States Code, the provisions of this title shall control.</text>
</paragraph></subsection><subsection id="IDf0298354055d4280a306b4ed44240c0a"><enum>(d)</enum><header>Equal status and tenure
positions</header>
<paragraph id="ID692d99e696dc4dd19e0e2d91b7ea3222"><enum>(1)</enum><header>Employees transferred
from fdic, hud, ncua, occ, and ots</header><text>Each employee transferred from
the Federal Deposit Insurance Corporation, the National Credit Union
Administration, the Office of the Comptroller of the Currency, the Office of
Thrift Supervision, or the Department of Housing and Urban Development shall be
placed in a position at the Bureau with the same status and tenure as that
employee held on the day before the designated transfer date.</text>
</paragraph><paragraph id="ID88ca3a9693f54fc4999da18175554b63"><enum>(2)</enum><header>Employees transferred
from the Federal reserve system</header>
<subparagraph id="IDe608ac87ba154e21a2a5aeeaedeaff85"><enum>(A)</enum><header>Comparability</header><text>Each
employee transferred from the Board of Governors or from a Federal reserve bank
shall be placed in a position with the same status and tenure as that of an
employee transferring to the Bureau from the Office of the Comptroller of the
Currency who perform similar functions and have similar periods of
service.</text>
</subparagraph><subparagraph id="IDbacbacdec4a94cccbe8de3c6a31948b8"><enum>(B)</enum><header>Service periods
credited</header><text>For purposes of this paragraph, periods of service with
the Board of Governors or a Federal reserve bank shall be credited as periods
of service with a Federal agency.</text>
</subparagraph></paragraph></subsection><subsection id="ID9332f6bfb59142ecae98f37d4c8a2ddd"><enum>(e)</enum><header>Additional
certification requirements limited</header><text>Examiners transferred to the
Bureau are not subject to any additional certification requirements before
being placed in a comparable examiner position at the Bureau examining the same
types of institutions as they examined before they were transferred.</text>
</subsection><subsection id="IDbb44b89c58e645d9b234731a65465c3f"><enum>(f)</enum><header>Personnel actions
limited</header>
<paragraph id="ID1a70210a2b2d4d00986612ccad8fc2cb"><enum>(1)</enum><header>2-Year
protection</header><text>Except as provided in paragraph (2), each transferred
employee holding a permanent position on the day before the designated transfer
date may not, during the 2-year period beginning on the designated transfer
date, be involuntarily separated, or involuntarily reassigned outside his or
her locality pay area, as defined by the Office of Personnel Management.</text>
</paragraph><paragraph id="IDc86201b68dea433dbd066057c9000e34"><enum>(2)</enum><header>Exceptions</header><text>Paragraph
(1) does not limit the right of the Bureau—</text>
<subparagraph id="ID6d1f4fcccf13435cbdb49866f14fec8b"><enum>(A)</enum><text>to separate an employee
for cause or for unacceptable performance;</text>
</subparagraph><subparagraph id="ID174953799c4543da8d4ad6e0411b155e"><enum>(B)</enum><text>to terminate an
appointment to a position excepted from the competitive service because of its
confidential policy-making, policy-determining, or policy-advocating character;
or</text>
</subparagraph><subparagraph id="ID266c3651f332467c93979dfbdf9a1fd0"><enum>(C)</enum><text>to reassign a supervisory
employee outside his or her locality pay area, as defined by the Office of
Personnel Management, when the Bureau determines that the reassignment is
necessary for the efficient operation of the Bureau.</text>
</subparagraph></paragraph></subsection><subsection id="ID357b9aaed5ca4ecdae458583395aef18"><enum>(g)</enum><header>Pay</header>
<paragraph id="ID9f5f259e6c954433a5d9f29a91bc8071"><enum>(1)</enum><header>2-Year
protection</header><text>Except as provided in paragraph (2), each transferred
employee shall, during the 2-year period beginning on the designated transfer
date, receive pay at a rate equal to not less than the basic rate of pay
(including any geographic differential) that the employee received during the
pay period immediately preceding the date of transfer.</text>
</paragraph><paragraph id="ID2aa5d563aba54468b4301e90fa8cbfd7"><enum>(2)</enum><header>Exceptions</header><text>Paragraph
(1) does not limit the right of the Bureau to reduce the rate of basic pay of a
transferred employee—</text>
<subparagraph id="ID16d3937cfae04e5fabe1cfcbf866da74"><enum>(A)</enum><text>for cause;</text>
</subparagraph><subparagraph id="ID9e2bc008d8a547599f11aa4701280e5a"><enum>(B)</enum><text>for unacceptable
performance; or</text>
</subparagraph><subparagraph id="ID43c0a1c574314dc8a60808475f0120c6"><enum>(C)</enum><text>with the consent of the
employee.</text>
</subparagraph></paragraph><paragraph id="IDe92a86e1651f4d709e8e15eab5234a87"><enum>(3)</enum><header>Protection only while
employed</header><text>Paragraph (1) applies to a transferred employee only
while that employee remains employed by the Bureau.</text>
</paragraph><paragraph id="IDf85cf849a4ae489c87777160aefdcae7"><enum>(4)</enum><header>Pay increases
permitted</header><text>Paragraph (1) does not limit the authority of the
Bureau to increase the pay of a transferred employee.</text>
</paragraph></subsection><subsection id="ID0ca49d31325c481c85b69e398d670750"><enum>(h)</enum><header>Reorganization</header>
<paragraph id="ID9d4df148a3fa4f6a9fa20c2344e720d8"><enum>(1)</enum><header>Between 1st and 3rd
year</header>
<subparagraph id="IDd5eca2cf81a54d0a9a81e259dcf1e6a1"><enum>(A)</enum><header>In
general</header><text>If the Bureau determines, during the 2-year period
beginning 1 year after the designated transfer date, that a reorganization of
the staff of the Bureau is required—</text>
<clause id="ID5d6b8810ce904d33a9ac9c0c5c3eebe8"><enum>(i)</enum><text>that reorganization shall
be deemed a <quote>major reorganization</quote> for purposes of affording
affected employees retirement under section 8336(d)(2) or 8414(b)(1)(B) of
title 5, United States Code;</text>
</clause><clause id="IDf0723f9b037f4ca19faa15885b5ad914"><enum>(ii)</enum><text>before the
reorganization occurs, all employees in the same locality pay area as defined
by the Office of Personnel Management shall be placed in a uniform position
classification system; and</text>
</clause><clause id="ID483b23b92c1d44f084565a5bcc3f43ab"><enum>(iii)</enum><text>any resulting reduction
in force shall be governed by the provisions of chapter 35 of title 5, United
States Code, except that the Bureau shall—</text>
<subclause id="ID15b82c23202b42b1a185897d9cd5c770"><enum>(I)</enum><text>establish competitive
areas (as that term is defined in regulations issued by the Office of Personnel
Management) to include at a minimum all employees in the same locality pay area
as defined by the Office of Personnel Management;</text>
</subclause><subclause id="ID4f4808e8b8c546abb6cde77b784a1821"><enum>(II)</enum><text>establish competitive
levels (as that term is defined in regulations issued by the Office of
Personnel Management) without regard to whether the particular employees have
been appointed to positions in the competitive service or the excepted service;
and</text>
</subclause><subclause id="ID108849e23a0e47a686f5911384ccbe21"><enum>(III)</enum><text>afford employees
appointed to positions in the excepted service (other than to a position
excepted from the competitive service because of its confidential
policy-making, policy-determining, or policy-advocating character) the same
assignment rights to positions within the Bureau as employees appointed to
positions in the competitive service.</text>
</subclause></clause></subparagraph><subparagraph id="ID1c146084c9d1425fae47fa0d9acdc82e"><enum>(B)</enum><header>Service credit for
reductions in force</header><text>For purposes of this paragraph, periods of
service with a Federal home loan bank, a joint office of the Federal home loan
banks, the Board of Governors, a Federal reserve bank, the Federal Deposit
Insurance Corporation, or the National Credit Union Administration shall be
credited as periods of service with a Federal agency.</text>
</subparagraph></paragraph><paragraph id="ID5bb967cde4a64e5498e55310a651a419"><enum>(2)</enum><header>After 3rd year</header>
<subparagraph id="ID86327b062eda45da9aeb47035b3b05cb"><enum>(A)</enum><header>In
general</header><text>If the Bureau determines, at any time after the 3-year
period beginning on the designated transfer date, that a reorganization of the
staff of the Bureau is required, any resulting reduction in force shall be
governed by the provisions of chapter 35 of title 5, United States Code, except
that the Bureau shall establish competitive levels (as that term is defined in
regulations issued by the Office of Personnel Management) without regard to
types of appointment held by particular employees transferred under this
section.</text>
</subparagraph><subparagraph id="ID8dbd9ef798f84c11a0a798b5f2508044"><enum>(B)</enum><header>Service credit for
reductions in force</header><text>For purposes of this paragraph, periods of
service with a Federal home loan bank, a joint office of the Federal home loan
banks, the Board of Governors, a Federal reserve bank, the Federal Deposit
Insurance Corporation, or the National Credit Union Administration shall be
credited as periods of service with a Federal agency.</text>
</subparagraph></paragraph></subsection><subsection id="ID2b97d7f2ac584402adb080ca338eb2dc"><enum>(i)</enum><header>Benefits</header>
<paragraph id="ID2ab9306a30604065801626aa11b8a777"><enum>(1)</enum><header>Retirement benefits for
transferred employees</header>
<subparagraph id="ID19101d8d29744dc1b00a609ed9d4b7d3"><enum>(A)</enum><header>In general</header>
<clause id="IDbeb2354f2d5e430eb22770668dd652d1"><enum>(i)</enum><header>Continuation of
existing retirement plan</header><text>Except as provided in subparagraph (B),
each transferred employee shall remain enrolled in his or her existing
retirement plan, through any period of continuous employment with the
Bureau.</text>
</clause><clause id="ID93bfda9e63554063bdc5737b8e282392"><enum>(ii)</enum><header>Employer
contribution</header><text>The Bureau shall pay any employer contributions to
the existing retirement plan of each transferred employee, as required under
that plan.</text>
</clause></subparagraph><subparagraph id="ID3d1c78539de84e27ad3e21bcfcffe8f8"><enum>(B)</enum><header>Option for employees
transferred from Federal reserve system to be subject to federal employee
retirement program</header>
<clause id="ID8869213559414ff3bb364ff57ebb80e0"><enum>(i)</enum><header>Election</header><text>Any
transferred employee who was enrolled in a Federal Reserve System retirement
plan on the day before his or her transfer to the Bureau may, during the 1-year
period beginning 6 months after the designated transfer date, elect to be
subject to the Federal employee retirement program.</text>
</clause><clause id="ID19146f4e8a184773b499d46424e0ec56"><enum>(ii)</enum><header>Effective date of
coverage</header><text>For any employee making an election under clause (i),
coverage by the Federal employee retirement program shall begin 1 year after
the designated transfer date.</text>
</clause></subparagraph><subparagraph id="ID00011fb63eb64c88bcccdfbb5a1fde41"><enum>(C)</enum><header>Bureau participation in
Federal reserve system retirement plan</header>
<clause id="IDa1c4c3ed6eaf43afbea35c0d5e000a63"><enum>(i)</enum><header>Separate account in
Federal reserve system retirement plan
established</header><text>Notwithstanding any other provision of law, and
subject to the terms and conditions of this section, a separate account in the
Federal Reserve System retirement plan shall be established for Bureau
employees who do not make the election under subparagraph (B).</text>
</clause><clause id="ID8ff5a5cfec384720881bfa41158d7278"><enum>(ii)</enum><header>Funds attributable to
transferred employees remaining in Federal reserve system retirement plan
transferred</header><text>The proportionate share of funds in the Federal
Reserve System retirement plan, including the proportionate share of any
funding surplus in that plan, attributable to a transferred employee who does
not make the election under subparagraph (B), shall be transferred to the
account established under clause (i).</text>
</clause><clause id="ID339e965873954bebb99e7a4d926923e2"><enum>(iii)</enum><header>Employer
contributions deposited</header><text>The Bureau shall deposit into the account
established under clause (i) the employer contributions that the Bureau makes
on behalf of employees who do not make the election under subparagraph
(B).</text>
</clause><clause id="IDf0be019092674d6d94972f5c515827a3"><enum>(iv)</enum><header>Account
administration</header><text>The Bureau shall administer the account
established under clause (i) as a participating employer in the Federal Reserve
System retirement plan.</text>
</clause></subparagraph><subparagraph id="IDdcc48ecc4a6b47af81cc19a4e85166d2"><enum>(D)</enum><header>Definitions</header><text>For
purposes of this paragraph—</text>
<clause id="ID4bbee4d29a3547c9b6c0867492465936"><enum>(i)</enum><text>the term <term>existing
retirement plan</term> means, with respect to any employee transferred under
this section, the particular retirement plan (including the Financial
Institutions Retirement Fund) and any associated thrift savings plan of the
agency or Federal reserve bank from which the employee was transferred, in
which the employee was enrolled on the day before the designated transfer date;
and</text>
</clause><clause id="ID2acfc594ac644f63b8b7e027e827448d"><enum>(ii)</enum><text>the term <term>Federal
employee retirement program</term> means the retirement program for Federal
employees established by chapter 84 of title 5, United States Code.</text>
</clause></subparagraph></paragraph><paragraph id="IDe7b547ae1f544ef1b34c46c0a05ceb8e"><enum>(2)</enum><header>Benefits other than
retirement benefits for transferred employees</header>
<subparagraph id="IDc05ca003fc384762bbf1d8882c0a3e31"><enum>(A)</enum><header>During 1st
year</header>
<clause id="IDf3c4e5ad3501436a8a081fd519fff7e4"><enum>(i)</enum><header>Existing plans
continue</header><text>Each transferred employee may, for 1 year after the
designated transfer date, retain membership in any other employee benefit
program of the agency or bank from which the employee transferred, including a
dental, vision, long term care, or life insurance program, to which the
employee belonged on the day before the designated transfer date.</text>
</clause><clause id="ID379b5cc8c3c6430db82c4c70e46fbd54"><enum>(ii)</enum><header>Employer
contribution</header><text>The Bureau shall reimburse the agency or bank from
which an employee was transferred for any cost incurred by that agency or bank
in continuing to extend coverage in the benefit program to the employee, as
required under that program or negotiated agreements.</text>
</clause></subparagraph><subparagraph id="ID4a22d48a244c48d88e71431b55aa310b"><enum>(B)</enum><header>Dental, vision, or life
insurance after 1st year</header><text>If, after the 1-year period beginning on
the designated transfer date, the Bureau decides not to continue participation
in any dental, vision, or life insurance program of an agency or bank from
which an employee transferred, a transferred employee who is a member of such a
program may, before the decision of the Bureau takes effect, elect to enroll,
without regard to any regularly scheduled open season, in—</text>
<clause id="ID9412e4555665457781bb3a91152a3cb3"><enum>(i)</enum><text>the enhanced dental
benefits established by chapter 89A of title 5, United States Code;</text>
</clause><clause id="IDd65156caa1b44c348137eaebb485e48f"><enum>(ii)</enum><text>the enhanced vision
benefits established by chapter 89B of title 5, United States Code; or</text>
</clause><clause id="IDb005329fbc954f93af0778e68357b174"><enum>(iii)</enum><text>the Federal Employees
Group Life Insurance Program established by chapter 87 of title 5, United
States Code, without regard to any requirement of insurability.</text>
</clause></subparagraph><subparagraph id="ID41b28d625f884bd6ae3b00ffa76f91bd"><enum>(C)</enum><header>Long term care
insurance after 1st year</header><text>If, after the 1-year period beginning on
the designated transfer date, the Bureau decides not to continue participation
in any long term care insurance program of an agency or bank from which an
employee transferred, a transferred employee who is a member of such a program
may, before the decision of the Bureau takes effect, elect to apply for
coverage under the Federal Long Term Care Insurance Program established by
chapter 90 of title 5, United States Code, under the underwriting requirements
applicable to a new active workforce member (as defined in part 875, title 5,
Code of Federal Regulations).</text>
</subparagraph><subparagraph id="ID132617389ddb44a5bab7cb2138c1ecbb"><enum>(D)</enum><header>Employee
contribution</header><text>An individual enrolled in the Federal Employees
Health Benefits program shall pay any employee contribution required by the
plan.</text>
</subparagraph><subparagraph id="ID8853d6ca66e742ef96c8083cd20095a1"><enum>(E)</enum><header>Additional
funding</header><text>The Bureau shall transfer to the Federal Employees Health
Benefits Fund established under section 8909 of title 5, United States Code, an
amount determined by the Director of the Office of Personnel Management, after
consultation with the Bureau and the Office of Management and Budget, to be
necessary to reimburse the Fund for the cost to the Fund of providing benefits
under this paragraph.</text>
</subparagraph><subparagraph id="ID662d1d41456b4a0894b39776382bd768"><enum>(F)</enum><header>Credit for time
enrolled in other plans</header><text>For employees transferred under this
title, enrollment in a health benefits plan administered by a transferor agency
or a Federal reserve bank, as the case may be, immediately before enrollment in
a health benefits plan under chapter 89 of title 5, United States Code, shall
be considered as enrollment in a health benefits plan under that chapter for
purposes of section 8905(b)(1)(A) of title 5, United States Code.</text>
</subparagraph><subparagraph id="ID193729cf245344d4ab19a94de3d13a68"><enum>(G)</enum><header>Special provisions to
ensure continuation of life insurance benefits</header>
<clause id="ID7668b6bb7e544b9682c014e657acae76"><enum>(i)</enum><header>In
general</header><text>An annuitant (as defined in section 8901(3) of title 5,
United States Code) who is enrolled in a life insurance plan administered by a
transferor agency on the day before the designated transfer date shall be
eligible for coverage by a life insurance plan under sections 8706(b), 8714a,
8714b, and 8714c of title 5, United States Code, or in a life insurance plan
established by the Bureau, without regard to any regularly scheduled open
season and requirement of insurability.</text>
</clause><clause id="IDd11115ae6bbd4bcc87a1ddfb31196e10"><enum>(ii)</enum><header>Employee
contribution</header><text>An individual enrolled in a life insurance plan
under this subparagraph shall pay any employee contribution required by the
plan.</text>
</clause><clause id="IDd973ed462cf145f0a104e1042abc7921"><enum>(iii)</enum><header>Additional
funding</header><text>The Bureau shall transfer to the Employees’ Life
Insurance Fund established under section 8714 of title 5, United States Code,
an amount determined by the Director of the Office of Personnel Management,
after consultation with the Bureau and the Office of Management and Budget, to
be necessary to reimburse the Fund for the cost to the Fund of providing
benefits under this subparagraph not otherwise paid for by the employee under
clause (ii).</text>
</clause><clause id="IDdb616c8becd74db7812cacaa5ead40ce"><enum>(iv)</enum><header>Credit for time
enrolled in other plans</header><text>For employees transferred under this
title, enrollment in a life insurance plan administered by a transferor agency
immediately before enrollment in a life insurance plan under chapter 87 of
title 5, United States Code, shall be considered as enrollment in a life
insurance plan under that chapter for purposes of section 8706(b)(1)(A) of
title 5, United States Code.</text>
</clause></subparagraph></paragraph><paragraph commented="no" id="idCFE4C341FFF64BE1A2BA41D3F4FC941C"><enum>(3)</enum><header>OPM
rules</header><text>The Office of Personnel Management shall issue such rules
as are necessary to carry out this subsection.</text>
</paragraph></subsection><subsection id="ID82c9243120d3473d8da7fc5b723195e8"><enum>(j)</enum><header>Implementation of
uniform pay and classification system</header><text>Not later than 2 years
after the designated transfer date, the Bureau shall implement a uniform pay
and classification system for all employees transferred under this
title.</text>
</subsection><subsection id="IDb06734e6e2964d6398e3271f928cb25b"><enum>(k)</enum><header>Equitable
treatment</header><text>In administering the provisions of this section, the
Bureau—</text>
<paragraph id="ID9ac1821f63934ea29b38b8e82f597c90"><enum>(1)</enum><text>shall take no action that
would unfairly disadvantage transferred employees relative to each other based
on their prior employment by the Board of Governors, the Federal Deposit
Insurance Corporation, the Federal Trade Commission, the National Credit Union
Administration, the Office of the Comptroller of the Currency, the Office of
Thrift Supervision, a Federal reserve bank, a Federal home loan bank, or a
joint office of the Federal home loan banks; and</text>
</paragraph><paragraph id="ID09027c877f784526a8aaa88db7c513f2"><enum>(2)</enum><text>may take such action as
is appropriate in individual cases so that employees transferred under this
section receive equitable treatment, with respect to the status, tenure, pay,
benefits (other than benefits under programs administered by the Office of
Personnel Management), and accrued leave or vacation time of those employees,
for prior periods of service with any Federal agency, including the Board of
Governors, the Corporation, the Federal Trade Commission, the National Credit
Union Administration, the Office of the Comptroller of the Currency, the Office
of Thrift Supervision, a Federal reserve bank, a Federal home loan bank, or a
joint office of the Federal home loan banks.</text>
</paragraph></subsection><subsection id="ID059362c214564b21ab51cf7d10547d73"><enum>(l)</enum><header>Implementation</header><text>In
implementing the provisions of this section, the Bureau shall coordinate with
the Office of Personnel Management and other entities having expertise in
matters related to employment to ensure a fair and orderly transition for
affected employees.</text>
</subsection></section><section id="ID3b8acfe253104f0491a322fa3262e0ed"><enum>1065.</enum><header>Incidental
transfers</header>
<subsection id="ID1c1b9f4bc1d3446ba2941b94f93af6d1"><enum>(a)</enum><header>Incidental transfers
authorized</header><text>The Director of the Office of Management and Budget,
in consultation with the Secretary, shall make such additional incidental
transfers and dispositions of assets and liabilities held, used, arising from,
available, or to be made available, in connection with the functions
transferred by this title, as the Director may determine necessary to
accomplish the purposes of this title.</text>
</subsection><subsection id="ID4821769d876e42f48a19a6252c7a7458"><enum>(b)</enum><header>Sunset</header><text>The
authority provided in this section shall terminate 5 years after the date of
enactment of this Act.</text>
</subsection></section><section id="ID2d1cafdaf1f5415b91febba3f7635cd3"><enum>1066.</enum><header>Interim authority of
the Secretary</header>
<subsection id="ID194e7cca84444abe9d68b1dd7e7ae6cf"><enum>(a)</enum><header>In
general</header><text>The Secretary is authorized to perform the functions of
the Bureau under this subtitle until the Director of the Bureau is confirmed by
the Senate in accordance with section 1011.</text>
</subsection><subsection id="IDfe249f1c180349948636b8d39b0d7a09"><enum>(b)</enum><header>Interim administrative
services by the department of the treasury</header><text>The Department of the
Treasury may provide administrative services necessary to support the Bureau
before the designated transfer date.</text>
</subsection></section><section id="idFDFC6012718549429703C04184D0EAE2"><enum>1067.</enum><header>Transition
oversight</header>
<subsection id="id79793E74472746899D5D0EC721AD638E"><enum>(a)</enum><header>Purpose</header><text>The
purpose of this section is to ensure that the Bureau—</text>
<paragraph id="id02EDCBAEAAAD405A9BF3F352C5C4291D"><enum>(1)</enum><text>has an orderly and
organized startup;</text>
</paragraph><paragraph id="idA31A762CC52948DDB9FA789362425DE7"><enum>(2)</enum><text>attracts and retains a
qualified workforce; and</text>
</paragraph><paragraph id="id992D44476AAC439FAEF4B9F220E01BD0"><enum>(3)</enum><text>establishes comprehensive
employee training and benefits programs.</text>
</paragraph></subsection><subsection id="id3ECCE71D833144A5BF24D8AA5348017B"><enum>(b)</enum><header>Reporting
requirement</header>
<paragraph id="idBD70A9CD1EDF4FB89197A072AFDD890A"><enum>(1)</enum><header>In
general</header><text>The Bureau shall submit an annual report to the Committee
on Banking, Housing, and Urban Affairs of the Senate and the Committee on
Financial Services of the House of Representatives that includes the plans
described in paragraph (2).</text>
</paragraph><paragraph id="id51A02BF6FE7042F4B5A9D884F7FD93D3"><enum>(2)</enum><header>Plans</header><text>The
plans described in this paragraph are as follows:</text>
<subparagraph id="id51E03B8CAF3D42FF9E4200DAE260E40B"><enum>(A)</enum><header>Training and workforce
development plan</header><text>The Bureau shall submit a training and workforce
development plan that includes, to the extent practicable—</text>
<clause id="idA8F4E04043C3432EA14FFB321CF4210C"><enum>(i)</enum><text>identification of skill
and technical expertise needs and actions taken to meet those
requirements;</text>
</clause><clause id="id62E71FFD00D04F91915281EA5908094F"><enum>(ii)</enum><text>steps taken to foster
innovation and creativity;</text>
</clause><clause id="id2B8D8292ADF548F6B536C999C14FDA38"><enum>(iii)</enum><text>leadership development
and succession planning; and</text>
</clause><clause id="id6581D87344904C5E88A51CED807079A8"><enum>(iv)</enum><text>effective use of
technology by employees.</text>
</clause></subparagraph><subparagraph id="idF33FD95EA45A445888792EBD46591D5E"><enum>(B)</enum><header>Workplace flexibilities
plan</header><text>The Bureau shall submit a workforce flexibility plan that
includes, to the extent practicable—</text>
<clause id="id13FF24FC146F40E5BCC802D7EBE63182"><enum>(i)</enum><text>telework;</text>
</clause><clause id="id29EFCC611ED94C1B9DF323DA018DBC5A"><enum>(ii)</enum><text>flexible work
schedules;</text>
</clause><clause id="idD10539B281E54408AC1BE18776CD449A"><enum>(iii)</enum><text>phased
retirement;</text>
</clause><clause id="idBD39F426E46047B5B2A010FA3589345B"><enum>(iv)</enum><text>reemployed
annuitants;</text>
</clause><clause id="idB98698ACF7434D7BBAB9B9A3A17EF619"><enum>(v)</enum><text>part-time work;</text>
</clause><clause id="id2EBD9EDA13944A25840672553E588EC9"><enum>(vi)</enum><text>job sharing;</text>
</clause><clause id="id12CCDFD783FF42C8A10C5A590721F443"><enum>(vii)</enum><text>parental leave benefits
and childcare assistance;</text>
</clause><clause id="idDF2183385B1E432C87D7DDCDD4C875DA"><enum>(viii)</enum><text>domestic partner
benefits;</text>
</clause><clause id="id68C400DB9F9345E8A64297EE1490B04E"><enum>(ix)</enum><text>other workplace
flexibilities; or</text>
</clause><clause id="id573A890BE96540019F862CFD8950B808"><enum>(x)</enum><text>any combination of the
items described in clauses (i) through (ix).</text>
</clause></subparagraph><subparagraph id="idBA7CE95ABBFF44379161E69B0F123613"><enum>(C)</enum><header>Recruitment and
retention plan</header><text>The Bureau shall submit a recruitment and
retention plan that includes, to the extent practicable, provisions relating
to—</text>
<clause id="id970D28DD5ECF41C9967BB7ABFE8D0120"><enum>(i)</enum><text>the steps necessary to
target highly qualified applicant pools with diverse backgrounds;</text>
</clause><clause id="id4B85463E6DFD49CE94A1D0CC2665BBE2"><enum>(ii)</enum><text>streamlined employment
application processes;</text>
</clause><clause id="id2F3B0C8154FB4C57819FBCF5B90CB3DB"><enum>(iii)</enum><text>the provision of timely
notification of the status of employment applications to applicants; and</text>
</clause><clause id="id8E4096433FD34039A171972FF7195359"><enum>(iv)</enum><text>the collection of
information to measure indicators of hiring effectiveness.</text>
</clause></subparagraph></paragraph></subsection><subsection id="id7095B736B09F4595929CF2C3BCB67905"><enum>(c)</enum><header>Expiration</header><text>The
reporting requirement under subsection (b) shall terminate 5 years after the
date of enactment of this Act.</text>
</subsection><subsection id="idE9E553AF2D5B46E9B8333E27E690AF35"><enum>(d)</enum><header>Rule of
construction</header><text>Nothing in this section may be construed to
affect—</text>
<paragraph id="idD0D6F090F85146F4B51E9660A851E1D5"><enum>(1)</enum><text>a collective bargaining
agreement, as that term is defined in section 7103(a)(8) of title 5, United
States Code, that is in effect on the date of enactment of this Act; or</text>
</paragraph><paragraph id="id7FA398089D2445D39FD474656D12245C"><enum>(2)</enum><text>the rights of employees
under chapter 71 of title 5, United States Code.</text>
</paragraph></subsection></section></subtitle><subtitle id="id477CE09A2603411090F166479E5FFDDB"><enum>G</enum><header>Regulatory
Improvements</header>
<section id="IDe5af87f7daf24545a774ecf5e7a5b919"><enum>1071.</enum><header>Small business data
collection</header>
<subsection id="IDc6a28777060f48b0b00694100777d703"><enum>(a)</enum><header>In
general</header><text>The Equal Credit Opportunity Act (15 U.S.C. 1691 et seq.)
is amended by inserting after section 704A the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id4D7CD030DBEE4CEA9C8728B77FD125B3" reported-display-style="italic" style="OLC">
<section id="ID1db1af17ef1f4b9aac6b228fac60cbb7"><enum>740B.</enum><header>Small business loan
data collection</header>
<subsection id="ID414892ad84894b27b321f64592463589"><enum>(a)</enum><header>Purpose</header><text>The
purpose of this section is to facilitate enforcement of fair lending laws and
enable communities, governmental entities, and creditors to identify business
and community development needs and opportunities of women-owned and
minority-owned small businesses.</text>
</subsection><subsection id="ID955254fa1e25484c9935d6dcc9860dba"><enum>(b)</enum><header>Information
gathering</header><text>Subject to the requirements of this section, in the
case of any application to a financial institution for credit for a small
business, the financial institution shall—</text>
<paragraph id="ID7ca986bf67914c16adb5055896f0c4ac"><enum>(1)</enum><text>inquire whether the small
business is a women- or minority-owned small business, without regard to
whether such application is received in person, by mail, by telephone, by
electronic mail or other form of electronic transmission, or by any other
means, and whether or not such application is in response to a solicitation by
the financial institution; and</text>
</paragraph><paragraph id="ID53d1cd4d037547efb840729c79861cb0"><enum>(2)</enum><text>maintain a record of the
responses to such inquiry, separate from the application and accompanying
information.</text>
</paragraph></subsection><subsection id="IDb2f662f4fc3b4bb396f52fec3a4e4ed1"><enum>(c)</enum><header>Right To
refuse</header><text>Any applicant for credit may refuse to provide any
information requested pursuant to subsection (b) in connection with any
application for credit.</text>
</subsection><subsection id="ID36a9f07667f8436488dbe6774eae5892"><enum>(d)</enum><header>No access by
underwriters</header>
<paragraph id="IDfaf040f09a834483b5d48a6ae81b3b72"><enum>(1)</enum><header>Limitation</header><text>Where
feasible, no loan underwriter or other officer or employee of a financial
institution, or any affiliate of a financial institution, involved in making
any determination concerning an application for credit shall have access to any
information provided by the applicant pursuant to a request under subsection
(b) in connection with such application.</text>
</paragraph><paragraph id="IDf6d3283d33784230a3d7ca799befed38"><enum>(2)</enum><header>Limited
access</header><text>If a financial institution determines that a loan
underwriter or other officer or employee of a financial institution, or any
affiliate of a financial institution, involved in making any determination
concerning an application for credit should have access to any information
provided by the applicant pursuant to a request under subsection (b), the
financial institution shall provide notice to the applicant of the access of
the underwriter to such information, along with notice that the financial
institution may not discriminate on the basis of such information.</text>
</paragraph></subsection><subsection id="ID8835f513db784cc4b73dbaf54482bdd8"><enum>(e)</enum><header>Form and manner of
information</header>
<paragraph id="IDacdbeab96bd0400499078db81a30d094"><enum>(1)</enum><header>In
general</header><text>Each financial institution shall compile and maintain, in
accordance with regulations of the Bureau, a record of the information provided
by any loan applicant pursuant to a request under subsection (b).</text>
</paragraph><paragraph id="ID2df98d9db193412b8beb593f4a926eb0"><enum>(2)</enum><header>Itemization</header><text>Information
compiled and maintained under paragraph (1) shall be itemized in order to
clearly and conspicuously disclose—</text>
<subparagraph id="ID94f0a39652f3440388a653caae1fd352"><enum>(A)</enum><text>the number of the
application and the date on which the application was received;</text>
</subparagraph><subparagraph id="IDa0ba0aec26b54478b706ede52aa76ad5"><enum>(B)</enum><text>the type and purpose of
the loan or other credit being applied for;</text>
</subparagraph><subparagraph id="IDa33c0f141b3e4261add4e12c1294c9d7"><enum>(C)</enum><text>the amount of the credit
or credit limit applied for, and the amount of the credit transaction or the
credit limit approved for such applicant;</text>
</subparagraph><subparagraph id="ID8107b10e7a0845fa9159a49ae6a06267"><enum>(D)</enum><text>the type of action taken
with respect to such application, and the date of such action;</text>
</subparagraph><subparagraph id="IDf686ab6c71b948aaa2886ed2d74a2d7f"><enum>(E)</enum><text>the census tract in which
is located the principal place of business of the small business loan
applicant;</text>
</subparagraph><subparagraph id="ID8a19c69a49cf4177af72bc219773d51c"><enum>(F)</enum><text>the gross annual revenue
of the business in the last fiscal year of the small business loan applicant
preceding the date of the application;</text>
</subparagraph><subparagraph id="IDb74602f31bff472f850091799a2b25cb"><enum>(G)</enum><text>the race and ethnicity of
the principal owners of the business; and</text>
</subparagraph><subparagraph id="ID3de9e03de61a4ac8b0bccef38dbf8ed3"><enum>(H)</enum><text>any additional data that
the Bureau determines would aid in fulfilling the purposes of this
section.</text>
</subparagraph></paragraph><paragraph id="IDcbad5e6d0d8648a787abb31004dffbdc"><enum>(3)</enum><header>No personally
identifiable information</header><text>In compiling and maintaining any record
of information under this section, a financial institution may not include in
such record the name, specific address (other than the census tract required
under paragraph (1)(E)), telephone number, electronic mail address, or any
other personally identifiable information concerning any individual who is, or
is connected with, the small business loan applicant.</text>
</paragraph><paragraph id="ID27b8e543c0ec4ba4998998d8430dfc96"><enum>(4)</enum><header>Discretion to delete or
modify publicly available data</header><text>The Bureau may, at its discretion,
delete or modify data collected under this section which is or will be
available to the public, if the Bureau determines that the deletion or
modification of the data would advance a compelling privacy interest.</text>
</paragraph></subsection><subsection id="ID3e87b78bb4ce4247837320524fb94d72"><enum>(f)</enum><header>Availability of
information</header>
<paragraph id="IDbc8647b31d284fcda327c15bb00a405d"><enum>(1)</enum><header>Submission to
Bureau</header><text>The data required to be compiled and maintained under this
section by any financial institution shall be submitted annually to the
Bureau.</text>
</paragraph><paragraph id="ID09e0ea14e8ab4278af6037743557aec4"><enum>(2)</enum><header>Availability of
information</header><text>Information compiled and maintained under this
section shall be—</text>
<subparagraph id="id7EB82DD4971E41F2A85EBB154585CBED"><enum>(A)</enum><text>retained for not less
than 3 years after the date of preparation;</text>
</subparagraph><subparagraph id="id6CB8C29BCA2F49CFA2887F3728C7EACE"><enum>(B)</enum><text>made available to any
member of the public, upon request, in the form required under regulations
prescribed by the Bureau;</text>
</subparagraph><subparagraph id="id4E1AC2C57F6C40F2A41C48F373D02F9D"><enum>(C)</enum><text>annually made available
to the public generally by the Bureau, in such form and in such manner as is
determined appropriate by the Bureau.</text>
</subparagraph></paragraph><paragraph id="ID5d0e4423079a467687cbd1f4cf00a6a1"><enum>(3)</enum><header>Compilation of
aggregate data</header><text>The Bureau may, at its discretion—</text>
<subparagraph id="id9B7AF6DCD7A94650BE07D4E7D4E3C705"><enum>(A)</enum><text>compile and aggregate
data collected under this section for its own use; and</text>
</subparagraph><subparagraph id="idFF9DEDB0AC2D4094A715F37C9FB36750"><enum>(B)</enum><text>make public such
compilations of aggregate data.</text>
</subparagraph></paragraph></subsection><subsection id="ID086b70beda7448ba908c0cbf93068f26"><enum>(g)</enum><header>Bureau action</header>
<paragraph id="ID714e82166fdb47ea95a60c9a4c0150ad"><enum>(1)</enum><header>In
general</header><text>The Bureau shall prescribe such rules and issue such
guidance as may be necessary to carry out, enforce, and compile data pursuant
to this section.</text>
</paragraph><paragraph id="ID4321cbef089c470eaa7d536b15744ba2"><enum>(2)</enum><header>Exceptions</header><text>The
Bureau, by rule or order, may adopt exceptions to any requirement of this
section and may, conditionally or unconditionally, exempt any financial
institution or class of financial institutions from the requirements of this
section, as the Bureau deems necessary or appropriate to carry out the purposes
of this section.</text>
</paragraph><paragraph id="ID371daba9c35643899462ae9163d611d3"><enum>(3)</enum><header>Guidance</header><text>The
Bureau shall issue guidance designed to facilitate compliance with the
requirements of this section, including assisting financial institutions in
working with applicants to determine whether the applicants are women- or
minority-owned for purposes of this section.</text>
</paragraph></subsection><subsection id="ID59ebe7dd714c413587e0e8bc479e5525"><enum>(h)</enum><header>Definitions</header><text>For
purposes of this section, the following definitions shall apply:</text>
<paragraph id="IDcce4ebdb9b9b4abdb771a57631c841af"><enum>(1)</enum><header>Financial
institution</header><text>The term <term>financial institution</term> means any
partnership, company, corporation, association (incorporated or
unincorporated), trust, estate, cooperative organization, or other entity that
engages in any financial activity.</text>
</paragraph><paragraph id="IDb0d8e7c823294a70ba52e80cc871b15e"><enum>(2)</enum><header>Minority</header><text>The
term <term>minority</term> has the same meaning as in section 1204(c)(3) of the
Financial Institutions Reform, Recovery, and Enforcement Act of 1989.</text>
</paragraph><paragraph id="ID6daa27cee3fb40cabe4bf05ebe8121bb"><enum>(3)</enum><header>Minority-owned small
business</header><text>The term <term>minority-owned small business</term>
means a small business—</text>
<subparagraph id="IDd966db856d3a4a7fa6bac96d5f7f159e"><enum>(A)</enum><text>more than 50 percent of
the ownership or control of which is held by 1 or more minority individuals;
and</text>
</subparagraph><subparagraph id="ID5abbefa5495043c5be651b98f17bcf51"><enum>(B)</enum><text>more than 50 percent of
the net profit or loss of which accrues to 1 or more minority
individuals.</text>
</subparagraph></paragraph><paragraph id="ID68753eaab41945d68c0edc9ed24489b7"><enum>(4)</enum><header>Small business
loan</header><text>The term <term>small business loan</term> shall be defined
by the Bureau, which may take into account—</text>
<subparagraph id="ID0021949c68364c1398aaf228a5f9a2a4"><enum>(A)</enum><text>the gross revenues of the
borrower;</text>
</subparagraph><subparagraph id="ID7965d460e8a14260bc2967a0febe71c1"><enum>(B)</enum><text>the total number of
employees of the borrower;</text>
</subparagraph><subparagraph id="ID585ac8a334e7418f878b6f59ea800b81"><enum>(C)</enum><text>the industry in which the
borrower has its primary operations; and</text>
</subparagraph><subparagraph id="IDe27c9d67be994ddb991f24405453eb73"><enum>(D)</enum><text>the size of the
loan.</text>
</subparagraph></paragraph><paragraph id="ID22d5a8051bc94b7b808f699073204edd"><enum>(5)</enum><header>Women-owned small
business</header><text>The term <term>women-owned small business</term> means a
business—</text>
<subparagraph id="IDe1c5763178ad443eab5b07629b08863a"><enum>(A)</enum><text>more than 50 percent of
the ownership or control of which is held by 1 or more women; and</text>
</subparagraph><subparagraph id="ID09d20877608e432d9c88595b061a6346"><enum>(B)</enum><text>more than 50 percent of
the net profit or loss of which accrues to 1 or more
women.</text>
</subparagraph></paragraph></subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="ID582846ce4b934597954aed1d502559a3"><enum>(b)</enum><header>Technical and
conforming amendments</header><text>Section 701(b) of the Equal Credit
Opportunity Act (15 U.S.C. 1691(b)) is amended—</text>
<paragraph id="ID730f6ba2b2a74407894f79fbc413c46c"><enum>(1)</enum><text>in paragraph (3), by
striking <quote>or</quote> at the end;</text>
</paragraph><paragraph id="ID813e6031ec9b43c88b48d7c8b5a7b906"><enum>(2)</enum><text>in paragraph (4), by
striking the period at the end and inserting <quote>; or</quote>; and</text>
</paragraph><paragraph id="ID0baf26f0d6854ec0843d225408e62ed5"><enum>(3)</enum><text>by inserting after
paragraph (4), the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id4A2958F5BBA142D3B7A2C7F8A0F421B6" reported-display-style="italic" style="OLC">
<paragraph id="ID1356462adc864330b35cf3b087318413"><enum>(5)</enum><text>to make an inquiry under
section 704B, in accordance with the requirements of that
section.</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="ID035f2ffcacc54b89bff8f2a0d14cd90f"><enum>(c)</enum><header>Clerical
amendment</header><text>The table of sections for title VII of the Consumer
Credit Protection Act is amended by inserting after the item relating to
section 704A the following new item:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id9AF981A205494CE2B816880F84C21B6A" reported-display-style="italic" style="OLC">
<toc changed="added" reported-display-style="italic">
<toc-entry bold="off" level="section">704B. Small business loan data
collection.</toc-entry>
</toc>
<after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="ID652ec440de3d405698c2cc865f918b40"><enum>(d)</enum><header>Effective
date</header><text>This section shall become effective on the designated
transfer date.</text>
</subsection></section><section id="ID4ce4887817e34ba78ec742cbf44a3237"><enum>1072.</enum><header>GAO study on the
effectiveness and impact of various appraisal methods</header>
<subsection id="ID9c8ff6e56be642f19e58e5fcc62a6003"><enum>(a)</enum><header>In
general</header><text>The Government Accountability Office shall conduct a
study on the effectiveness and impact of various appraisal methods, including
the cost approach, the comparative sales approach, the income approach, and
others that may be available.</text>
</subsection><subsection id="IDa527ac8844bf4bd084afb036f0fe34d0"><enum>(b)</enum><header>Study</header><text>Not
later than—</text>
<paragraph id="id63084A79A9824C3E8DE7DDE08FB5D597"><enum>(1)</enum><text>1 year after the date of
enactment of this Act, the Government Accountability Office shall submit a
study to the Committee on Banking, Housing, and Urban Affairs of the Senate and
the Committee on Financial Services of the House of Representatives;</text>
</paragraph><paragraph id="IDe0ad5962969448a4afeca05fa960f5f1"><enum>(2)</enum><text>90 days after the date of
enactment of this Act, the Government Accountability Office shall provide a
report on the status of the study and any preliminary findings to the Committee
on Banking, Housing, and Urban Affairs of the Senate and the Committee on
Financial Services of the House of Representatives.</text>
</paragraph></subsection><subsection id="ID65bbe0ad252b4a3a9116dbf794c86a2b"><enum>(c)</enum><header>Content of
study</header><text>The study required by this section shall include an
examination of—</text>
<paragraph id="IDa6d1f1ccff6740188c643c63f13ecba1"><enum>(1)</enum><text>the prevalence, alone or
in combination, of these approaches in purchase-money and refinance mortgage
transactions;</text>
</paragraph><paragraph id="ID1f390978b9fd435894c68f2537dae7c3"><enum>(2)</enum><text>the accuracy of the
various approaches in assessing the property as collateral;</text>
</paragraph><paragraph id="ID66ec7c0c8dfa4287a6b4524924cc6998"><enum>(3)</enum><text>whether and how the
approaches contributed to price speculation in the previous cycle;</text>
</paragraph><paragraph id="ID25ed06ce821c494eae5dfa6b10bcdbac"><enum>(4)</enum><text>the costs to consumers of
these approaches;</text>
</paragraph><paragraph id="IDa91f8e4dfb3a4fcea5c5a433b46bacb6"><enum>(5)</enum><text>the disclosure of fees to
consumers in the appraisal process;</text>
</paragraph><paragraph id="ID711560845bc948659f57061af2a624ca"><enum>(6)</enum><text>to what extent such
approaches may be influenced by a conflict of interest between the mortgage
lender and the appraiser and the mechanism by which the lender selects and
compensates the appraiser; and</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="IDe9850ec6992d4a8d8fac245e430bf47f"><enum>(7)</enum><text>the suitability of
appraisal approaches in rural versus urban areas.</text>
</paragraph></subsection></section><section id="ID1bb343fafc554719869b59d2eec0dafb"><enum>1073.</enum><header>Prohibited payments
to mortgage originators</header><text display-inline="no-display-inline">Section 129 of the Truth in Lending Act (15
U.S.C. 1639) is amended by inserting after subsection (j) the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idB59F5D71933B4316A58996A164A5A697" reported-display-style="italic" style="OLC">
<subsection id="ID77bd21a3ec1e4e74b9c9b3189fe50c9d"><enum>(k)</enum><header>Prohibition on steering
incentives</header>
<paragraph id="ID89de5e6c29a54c94aa47ac34ef14d7a7"><enum>(1)</enum><header>In
general</header><text>For any consumer credit transaction secured by real
property or a dwelling, no loan originator shall receive from any person and no
person shall pay to a loan originator, directly or indirectly, compensation
that varies based on the terms of the loan (other than the amount of the
principal).</text>
</paragraph><paragraph id="ID7effe1d2b09f4c5786cababed98dff04"><enum>(2)</enum><header>Restructuring of
financing origination fee</header>
<subparagraph id="ID6f2a03834ce045738bbbc2d7870d4551"><enum>(A)</enum><header>In
general</header><text>For any consumer credit transaction secured by real
property or a dwelling, a loan originator may not arrange for a consumer to
finance through the rate any origination fee or cost except bona fide third
party settlement charges not retained by the creditor or loan
originator.</text>
</subparagraph><subparagraph id="ID3f010fc95f3341ca9321597e77b1bc9f"><enum>(B)</enum><header>Exception</header><text>Notwithstanding
subparagraph (A), a loan originator may arrange for a consumer to finance
through the rate an origination fee or cost if—</text>
<clause id="ID5769ffd54d534a8eb33cc62c48407695"><enum>(i)</enum><text>the loan originator does
not receive any other compensation, directly or indirectly, from the consumer
except the compensation that is financed through the rate;</text>
</clause><clause id="ID436b7e4e1d95468ab0abba17cd6649de"><enum>(ii)</enum><text>no person who knows or
has reason to know of the consumer-paid compensation to the loan originator,
other than the consumer, pays any compensation to the loan originator, directly
or indirectly, in connection with the transaction; and</text>
</clause><clause id="ID5da026bacfbc4dcb88524da8505f4eac"><enum>(iii)</enum><text>the consumer does not
make an upfront payment of discount points, origination points, or fees,
however denominated (other than bona fide third party settlement
charges).</text>
</clause></subparagraph></paragraph><paragraph id="IDe4c860848f5a47178a70e5d3518199ef"><enum>(3)</enum><header>Rules of
construction</header><text>No provision of this subsection shall be construed
as—</text>
<subparagraph id="ID2326665cce5f4a748c54847cee11206f"><enum>(A)</enum><text>limiting or affecting the
amount of compensation received by a creditor upon the sale of a consummated
loan to a subsequent purchaser;</text>
</subparagraph><subparagraph id="ID90bf90601c5a44e292611fd45e5d32e5"><enum>(B)</enum><text>restricting a consumer’s
ability to finance, at the option of the consumer, including through principal
or rate, any origination fees or costs permitted under this subsection, or the
loan originator’s right to receive such fees or costs (including compensation)
from any person, subject to paragraph (2)(B), so long as such fees or costs do
not vary based on the terms of the loan (other than the amount of the
principal) or the consumer’s decision about whether to finance such fees or
costs; or</text>
</subparagraph><subparagraph id="IDde75a03556e64663b27f5dfc9b3b8339"><enum>(C)</enum><text>prohibiting incentive
payments to a loan originator based on the number of loans originated within a
specified period of time.</text>
</subparagraph></paragraph><paragraph id="ID4c80a41b07fb4716999b0c976d772195"><enum>(4)</enum><header>Loan
originator</header><text>For the purposes of this section, the term <term>loan
originator</term>—</text>
<subparagraph id="IDd4857c67dbe44645a9f870b42cbefdde"><enum>(A)</enum><text>means any person who, for
direct or indirect compensation or gain, or in the expectation of direct or
indirect compensation or gain, with respect to credit to be secured by real
property or a dwelling—</text>
<clause id="IDf1f91a4db7284a1880c298656ae6e840"><enum>(i)</enum><text>arranges for an
extension, renewal, or continuation of such credit;</text>
</clause><clause id="ID2c9b42dcd56a4999805546ce9024267e"><enum>(ii)</enum><text>takes an application for
credit or assists a consumer in applying for such credit; or</text>
</clause><clause id="ID03927ab7c2c34e808aa9b66d9302b145"><enum>(iii)</enum><text>offers or negotiates
terms of such credit;</text>
</clause></subparagraph><subparagraph id="ID302cf64aee15420e87021d1f8ec171f0"><enum>(B)</enum><text>does not include any
person who is not otherwise described in subparagraph (A) and who performs
purely administrative or clerical tasks on behalf of a person who is described
in subparagraph (A); and</text>
</subparagraph><subparagraph id="ID41a197f523a846f98226ac51e95fe054"><enum>(C)</enum><text>does not include a person
that only performs real estate brokerage activities and is licensed or
registered in accordance with applicable State law, unless the person is
compensated by a lender or other loan originator or by any agent of such lender
or other loan
originator.</text>
</subparagraph></paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</section><section id="ID83dd5dba6fba4115822b506ee2cb6ee7"><enum>1074.</enum><header>Minimum standards for
residential mortgage loans</header>
<subsection id="ID4e347fa5f45e49ee87ec759788b65c40"><enum>(a)</enum><header>In
general</header><text>No rule, order, or guidance issued by the Bureau under
this title shall be construed as requiring a depository institution to apply
mortgage underwriting standards that do not meet the minimum underwriting
standards required by the appropriate prudential regulator of the depository
institution.</text>
</subsection><subsection id="ID40624ed9882f4708a32d93d4a44a2893"><enum>(b)</enum><header>Ability To
repay</header>
<paragraph id="idB0A0B2F94A1B48A284C28DF6F7182644"><enum>(1)</enum><header>TILA
amendment</header><text>Section 129 of the Truth in Lending Act (15 U.S.C.
1639), as amended by section 1074 of this Act, is further amended by inserting
after subsection (k) the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id2D60840198454A848603A9576345DF2A" reported-display-style="italic" style="OLC">
<subsection id="IDcbb90df36063478d82c53a8c457872bd"><enum>(l)</enum><header>Ability To
repay</header>
<paragraph id="ID9e6e5025360b4e75aed205434f961020"><enum>(1)</enum><header>In
general</header><text>No creditor may make a loan secured by real property or a
dwelling unless the creditor, based on verified and documented information,
determines that, at the time the loan is consummated, the consumer has a
reasonable ability to repay the loan, according to its terms, and all
applicable taxes, insurance, and assessments.</text>
</paragraph><paragraph id="ID015913c675084949a4aad9fd511a438f"><enum>(2)</enum><header>Multiple
loans</header><text>If the creditor knows, or has reason to know, that 1 or
more loans secured by the same real property or dwelling will be made to the
same consumer, the creditor shall, based on verified and documented
information, determine that the consumer has a reasonable ability to repay the
combined payments of all loans on the same real property or dwelling according
to the terms of those loans and all applicable taxes, insurance, and
assessments.</text>
</paragraph><paragraph id="IDad642aa226794453b6cccb85f12e875e"><enum>(3)</enum><header>Basis for
determination</header><text>A determination under this subsection of a
consumer’s ability to repay a loan described in paragraph (1) shall include
consideration of the consumer’s credit history, current income, expected income
the consumer is reasonably assured of receiving, current obligations,
debt-to-income ratio or the residual income the consumer will have after paying
non-mortgage debt and mortgage-related obligations, employment status, and
other financial resources other than the consumer’s equity in the dwelling or
real property that secures repayment of the loan.</text>
</paragraph><paragraph id="IDf2e99cf95b234c569e134ef5c60ac609"><enum>(4)</enum><header>Income
verification</header><text>A creditor shall verify amounts of income or assets
that such creditor relies on to determine repayment ability, including expected
income or assets, by reviewing the consumer’s Internal Revenue Service Form
W–2, tax returns, payroll receipts, financial institution records, or other
third-party documents that provide reasonably reliable evidence of the
consumer’s income or assets. In order to safeguard against fraudulent
reporting, any consideration of a consumer’s income history in making a
determination under this subsection shall include the verification of such
income by the use of—</text>
<subparagraph id="ID5b8e122f9f3f4531b008eeca1835118d"><enum>(A)</enum><text>Internal Revenue Service
transcripts of tax returns; or</text>
</subparagraph><subparagraph id="ID2575108ff5d5463d9f006871889313c7"><enum>(B)</enum><text>a method that quickly and
effectively verifies income documentation by a third party subject to rules
prescribed by the Board.</text>
</subparagraph></paragraph><paragraph id="IDe2acc3b1300440f98b6d5fcddc0c8164"><enum>(5)</enum><header>Presumption of ability
to repay</header><text>Any creditor with respect to any consumer loan secured
by real property or a dwelling is presumed to have complied with this
subsection with respect to such loan if the creditor—</text>
<subparagraph id="IDdda79a734348495bb0c7ff03c63cddcf"><enum>(A)</enum><text>verifies the consumer’s
ability to repay as provided in paragraphs (1), (2), (3), and (4); and</text>
</subparagraph><subparagraph id="ID26611539c8634b38b34778eb5191dbe0"><enum>(B)</enum><text>determines the consumer’s
ability to repay using the maximum rate permitted under the loan during the
first 5 years following consummation and a payment schedule that fully
amortizes the loan and taking into account current obligations and all
applicable taxes, insurance, and assessments.</text>
</subparagraph></paragraph><paragraph id="ID3aa7337145f34bb4b533494f7104575b"><enum>(6)</enum><header>Exceptions to
presumption</header><text>Notwithstanding paragraph (5), no presumption of
compliance shall be applied to a loan—</text>
<subparagraph id="IDfe6272aa903a4c739c1d741748b8385d"><enum>(A)</enum><text>for which the regular
periodic payments for the loan may—</text>
<clause id="idF09E389AD98A44AC96A16C24B6A32C41"><enum>(i)</enum><text>result in an increase of
the principal balance; or</text>
</clause><clause id="id31F12DCCCB06463BBC3A13F96EEEF056"><enum>(ii)</enum><text>allow the consumer to
defer repayment of principal.</text>
</clause></subparagraph><subparagraph id="ID0f7054528fb145e29c1f78cab6c3e009"><enum>(B)</enum><text>the terms of which result
in a balloon payment, where a <quote>balloon payment</quote> is a scheduled
payment that is more than twice as large as the average of earlier scheduled
payments; or</text>
</subparagraph><subparagraph id="ID7ceba5bb38fc4337ae217bfc921dde54"><enum>(C)</enum><text>for which the total
points and fees payable in connection with the loan exceed 3 percent of the
total loan amount, where <quote>points and fees</quote> means points and fees
as defined by section 103(aa)(4) of the Truth in Lending Act (15 U.S.C.
1602(aa)(4)), except that, for the purposes of computing the total points and
fees under this subparagraph, the total points and fees attributable to any
premium for mortgage guarantee insurance provided by an agency of the Federal
Government or an agency of a State shall exclude any amount of the points and
fees for such insurance greater than 1 percent of the total loan amount.</text>
</subparagraph></paragraph><paragraph id="ID90aa88d2eb614c98985ecac9a9308504"><enum>(7)</enum><header>Exemption</header>
<subparagraph id="IDaf4d47a4a5b14ed6b0acde95f77e47e5"><enum>(A)</enum><text>The Board may revise, add
to, or subtract from the criteria under paragraphs (5) and (6) and
subparagraphs (B) and (C) of this paragraph upon a finding that such
regulations are necessary or appropriate to effectuate the purposes of this
title, to prevent circumvention or evasion thereof, or to facilitate compliance
with this subsection.</text>
</subparagraph><subparagraph id="ID69ba8fbd41c042b6877066eb9a914388"><enum>(B)</enum><header>Bridge
loans</header><text>This subsection does not apply to a temporary or
<quote>bridge</quote> loan with a term of 12 months or less, including to any
loan to purchase a new dwelling where the consumer plans to sell a current
dwelling within 12 months.</text>
</subparagraph><subparagraph id="IDcb58381ac16245a8b85ba4a247b53ab5"><enum>(C)</enum><header>Reverse
mortgages</header><text>This subsection does not apply with respect to any
reverse mortgage.</text>
</subparagraph></paragraph><paragraph commented="no" display-inline="no-display-inline" id="IDe79e9ed893644f25b0e8eda85130bcd5"><enum>(8)</enum><header display-inline="yes-display-inline">Seasonal income</header><text display-inline="yes-display-inline">If documented income, including income from
a small business, is a repayment source for an extension of credit secured by
residential real estate or a dwelling, a creditor may consider the seasonality
and irregularity of such income in the underwriting of and scheduling of
payments for such
credit.</text>
</paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph><paragraph id="idF843B6589E9C4941A5053A7E8624A088"><enum>(2)</enum><header>Conforming
amendment</header><text>Section 129 of the Truth in Lending Act (15 U.S.C.
1639), as amended by this Act, is amended—</text>
<subparagraph id="idAD0FDD32E7B042DCA0182094ABF909D7"><enum>(A)</enum><text>by redesignating
subsections (k), (l), and (m) as subsections (m), (n), and (o), respectively;
and</text>
</subparagraph><subparagraph id="idF88DA929EEBB474B9BA4C3C3F7374A65"><enum>(B)</enum><text>in subsection (o), as so
redesignated, by striking <quote>(l)(2)</quote> and inserting
<quote>(n)(2)</quote>.</text>
</subparagraph></paragraph></subsection></section><section id="IDcb6406b3486743a69bf0aeab0865a420"><enum>1075.</enum><header>Prohibition on
certain prepayment penalties</header>
<subsection id="ID1133b606da8b4916bd72d56825631f6d"><enum>(a)</enum><header>In
general</header><text>Chapter 2 of the Truth in Lending Act (15 U.S.C. 1631 et
seq.) is amended by inserting after section 129A (15 U.S.C. 1639a) the
following new section:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id0136881A7BB6463C89DFF6E63316503A" reported-display-style="italic" style="OLC">
<section id="ID47a895b4bb904496b138ff75ea190a03"><enum>129B.</enum><header>Prohibition on
certain prepayment penalties</header>
<subsection id="IDedea67b81dc64899870bdd10ac762ae6"><enum>(a)</enum><header>Prohibited on certain
loans</header><text>A residential mortgage loan that is not a qualified
mortgage may not contain terms under which a consumer is required to pay a
prepayment penalty for paying all or part of the principal after the loan is
consummated.</text>
</subsection><subsection id="IDc2a290681a914a4f9d8f5e43e2eafb4d"><enum>(b)</enum><header>Phased-out penalties on
qualified mortgages</header>
<paragraph id="id1ECDCC9E436642B394602D19BD29E3CA"><enum>(1)</enum><header>In
general</header><text>A qualified mortgage may not contain terms under which a
consumer is required to pay a prepayment penalty for paying all or part of the
principal after the loan is consummated in excess of—</text>
<subparagraph id="IDeb0a235a427b4996920676884aa8c9a9"><enum>(A)</enum><text>during the 1-year period
beginning on the date on which the loan is consummated, an amount equal to 3
percent of the outstanding balance on the loan;</text>
</subparagraph><subparagraph id="ID502672d1627c4b5d9a6bf174fab70e95"><enum>(B)</enum><text>during the 1-year period
beginning immediately after the end of the period described in subparagraph
(A), an amount equal to 2 percent of the outstanding balance on the loan;
and</text>
</subparagraph><subparagraph id="ID933c032d9f3d432fab3c6ad52e270de5"><enum>(C)</enum><text>during the 1-year period
beginning immediately after the end of the 1-year period described in
subparagraph (B), an amount equal to 1 percent of the outstanding balance on
the loan.</text>
</subparagraph></paragraph><paragraph id="ID1de5726160db45e8a3d0ae828f32fcf4"><enum>(2)</enum><header>Prohibition</header><text>After
the end of the 3-year period beginning on the date on which the loan is
consummated, no prepayment penalty may be imposed on a qualified
mortgage.</text>
</paragraph></subsection><subsection id="IDc7b863d5d7a84356aa8b8c6899ed6335"><enum>(c)</enum><header>Option for no
prepayment penalty required</header><text>A creditor may not offer a consumer a
residential mortgage loan product that has a prepayment penalty for paying all
or part of the principal after the loan is consummated as a term of the loan,
without offering to the consumer a residential mortgage loan product that does
not have a prepayment penalty as a term of the loan.</text>
</subsection><subsection id="ID612cf4bdd2b44a62bc39a57b100f0233"><enum>(d)</enum><header>Prohibitions on
evasions, structuring of transactions, and reciprocal
arrangements</header><text>A creditor may not take any action in connection
with a residential mortgage loan—</text>
<paragraph id="ID6426e83d7b4d4e00bcf8e073ea507c40"><enum>(1)</enum><text>to structure a loan
transaction as an open end consumer credit plan or another form of loan for the
purpose and with the intent of evading the provisions of this section;
or</text>
</paragraph><paragraph id="ID9a7fd2c20c7e4db1a93a07b67286beb4"><enum>(2)</enum><text>to divide any loan
transaction into separate parts for the purpose and with the intent of evading
provisions of this section.</text>
</paragraph></subsection><subsection id="ID6f534ab0cff741bf8f8876ab19a6ff9d"><enum>(e)</enum><header>Publication of average
prime offer rate and APR thresholds</header><text>The Board—</text>
<paragraph id="ID274d050048b44ec68d0f334343ec3e4d"><enum>(1)</enum><text>shall publish, and update
at least weekly, average prime offer rates;</text>
</paragraph><paragraph id="IDbab5e78e72b24788bb77de1fac16d12b"><enum>(2)</enum><text>may publish multiple
rates based on varying types of mortgage transactions; and</text>
</paragraph><paragraph id="IDa0e167c5d7e549ed8010e76a77e5ce39"><enum>(3)</enum><text>shall adjust the
thresholds of 1.50 percentage points in subsection (g)(3)(A)(v)(I), 2.50
percentage points in subsection (g)(3)(A)(v)(II), and 3.50 percentage points in
subsection (g)(3)(A)(v)(III), as necessary to reflect significant changes in
market conditions and to effectuate the purposes of this section.</text>
</paragraph></subsection><subsection id="ID108cd0ac01f74189a375f64818d1378b"><enum>(f)</enum><header>Regulations</header>
<paragraph id="ID3f0e08371c7d4f76ba3185d48018abfa"><enum>(1)</enum><header>In
general</header><text>The Bureau shall prescribe regulations to carry out this
section.</text>
</paragraph><paragraph id="ID7542012d52f341b0b3207a64135353d8"><enum>(2)</enum><header>Revision of safe harbor
criteria</header><text>The Bureau may prescribe regulations that revise, add
to, or subtract from the criteria that define a qualified mortgage, upon a
finding that such regulations are necessary or appropriate—</text>
<subparagraph id="id38409D1E07B14F6CA98CAD8F92C22FF0"><enum>(A)</enum><text>to ensure that
responsible, affordable mortgage credit remains available to consumers in a
manner consistent with the purposes of this section;</text>
</subparagraph><subparagraph id="id1170ED3FDD2E43FA848600F3ADC8C684"><enum>(B)</enum><text>to effectuate the
purposes of this section;</text>
</subparagraph><subparagraph id="id2F3C3BD09B7041F0BCE890E75574A9FE"><enum>(C)</enum><text>to prevent circumvention
or evasion thereof; or</text>
</subparagraph><subparagraph id="id33BB3CB2D51247B5B4B5FF346F54DBBF"><enum>(D)</enum><text>to facilitate compliance
with this section.</text>
</subparagraph></paragraph><paragraph commented="no" id="IDdd8aeefe3f434987ad903a9f67caf2aa"><enum>(3)</enum><header>Interagency
harmonization</header>
<subparagraph commented="no" id="id593E413F0F9B4BA48E8D8B73C2868EDC"><enum>(A)</enum><header>Determination of
Qualifying mortgage treatment</header><text>The agencies and officials
described in subparagraph (B) shall, in consultation with the Bureau, prescribe
rules defining the types of loans they insure, guarantee, or administer, as the
case may be, that are qualified mortgages for purposes of this section, upon a
finding that such rules are consistent with the purposes of this section or are
appropriate to prevent circumvention or evasion thereof or to facilitate
compliance with this section.</text>
</subparagraph><subparagraph id="id890B4A2FF69C41F98CEDD8749D32614F"><enum>(B)</enum><header>Agencies and
officials</header><text>The agencies and officials described in this
subparagraph are—</text>
<clause id="ID5414caf53cb54470a5f7855693dee9bb"><enum>(i)</enum><text>the Secretary of the
Department of Housing and Urban Development, with regard to mortgages insured
under title II of the National Housing Act (12 U.S.C. 1707 et seq.);</text>
</clause><clause id="IDdd901b2f25384796860e498fabade486"><enum>(ii)</enum><text>the Secretary of
Veterans Affairs, with regard to a loan made or guaranteed by the Secretary of
Veterans Affairs;</text>
</clause><clause id="ID8dfb04661ffe4a808cb753297dbf405f"><enum>(iii)</enum><text>the Secretary of
Agriculture, with regard to loans guaranteed by the Secretary of Agriculture
pursuant to section 502 of the Housing Act of 1949 (42 U.S.C. 1472(h));</text>
</clause><clause id="ID9d5991387c224ae1b4ca2b6334efad8e"><enum>(iv)</enum><text>the Federal Housing
Finance Agency, with regard to loans meeting the conforming loan standards of
the Federal National Mortgage Association or the Federal Home Loan Mortgage
Corporation; and</text>
</clause><clause id="ID712dcc2c593d4d21b787fd4f48497c98"><enum>(v)</enum><text>the Rural Housing
Service, with regard to loans insured by the Rural Housing Service.</text>
</clause></subparagraph></paragraph><paragraph id="ID98f03e475080453f9a5292a54ff0c609"><enum>(4)</enum><header>Implementation</header><text>Regulations
required or authorized to be prescribed under this subsection—</text>
<subparagraph id="ID3c72781b9acc4e49ae7e4fb66663ea8e"><enum>(A)</enum><text>shall be prescribed in
final form before the end of the 12-month period beginning on the date of
enactment of this section; and</text>
</subparagraph><subparagraph id="ID6137f72482924a929b2106548a160733"><enum>(B)</enum><text>shall take effect not
later than 18 months after the date of enactment of this section.</text>
</subparagraph></paragraph></subsection><subsection id="IDd7d40d0f42eb4e6e9bc6900e4fe0e4ef"><enum>(g)</enum><header>Definitions</header><text>For
purposes of this section, the following definitions shall apply:</text>
<paragraph id="ID32bcc85e98ed40f6acc6021e3d6d83bf"><enum>(1)</enum><header>Average prime offer
rate</header><text>The term <term>average prime offer rate</term> means an
annual percentage rate that is derived from average interest rates, points, and
other loan pricing terms currently offered to consumers by a representative
sample of creditors for mortgage transactions that have low-risk pricing
characteristics.</text>
</paragraph><paragraph id="IDa994a81dc51a48f6b01c71e99a0181a9"><enum>(2)</enum><header>Prepayment
penalty</header><text>The term <term>prepayment penalty</term> means any
penalty for paying all or part of the principal on an extension of credit
before the date on which the principal is due, including a computation of a
refund of unearned interest by a method that is less favorable to the consumer
than the actuarial method, as defined in section 933(d) of the Housing and
Community Development Act of 1992 (15 U.S.C. 1615(d)).</text>
</paragraph><paragraph id="ID2444ca3891e84c72862dc49b163a126f"><enum>(3)</enum><header>Qualified
mortgage</header><text>The term <term>qualified mortgage</term> means—</text>
<subparagraph id="id3BD430F7155D478A917A87014ACEB1D3"><enum>(A)</enum><text>any residential mortgage
loan—</text>
<clause id="IDaf9bb555c574497f86cc447863f73ef6"><enum>(i)</enum><text>that does not have an
adjustable rate;</text>
</clause><clause id="ID45d56dc82874491494adae75d197dad5"><enum>(ii)</enum><text>that does not allow a
consumer to defer repayment of principal or interest, or is not otherwise
deemed a <quote>non-traditional mortgage</quote> under guidance, advisories, or
regulations prescribed by the Bureau;</text>
</clause><clause id="IDbe40ce3ea90d4a22a1070d6cc422ff4d"><enum>(iii)</enum><text>that does not provide
for a repayment schedule that results in negative amortization at any
time;</text>
</clause><clause id="ID83ae195d88d247488235be73bd45b2ae"><enum>(iv)</enum><text>for which the terms are
fully amortizing and which does not result in a balloon payment, where a
<quote>balloon payment</quote> is a scheduled payment that is more than twice
as large as the average of earlier scheduled payments;</text>
</clause><clause id="IDb07581c967dc4e778b4e0585b57e9cfd"><enum>(v)</enum><text>which has an annual
percentage rate that does not exceed the average prime offer rate for a
comparable transaction, as of the date on which the interest rate is
set—</text>
<subclause id="ID4c8766892c9e47859c6b60720a1fecb2"><enum>(I)</enum><text>by 1.5 or more percentage
points, in the case of a first lien residential mortgage loan having an
original principal obligation amount that is equal to or less than the amount
of the maximum limitation on the original principal obligation of a mortgage in
effect for a residence of the applicable size, as of the date on which such
interest rate is set, pursuant to the sixth sentence of section 305(a)(2) of
the Federal Home Loan Mortgage Corporation Act (12 U.S.C. 1454(a)(2));</text>
</subclause><subclause id="ID58b50c8efc01497a989abc6686ac3191"><enum>(II)</enum><text>by 2.5 or more
percentage points, in the case of a first lien residential mortgage loan having
an original principal obligation amount that is more than the amount of the
maximum limitation on the original principal obligation of a mortgage in effect
for a residence of the applicable size, as of the date on which such interest
rate is set, pursuant to the sixth sentence of section 305(a)(2) of the Federal
Home Loan Mortgage Corporation Act (12 U.S.C. 1454(a)(2)); or</text>
</subclause><subclause id="ID8aecf50b590c4faa96b29a0dd3b6eab8"><enum>(III)</enum><text>by 3.5 or more
percentage points, in the case of a subordinate lien residential mortgage
loan;</text>
</subclause></clause><clause id="ID81f86ab9c7be412f8d77d7252ac346ad"><enum>(vi)</enum><text>for which the income and
financial resources relied upon to qualify the obligors on the loan are
verified and documented;</text>
</clause><clause id="IDa16066f09fc4451fb3545acaae56034e"><enum>(vii)</enum><text>for which the
underwriting process is based on a payment schedule that fully amortizes the
loan over the loan term and takes into account all applicable taxes, insurance,
and assessments;</text>
</clause><clause id="IDab568dfdd2974b2c89c01b31732fad5f"><enum>(viii)</enum><text>that does not cause
the total monthly debts of the consumer, including amounts under the loan, to
exceed a percentage established by regulation of the monthly gross income of
the consumer, or such other maximum percentage of such income, as may be
prescribed by regulation under subsection (g), which rules shall take into
consideration the income of the consumer available to pay regular expenses
after payment of all installment and revolving debt;</text>
</clause><clause id="ID37a18c667fcb4405a5ace6d88fadcb4c"><enum>(ix)</enum><text>for which the total
points and fees payable in connection with the loan do not exceed 2 percent of
the total loan amount, where the term <quote>points and fees</quote> means
points and fees as defined by Section 103(aa)(4) of the Truth in Lending Act
(15 U.S.C. 1602(aa)(4)); and</text>
</clause><clause id="IDa96916b0ed3843e68b68e43f334a4a16"><enum>(x)</enum><text>for which the term of the
loan does not exceed 30 years, except as such term may be extended under
subsection (g); and</text>
</clause></subparagraph><subparagraph id="IDb5cd57c68ff545beae970931e05f7fb9"><enum>(B)</enum><text>any reverse mortgage that
is insured by the Federal Housing Administration or complies with the condition
established in subparagraph (A)(v).</text>
</subparagraph></paragraph><paragraph id="IDcaf78e43cfa04189a8dcfb9a5a621357"><enum>(4)</enum><header>Residential mortgage
loan</header><text>The term <term>residential mortgage loan</term> means any
consumer credit transaction that is secured by a mortgage, deed of trust, or
other equivalent consensual security interest on a dwelling or on residential
real property that includes a dwelling, other than a consumer credit
transaction under an open end credit plan or an extension of credit relating to
a plan described in section 101(53D) of title 11, United States
Code.</text>
</paragraph></subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="ID192e3fbb52d143359aa2b364f10b1089"><enum>(b)</enum><header>Conforming
amendments</header><text>Section 129(c) of the Truth in Lending Act (15 U.S.C.
1639(c)) is amended—</text>
<paragraph id="idFB346C49F8244C88867E32473A9B260E"><enum>(1)</enum><text>by striking paragraph
(2);</text>
</paragraph><paragraph id="idE4F61EF5FB274CF4A175723F91094D00"><enum>(2)</enum><text>by striking <quote>(1)
<header-in-text level="paragraph" style="OLC">In
general.—</header-in-text></quote>; and</text>
</paragraph><paragraph id="idFEC182F303AF46E9B5ECDA1DC96B1D0E"><enum>(3)</enum><text>by redesignating
subparagraphs (A) and (B) as paragraphs (1) and (2), respectively.</text>
</paragraph></subsection></section><section id="IDbf91e9aa621a4e54a63c63aacd3082e6"><enum>1076.</enum><header>Assistance for
economically vulnerable individuals and families</header>
<subsection id="IDb9b70899fc5b415a99c0e99832064651"><enum>(a)</enum><header>HERA
amendments</header><text>Section 1132 of the Housing and Economic Recovery Act
of 2008 (12 U.S.C. 1701x note) is amended—</text>
<paragraph id="ID61fd42da97484d66bde69233a4814cc6"><enum>(1)</enum><text>in subsection (a), by
inserting in each of paragraphs (1), (2), (3), and (4) “or economically
vulnerable individuals and families” after <quote>homebuyers</quote> each place
that term appears;</text>
</paragraph><paragraph id="IDcc66681c47ef477e8f178633836d0ac1"><enum>(2)</enum><text>in subsection (b)(1), by
inserting <quote>or economically vulnerable individuals and families</quote>
after <quote>homebuyers</quote>;</text>
</paragraph><paragraph id="IDc898e07421cc4fc7a83ad250486b58be"><enum>(3)</enum><text>in subsection
(c)(1)—</text>
<subparagraph id="ID3fc70bfccc0a4491a3eaae383aec8758"><enum>(A)</enum><text>in subparagraph (A), by
striking <quote>or</quote> at the end;</text>
</subparagraph><subparagraph id="ID17ffc430b1d340f3a6fc779039ac21b8"><enum>(B)</enum><text>in subparagraph (B), by
striking the period at the end and inserting <quote>; or</quote>; and</text>
</subparagraph><subparagraph id="ID4a874b4ecd8b42b8b3801ea6445b26af"><enum>(C)</enum><text>by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id38A1428F3F2C47E1BB6C0A23E2980D2D" reported-display-style="italic" style="OLC">
<subparagraph id="ID725abd9d6f7043418b8a144853491664"><enum>(C)</enum><text>a nonprofit corporation
that—</text>
<clause id="IDc668e3a5cbbb4530b1899164d720065b"><enum>(i)</enum><text>is exempt from taxation
under section 501(c)(3) of the Internal Revenue Code of 1986; and</text>
</clause><clause id="ID3ed559f8a5f049f4b75c0e99793a9494"><enum>(ii)</enum><text>specializes or has
expertise in working with economically vulnerable individuals and families, but
whose primary purpose is not provision of credit counseling
services.</text>
</clause></subparagraph><after-quoted-block>;
and</after-quoted-block></quoted-block>
</subparagraph></paragraph><paragraph id="ID69cdba8c5783475887f2172a4fb7f3b3"><enum>(4)</enum><text>in subsection (d)(1), by
striking <quote>not more than 5</quote>.</text>
</paragraph></subsection><subsection id="ID6c903b2a48b54ab193b898b7c0201e30"><enum>(b)</enum><header>Applicability</header><text>Amendments
made by subsection (a) shall not apply to programs authorized by section 1132
of the Housing and Economic Recovery Act of 2008 (12 U.S.C. 1701x note) that
are funded with appropriations prior to fiscal year 2011.</text>
</subsection></section><section id="id8DB8AF88744F43D0895EDA2E4AF5916E"><enum>1077.</enum><header>Remittance
transfers</header>
<subsection id="id0F4BF903665E410A92C83A1092E7C405"><enum>(a)</enum><header>Treatment of remittance
transfers</header><text>The <act-name parsable-cite="EFTA">Electronic Fund
Transfer Act</act-name> (15 U.S.C. 1693 et seq.) is amended—</text>
<paragraph id="id7093FDA7E858428EAAD77EC597BE3D57"><enum>(1)</enum><text>in section 902(b) (15
U.S.C. 1693(b)), by inserting <quote>and remittance</quote> after
<quote>electronic fund</quote>;</text>
</paragraph><paragraph id="id3C576B9FE48F400E8A4DFCD6FF07BB8E"><enum>(2)</enum><text>by redesignating sections
919, 920, 921, and 922 as sections 920, 921, 922, and 923, respectively;
and</text>
</paragraph><paragraph id="idAA372EC0A2034DDC9111792B08D56F8F"><enum>(3)</enum><text>by inserting after
section 918 the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idB90AB7DB3C194CDEB40CA5BD3B562B95" reported-display-style="italic" style="OLC">
<section id="id0908105751C1487CBF9C87551404F866"><enum>919.</enum><header>Remittance
transfers</header>
<subsection id="idBC11567835914156BB38359B964D000B"><enum>(a)</enum><header>Disclosures required
for remittance transfers</header>
<paragraph id="idF4DABCE5FAF5444B9C42097085891D83"><enum>(1)</enum><header>In
general</header><text>Each remittance transfer provider shall make disclosures
as required under this section and in accordance with rules prescribed by the
Board.</text>
</paragraph><paragraph id="id2A19FB258C624385846CCD1687386CC2"><enum>(2)</enum><header>Storefront
disclosures</header>
<subparagraph id="idF07BDC7F5A75495B88656B95DFF78E86"><enum>(A)</enum><header>In
general</header><text>At every physical storefront location owned or controlled
by a remittance transfer provider (with respect to remittance transfer
activities), the remittance transfer provider shall prominently post, and
update daily, a notice describing a model transfer for the amounts of $100 and
$200 (in United States dollars) showing the amount of currency that will be
received by the designated recipient, using the values of the currency into
which the funds will be exchanged for the 3 currencies to which that particular
storefront sends the greatest number of remittance transfer payments, measured
irrespective of the value of such payments. The values shall include all fees
charged by the remittance transfer provider, taken out of the $100 and $200
amounts.</text>
</subparagraph><subparagraph commented="no" id="id1877249AFBFA440F9D0B436B7B94A0BA"><enum>(B)</enum><header>Electronic
disclosure</header><text>Subject to the rules prescribed by the Board, a
remittance transfer provider shall prominently post, and update daily, a notice
describing a model transfer, as described in subparagraph (A), on the Internet
site owned or controlled by the remittance transfer provider which senders use
to electronically conduct remittance transfer transactions.</text>
</subparagraph></paragraph><paragraph id="id0D73DB676E804EBD833091C2D90AC4D3"><enum>(3)</enum><header>Specific
disclosures</header><text>In addition to any other disclosures applicable under
this title, and subject to paragraph (4), a remittance transfer provider shall
provide, in writing and in a form that the sender may keep, to each sender
requesting a remittance transfer, as applicable to the transaction—</text>
<subparagraph id="id5076BCEFE57441EFB92059C0AC3B91B9"><enum>(A)</enum><text>at the time at which the
sender requests a remittance transfer to be initiated, and prior to the sender
making any payment in connection with the remittance transfer, a disclosure
describing the amount of currency that will be sent to the designated
recipient, using the values of the currency into which the funds will be
exchanged; and</text>
</subparagraph><subparagraph id="id6F9145EBE88D4BF596F6C89804F1F50F"><enum>(B)</enum><text>at the time at which the
sender makes payment in connection with the remittance transfer—</text>
<clause id="idA79F9F1223A04C0CAFF14C7EE25CBD38"><enum>(i)</enum><text>a receipt showing—</text>
<subclause id="idBCE0CA764D194469AEF2984F0B521582"><enum>(I)</enum><text>the information described
in subparagraph (A);</text>
</subclause><subclause id="id37F781FDFF3F4165BBEF0A5176860357"><enum>(II)</enum><text>the promised date of
delivery to the designated recipient; and</text>
</subclause><subclause id="id68C9D358B3814E2BA81ECE367FA7C395"><enum>(III)</enum><text>the name and either the
telephone number or the address of the designated recipient; and</text>
</subclause></clause><clause id="idF3034693853E4662ABCDB3B0D0C58887"><enum>(ii)</enum><text>a statement
containing—</text>
<subclause id="id60EF21EF37E44E778244012F2B0BBA02"><enum>(I)</enum><text>information about the
rights of the sender under this section regarding the resolution of errors;
and</text>
</subclause><subclause id="id9ACAB848973C4177B80D2483CABEC8C5"><enum>(II)</enum><text>appropriate contact
information for—</text>
<item id="idB4BBF06BF88E4740A73068A11DDA1AA2"><enum>(aa)</enum><text>the remittance transfer
provider; and</text>
</item><item id="idB848457B769548ED9BC2A435A4D241A1"><enum>(bb)</enum><text>each State or Federal
agency supervising the remittance transfer provider, including its State
licensing authority or Federal regulator, as applicable.</text>
</item></subclause></clause></subparagraph></paragraph><paragraph id="id6B0191AC25174EAFB92BAA40F8782BA3"><enum>(4)</enum><header>Requirements relating
to disclosures</header><text>With respect to each disclosure required to be
provided under paragraph (3), and subject to paragraph (5), a remittance
transfer provider shall—</text>
<subparagraph id="idBE5910F3B7854E45AEC75E9EFAE38468"><enum>(A)</enum><text>provide an initial notice
and receipt, as required by subparagraphs (A) and (B) of paragraph (3), and an
error resolution statement, as required by subsection (c), that clearly and
conspicuously describe the information required to be disclosed therein;
and</text>
</subparagraph><subparagraph id="id7D1F1A698517463EA4482260DD4EAF3A"><enum>(B)</enum><text>with respect to any
transaction that a sender conducts electronically, comply with the Electronic
Signatures in Global and National Commerce Act (15 U.S.C. 7001 et seq.).</text>
</subparagraph></paragraph><paragraph id="id06C5EFD8549C422784DCBCF3D2B60545"><enum>(5)</enum><header>Exemption
authority</header><text>The Board may, by rule, permit a remittance transfer
provider to satisfy the requirements of—</text>
<subparagraph id="id51606303EE434FDDBF28DD987DEE3AFF"><enum>(A)</enum><text>paragraph (3)(A) orally,
if the transaction is conducted entirely by telephone;</text>
</subparagraph><subparagraph id="id2AD7D9891A4C48E9971F9A2F32B922DF"><enum>(B)</enum><text>paragraph (3)(B), by
mailing the documents required under such subparagraph to the sender, not later
than 1 business day after the date on which the transaction is conducted, if
the transaction is conducted entirely by telephone;</text>
</subparagraph><subparagraph id="idC3DEFB89B25A434CB7D037F13D952D95"><enum>(C)</enum><text>subparagraphs (A) and (B)
of paragraph (3) together in one written disclosure, but only to the extent
that the information provided in accordance with paragraph (3)(A) is accurate
at the time at which payment is made in connection with the subject remittance
transfer;</text>
</subparagraph><subparagraph id="id654F8212E89D41CB986D65F238205D98"><enum>(D)</enum><text>paragraph (3)(A), if a
sender initiates a transaction to one of those countries displayed, in the
exact amount of the transfers displayed pursuant to paragraph (2), if the Board
finds it to be appropriate; and</text>
</subparagraph><subparagraph id="id9CCD614930B94168A62885EFE482FAFE"><enum>(E)</enum><text>paragraph (3)(A), without
compliance with section 101(c) of the Electronic Signatures in Global Commerce
Act, if a sender initiates the transaction electronically and the information
is displayed electronically in a manner that the sender can keep.</text>
</subparagraph></paragraph></subsection><subsection id="id33AFBBB2D1F642CF89F784DCDFBDDE86"><enum>(b)</enum><header>Foreign language
disclosures</header>
<paragraph id="idF5F64E095DF9402EB474F485A5E3E161"><enum>(1)</enum><header>In
general</header><text>The disclosures required under this section shall be made
in English and in each of the same foreign languages principally used by the
remittance transfer provider, or any of its agents, to advertise, solicit, or
market, either orally or in writing, at that office.</text>
</paragraph><paragraph id="id1CC7E589C1C7455FAA6CB773C2A9C94E"><enum>(2)</enum><header>Accounts</header><text>In
the case of a sender who holds a demand deposit, savings deposit, or other
asset account with the remittance transfer provider (other than an occasional
or incidental credit balance under an open end credit plan, as defined in
section 103(i) of the Truth in Lending Act), the disclosures required under
this section shall be made in the language or languages principally used by the
remittance transfer provider to communicate to the sender with respect to the
account.</text>
</paragraph></subsection><subsection id="id926E6F77EC874416945675A530183D87"><enum>(c)</enum><header>Remittance transfer
errors</header>
<paragraph id="idAABAF4A5CAE24D79970C094215965DDF"><enum>(1)</enum><header>Error
resolution</header>
<subparagraph id="id6B93034074694057978D22F6566D425E"><enum>(A)</enum><header>In
general</header><text>If a remittance transfer provider receives oral or
written notice from the sender within 180 days of the promised date of delivery
that an error occurred with respect to a remittance transfer, including the
amount of currency designated in subsection (a)(3)(A) that was to be sent to
the designated recipient of the remittance transfer, using the values of the
currency into which the funds should have been exchanged, but was not made
available to the designated recipient in the foreign country, the remittance
transfer provider shall resolve the error pursuant to this subsection and
investigate the reason for the error.</text>
</subparagraph><subparagraph id="idF744D8C7AF794EAF947F87FD4C54E345"><enum>(B)</enum><header>Remedies</header><text>Not
later than 90 days after the date of receipt of a notice from the sender
pursuant to subparagraph (A), the remittance transfer provider shall, as
applicable to the error and as designated by the sender—</text>
<clause id="id5EB8EC6E1B654D30B005E2E4F0E75DFD"><enum>(i)</enum><text>refund to the sender the
total amount of funds tendered by the sender in connection with the remittance
transfer which was not properly transmitted;</text>
</clause><clause id="id22B54F0137714810B716DDB4BC037709"><enum>(ii)</enum><text>make available to the
designated recipient, without additional cost to the designated recipient or to
the sender, the amount appropriate to resolve the error;</text>
</clause><clause id="id676E49DFC9F34F479036E98E317AA691"><enum>(iii)</enum><text>provide such other
remedy, as determined appropriate by rule of the Board for the protection of
senders; or</text>
</clause><clause id="idBF5E00B5A668483B8E9E5913D30642AF"><enum>(iv)</enum><text>provide written notice
to the sender that there was no error with an explanation responding to the
specific complaint of the sender.</text>
</clause></subparagraph></paragraph><paragraph id="idBEC18C3BC0F448D2813E18423BBBD910"><enum>(2)</enum><header>Rules</header><text>The
Board shall establish, by rule issued not later than 1 calendar year after the
date of enactment of the Restoring American Financial Stability Act of 2010,
clear and appropriate standards for remittance transfer providers with respect
to error resolution relating to remittance transfers, to protect senders from
such errors. Standards prescribed under this paragraph shall include
appropriate standards regarding record keeping, as required, including
documentation—</text>
<subparagraph id="idA9406CD3500E4BCA92347A8211D181A5"><enum>(A)</enum><text>of the complaint of the
sender;</text>
</subparagraph><subparagraph id="idB1724E88039649149E81CD87A60FCDA7"><enum>(B)</enum><text>that the sender provides
the remittance transfer provider with respect to the alleged error; and</text>
</subparagraph><subparagraph id="idB1F01F42B6174D788A42141A632C6D57"><enum>(C)</enum><text>of the findings of the
remittance transfer provider regarding the investigation of the alleged error
that the sender brought to their attention.</text>
</subparagraph></paragraph></subsection><subsection id="id85D6BD79FF8B467F8ED352733463277C"><enum>(d)</enum><header>Applicability of this
title</header>
<paragraph id="idEF407EC86A7F4F76821C68860091A0DF"><enum>(1)</enum><header>In
general</header><text>A remittance transfer that is not an electronic fund
transfer, as defined in section 903, shall not be subject to any of the
provisions of sections 905 through 913. A remittance transfer that is an
electronic fund transfer, as defined in section 903, shall be subject to all
provisions of this title, except for section 908, that are otherwise applicable
to electronic fund transfers under this title.</text>
</paragraph><paragraph id="idC0B85D78CFC14D8495B8A72609613F7E"><enum>(2)</enum><header>Rule of
construction</header><text>Nothing in this section shall be construed—</text>
<subparagraph id="id0AF0D6229F2140A892B4E342D50528C9"><enum>(A)</enum><text>to affect the application
to any transaction, to any remittance provider, or to any other person of any
of the provisions of subchapter II of chapter 53 of title 31, United States
Code, section 21 of the Federal Deposit Insurance Act (12 U.S.C. 1829b), or
chapter 2 of title I of Public Law 91–508 (12 U.S.C. 1951–1959), or any
regulations promulgated thereunder; or</text>
</subparagraph><subparagraph id="id2C1E33419ECC4DBA9E092572909F236F"><enum>(B)</enum><text>to cause any fund
transfer that would not otherwise be treated as such under paragraph (1) to be
treated as an electronic fund transfer, or as otherwise subject to this title,
for the purposes of any of the provisions referred to in subparagraph (A) or
any regulations promulgated thereunder.</text>
</subparagraph></paragraph></subsection><subsection id="id487302EE6B334248AE5B92C892F5B1D2"><enum>(e)</enum><header>Acts of
agents</header><text>A remittance transfer provider shall be liable for any
violation of this section by any agent, authorized delegate, or person
affiliated with such provider, when such agent, authorized delegate, or
affiliate acts for that remittance transfer provider.</text>
</subsection><subsection id="id9BAD3E04DF9947678BC1CE3AFEF02677"><enum>(f)</enum><header>Definitions</header><text>As
used in this section—</text>
<paragraph id="idFAF2942CC2C142B881F28C8D6F5C23AC"><enum>(1)</enum><text>the term <term>designated
recipient</term> means any person located in a foreign country and identified
by the sender as the authorized recipient of a remittance transfer to be made
by a remittance transfer provider, except that a designated recipient shall not
be deemed to be a consumer for purposes of this Act;</text>
</paragraph><paragraph id="id51D1EFFA4DB440C287D42EA5FE7A6BF2"><enum>(2)</enum><text>the term <term>remittance
transfer</term> means the electronic (as defined in section 106(2) of the
Electronic Signatures in Global and National Commerce Act (15 U.S.C. 7006(2)))
transfer of funds requested by a sender located in any State to a designated
recipient that is initiated by a remittance transfer provider, whether or not
the sender holds an account with the remittance transfer provider or whether or
not the remittance transfer is also an electronic fund transfer, as defined in
section 903;</text>
</paragraph><paragraph id="id31B0F3443A8A48118F821B419D861834"><enum>(3)</enum><text>the term <term>remittance
transfer provider</term> means any person or financial institution that
provides remittance transfers for a consumer in the normal course of its
business, whether or not the consumer holds an account with such person or
financial institution; and</text>
</paragraph><paragraph id="id35E77337382E4A748D9D3C42D3B23F8B"><enum>(4)</enum><text>the term
<term>sender</term> means a consumer who requests a remittance provider to send
a remittance transfer for the consumer to a designated
recipient.</text>
</paragraph></subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="idF4289D2A47344ECB9072C0E8F4214970"><enum>(b)</enum><header>Automated clearinghouse
system</header>
<paragraph id="idD6802E4455224E0F9CCF59593085FED2"><enum>(1)</enum><header>Expansion of
system</header><text>The Board of Governors shall work with the Federal reserve
banks to expand the use of the automated clearinghouse system for remittance
transfers to foreign countries, with a focus on countries that receive
significant remittance transfers from the United States, based on—</text>
<subparagraph id="idA91982A5911541DAA5508DF6ED1F5C20"><enum>(A)</enum><text>the number, volume, and
size of such transfers;</text>
</subparagraph><subparagraph id="id0F9917A2FF5C42D2ADDAAEDBD0A7A85D"><enum>(B)</enum><text>the significance of the
volume of such transfers relative to the external financial flows of the
receiving country, including—</text>
<clause id="idAE7F07F1D31E4BD7882F80CC914B46AB"><enum>(i)</enum><text>the total amount
transferred; and</text>
</clause><clause id="id9C72EC1729CE4C5EB22F099DE60294F2"><enum>(ii)</enum><text>the total volume of
payments made by United States Government agencies to beneficiaries and
retirees living abroad;</text>
</clause></subparagraph><subparagraph id="id5532848843724EC396EDF1D653DDAAAB"><enum>(C)</enum><text>the feasibility of such
an expansion; and</text>
</subparagraph><subparagraph id="idDA76159190DE4EFE80A4024077715AE5"><enum>(D)</enum><text>the ability of the
Federal Reserve System to establish payment gateways in different geographic
regions and currency zones to receive remittance transfers and route them
through the payments systems in the destination countries.</text>
</subparagraph></paragraph><paragraph id="id94313F98732F4C73AC95DB54E1D61B3C"><enum>(2)</enum><header>Report to
congress</header><text>Not later than one calendar year after the date of
enactment of this Act, and on April 30 biennially thereafter during the 10-year
period beginning on that date of enactment, the Board of Governors shall submit
a report to the Committee on Banking, Housing, and Urban Affairs of the Senate
and the Committee on Financial Services of the House of Representatives on the
status of the automated clearinghouse system and its progress in complying with
the requirements of this subsection. The report shall include an analysis of
adoption rates of International ACH Transactions rules and formats, the
efficacy of increasing adoption rates, and potential recommendations to
increase adoption.</text>
</paragraph></subsection><subsection id="id0D59CD6E025D4996A1D70DEF66AAEEF0"><enum>(c)</enum><header>Expansion of financial
institution provision of remittance transfers</header>
<paragraph id="idD2A0D9E65A5F496F9BE6772B330AA521"><enum>(1)</enum><header>Provision of guidelines
to institutions</header><text>Each of the Federal banking agencies and the
National Credit Union Administration shall provide guidelines to financial
institutions under the jurisdiction of the agency regarding the offering of
low-cost remittance transfers and no-cost or low-cost basic consumer accounts,
as well as agency services to remittance transfer providers.</text>
</paragraph><paragraph id="id2C13836EFE8A479DAEE0044C51D7D49E"><enum>(2)</enum><header>Assistance to financial
literacy commission</header><text>As part of its duties as members of the
Financial Literacy and Education Commission, the Bureau, the Federal banking
agencies, and the National Credit Union Administration shall assist the
Financial Literacy and Education Commission in executing the Strategy for
Assuring Financial Empowerment (or the <quote>SAFE Strategy</quote>), as it
relates to remittances.</text>
</paragraph></subsection><subsection id="id7765A8294B36499BACA4BF841AC38B8A"><enum>(d)</enum><header>Federal Credit Union
Act conforming amendment</header><text display-inline="yes-display-inline">Paragraph (12) of section 107 of the
<act-name parsable-cite="FCUA">Federal Credit Union Act</act-name> (12 U.S.C.
1757) is amended to read as follows:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idAEF94E525C4A46638CC200DD8E8E155C" reported-display-style="italic" style="OLC">
<paragraph id="id87AC32B1DCF24CF5A1CFBEDDBBA5AA28"><enum>(12)</enum><text>in accordance with
regulations prescribed by the Board—</text>
<subparagraph id="idA1A5921FF6BA42DEB0BCB35989DA4DD7"><enum>(A)</enum><text>to sell, to persons in
the field of membership, negotiable checks (including travelers checks), money
orders, and other similar money transfer instruments (including international
and domestic electronic fund transfers);</text>
</subparagraph><subparagraph id="id6610320BB4B545FEA0F0967F49D5DEDB"><enum>(B)</enum><text>to provide remittance
transfers, as defined in section 919 of the <act-name parsable-cite="EFTA">Electronic Fund Transfer Act</act-name>, to persons in the
field of membership; and</text>
</subparagraph><subparagraph id="idCCA6B3D6AFEA43C8B15CBDF7E3CD4F9C"><enum>(C)</enum><text>to cash checks and money
orders for persons in the field of membership for a
fee;</text>
</subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection></section><section id="idF1B940C69104454DB9844B224C7B91BF"><enum>1078.</enum><header>Department of the
Treasury study on ending the conservatorship of Fannie Mae, Freddie Mac, and
reforming the housing finance system</header>
<subsection id="id1757A579838F4CF893AF1E0E1FBC6383"><enum>(a)</enum><header>Study required</header>
<paragraph id="id5D8573A1E779494B8BE3F8FACE548EAB"><enum>(1)</enum><header>In
general</header><text>The Secretary of the Treasury shall conduct a study of
and develop recommendations regarding the options for ending the
conservatorship of the Federal National Mortgage Association (in this section
referred to as <quote>Fannie Mae</quote>) and the Federal Home Loan Mortgage
Corporation (in this section referred to as <quote>Freddie Mac</quote>), while
minimizing the cost to taxpayers, including such options as—</text>
<subparagraph id="id860F886C2E1D4EC7882A1BB9F1A2C004"><enum>(A)</enum><text>the gradual wind-down and
liquidation of such entities;</text>
</subparagraph><subparagraph id="id9F5B0CC1A163420792FCA3CEE04146AB"><enum>(B)</enum><text>the privatization of such
entities;</text>
</subparagraph><subparagraph id="id5DC5CC2DD1CA4FBE89971850F8EA8641"><enum>(C)</enum><text>the incorporation of the
functions of such entities into a Federal agency;</text>
</subparagraph><subparagraph id="id9E034C3828F747DDB5786FF10FA6416E"><enum>(D)</enum><text>the dissolution of Fannie
Mae and Freddie Mac into smaller companies; or</text>
</subparagraph><subparagraph id="idFA71F82D44A54D3AB8676A47929A3828"><enum>(E)</enum><text>any other measures the
Secretary determines appropriate.</text>
</subparagraph></paragraph><paragraph id="id9595D600F8044B17A70485FDF2ED7723"><enum>(2)</enum><header>Analyses</header><text>The
study required under paragraph (1) shall include an analysis of—</text>
<subparagraph id="IDa09c6f73e47945b9b7c4d7fc0cb98cce"><enum>(A)</enum><text>the role of the Federal
Government in supporting a stable, well-functioning housing finance system, and
whether and to what extent the Federal Government should bear risks in meeting
Federal housing finance objectives;</text>
</subparagraph><subparagraph id="IDef876d92011c492ebbc0b0acb5cc3a89"><enum>(B)</enum><text>how the current structure
of the housing finance system can be improved;</text>
</subparagraph><subparagraph id="IDbb757c85844d41e693c5fd378a7cf549"><enum>(C)</enum><text>how the housing finance
system should support the continued availability of mortgage credit to all
segments of the market;</text>
</subparagraph><subparagraph id="IDf27e490f07c7439d935cf4a0482b87a5"><enum>(D)</enum><text>how the housing finance
system should be structured to ensure that consumers continue to have access to
30-year, fixed rate, pre-payable mortgages and other mortgage products that
have simple terms that can be easily understood;</text>
</subparagraph><subparagraph id="ID8fe8909226a447e6b8368581027bec59"><enum>(E)</enum><text>the role of the Federal
Housing Administration and the Department of Veterans Affairs in a future
housing system;</text>
</subparagraph><subparagraph id="ID7b23356245534c76923e66871834520c"><enum>(F)</enum><text>the impact of reforms of
the housing finance system on the financing of rental housing;</text>
</subparagraph><subparagraph id="IDaa6aee2cb69949d89716cb2e4fd025fb"><enum>(G)</enum><text>the impact of reforms of
the housing finance system on secondary market liquidity;</text>
</subparagraph><subparagraph id="IDb27c016f08564b21ac0a8a84e8d9bf33"><enum>(H)</enum><text>the role of
standardization in the housing finance system;</text>
</subparagraph><subparagraph id="ID9a6a6dd54b60429d93b965d19cdbc1fe"><enum>(I)</enum><text>how housing finance
systems in other countries offer insights that can help inform options for
reform in the United States; and</text>
</subparagraph><subparagraph id="ID806b9b77478d4c448ad589e88ebc3431"><enum>(J)</enum><text>the options for
transition to a reformed housing finance system.</text>
</subparagraph></paragraph></subsection><subsection id="idCB674F7296354A249561A7C7F1936BD9"><enum>(b)</enum><header>Report and
recommendations</header><text>Not later than January 31, 2011, the Secretary of
the Treasury shall submit the report and recommendations required under
subsection (a) to the Committee on Banking, Housing, and Urban Affairs of the
Senate and the Committee on Financial Services of the House of
Representatives.</text>
</subsection></section><section commented="no" id="id5F2C0B3B3A544AF5A94EB65259C5DD56"><enum>1079.</enum><header>Reasonable fees and
rules for payment card transactions</header><text display-inline="no-display-inline">The Electronic Fund Transfer Act (15 U.S.C.
1693 et seq.) is amended—</text>
<paragraph commented="no" id="idD057140203AA4DB089F233C08066754E"><enum>(1)</enum><text>by redesignating sections
920 and 921 as sections 921 and 922, respectively; and</text>
</paragraph><paragraph commented="no" id="idE5117B4F752A4ABC867CD07E1280D0EB"><enum>(2)</enum><text>by inserting after
section 919 the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id74FD8762B0A142E6AA672D67A4072FDC" reported-display-style="italic" style="OLC">
<section id="IDd7409ab4cd834a688de0716c1014043c"><enum>920.</enum><header>Reasonable fees and
rules for payment card transactions</header>
<subsection id="idB456B3F812624BD9BE6C95AA20900336"><enum>(a)</enum><header>Reasonable interchange
transaction fees for electronic debit transactions</header>
<paragraph id="ID2fae561b9edd4f9e838d45261b9f5c59"><enum>(1)</enum><header>Regulatory
authority</header><text>The Board shall have authority to establish rules,
pursuant to section 553 of title 5, United States Code, regarding any
interchange transaction fee that an issuer or payment card network may charge
with respect to an electronic debit transaction.</text>
</paragraph><paragraph id="ID7eb29ce6a8094977b357d3d032e6751f"><enum>(2)</enum><header>Reasonable
fees</header><text>The amount of any interchange transaction fee that an issuer
or payment card network may charge with respect to an electronic debit
transaction shall be reasonable and proportional to the actual cost incurred by
the issuer or payment card network with respect to the transaction.</text>
</paragraph><paragraph id="IDe843cebf268c4c64b61636a87eefffeb"><enum>(3)</enum><header>Rulemaking
required</header><text>The Board shall issue final rules, not later than 9
months after the date of enactment of the Consumer Financial Protection Act of
2010, to establish standards for assessing whether the amount of any
interchange transaction fee described in paragraph (2) is reasonable and
proportional to the actual cost incurred by the issuer or payment card network
with respect to the transaction.</text>
</paragraph><paragraph id="IDea613a7646f849fba1c635a1fbfb9cf1"><enum>(4)</enum><header>Considerations</header><text>In
issuing rules required by this section, the Board shall—</text>
<subparagraph id="ID68e41ddcd85a4ff18719ff29a98c6049"><enum>(A)</enum><text>consider the functional
similarity between—</text>
<clause id="IDdaab826db84043538eab74c3b5fd1728"><enum>(i)</enum><text>electronic debit
transactions; and</text>
</clause><clause id="IDa4576d1fb5114910823b397433d5161a"><enum>(ii)</enum><text>checking transactions
that are required within the Federal Reserve bank system to clear at
par;</text>
</clause></subparagraph><subparagraph id="IDdcebb4e67add401897f8fc68c764e4f9"><enum>(B)</enum><text>distinguish
between—</text>
<clause id="IDa90481342665478a9b66a5988886ceb1"><enum>(i)</enum><text>the actual incremental
cost incurred by an issuer or payment card network for the role of the issuer
or the payment card network in the authorization, clearance, or settlement of a
particular electronic debit transaction, which cost shall be considered under
paragraph (2); and</text>
</clause><clause id="IDf8ce2e565bfb440b9b170001de220219"><enum>(ii)</enum><text>other costs incurred by
an issuer or payment card network which are not specific to a particular
electronic debit transaction, which costs shall not be considered under
paragraph (2); and</text>
</clause></subparagraph><subparagraph id="IDb8931be3ce974d54a4ac015ff87b0589"><enum>(C)</enum><text>consult, as appropriate,
with the Comptroller of the Currency, the Board of Directors of the Federal
Deposit Insurance Corporation, the Director of the Office of Thrift
Supervision, the National Credit Union Administration Board, the Administrator
of the Small Business Administration, and the Director of the Bureau of
Consumer Financial Protection.</text>
</subparagraph></paragraph><paragraph id="ID218c84bb5a1b4d4b8cc1e2d20fe6c427"><enum>(5)</enum><header>Exemption for small
issuers</header><text>This subsection shall not apply to issuers that, together
with affiliates, have assets of less than $10,000,000,000, and the Board shall
exempt such issuers from rules issued under paragraph (3).</text>
</paragraph><paragraph id="ID79be160202a64b84bfec0aa144c6f909"><enum>(6)</enum><header>Effective
date</header><text>Paragraph (2) shall become effective 12 months after the
date of enactment of the Consumer Financial Protection Act of 2010.</text>
</paragraph></subsection><subsection id="id9AE6F2A6B0664622A4681329BEA98936"><enum>(b)</enum><header>Limitation on
anti-competitive payment card network restrictions</header>
<paragraph id="IDe002e7b8e93f4706a89f06a1e4bc9815"><enum>(1)</enum><header>No restrictions on
offering discounts for use of a competing payment card network</header><text>A
payment card network shall not, directly or through any agent, processor, or
licensed member of the network, by contract, requirement, condition, penalty,
or otherwise, inhibit the ability of any person to provide a discount or
in-kind incentive for payment through the use of a card or device of another
payment card network, provided that the discount or in-kind incentive only
differentiates between payment card networks and not between other
issuers.</text>
</paragraph><paragraph id="IDf24614aff72a4083b26969f4ebdba52f"><enum>(2)</enum><header>No restrictions on
offering discounts for use of a form of payment</header><text>A payment card
network shall not, directly or through any agent, processor, or licensed member
of the network, by contract, requirement, condition, penalty, or otherwise,
inhibit the ability of any person to provide a discount or in-kind incentive
for payment by the use of cash, check, debit card, or credit card.</text>
</paragraph><paragraph id="ID1db9114dec0e47be8ebf8b0daf200887"><enum>(3)</enum><header>No restrictions on
setting transaction minimums or maximums</header><text>A payment card network
shall not, directly or through any agent, processor, or licensed member of the
network, by contract, requirement, condition, penalty, or otherwise, inhibit
the ability of any person to set a minimum or maximum dollar value for the
acceptance by that person of credit cards, provided that such minimum or
maximum dollar value does not differentiate between issuers or between payment
card networks.</text>
</paragraph></subsection><subsection id="IDeec593d42c1648f08be4a9ac1af00f93"><enum>(c)</enum><header>Definitions</header><text>For
purposes of this section, the following definitions shall apply:</text>
<paragraph id="IDc4a1bcda195d4e24aa8dc35325f9b4bc"><enum>(1)</enum><header>Debit
card</header><text>The term <term>debit card</term>—</text>
<subparagraph id="id297A775CB96F4217B7B9E57D56DC01F2"><enum>(A)</enum><text>means any card, or other
payment code or device, issued or approved for use through a payment card
network to debit an asset account for the purpose of transferring money between
accounts or obtaining goods or services, whether authorization is based on
signature, PIN, or other means;</text>
</subparagraph><subparagraph id="id09EBE632E9874B84A86C97DF2FCE673A"><enum>(B)</enum><text>includes general use
prepaid cards, as that term is defined in section 915(a)(2)(A) (15 U.S.C.
1693l–1(a)(2)(A)); and</text>
</subparagraph><subparagraph id="id5BB8ADD5608743F5943AAD5A4E04FB57"><enum>(C)</enum><text>does not include paper
checks.</text>
</subparagraph></paragraph><paragraph id="idB45E7E63F6F6435DAD133082D1595D94"><enum>(2)</enum><header>Credit
card</header><text>The term <term>credit card</term> has the same meaning as in
section 103 of the Truth in Lending Act (15 U.S.C. 1602).</text>
</paragraph><paragraph id="id2E75D537EF7C4A2F82A3877FA6C13921"><enum>(3)</enum><header>Discount</header><text>The
term <term>discount</term>—</text>
<subparagraph id="idC7384C87E989418ABFB68EA577C9E2F2"><enum>(A)</enum><text>means a reduction made
from the price that customers are informed is the regular price; and</text>
</subparagraph><subparagraph id="idFB1249493E5E4A7AAB01BEBD002091FA"><enum>(B)</enum><text>does not include any
means of increasing the price that customers are informed is the regular
price.</text>
</subparagraph></paragraph><paragraph id="ID0824d84a443d49138e3f95bf59313fdd"><enum>(4)</enum><header>Electronic debit
transaction</header><text>The term <term>electronic debit transaction</term>
means a transaction in which a person uses a debit card to debit an asset
account.</text>
</paragraph><paragraph id="ID380bcc7fd19c495f849a98332423ddec"><enum>(5)</enum><header>Interchange transaction
fee</header><text>The term <term>interchange transaction fee</term> means any
fee established by a payment card network that has been established for the
purpose of compensating an issuer or payment card network for its involvement
in an electronic debit transaction.</text>
</paragraph><paragraph id="IDa0c3d326d4f741e1887e62946e0e3815"><enum>(6)</enum><header>Issuer</header><text display-inline="yes-display-inline">The term <term>issuer</term> means any
person who issues a debit card, or credit card, or the agent of such person
with respect to such card.</text>
</paragraph><paragraph id="IDae92e61b7d534f5fb105525051db677b"><enum>(7)</enum><header>Payment card
network</header><text>The term <term>payment card network</term> means an
entity that directly, or through licensed members, processors, or agents,
provides the proprietary services, infrastructure, and software that route
information and data to conduct transaction authorization, clearance, and
settlement, and that a person uses in order to accept as a form of payment a
brand of debit card, credit card or other device that may be used to carry out
debit or credit
transactions.</text>
</paragraph></subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></section><section id="id2F491952EB7B4DF4A73A3D326B3CFACA"><enum>1079A.</enum><header>Use of consumer
reports</header><text display-inline="no-display-inline">Section 615 of the
Fair Credit Reporting Act (15 U.S.C. 1681m) is amended—</text>
<paragraph id="idE9C71F21E65A4494BF211A50BB67E79C"><enum>(1)</enum><text display-inline="yes-display-inline">in subsection (a)—</text>
<subparagraph id="id00C1622F517F453FAABF5DCBB778F365"><enum>(A)</enum><text>by redesignating
paragraphs (2) and (3) as paragraphs (3) and (4), respectively;</text>
</subparagraph><subparagraph id="idC9AEBDD8DD8A4056B89BED02A3DFBCEB"><enum>(B)</enum><text>by inserting after
paragraph (1) the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id28FA5DD4166841B5BE1C5550CC46549D" reported-display-style="italic" style="OLC">
<paragraph id="id459C2A95CAD4435DA4B05B07A57894A8"><enum>(2)</enum><text>provide to the consumer
written or electronic disclosure—</text>
<subparagraph id="id51CA95B3E9184DFFBC9B02211184593B"><enum>(A)</enum><text>of a numerical credit
score as defined in section 609(f)(2)(A) used by such person in taking any
adverse action based in whole or in part on any information in a consumer
report; and</text>
</subparagraph><subparagraph id="id0C86C84F693442A987EED90ACAD040B1"><enum>(B)</enum><text>of the information set
forth in subparagraphs (B) through (E) of section
609(f)(1);</text>
</subparagraph></paragraph><after-quoted-block>;
and</after-quoted-block></quoted-block>
</subparagraph><subparagraph id="id37AE99E8AB9C4AB4B014A21738B62593"><enum>(C)</enum><text>in paragraph (4) (as so
redesignated), by striking <quote>paragraph (2)</quote> and inserting
<quote>paragraph (3)</quote>; and</text>
</subparagraph></paragraph><paragraph id="id53DA8D3A82C741B08CA7111A5C1A1017"><enum>(2)</enum><text>in subsection
(h)(5)—</text>
<subparagraph id="id6F020479F72449C2BD0730B225B755A6"><enum>(A)</enum><text>in subparagraph (C), by
striking <quote>; and</quote> and inserting a semicolon;</text>
</subparagraph><subparagraph id="id2732F0F523654B5AB648B5CA51F4F803"><enum>(B)</enum><text>in subparagraph (D), by
striking the period and inserting <quote>; and</quote>; and</text>
</subparagraph><subparagraph id="id0A7F38DBA93348A799B282119D3E4830"><enum>(C)</enum><text>by inserting at the end
the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id2704FF6F864644148B53DAF4B74EFE5F" reported-display-style="italic" style="OLC">
<subparagraph id="IDde54e353603b438e8c5aacaf3a4c19d7"><enum>(E)</enum><text>include a statement
informing the consumer of—</text>
<clause id="id60E1B59356A0469E94FFFC2E822AECD4"><enum>(i)</enum><text>a numerical credit score
as defined in section 609(f)(2)(A), used by such person in connection with the
credit decision described in paragraph (1) based in whole or in part on any
information in a consumer report; and</text>
</clause><clause id="id9C6607C7419F426892425ED156778773"><enum>(ii)</enum><text>the information set
forth in subparagraphs (B) through (E) of section
609(f)(1).</text>
</clause></subparagraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subparagraph></paragraph></section></subtitle><subtitle id="id11013149F0D3404FAF1C5F7C6AF29DCB"><enum>H</enum><header>Conforming
Amendments</header>
<section id="idDC10FFD5300C4C7AB9896A4D72E408BA"><enum>1081.</enum><header>Amendments to the
Inspector General Act</header><text display-inline="no-display-inline">Effective on the date of enactment of this
Act, the Inspector General Act of 1978 (5 U.S.C. App. 3) is amended—</text>
<paragraph id="ID66a4b88677074d17913acd056a9e10ed"><enum>(1)</enum><text>in section 8G(a)(2), by
inserting <quote>and the Bureau of Consumer Financial Protection</quote> after
<quote>Board of Governors of the Federal Reserve System</quote>;</text>
</paragraph><paragraph id="ID6374ce741a324103b7f2b663e5fd257f"><enum>(2)</enum><text>in section 8G(c), by
adding at the end the following: <quote>For purposes of implementing this
section, the Chairman of the Board of Governors of the Federal Reserve System
shall appoint the Inspector General of the Board of Governors of the Federal
Reserve System and the Bureau of Consumer Financial Protection. The Inspector
General of the Board of Governors of the Federal Reserve System and the Bureau
of Consumer Financial Protection shall have all of the authorities and
responsibilities provided by this Act with respect to the Bureau of Consumer
Financial Protection, as if the Bureau were part of the Board of Governors of
the Federal Reserve System.</quote>; and</text>
</paragraph><paragraph id="ID2cb0fcd42c56440c869686dccb09397f"><enum>(3)</enum><text>in section 8G(g)(3), by
inserting <quote>and the Bureau of Consumer Financial Protection</quote> after
<quote>Board of Governors of the Federal Reserve System</quote> the first place
that term appears.</text>
</paragraph></section><section id="ID483638841268420b808a8b1ea5800daf"><enum>1082.</enum><header>Amendments to the
Privacy Act of 1974</header><text display-inline="no-display-inline">Effective
on the date of enactment of this Act, section 552a of title 5, United States
Code, is amended by adding at the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id4DF5F2DEFA1B499FAB6261ED8CFB6ADD" reported-display-style="italic" style="OLC">
<subsection id="IDa97be0823ca44fcd859e7a983d1af096"><enum>(w)</enum><header>Applicability to Bureau
of Consumer Financial Protection</header><text>Except as provided in the
Consumer Financial Protection Act of 2010, this section shall apply with
respect to the Bureau of Consumer Financial
Protection.</text>
</subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</section><section id="IDe539d309386c45dc9ffa728aca2f205a"><enum>1083.</enum><header>Amendments to the
Alternative Mortgage Transaction Parity Act of 1982</header>
<subsection id="id9CC3FCE7213C496D825E960B777D40A9"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">The Alternative
Mortgage Transaction Parity Act of 1982 (12 U.S.C. 3801 et seq.) is
amended—</text>
<paragraph id="idEFBFB664D9CA44A69B448055CCECF88B"><enum>(1)</enum><text display-inline="yes-display-inline">in section 803 (12 U.S.C. 3802(1)), by
striking <quote>1974</quote> and all that follows through <quote>described and
defined</quote> and inserting the following: <quote>1974), in which the
interest rate or finance charge may be adjusted or renegotiated, described and
defined</quote>; and</text>
</paragraph><paragraph id="ID27ae90e97f4b4759926abd34f7d8269f"><enum>(2)</enum><text>in section 804 (12 U.S.C.
3803)—</text>
<subparagraph id="ID42e3d1fd929142c1b21bab878c8c19b1"><enum>(A)</enum><text>in subsection (a)—</text>
<clause id="ID4222bcf2b871463cb415e4b79cc4f05b"><enum>(i)</enum><text>in each of paragraphs
(1), (2), and (3), by inserting after <quote>transactions made</quote> each
place that term appears <quote>on or before the designated transfer date, as
determined under section 1062 of the Consumer Financial Protection Act of
2010,</quote>;</text>
</clause><clause id="ID933e35f19c10470a9026aef6589cbf68"><enum>(ii)</enum><text>in paragraph (2), by
striking <quote>and</quote> at the end;</text>
</clause><clause id="IDd184979d64a2429492dac5e7a42bfaeb"><enum>(iii)</enum><text>in paragraph (3), by
striking the period at the end and inserting <quote>; and</quote>; and</text>
</clause><clause id="ID224d56a444cd4d52bfda7107d90296a6"><enum>(iv)</enum><text>by adding at the end the
following new paragraph:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id2471111CC57D4AF6A261989B85B84EFC" reported-display-style="italic" style="OLC">
<paragraph id="IDa7d11a56330948f0abd84554223330bf"><enum>(4)</enum><text>with respect to
transactions made after the designated transfer date, only in accordance with
regulations governing alternative mortgage transactions, as issued by the
Bureau of Consumer Financial Protection for federally chartered housing
creditors, in accordance with the rulemaking authority granted to the Bureau of
Consumer Financial Protection with regard to federally chartered housing
creditors under provisions of law other than this
section.</text>
</paragraph><after-quoted-block>;</after-quoted-block></quoted-block>
</clause></subparagraph><subparagraph id="IDfdb36a9ef1a34eb4a889f5a824e0e251"><enum>(B)</enum><text>by striking subsection
(c) and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id801F2A1D9859427B9BCC2E3B13908268" reported-display-style="italic" style="OLC">
<subsection id="IDa175896c4d344e9b9398dcf301895dd9"><enum>(c)</enum><header>Preemption of state
law</header><text>An alternative mortgage transaction may be made by a housing
creditor in accordance with this section, notwithstanding any State
constitution, law, or regulation that prohibits an alternative mortgage
transaction. For purposes of this subsection, a State constitution, law, or
regulation that prohibits an alternative mortgage transaction does not include
any State constitution, law, or regulation that regulates mortgage transactions
generally, including any restriction on prepayment penalties or late
charges.</text>
</subsection><after-quoted-block>;
and</after-quoted-block></quoted-block>
</subparagraph><subparagraph id="ID40f4c680a2cf4e43b0701bb89bb4129d"><enum>(C)</enum><text>by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id1B953A3057754E55A508D5C8635C96E9" reported-display-style="italic" style="OLC">
<subsection id="ID3613cb3ffe074fb69ca1d84b6ad6ff7e"><enum>(d)</enum><header>Bureau
actions</header><text>The Bureau of Consumer Financial Protection shall—</text>
<paragraph id="ID6ad3ca35060c4b7fad986e2c776f76b6"><enum>(1)</enum><text>review the regulations
identified by the Comptroller of the Currency and the National Credit Union
Administration, (as those rules exist on the designated transfer date), as
applicable under paragraphs (1) through (3) of subsection (a);</text>
</paragraph><paragraph id="IDa765354a9f524d97bf1ebfecabdb3803"><enum>(2)</enum><text>determine whether such
regulations are fair and not deceptive and otherwise meet the objectives of the
Consumer Financial Protection Act of 2010; and</text>
</paragraph><paragraph id="IDb02891925ad84c128923a23e7c5f615e"><enum>(3)</enum><text>promulgate regulations
under subsection (a)(4) after the designated transfer date.</text>
</paragraph></subsection><subsection id="id22A9B8A5BFBB439280A80BDDD89B0F2B"><enum>(e)</enum><header>Designated transfer
date</header><text>As used in this section, the term <quote>designated transfer
date</quote> means the date determined under section 1062 of the Consumer
Financial Protection Act of
2010.</text>
</subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subparagraph></paragraph></subsection><subsection id="ID77d50f0d739e4967b2434093f4a360be"><enum>(b)</enum><header>Effective
date</header><text>This section and the amendments made by this section shall
become effective on the designated transfer date.</text>
</subsection><subsection id="ID17a5c27ec49546fe9cb9998ecb50a23e"><enum>(c)</enum><header>Rule of
construction</header><text>The amendments made by subsection (a) shall not
affect any transaction covered by the Alternative Mortgage Transaction Parity
Act of l982 (12 U.S.C. 3801 et seq.) and entered into on or before the
designated transfer date.</text>
</subsection></section><section id="IDed4f9e212c63431bab0be15f52e04a2a"><enum>1084.</enum><header>Amendments to the
Electronic Fund Transfer Act</header><text display-inline="no-display-inline">The Electronic Fund Transfer Act (15 U.S.C.
1693 et seq.) is amended—</text>
<paragraph commented="no" id="idF62795F93202433AB12ADA055E0D3898"><enum>(1)</enum><text display-inline="yes-display-inline">by striking <quote>Board</quote> each place
that term appears and inserting <quote>Bureau</quote>, except in section 918
(as so designated by the Credit Card Act of 2009) (15 U.S.C. 1693o);</text>
</paragraph><paragraph commented="no" id="id588F9C60D6124510BF1D892DB95B2D32"><enum>(2)</enum><text display-inline="yes-display-inline">in section 903 (15 U.S.C. 1693a), by
striking paragraph (3) and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idDF469E3A22D04B18A47C067DED3DC9FD" reported-display-style="italic" style="OLC">
<paragraph id="IDeaa4ac2ea9e44df9ac50f094be90687e"><enum>(3)</enum><text>the term
<term>Bureau</term> means the Bureau of Consumer Financial
Protection;</text>
</paragraph><after-quoted-block>;</after-quoted-block></quoted-block>
</paragraph><paragraph commented="no" id="id9DD2621D61FA4E718FDBA39D39B66579"><enum>(3)</enum><text>in section 916(d) (as so
designated by section 401 of the Credit CARD Act of 2009) (15 U.S.C.
1693m)—</text>
<subparagraph id="ID01004d9840414b499bccb1eb24c1cabc"><enum>(A)</enum><text>by striking
<quote><header-in-text level="subsection" style="OLC">Federal reserve
system</header-in-text></quote> and inserting <quote><header-in-text level="subsection" style="OLC">Bureau of Consumer Financial
Protection</header-in-text></quote>; and</text>
</subparagraph><subparagraph id="ID69913b3097b94458bec095bf49249487"><enum>(B)</enum><text>by striking
<quote>Federal Reserve System</quote> and inserting <quote>Bureau of Consumer
Financial Protection</quote>; and</text>
</subparagraph></paragraph><paragraph id="id7E6701440CAA495687CC9C897F92578A"><enum>(4)</enum><text>in section 918 (as so
designated by the Credit CARD Act of 2009) (15 U.S.C. 1693o)—</text>
<subparagraph id="ID498083c8196f48ddbe2c65c768cb7782"><enum>(A)</enum><text>in subsection (a)—</text>
<clause id="ID543e0bdeb67c4fdda89029c66add0596"><enum>(i)</enum><text>by striking
<quote>Compliance</quote> and inserting <quote>Except as otherwise provided by
subtitle B of the Consumer Financial Protection Act of 2010,
compliance</quote>; and</text>
</clause><clause id="IDd30a6d87ca5e4698ad5807ad5699ceb5"><enum>(ii)</enum><text>by striking paragraph
(2) and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idB9BACB2625EE40F29354091F9C26C29B" reported-display-style="italic" style="OLC">
<paragraph id="IDc10218cd7f9645ad96ce843f237354c3"><enum>(2)</enum><text>subtitle E of the
Consumer Financial Protection Act of 2010, by the
Bureau;</text>
</paragraph><after-quoted-block>;
and</after-quoted-block></quoted-block>
</clause></subparagraph><subparagraph id="ID817983670ca7457eac3e2dca1db3ed75"><enum>(B)</enum><text>by striking subsection
(c) and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id15F08EC87BFE44B7B971EA6B621888C5" reported-display-style="italic" style="OLC">
<subsection id="ID5b1a05a2e0884b37a816035970e8029b"><enum>(c)</enum><header>Overall enforcement
authority of the Federal Trade Commission</header><text>Except to the extent
that enforcement of the requirements imposed under this title is specifically
committed to some other Government agency under subsection (a), and subject to
subtitle B of the Consumer Financial Protection Act of 2010, the Federal Trade
Commission shall enforce such requirements. For the purpose of the exercise by
the Federal Trade Commission of its functions and powers under the Federal
Trade Commission Act, a violation of any requirement imposed under this title
shall be deemed a violation of a requirement imposed under that Act. All of the
functions and powers of the Federal Trade Commission under the Federal Trade
Commission Act are available to the Federal Trade Commission to enforce
compliance by any person subject to the jurisdiction of the Federal Trade
Commission with the requirements imposed under this title, irrespective of
whether that person is engaged in commerce or meets any other jurisdictional
tests under the Federal Trade Commission
Act.</text>
</subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subparagraph></paragraph></section><section id="IDbcfa00b792284fb9b158cdd7220f38c8"><enum>1085.</enum><header>Amendments to the
Equal Credit Opportunity Act</header><text display-inline="no-display-inline">The Equal Credit Opportunity Act (15 U.S.C.
1691 et seq.) is amended—</text>
<paragraph commented="no" id="id947BB60833614241876944A7955EA3D7"><enum>(1)</enum><text>by striking
<quote>Board</quote> each place that term appears and inserting
<quote>Bureau</quote>;</text>
</paragraph><paragraph id="idF05CE82187884E6895465C54E29A1FB7"><enum>(2)</enum><text>in section 702 (15 U.S.C.
1691a), by striking subsection (c) and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id328B1CC7FB2941E1BC94EE6C8443472F" reported-display-style="italic" style="OLC">
<subsection id="ID99237bbe3ce14f73aedee2cc5e3d689f"><enum>(c)</enum><text>The term
<term>Bureau</term> means the Bureau of Consumer Financial
Protection.</text>
</subsection><after-quoted-block>;</after-quoted-block></quoted-block>
</paragraph><paragraph id="id5AD5856961674E1ABA913642C2C0404B"><enum>(3)</enum><text>in section 703 (15 U.S.C.
1691b)—</text>
<subparagraph id="id512DDCFD8AC046CEB0F7BBCDBBC99AE0"><enum>(A)</enum><text>by striking the section
heading and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id91154BACD1EE493985CAFC12B362D75E" reported-display-style="italic" style="OLC">
<section id="id1E607CC0351047F6B2D6624C728DEC09"><enum>703.</enum><header>Promulgation of
regulations by the
Bureau</header>
</section><after-quoted-block>;</after-quoted-block></quoted-block>
</subparagraph><subparagraph id="ID7c729a7c42c14be7b95b800b266ab424"><enum>(B)</enum><text>by striking <quote>(a)
<header-in-text level="subsection" style="OLC">Regulations</header-in-text>.—</quote>;</text>
</subparagraph><subparagraph id="IDfb2cecc931b74575a8104ca9c632b8f1"><enum>(C)</enum><text>by striking subsection
(b);</text>
</subparagraph><subparagraph id="ID54398e761a9f495c9875078b3f82368d"><enum>(D)</enum><text>by redesignating
paragraphs (1) through (5) as subsections (a) through (e), respectively;
and</text>
</subparagraph><subparagraph id="idF782F0B9F53341EDBC8F4B2D6D7B0A60"><enum>(E)</enum><text>in subsection (c), as so
redesignated, by striking <quote>paragraph (2)</quote> and inserting
<quote>subsection (b)</quote>;</text>
</subparagraph></paragraph><paragraph id="id4992F65E64C3416FA75A1EAA8413522D"><enum>(4)</enum><text>in section 704 (15 U.S.C.
1691c)—</text>
<subparagraph id="IDadb1d9918d1c4db48a994299bf78a11d"><enum>(A)</enum><text>in subsection (a)—</text>
<clause id="ID8640d5d3a4c64c05b78316288214a95c"><enum>(i)</enum><text>by striking
<quote>Compliance</quote> and inserting <quote>Except as otherwise provided by
subtitle B of the Consumer Protection Financial Protection Act of 2010</quote>;
and</text>
</clause><clause id="ID249a4c509c51472483cdaf27268ceb53"><enum>(ii)</enum><text>by striking paragraph
(2) and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id71E187FEA9CC4837B77DD3DAE7C1AE37" reported-display-style="italic" style="OLC">
<paragraph id="IDaed8c4ee5ac44a278b5a282389dbacb5"><enum>(2)</enum><text>Subtitle E of the
Consumer Financial Protection Act of 2010, by the
Bureau.</text>
</paragraph><after-quoted-block>;
</after-quoted-block></quoted-block>
</clause></subparagraph><subparagraph id="ID5db1097fef0e46a2b344cfbdd7023eb1"><enum>(B)</enum><text>by striking subsection
(c) and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idCE93A516778C4F83BDD76083D21A13C3" reported-display-style="italic" style="OLC">
<subsection id="ID2021fc73ce3640008a970f588c5cdc00"><enum>(c)</enum><header>Overall enforcement
authority of Federal trade commission</header><text>Except to the extent that
enforcement of the requirements imposed under this title is specifically
committed to some other Government agency under subsection (a), and subject to
subtitle B of the Consumer Financial Protection Act of 2010, the Federal Trade
Commission shall enforce such requirements. For the purpose of the exercise by
the Federal Trade Commission of its functions and powers under the Federal
Trade Commission Act (15 U.S.C. 41 et seq.), a violation of any requirement
imposed under this subchapter shall be deemed a violation of a requirement
imposed under that Act. All of the functions and powers of the Federal Trade
Commission under the Federal Trade Commission Act are available to the Federal
Trade Commission to enforce compliance by any person with the requirements
imposed under this title, irrespective of whether that person is engaged in
commerce or meets any other jurisdictional tests under the Federal Trade
Commission Act, including the power to enforce any rule prescribed by the
Bureau under this title in the same manner as if the violation had been a
violation of a Federal Trade Commission trade regulation
rule.</text>
</subsection><after-quoted-block>;
and</after-quoted-block></quoted-block>
</subparagraph><subparagraph id="id0362F0F893AB4015815AA3C043F46E7D"><enum>(C)</enum><text>in subsection (d), by
striking <quote>Board</quote> and inserting <quote>Bureau</quote>; and</text>
</subparagraph></paragraph><paragraph id="id35CBF97890844F4490F8F99E1BD341B1"><enum>(5)</enum><text>in section 706(e) (15
U.S.C. 1691e(e))—</text>
<subparagraph id="idCF4ED3A27E4349FE987A60CCAAC1F3A8"><enum>(A)</enum><text>in the subsection
heading—</text>
<clause id="IDb3712ebe7c214de0a91dcc8766859c84"><enum>(i)</enum><text>by striking
<quote><header-in-text level="subsection" style="OLC">Board</header-in-text></quote> each place that term appears and
inserting <quote><header-in-text level="subsection" style="OLC">Bureau</header-in-text></quote>; and</text>
</clause><clause id="IDad7c40902539483ea9b5b604732627cc"><enum>(ii)</enum><text>by striking
<quote><header-in-text level="subsection" style="OLC">Federal reserve
system</header-in-text></quote> and inserting <quote><header-in-text level="subsection" style="OLC">Bureau of Consumer Financial
Protection</header-in-text></quote>; and</text>
</clause></subparagraph><subparagraph id="ID09eb6e75b87a450389f9b9306128fe01"><enum>(B)</enum><text>by striking
<quote>Federal Reserve System</quote> and inserting <quote>Bureau of Consumer
Financial Protection</quote>.</text>
</subparagraph></paragraph></section><section id="ID5011e4e3414e406396b12d0a203c0a82"><enum>1086.</enum><header>Amendments to the
Expedited Funds Availability Act</header>
<subsection id="IDd634ebad2842409395fff1bd13ba299f"><enum>(a)</enum><header>Amendment to Section
<enum-in-header>603</enum-in-header></header><text>Section 603(d)(1) of the
Expedited Funds Availability Act (12 U.S.C. 4002) is amended by inserting after
<quote>Board</quote> the following <quote>, jointly with the Director of the
Bureau of Consumer Financial Protection,</quote>.</text>
</subsection><subsection id="ID94f547b12ece45b691c7798973ec7588"><enum>(b)</enum><header>Amendments to Section
<enum-in-header>604</enum-in-header></header><text>Section 604 of the Expedited
Funds Availability Act (12 U.S.C. 4003) is amended—</text>
<paragraph id="id15BFE37C75F641D3B26714DE316922B0"><enum>(1)</enum><text>by inserting after
<quote>Board</quote> each place that term appears, other than in subsection
(f), the following: <quote>, jointly with the Director of the Bureau of
Consumer Financial Protection,</quote>; and</text>
</paragraph><paragraph id="id903D8E6E7FE443AAB5ED29D36EEDE2F1"><enum>(2)</enum><text>in subsection (f), by
striking <quote>Board.</quote> each place that term appears and inserting the
following: <quote>Board, jointly with the Director of the Bureau of Consumer
Financial Protection.</quote>.</text>
</paragraph></subsection><subsection id="ID7b33a4e168be4538a580569fe16bb348"><enum>(c)</enum><header>Amendments to Section
<enum-in-header>605</enum-in-header></header><text>Section 605 of the Expedited
Funds Availability Act (12 U.S.C. 4004) is amended—</text>
<paragraph id="ID149ba7e3e3944db99be37aaf606dd35f"><enum>(1)</enum><text>by inserting after
<quote>Board</quote> each place that term appears, other than in the heading
for section 605(f)(1), the following: <quote>, jointly with the Director of the
Bureau of Consumer Financial Protection,</quote>; and</text>
</paragraph><paragraph id="IDaa33f09155654bfab16f884943151dbe"><enum>(2)</enum><text>in subsection (f)(1), in
the paragraph heading, by inserting <quote><header-in-text level="paragraph" style="OLC">and Bureau</header-in-text></quote> after <quote><header-in-text level="paragraph" style="OLC">board</header-in-text></quote>.</text>
</paragraph></subsection><subsection id="ID10a1f22c03364030957ff07b3a9f231c"><enum>(d)</enum><header>Amendments to Section
<enum-in-header>609</enum-in-header></header><text>Section 609 of the Expedited
Funds Availability Act (12 U.S.C. 4008) is amended:</text>
<paragraph id="ID8de0050365ac4e92b978b2f81f1cec88"><enum>(1)</enum><text>in subsection (a), by
inserting after <quote>Board</quote> the following <quote>, jointly with the
Director of the Bureau of Consumer Financial Protection,</quote>; and</text>
</paragraph><paragraph id="ID6358577f3cba40c387012549bef33a4c"><enum>(2)</enum><text>by striking subsection
(e) and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id009CF13212094F9BA0C59F0DC7CC2A2E" reported-display-style="italic" style="OLC">
<subsection id="idC5E5F4C9704A49589FE95A019BA97871"><enum>(e)</enum><header>Consultations</header><text>In
prescribing regulations under subsections (a) and (b), the Board and the
Director of the Bureau of Consumer Financial Protection, in the case of
subsection (a), and the Board, in the case of subsection (b), shall consult
with the Comptroller of the Currency, the Board of Directors of the Federal
Deposit Insurance Corporation, and the National Credit Union Administration
Board.</text>
</subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="id3F430A906A3D4BBDB252B80D5394A19B"><enum>(e)</enum><header>Expedited funds
availability improvements</header><text>Section 603 of the Expedited Funds
Availability Act (12 U.S.C. 4002) is amended—</text>
<paragraph id="id77DE30EACC514EB1ACF49DD03F64CF60"><enum>(1)</enum><text>in subsection (a)(2)(D),
by striking “$100” and inserting <quote>$200</quote>; and</text>
</paragraph><paragraph id="id4505A9DCE0EC4221ADF6C03CF7F3C710"><enum>(2)</enum><text>in subsection (b)(3)(C),
in the subparagraph heading, by striking <quote><header-in-text level="subparagraph" style="OLC">$100</header-in-text></quote> and inserting
<quote><header-in-text level="subparagraph" style="OLC">$200</header-in-text></quote>; and</text>
</paragraph><paragraph id="id3AD718A0D10A4A09B49BCCE7BB42D55F"><enum>(3)</enum><text>in subsection
(c)(1)(B)(iii), in the clause heading, by striking <quote><header-in-text level="clause" style="OLC">$100</header-in-text></quote> and inserting <quote><header-in-text level="clause" style="OLC">$200</header-in-text></quote>.</text>
</paragraph></subsection><subsection id="id145E34ECFA0C45D0A9B64B89CF4FB00F"><enum>(f)</enum><header>Regular adjustments for
inflation</header><text display-inline="yes-display-inline">Section 607 of the
Expedited Funds Availability Act (12 U.S.C. 4006) is amended by adding at the
end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idF8245963EB7B477E84840E527D2D6D06" reported-display-style="italic" style="OLC">
<subsection id="idB88EA868538A4AA48E1C55375B49B7B1"><enum>(f)</enum><header>Adjustments to dollar
amounts for inflation</header><text>The dollar amounts under this title shall
be adjusted every 5 years after December 31, 2011, by the annual percentage
increase in the Consumer Price Index for Urban Wage Earners and Clerical
Workers, as published by the Bureau of Labor Statistics, rounded to the nearest
multiple of
$25.</text>
</subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection></section><section id="ID726c0f89641340ba98e82bea43a5c2d2"><enum>1087.</enum><header>Amendments to the
Fair Credit Billing Act</header><text display-inline="no-display-inline">The
Fair Credit Billing Act (15 U.S.C. 1666–1666j) is amended by striking
<quote>Board</quote> each place that term appears and inserting
<quote>Bureau</quote>.</text>
</section><section id="IDbf3ebb35bd2b4b66acb625461b4aa7b4"><enum>1088.</enum><header>Amendments to the
Fair Credit Reporting Act and the Fair and Accurate Credit Transactions
Act</header>
<subsection id="idE904BD27C2C946B1B087E256CFA72D35"><enum>(a)</enum><header>Fair Credit Reporting
Act</header><text>The Fair Credit Reporting Act (15 U.S.C. 1681 et seq.) is
amended—</text>
<paragraph id="ID60c8e6564d6640edafe46282fe3bb747"><enum>(1)</enum><text>in section 603 (15 U.S.C.
1681a)—</text>
<subparagraph id="IDe8e605cd378e4e3f9167293cf1a1b4d7"><enum>(A)</enum><text>by redesignating
subsections (w) and (x) as subsections (x) and (y), respectively; and</text>
</subparagraph><subparagraph id="IDbd5ecae3cd52401980a4ecf909f746d7"><enum>(B)</enum><text>by inserting after
subsection (v) the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id0F423B3258924C57B5CCD745333EE969" reported-display-style="italic" style="OLC">
<subsection id="ID4974f1754f4b4150bfafb1ce303599a0"><enum>(w)</enum><text>The term
<term>Bureau</term> means the Bureau of Consumer Financial
Protection.</text>
</subsection><after-quoted-block>;
and</after-quoted-block></quoted-block>
</subparagraph></paragraph><paragraph id="ID4df26cecb2634726ba353025498dde12"><enum>(2)</enum><text>except as otherwise
specifically provided in this subsection—</text>
<subparagraph id="ID10060e0b21724233a342494aba21e953"><enum>(A)</enum><text>by striking
<quote>Federal Trade Commission</quote> each place that term appears and
inserting <quote>Bureau</quote>;</text>
</subparagraph><subparagraph id="ID0a4babc215ef452b9f776220f654e434"><enum>(B)</enum><text>by striking
<quote>FTC</quote> each place that term appears and inserting
<quote>Bureau</quote>;</text>
</subparagraph><subparagraph id="ID79ea0226bbf34cac817f2b5ad9445014"><enum>(C)</enum><text>by striking <quote>the
Commission</quote> each place that term appears and inserting <quote>the
Bureau</quote>; and</text>
</subparagraph><subparagraph id="ID29643ba467b543e69aa2b9282cbc280c"><enum>(D)</enum><text>by striking <quote>The
Federal banking agencies, the National Credit Union Administration, and the
Commission shall jointly</quote> each place that term appears and inserting
<quote>The Bureau shall</quote>;</text>
</subparagraph></paragraph><paragraph id="IDf469625f05884cf9a7063e315817c6cb"><enum>(3)</enum><text>in section 603(k)(2) (15
U.S.C. 1681a(k)(2)), by striking <quote>Board of Governors of the Federal
Reserve System</quote> and inserting <quote>Bureau</quote>;</text>
</paragraph><paragraph id="IDdf7ad4b5c09e45c2b949af214840ae01"><enum>(4)</enum><text>in section 604(g) (15
U.S.C. 1681b(g))—</text>
<subparagraph id="ID34653f3e409a41e9a3e5db307f6327c7"><enum>(A)</enum><text>in paragraph (3), by
striking subparagraph (C) and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idC083CC11CFC54AC287B901F6A64023B3" reported-display-style="italic" style="OLC">
<subparagraph id="ID8a3eb82b514c419db9bb70dbef346d39"><enum>(C)</enum><text>as otherwise determined
to be necessary and appropriate, by regulation or order, by the Bureau
(consistent with the enforcement authorities prescribed under section 621(b)),
or the applicable State insurance authority (with respect to any person engaged
in providing insurance or
annuities).</text>
</subparagraph><after-quoted-block>;</after-quoted-block></quoted-block>
</subparagraph><subparagraph id="ID68e5f6949daf4bc69dcb390fa7b82c35"><enum>(B)</enum><text>by striking paragraph (5)
and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id85BC8FF94BE143C2A8FBDB3430F6E156" reported-display-style="italic" style="OLC">
<paragraph id="IDda016f3b91d74d9a965e9ad30bb9c22b"><enum>(5)</enum><header>Regulations and
effective date for paragraph (2)</header>
<subparagraph id="ID5445513971be496284c243422cd26cfd"><enum>(A)</enum><header>Regulations
required</header><text>The Bureau may, after notice and opportunity for
comment, prescribe regulations that permit transactions under paragraph (2)
that are determined to be necessary and appropriate to protect legitimate
operational, transactional, risk, consumer, and other needs (and which shall
include permitting actions necessary for administrative verification purposes),
consistent with the intent of paragraph (2) to restrict the use of medical
information for inappropriate purposes.</text>
</subparagraph></paragraph><after-quoted-block>;
and</after-quoted-block></quoted-block>
</subparagraph><subparagraph id="IDd381f420f6fb41849cf21e6faa8caf58"><enum>(C)</enum><text>by striking paragraph
(6);</text>
</subparagraph></paragraph><paragraph id="ID9f3c8b429e954cb39b168a5e7a2ed912"><enum>(5)</enum><text>in section 611(e)(2) (15
U.S.C. 1681i(e)), by striking paragraph (2) and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id6A311A2315B040AB9DE52398C1AD3502" reported-display-style="italic" style="OLC">
<paragraph id="IDe56a45227eac4f1ba39b37059d4ede64"><enum>(2)</enum><header>Exclusion</header><text>Complaints
received or obtained by the Bureau pursuant to its investigative authority
under the Consumer Financial Protection Act of 2010 shall not be subject to
paragraph
(1).</text>
</paragraph><after-quoted-block>;</after-quoted-block></quoted-block>
</paragraph><paragraph id="ID61f8edad94bd44979da986009f7ee776"><enum>(6)</enum><text>in section 615(h)(6) (15
U.S.C. 1681m(h)(6)), by striking subparagraph (A) and inserting the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idC8DCC0D0EB754ADA88748B817A916E1A" reported-display-style="italic" style="OLC">
<subparagraph id="ID11aab0e67c204117b9eeed015adb8c93"><enum>(A)</enum><header>Rules
required</header><text>The Bureau shall prescribe rules to carry out this
subsection.</text>
</subparagraph><after-quoted-block>;</after-quoted-block></quoted-block>
</paragraph><paragraph id="ID6e3f2a171feb4ca7a4139cd219e5530d"><enum>(7)</enum><text>in section 621 (15 U.S.C.
1681s)—</text>
<subparagraph id="IDb2f674a0d4c74a579bed3692dc953910"><enum>(A)</enum><text>by striking subsection
(a) and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id577B360DEAFA41E094979805817144E7" reported-display-style="italic" style="OLC">
<subsection id="ID23ee692a42154c78a92b4c4f6d5e97a4"><enum>(a)</enum><header>Enforcement by Federal
Trade Commission</header>
<paragraph id="ID59dd547e38ed410f9cdd07b4a9f0e032"><enum>(1)</enum><header>In
general</header><text>Except as otherwise provided by subtitle B of the
Consumer Financial Protection Act of 2010, compliance with the requirements
imposed under this title shall be enforced under the Federal Trade Commission
Act (15 U.S.C. 41 et seq.) by the Federal Trade Commission, with respect to
consumer reporting agencies and all other persons subject thereto, except to
the extent that enforcement of the requirements imposed under this title is
specifically committed to some other Government agency under subsection (b).
For the purpose of the exercise by the Federal Trade Commission of its
functions and powers under the Federal Trade Commission Act, a violation of any
requirement or prohibition imposed under this title shall constitute an unfair
or deceptive act or practice in commerce, in violation of section 5(a) of the
Federal Trade Commission Act (15 U.S.C. 45(a)), and shall be subject to
enforcement by the Federal Trade Commission under section 5(b) of that Act with
respect to any consumer reporting agency or person that is subject to
enforcement by the Federal Trade Commission pursuant to this subsection,
irrespective of whether that person is engaged in commerce or meets any other
jurisdictional tests under the Federal Trade Commission Act. The Federal Trade
Commission shall have such procedural, investigative, and enforcement powers
(except as otherwise provided by subtitle B of the Consumer Financial
Protection Act of 2010), including the power to issue procedural rules in
enforcing compliance with the requirements imposed under this title and to
require the filing of reports, the production of documents, and the appearance
of witnesses, as though the applicable terms and conditions of the Federal
Trade Commission Act were part of this title. Any person violating any of the
provisions of this title shall be subject to the penalties and entitled to the
privileges and immunities provided in the Federal Trade Commission Act as
though the applicable terms and provisions of such Act are part of this
title.</text>
</paragraph><paragraph id="IDc9427393f4a642e68957b0bf6a4fb097"><enum>(2)</enum><header>Penalties</header>
<subparagraph id="id1CD490B945EC437DA2569BA67565F567"><enum>(A)</enum><header>Knowing
violations</header><text>Except as otherwise provided by subtitle B of the
Consumer Financial Protection Act of 2010, in the event of a knowing violation,
which constitutes a pattern or practice of violations of this title, the
Federal Trade Commission may commence a civil action to recover a civil penalty
in a district court of the United States against any person that violates this
title. In such action, such person shall be liable for a civil penalty of not
more than $2,500 per violation.</text>
</subparagraph><subparagraph id="ID067d0c68b0364a4c8159a1a861609b0b"><enum>(B)</enum><header>Determining penalty
amount</header><text>In determining the amount of a civil penalty under
subparagraph (A), the court shall take into account the degree of culpability,
any history of such prior conduct, ability to pay, effect on ability to
continue to do business, and such other matters as justice may require.</text>
</subparagraph><subparagraph id="IDe9d5cc5967a249e4977b9cb4af486add"><enum>(C)</enum><header>Limitation</header><text>Notwithstanding
paragraph (2), a court may not impose any civil penalty on a person for a
violation of section 623(a)(1), unless the person has been enjoined from
committing the violation, or ordered not to commit the violation, in an action
or proceeding brought by or on behalf of the Federal Trade Commission, and has
violated the injunction or order, and the court may not impose any civil
penalty for any violation occurring before the date of the violation of the
injunction or
order.</text>
</subparagraph></paragraph></subsection><after-quoted-block>;</after-quoted-block></quoted-block>
</subparagraph></paragraph><paragraph id="IDaf9570b95c9540fead8627ee8f5c6c95"><enum>(8)</enum><text>by striking subsection
(b) and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idC34286E8DA7F46A0B6B5D62969D7E214" reported-display-style="italic" style="OLC">
<subsection id="ID30cbb160de69465f945b818bb03ff042"><enum>(b)</enum><header>Enforcement by other
agencies</header>
<paragraph id="id6F2B8345F16340668270580C57400B00"><enum>(1)</enum><header>In
general</header><text>Except as otherwise provided by subtitle B of the
Consumer Financial Protection Act of 2010, compliance with the requirements
imposed under this title with respect to consumer reporting agencies, persons
who use consumer reports from such agencies, persons who furnish information to
such agencies, and users of information that are subject to section 615(d)
shall be enforced under—</text>
<subparagraph id="ID924bde93737d4a5daa74772b2b42a164"><enum>(A)</enum><text>section 8 of the Federal
Deposit Insurance Act (12 U.S.C. 1818), in the case of—</text>
<clause id="ID4e288ccd9aec4d8fb83b8b804e9f9590"><enum>(i)</enum><text>any national bank, and
any Federal branch or Federal agency of a foreign bank, by the Office of the
Comptroller of the Currency;</text>
</clause><clause id="IDcdb98bd5077444fd85bc01084e174e07"><enum>(ii)</enum><text>any member bank of the
Federal Reserve System (other than a national bank), a branch or agency of a
foreign bank (other than a Federal branch, Federal agency, or insured State
branch of a foreign bank), a commercial lending company owned or controlled by
a foreign bank, and any organization operating under section 25 or 25A of the
Federal Reserve Act, by the Board of Governors of the Federal Reserve System;
and</text>
</clause><clause id="ID5e98a5f0e23c42bb862e1826afaf893c"><enum>(iii)</enum><text>any bank insured by the
Federal Deposit Insurance Corporation (other than a member of the Federal
Reserve System) and any insured State branch of a foreign bank, by the Board of
Directors of the Federal Deposit Insurance Corporation;</text>
</clause></subparagraph><subparagraph id="ID72efd44efb6d43de984493a5e75b113e"><enum>(B)</enum><text>subtitle E of the
Consumer Financial Protection Act of 2010, by the Bureau;</text>
</subparagraph><subparagraph id="IDedc54d68f7814fa3afc9774aa555e2a7"><enum>(C)</enum><text>the Federal Credit Union
Act (12 U.S.C. 1751 et seq.), by the Administrator of the National Credit Union
Administration with respect to any Federal credit union;</text>
</subparagraph><subparagraph id="ID56dc609246924655afd002ad1fd2cbff"><enum>(D)</enum><text>subtitle IV of title 49,
United States Code, by the Secretary of Transportation, with respect to all
carriers subject to the jurisdiction of the Surface Transportation
Board;</text>
</subparagraph><subparagraph id="ID46d1a5b29a4d4a49987e3254eff8ecf9"><enum>(E)</enum><text>the Federal Aviation Act
of 1958 (49 U.S.C. App. 1301 et seq.), by the Secretary of Transportation, with
respect to any air carrier or foreign air carrier subject to that Act;</text>
</subparagraph><subparagraph id="ID1edf7df91c944d69ad77efbf45b2cfc3"><enum>(F)</enum><text>the Packers and
Stockyards Act, 1921 (7 U.S.C. 181 et seq.) (except as provided in section 406
of that Act), by the Secretary of Agriculture, with respect to any activities
subject to that Act;</text>
</subparagraph><subparagraph id="ID33c0d89f738345c7995721f3718c039b"><enum>(G)</enum><text>the Commodity Exchange
Act, with respect to a person subject to the jurisdiction of the Commodity
Futures Trading Commission; and</text>
</subparagraph><subparagraph id="ID2d6b68a057644b018ca5215f0f7ad24d"><enum>(H)</enum><text>the Federal securities
laws, and any other laws that are subject to the jurisdiction of the Securities
and Exchange Commission, with respect to a person that is subject to the
jurisdiction of the Securities and Exchange Commission.</text>
</subparagraph></paragraph><paragraph id="id8384943C8CDD4262BD0491ACBF13CE88"><enum>(2)</enum><header>Incorporated
definitions</header><text>The terms used in paragraph (1) that are not defined
in this title or otherwise defined in section 3(s) of the Federal Deposit
Insurance Act (12 U.S.C. 1813(s)) have the same meanings as in section 1(b) of
the International Banking Act of 1978 (12 U.S.C.
3101).</text>
</paragraph></subsection><after-quoted-block>;</after-quoted-block></quoted-block>
</paragraph><paragraph id="ID10204f41813a4063a56a6ca6a64290a0"><enum>(9)</enum><text>by striking subsection
(e) and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id8D6F79F201184153BF6587D293F7CCC5" reported-display-style="italic" style="OLC">
<subsection id="ID34f15b1a089a4dab83ac96ed87b89bfb"><enum>(e)</enum><header>Regulatory
authority</header><text>The Bureau shall prescribe such regulations as are
necessary to carry out the purposes of this Act. The regulations prescribed by
the Bureau under this subsection shall apply to any person that is subject to
this Act, notwithstanding the enforcement authorities granted to other agencies
under this section.</text>
</subsection><after-quoted-block>;
and</after-quoted-block></quoted-block>
</paragraph><paragraph id="ID4804d23b6205441dbe0f3493837e98ed"><enum>(10)</enum><text>in section 623 (15
U.S.C. 1681s–2)—</text>
<subparagraph id="IDcadad04967f641ee862c4645246a853f"><enum>(A)</enum><text>in subsection (a)(7), by
striking subparagraph (D) and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idBCB6691DFBEA428D816526A3EC3F8C58" reported-display-style="italic" style="OLC">
<subparagraph id="ID876c084ca1c748b3aea4e152e2ec2c57"><enum>(D)</enum><header>Model
disclosure</header>
<clause id="ID43ccff2426424709a5b1650b7287b9ce"><enum>(i)</enum><header>Duty of
Bureau</header><text>The Bureau shall prescribe a brief model disclosure that a
financial institution may use to comply with subparagraph (A), which shall not
exceed 30 words.</text>
</clause><clause id="ID4cc24ef1a11a4a619098b650d26b3c3d"><enum>(ii)</enum><header>Use of model not
required</header><text>No provision of this paragraph may be construed to
require a financial institution to use any such model form prescribed by the
Bureau.</text>
</clause><clause id="IDd501a26582af4f8794ada1555db67d51"><enum>(iii)</enum><header>Compliance using
model</header><text>A financial institution shall be deemed to be in compliance
with subparagraph (A) if the financial institution uses any model form
prescribed by the Bureau under this subparagraph, or the financial institution
uses any such model form and rearranges its
format.</text>
</clause></subparagraph><after-quoted-block>;
and</after-quoted-block></quoted-block>
</subparagraph><subparagraph id="IDab46b9362d664d84aafee93a4d7f9efb"><enum>(B)</enum><text>by striking subsection
(e) and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idAD84C6A377DD4F929507332F0756CF52" reported-display-style="italic" style="OLC">
<subsection id="ID9bd4c783f0514fcba43d5be1b9513d54"><enum>(e)</enum><header>Accuracy guidelines and
regulations required</header>
<paragraph id="ID31631763613048a3a514c89514edd4a2"><enum>(1)</enum><header>Guidelines</header><text>The
Bureau shall, with respect to persons or entities that are subject to the
enforcement authority of the Bureau under section 621—</text>
<subparagraph id="IDae149624765c4d1aad58d3eafbb56ff5"><enum>(A)</enum><text>establish and maintain
guidelines for use by each person that furnishes information to a consumer
reporting agency regarding the accuracy and integrity of the information
relating to consumers that such entities furnish to consumer reporting
agencies, and update such guidelines as often as necessary; and</text>
</subparagraph><subparagraph id="IDc02077f3f06d453bbf1a4752ca14713c"><enum>(B)</enum><text>prescribe regulations
requiring each person that furnishes information to a consumer reporting agency
to establish reasonable policies and procedures for implementing the guidelines
established pursuant to subparagraph (A).</text>
</subparagraph></paragraph><paragraph id="ID6687b3603c9d44d09344066288de9e8e"><enum>(2)</enum><header>Criteria</header><text>In
developing the guidelines required by paragraph (1)(A), the Bureau
shall—</text>
<subparagraph id="IDe457cb069d0d4915992a54208db0fb29"><enum>(A)</enum><text>identify patterns,
practices, and specific forms of activity that can compromise the accuracy and
integrity of information furnished to consumer reporting agencies;</text>
</subparagraph><subparagraph id="IDd429aea887a947a59a3565ea4e71f664"><enum>(B)</enum><text>review the methods
(including technological means) used to furnish information relating to
consumers to consumer reporting agencies;</text>
</subparagraph><subparagraph id="IDb126b6a3ebd049ff8ddbc3985b3e260b"><enum>(C)</enum><text>determine whether persons
that furnish information to consumer reporting agencies maintain and enforce
policies to ensure the accuracy and integrity of information furnished to
consumer reporting agencies; and</text>
</subparagraph><subparagraph id="IDe55896cc7e7d4d089b3416f3a66643bb"><enum>(D)</enum><text>examine the policies and
processes that persons that furnish information to consumer reporting agencies
employ to conduct reinvestigations and correct inaccurate information relating
to consumers that has been furnished to consumer reporting
agencies.</text>
</subparagraph></paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subparagraph></paragraph></subsection><subsection id="IDf3a09c4ee49540bd810d65681233ddaf"><enum>(b)</enum><header>Fair and Accurate
Credit Transactions Act of 2003</header><text display-inline="yes-display-inline">Section 214(b)(1) of the Fair and Accurate
Credit Transactions Act of 2003 (15 U.S.C. 1681s–3 note) is amended by striking
paragraph (1) and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id24CDA3304F2B4560B2BD7B656BA0DF38" reported-display-style="italic" style="OLC">
<paragraph id="id54A0E781A09448268911796AEB73ECF7"><enum>(1)</enum><header>In
general</header><text display-inline="yes-display-inline">Regulations to carry
out section 624 of the Fair Credit Reporting Act (15 U.S.C. 1681s–3), shall be
prescribed, as described in paragraph (2), by—</text>
<subparagraph id="id600319435EBE44089B628A63795A0D11"><enum>(A)</enum><text display-inline="yes-display-inline">the Commodity Futures Trading Commission,
with respect to entities subject to its enforcement authorities;</text>
</subparagraph><subparagraph id="id57C413ED5A9C4F88B1AA308B9FCC0316"><enum>(B)</enum><text display-inline="yes-display-inline">the Securities and Exchange Commission,
with respect to entities subject to its enforcement authorities; and</text>
</subparagraph><subparagraph id="id46DD447451E940BBAAE33A13BA8E722F"><enum>(C)</enum><text display-inline="yes-display-inline">the Bureau, with respect to other entities
subject to this
Act.</text>
</subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection></section><section id="IDbd61a6fc5bc0462e9a510a8e64bc242a"><enum>1089.</enum><header>Amendments to the
Fair Debt Collection Practices Act</header><text display-inline="no-display-inline">The Fair Debt Collection Practices Act (15
U.S.C. 1692 et seq.) is amended—</text>
<paragraph commented="no" id="idC0DA9E03B2E142DA90AA2E7DF6141B32"><enum>(1)</enum><text display-inline="yes-display-inline">by striking <quote>Commission</quote> each
place that term appears and inserting <quote>Bureau</quote>;</text>
</paragraph><paragraph id="idF713A76F9FA7457082DE76A8F9D2E366"><enum>(2)</enum><text>in section 803 (15 U.S.C.
1692a)—</text>
<subparagraph id="IDb19f7143c58a4194a60daf4bd780e676"><enum>(A)</enum><text>by striking paragraph (1)
and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idC2C4C49079304CFB83F388D5E15589E0" reported-display-style="italic" style="OLC">
<paragraph id="ID7b3657ac58d0421ea011a360baff063f"><enum>(1)</enum><text>The term
<term>Bureau</term> means the Bureau of Consumer Financial
Protection.</text>
</paragraph><after-quoted-block>;</after-quoted-block></quoted-block>
</subparagraph></paragraph><paragraph id="id6F46AF89CCC64C5BB8CA8C311E8F1B76"><enum>(3)</enum><text>in section 814 (15 U.S.C.
1692l)—</text>
<subparagraph id="IDe4cf2d01a38144e1b64f089c2637b414"><enum>(A)</enum><text>by striking subsection
(a) and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idD8D78BB979504394A4A7DFF83A603169" reported-display-style="italic" style="OLC">
<subsection id="ID3a588e3f22d9452daedd03e7b2459136"><enum>(a)</enum><header>Federal Trade
Commission</header><text>Except as otherwise provided by subtitle B of the
Consumer Financial Protection Act of 2010, compliance with this title shall be
enforced by the Federal Trade Commission, except to the extent that enforcement
of the requirements imposed under this title is specifically committed to
another Government agency under subsection (b). For purpose of the exercise by
the Federal Trade Commission of its functions and powers under the Federal
Trade Commission Act (15 U.S.C. 41 et seq.), a violation of this title shall be
deemed an unfair or deceptive act or practice in violation of that Act. All of
the functions and powers of the Federal Trade Commission under the Federal
Trade Commission Act are available to the Federal Trade Commission to enforce
compliance by any person with this title, irrespective of whether that person
is engaged in commerce or meets any other jurisdictional tests under the
Federal Trade Commission Act, including the power to enforce the provisions of
this title, in the same manner as if the violation had been a violation of a
Federal Trade Commission trade regulation
rule.</text>
</subsection><after-quoted-block>;
and</after-quoted-block></quoted-block>
</subparagraph><subparagraph id="ID376ec4434cd34e56801e07d3cf130d77"><enum>(B)</enum><text>in subsection (b)—</text>
<clause id="ID9d471099fe4c4f318826fe5303cfdde7"><enum>(i)</enum><text>by striking
<quote>Compliance</quote> and inserting <quote>Except as otherwise provided by
subtitle B of the Consumer Financial Protection Act of 2010,
compliance</quote>; and</text>
</clause><clause id="ID7e82929b1d3e4abe90542fa6683039eb"><enum>(ii)</enum><text>by striking paragraph
(2) and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idD66F85FEA2BF491290F68ADBE45DE53A" reported-display-style="italic" style="OLC">
<paragraph id="IDd1ffce8ee153401d8db2916ffb063306"><enum>(2)</enum><text>subtitle E of the
Consumer Financial Protection Act of 2010, by the
Bureau;</text>
</paragraph><after-quoted-block>;
and</after-quoted-block></quoted-block>
</clause></subparagraph></paragraph><paragraph id="IDcafb024b700844a0852fa54b65b530a4"><enum>(4)</enum><text>in subsection (d), by
striking <quote>Neither the Commission</quote> and all that follows through the
end of the subsection and inserting the following: <quote>The Bureau may
prescribe rules with respect to the collection of debts by debt collectors, as
defined in this Act.</quote>.</text>
</paragraph></section><section id="ID715ad0ac875148ad951ae073cf0e77af"><enum>1090.</enum><header>Amendments to the
Federal Deposit Insurance Act</header><text display-inline="no-display-inline">The Federal Deposit Insurance Act (12 U.S.C.
1811 et seq.) is amended—</text>
<paragraph id="idB539FEEC06AC45BABD6F2BA472CA8BC2"><enum>(1)</enum><text display-inline="yes-display-inline">in section 8(t) (12 U.S.C. 1818(t)), by
adding at the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idAC8711D4344C49259E7E4F832805CCD1" reported-display-style="italic" style="OLC">
<paragraph id="ID038cfb13025c464f8f6dc24c759cf8f5"><enum>(6)</enum><header>Referral to Bureau of
Consumer Financial Protection</header><text>Subject to subtitle B of the
Consumer Financial Protection Act of 2010, each appropriate Federal banking
agency shall make a referral to the Bureau of Consumer Financial Protection
when the Federal banking agency has a reasonable belief that a violation of an
enumerated consumer law, as defined in the Consumer Financial Protection Act of
2010, has been committed by any insured depository institution or
institution-affiliated party within the jurisdiction of that appropriate
Federal banking agency.</text>
</paragraph><after-quoted-block>;
and</after-quoted-block></quoted-block>
</paragraph><paragraph id="ID9f5920d6b1ef4f85901db350854935c3"><enum>(2)</enum><text>in section 43 (12 U.S.C.
1831t)—</text>
<subparagraph id="IDcaa3b087cb464f869c55b6795796f5a3"><enum>(A)</enum><text>in subsection (c), by
striking <quote>Federal Trade Commission</quote> and inserting
<quote>Bureau</quote>;</text>
</subparagraph><subparagraph id="ID54d1af3debb34d8faf34a7f7037833d8"><enum>(B)</enum><text>in subsection (d), by
striking <quote>Federal Trade Commission</quote> and inserting
<quote>Bureau</quote>;</text>
</subparagraph><subparagraph id="IDa4fa14ca895c40d4a87acddd5f29678e"><enum>(C)</enum><text>in subsection (e)—</text>
<clause id="ID8e0e9b02a4ab4d3eb2ba30ac254c47cc"><enum>(i)</enum><text>in paragraph (2), by
striking <quote>Federal Trade Commission</quote> and inserting
<quote>Bureau</quote>; and</text>
</clause><clause id="ID5b51be7391b642ab97a538e728299b38"><enum>(ii)</enum><text>by adding at the end the
following new paragraph:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idA1454F60FA824BA09F52761ABD9FACE3" reported-display-style="italic" style="OLC">
<paragraph id="ID3d43ba373cef46b59ffb8a6438f64c6c"><enum>(5)</enum><header>Bureau</header><text>The
term <term>Bureau</term> means the Bureau of Consumer Financial
Protection.</text>
</paragraph><after-quoted-block>;
and</after-quoted-block></quoted-block>
</clause></subparagraph><subparagraph id="IDe91e918ed8754816b8259e49ecaaaed4"><enum>(D)</enum><text>in subsection (f)—</text>
<clause id="ID47adce1492b5454baf4a94986643d660"><enum>(i)</enum><text>by striking paragraph (1)
and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id388562ED4E8243F9878DBB2AFBB6A320" reported-display-style="italic" style="OLC">
<paragraph id="IDa442998f38924511a4a00ad30a2404f4"><enum>(1)</enum><header>Limited enforcement
authority</header><text>Compliance with the requirements of subsections (b),
(c), and (e), and any regulation prescribed or order issued under such
subsection, shall be enforced under the Consumer Financial Protection Act of
2010, by the Bureau, subject to subtitle B of the Consumer Financial Protection
Act of 2010, and under the Federal Trade Commission Act (15 U.S.C. 41 et seq.)
by the Federal Trade Commission.</text>
</paragraph><after-quoted-block>;
and</after-quoted-block></quoted-block>
</clause><clause id="ID9b908fb89e634edfb89c7096697e999f"><enum>(ii)</enum><text>in paragraph (2), by
striking subparagraph (C) and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id07BB29C547AA4B39B3D70C91671A43F3" reported-display-style="italic" style="OLC">
<subparagraph id="ID0d598e2d098d4a91b3216a6c20246465"><enum>(C)</enum><header>Limitation on State
action while Federal action pending</header><text>If the Bureau or Federal
Trade Commission has instituted an enforcement action for a violation of this
section, no appropriate State supervisory agency may, during the pendency of
such action, bring an action under this section against any defendant named in
the complaint of the Bureau or Federal Trade Commission for any violation of
this section that is alleged in that
complaint.</text>
</subparagraph><after-quoted-block>.</after-quoted-block></quoted-block>
</clause></subparagraph></paragraph></section><section id="ID6c4b681fa94d4af6b803e4643f65cbf5"><enum>1091.</enum><header>Amendments to the
Gramm-Leach-Bliley Act</header><text display-inline="no-display-inline">Title V
of the Gramm-Leach-Bliley Act (15 U.S.C. 6801 et seq.) is amended—</text>
<paragraph id="ID486ed0d5b2d04d009ebda008dc8b8832"><enum>(1)</enum><text>in section 504(a)(1) (15
U.S.C. 6804(a)(1))—</text>
<subparagraph id="IDfdc95ccc0f1e4c029e0b7c687f51223b"><enum>(A)</enum><text>by striking <quote>The
Federal banking agencies, the National Credit Union Administration, the
Secretary of the Treasury,</quote> and inserting <quote>The Bureau of Consumer
Financial Protection and</quote>; and</text>
</subparagraph><subparagraph id="IDbbcf546f5c4c47479c4445ad60b34536"><enum>(B)</enum><text>by striking <quote>, and
the Federal Trade Commission</quote>;</text>
</subparagraph></paragraph><paragraph id="ID3438ca16bb534067aae57652c9b53181"><enum>(2)</enum><text>in section 505(a) (15
U.S.C. 6805(a))—</text>
<subparagraph id="ID248cf5deb3694179b79467afba89715e"><enum>(A)</enum><text>by striking <quote>This
subtitle</quote> and all that follows through <quote>as follows:</quote> and
inserting <quote>Except as otherwise provided by subtitle B of the Consumer
Financial Protection Act of 2010, this subtitle and the regulations prescribed
thereunder shall be enforced by the Bureau of Consumer Financial Protection,
the Federal functional regulators, the State insurance authorities, and the
Federal Trade Commission with respect to financial institutions and other
persons subject to their jurisdiction under applicable law, as
follows:</quote>;</text>
</subparagraph><subparagraph id="ID5cea2dda89f64844895ba85e440d822b"><enum>(B)</enum><text>in paragraph (1)—</text>
<clause id="id8B77E86ED6F047158DB9BD9B40B6E93D"><enum>(i)</enum><text>in subparagraph (B), by
inserting <quote>and</quote> after the semicolon;</text>
</clause><clause id="idD2FF8B80227A44FEB7788CB8DEA3B35B"><enum>(ii)</enum><text>in subparagraph (C), by
striking <quote>; and</quote> and inserting a period; and</text>
</clause><clause id="idA0F1CEF4F9A94B85BA7C0A5E799CB52B"><enum>(iii)</enum><text>by striking
subparagraph (D); and</text>
</clause></subparagraph><subparagraph id="IDad8c7ae37486478ca1d8ad5d5729d879"><enum>(C)</enum><text>by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id873331F12C5942379F24B8D072A87E74" reported-display-style="italic" style="OLC">
<paragraph id="ID038bc14ca3104e9b8aea1556a3a4614c"><enum>(8)</enum><text>Under the Consumer
Financial Protection Act of 2010, by the Bureau of Consumer Financial
Protection, in the case of any financial institution and other covered person
or service provider that is subject to the jurisdiction of the Bureau under
that Act, but not with respect to the standards under section
501.</text>
</paragraph><after-quoted-block>;
and</after-quoted-block></quoted-block>
</subparagraph></paragraph><paragraph id="ID709b13907025421c92ecbe7dff85b98d"><enum>(3)</enum><text>in section 505(b)(1) (15
U.S.C. 6805(b)(1)), by inserting <quote>, other than the Bureau of Consumer
Financial Protection, </quote> after <quote>subsection (a)</quote>.</text>
</paragraph></section><section id="IDe55450f731d847dfbbdea72152937d0f"><enum>1092.</enum><header>Amendments to the
Home Mortgage Disclosure Act</header><text display-inline="no-display-inline">The Home Mortgage Disclosure Act of 1975 (12
U.S.C. 2801 et seq.) is amended—</text>
<paragraph id="id35533617561F456CA3A2DA9761F0BF9C"><enum>(1)</enum><text>except as otherwise
specifically provided in this section, by striking <quote>Board</quote> each
place that term appears and inserting <quote>Bureau</quote>;</text>
</paragraph><paragraph id="IDa8a0d53bea244b4792495fd778f0311c"><enum>(2)</enum><text>in section 303 (12 U.S.C.
2802)—</text>
<subparagraph id="IDaaae5ce192964b43842eae66b9e2338b"><enum>(A)</enum><text>by redesignating
paragraphs (1) through (6) as paragraphs (2) through (7), respectively;
and</text>
</subparagraph><subparagraph id="ID1893ab4a68ea46baa04dba6f97642833"><enum>(B)</enum><text>by inserting before
paragraph (2) the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id3236BDD357F6498284A99AA1E94441CD" reported-display-style="italic" style="OLC">
<paragraph id="IDb5c25a48ed0d42c2aa21c457bb5caf07"><enum>(1)</enum><text>the term
<term>Bureau</term> means the Bureau of Consumer Financial
Protection;</text>
</paragraph><after-quoted-block>;</after-quoted-block></quoted-block>
</subparagraph></paragraph><paragraph id="IDf01a3e7bb95046fab89355d2589ca61a"><enum>(3)</enum><text>in section 304 (12 U.S.C.
2803)—</text>
<subparagraph id="IDc289fe5da7e449699b188d3ea77d45b4"><enum>(A)</enum><text>in subsection (b)—</text>
<clause id="id7D8B7AE14A514B3FA435BF0EA8579B7D"><enum>(i)</enum><text>in paragraph (4), by
inserting <quote>age,</quote> before <quote>and gender</quote>;</text>
</clause><clause id="ID626611604c494ac0a4816f0c7ad9051c"><enum>(ii)</enum><text>in paragraph (3), by
striking <quote>and</quote> at the end;</text>
</clause><clause id="ID96a96a535185439fa052f8a45997f1fb"><enum>(iii)</enum><text>in paragraph (4), by
striking the period at the end and inserting a semicolon; and</text>
</clause><clause id="idB6B05D90C873405E998BF8084A20D240"><enum>(iv)</enum><text>by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id5AD5DAA881A24C468201BCA3142AB3FC" reported-display-style="italic" style="OLC">
<paragraph id="ID53a9d3c95a0c456c98069257f9265934"><enum>(5)</enum><text>the number and dollar
amount of mortgage loans grouped according to measurements of—</text>
<subparagraph id="IDfadb09ffdf464f338402281fea5204ee"><enum>(A)</enum><text>the total points and fees
payable at origination in connection with the mortgage as determined by the
Bureau, taking into account 15 U.S.C. 1602(aa)(4);</text>
</subparagraph><subparagraph id="IDdc5fa06acc7c4046b61dde6a20217c7f"><enum>(B)</enum><text>the difference between
the annual percentage rate associated with the loan and a benchmark rate or
rates for all loans;</text>
</subparagraph><subparagraph id="IDb279754928404f4f8ceaf2ac31beeef8"><enum>(C)</enum><text>the term in months of any
prepayment penalty or other fee or charge payable on repayment of some portion
of principal or the entire principal in advance of scheduled payments;
and</text>
</subparagraph><subparagraph id="ID8dda938feeac4576b8294686d51a34e5"><enum>(D)</enum><text>such other information as
the Bureau may require; and</text>
</subparagraph></paragraph><paragraph id="ID049035f6a93d476db458d45da991a61a"><enum>(6)</enum><text>the number and dollar
amount of mortgage loans and completed applications grouped according to
measurements of—</text>
<subparagraph id="ID6f016e4a91504e9db8e515f988080193"><enum>(A)</enum><text>the value of the real
property pledged or proposed to be pledged as collateral;</text>
</subparagraph><subparagraph id="ID12e01695e3e04772b041a1a8d22c08c1"><enum>(B)</enum><text>the actual or proposed
term in months of any introductory period after which the rate of interest may
change;</text>
</subparagraph><subparagraph id="IDd0212e61650041739672b2e9f25515f0"><enum>(C)</enum><text>the presence of
contractual terms or proposed contractual terms that would allow the mortgagor
or applicant to make payments other than fully amortizing payments during any
portion of the loan term;</text>
</subparagraph><subparagraph id="ID46fd8ff97997486791a24c33c803e420"><enum>(D)</enum><text>the actual or proposed
term in months of the mortgage loan;</text>
</subparagraph><subparagraph id="ID94ff885be3c5464ab897e706414911b1"><enum>(E)</enum><text>the channel through which
application was made, including retail, broker, and other relevant
categories;</text>
</subparagraph><subparagraph id="ID0233aa127d2744cc8d41f27f60233e78"><enum>(F)</enum><text>as the Bureau may
determine to be appropriate, a unique identifier that identifies the loan
originator as set forth in section 1503 of the S.A.F.E. Mortgage Licensing Act
of 2008;</text>
</subparagraph><subparagraph id="ID552475439faa4552a8f5713af58d79b8"><enum>(G)</enum><text>as the Bureau may
determine to be appropriate, a universal loan identifier;</text>
</subparagraph><subparagraph id="IDa86d4ce2484848d8a195e1e065d523d9"><enum>(H)</enum><text>as the Bureau may
determine to be appropriate, the parcel number that corresponds to the real
property pledged or proposed to be pledged as collateral;</text>
</subparagraph><subparagraph id="IDa1450bc2125b429a8f640589648c3c87"><enum>(I)</enum><text>the credit score of
mortgage applicants and mortgagors, in such form as the Bureau may prescribe,
except that the Bureau shall modify or require modification of credit score
data that is or will be available to the public to protect the compelling
privacy interest of the mortgage applicant or mortgagors; and</text>
</subparagraph><subparagraph id="ID5a9c52a02b6c43a5b94fdfebbbeb17f9"><enum>(J)</enum><text>such other information as
the Bureau may
require.</text>
</subparagraph></paragraph><after-quoted-block>;</after-quoted-block></quoted-block>
</clause></subparagraph><subparagraph id="ID5e75acde3caa41e0bd4475e5327a6822"><enum>(B)</enum><text>in subsection (i), by
striking <quote>subsection (b)(4)</quote> and inserting <quote>subsections
(b)(4), (b)(5), and (b)(6)</quote>;</text>
</subparagraph><subparagraph id="IDcf23f07850174b319c4025ce2c9e12ef"><enum>(C)</enum><text>in subsection (j)—</text>
<clause id="ID842b81958d2d45ceb5f3af4e262d4004"><enum>(i)</enum><text>in paragraph (1), by
striking <quote>(as</quote> and inserting <quote>(containing loan-level and
application-level information relating to disclosures required under
subsections (a) and (b) and as otherwise</quote>;</text>
</clause><clause id="ID60c5a514c8e9462f9741de0b5d9a3647"><enum>(ii)</enum><text>by striking paragraph
(3) and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id1AA673E468A94842A1CEB08127048C36" reported-display-style="italic" style="OLC">
<paragraph id="IDb7a6ac9789384a80ba2d73f9e400ec52"><enum>(3)</enum><header>Change of form not
required</header><text>A depository institution meets the disclosure
requirement of paragraph (1) if the institution provides the information
required under such paragraph in such formats as the Bureau may
require</text>
</paragraph><after-quoted-block>;
and</after-quoted-block></quoted-block>
</clause><clause id="IDf0cef290d46647d382e142ffc78b7e70"><enum>(iii)</enum><text>in paragraph (2)(A), by
striking <quote>in the format in which such information is maintained by the
institution</quote> and inserting <quote>in such formats as the Bureau may
require</quote>;</text>
</clause></subparagraph><subparagraph id="ID3094b8c90c174323ba94e778a8dbbc18"><enum>(D)</enum><text>in subsection (m), by
striking paragraph (2) and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idF64A5FD8EC18403C9688F97DE6F14C17" reported-display-style="italic" style="OLC">
<paragraph id="IDe41fa740b69842229dcab5eb0c54f832"><enum>(2)</enum><header>Form of
information</header><text>In complying with paragraph (1), a depository
institution shall provide the person requesting the information with a copy of
the information requested in such formats as the Bureau may
require</text>
</paragraph><after-quoted-block>;</after-quoted-block></quoted-block>
</subparagraph><subparagraph id="id0C5C5FC5DE8C422ABE975039D9CA9D3D"><enum>(E)</enum><text>by striking subsection
(h) and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id4E24D4758B4A4943ACF55DAF8EE186DF" reported-display-style="italic" style="OLC">
<subsection id="ID99e733f6fca446d993a4bc80fb5d9209"><enum>(h)</enum><header>Submission to
agencies</header>
<paragraph id="idA281AC84DC624B5DBE31A8503D76B812"><enum>(1)</enum><header>In
general</header><text>The data required to be disclosed under subsection (b)
shall be submitted to the Bureau or to the appropriate agency for the
institution reporting under this title, in accordance with rules prescribed by
the Bureau. Notwithstanding the requirement of subsection (a)(2)(A) for
disclosure by census tract, the Bureau, in cooperation with other appropriate
regulators described in paragraph (2), shall develop regulations that—</text>
<subparagraph id="id5ADB1907931D486D9CA037A06569BACF"><enum>(A)</enum><text>prescribe the format for
such disclosures, the method for submission of the data to the appropriate
regulatory agency, and the procedures for disclosing the information to the
public;</text>
</subparagraph><subparagraph id="idCD634CE56E5543AD81F64047BF9A6D25"><enum>(B)</enum><text>require the collection of
data required to be disclosed under subsection (b) with respect to loans sold
by each institution reporting under this title;</text>
</subparagraph><subparagraph id="id3343CBC82F49490FB5CDBF332CE0CECA"><enum>(C)</enum><text>require disclosure of the
class of the purchaser of such loans; and</text>
</subparagraph><subparagraph id="idB26E0D101AB84089800AC33F492EBCD5"><enum>(D)</enum><text>permit any reporting
institution to submit in writing to the Bureau or to the appropriate agency
such additional data or explanations as it deems relevant to the decision to
originate or purchase mortgage loans.</text>
</subparagraph></paragraph><paragraph id="id18E5E7DC737A42ACBD40A49CAE8E8FF1"><enum>(2)</enum><header>Other appropriate
agencies</header><text>The appropriate regulators described in this paragraph
are—</text>
<subparagraph commented="no" id="IDa778daf4a6f44358b05a8079acd6eb87"><enum>(A)</enum><text>the Office of the
Comptroller of the Currency (hereafter referred to in this Act as
<quote>Comptroller</quote>) for national banks and Federal branches, Federal
agencies of foreign banks, and savings associations;</text>
</subparagraph><subparagraph id="IDeb5b7f194d6e42da9bb68376a152957a"><enum>(B)</enum><text>the Federal Deposit
Insurance Corporation for banks insured by the Federal Deposit Insurance
Corporation (other than members of the Federal Reserve System), mutual savings
banks, insured State branches of foreign banks, and any other depository
institution described in section 303(2)(A) which is not otherwise referred to
in this paragraph;</text>
</subparagraph><subparagraph id="ID3d49d1d198e343758b0dd58d5f7a4bc5"><enum>(C)</enum><text>the National Credit Union
Administration Board for credit unions; and</text>
</subparagraph><subparagraph id="IDb2a9f694f77a4c0da43638d333a8dbc3"><enum>(D)</enum><text>the Secretary of Housing
and Urban Development for other lending institutions not regulated by the
agencies referred to in subparagraphs (A) through
(C).</text>
</subparagraph></paragraph></subsection><after-quoted-block>;
and</after-quoted-block></quoted-block>
</subparagraph><subparagraph id="idEAB7CD99A009470D813A07BB8AC20F3F"><enum>(F)</enum><text>by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id9FD6C861CA784D04A8DF14F3B94FBD91" reported-display-style="italic" style="OLC">
<subsection commented="no" id="idB4CE2C7C6BFF42C581CFF46D166CCFBA"><enum>(n)</enum><header>Timing of certain
disclosures</header><text>The data required to be disclosed under subsection
(b) shall be submitted to the Bureau or to the appropriate agency for any
institution reporting under this title, in accordance with regulations
prescribed by the Bureau. Institutions shall not be required to report new data
under paragraph (5) or (6) of subsection (b) before the first January 1 that
occurs after the end of the 9-month period beginning on the date on which
regulations are issued by the Bureau in final form with respect to such
disclosures.</text>
</subsection><after-quoted-block>;</after-quoted-block></quoted-block>
</subparagraph></paragraph><paragraph id="ID20918b050822462db1712e4df9cb936a"><enum>(4)</enum><text>in section 305 (12 U.S.C.
2804)—</text>
<subparagraph id="ID09c115390038473ca1c45c304f29ccb9"><enum>(A)</enum><text>by striking subsection
(b) and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id5C13DB49316E405CBF866DD02C314448" reported-display-style="italic" style="OLC">
<subsection id="IDc274ccf53e7f4c73ba094415c8512e63"><enum>(b)</enum><header>Powers of certain other
agencies</header>
<paragraph id="id23B58D32A16B4EF79499E6FC779723A5"><enum>(1)</enum><header>In
general</header><text>Except as otherwise provided by subtitle B of the
Consumer Financial Protection Act of 2010, compliance with the requirements of
this title shall be enforced—</text>
<subparagraph id="IDf1fb5c561d4b4045b39ecaa207727cdb"><enum>(A)</enum><text>under section 8 of the
Federal Deposit Insurance Act, in the case of—</text>
<clause id="ID1f4b840fcba54e4585ff612b69701fcf"><enum>(i)</enum><text>any national bank, and
any Federal branch or Federal agency of a foreign bank, by the Office of the
Comptroller of the Currency;</text>
</clause><clause id="ID9d80d2116e3d43cf84cc081d9bd120e3"><enum>(ii)</enum><text>any member bank of the
Federal Reserve System (other than a national bank), branch or agency of a
foreign bank (other than a Federal branch, Federal agency, and insured State
branch of a foreign bank), commercial lending company owned or controlled by a
foreign bank, and any organization operating under section 25 or 25(a) of the
Federal Reserve Act, by the Board; and</text>
</clause><clause id="ID966ff96b251c49f086264edcc93fc1a7"><enum>(iii)</enum><text>any bank insured by the
Federal Deposit Insurance Corporation (other than a member of the Federal
Reserve System), any mutual savings bank as, defined in section 3(f) of the
Federal Deposit Insurance Act (12 U.S.C. 1813(f)), any insured State branch of
a foreign bank, and any other depository institution not referred to in this
paragraph or subparagraph (B) or (C), by the Federal Deposit Insurance
Corporation;</text>
</clause></subparagraph><subparagraph id="ID34ecd9915a744e1dba7dad66796fa29b"><enum>(B)</enum><text>under subtitle E of the
Consumer Financial Protection Act of 2010, by the Bureau;</text>
</subparagraph><subparagraph id="IDb17062b993074bf185990349fb561e70"><enum>(C)</enum><text>under the Federal Credit
Union Act, by the Administrator of the National Credit Union Administration
with respect to any insured credit union; and</text>
</subparagraph><subparagraph id="ID86ab705071364952ba2b7ea7b09bc430"><enum>(D)</enum><text>with respect to other
lending institutions, by the Secretary of Housing and Urban Development.</text>
</subparagraph></paragraph><paragraph id="idD1B16AFE333E418CBE9BFC56C1F409E7"><enum>(2)</enum><header>Incorporated
definitions</header><text>The terms used in paragraph (1) that are not defined
in this title or otherwise defined in section 3(s) of the Federal Deposit
Insurance Act (12 U.S.C. 1813(s)) shall have the same meanings as in section
1(b) of the International Banking Act of 1978 (12 U.S.C.
3101).</text>
</paragraph></subsection><after-quoted-block>;
and</after-quoted-block></quoted-block>
</subparagraph><subparagraph id="ID6421acf2539b434f879970bf9bc76396"><enum>(B)</enum><text>by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id74B30FBC39C740B9A4631816275FADEA" reported-display-style="italic" style="OLC">
<subsection id="ID51aefb77d9c04301af05d4d755d29f9c"><enum>(d)</enum><header>Overall enforcement
authority of the Bureau of Consumer Financial Protection</header><text>Subject
to subtitle B of the Consumer Financial Protection Act of 2010, enforcement of
the requirements imposed under this title is committed to each of the agencies
under subsection (b). The Bureau may exercise its authorities under the
Consumer Financial Protection Act of 2010 to exercise principal authority to
examine and enforce compliance by any person with the requirements of this
title.</text>
</subsection><after-quoted-block>;</after-quoted-block></quoted-block>
</subparagraph></paragraph><paragraph id="IDa81fc497426b47199f644a768f6b2dd5"><enum>(5)</enum><text>in section 306 (12 U.S.C.
2805(b)), by striking subsection (b) and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id5754EAD68719436DBB3B8C4110C9AC2B" reported-display-style="italic" style="OLC">
<subsection id="ID4ce24ace64bd4e3cbf245875fe502b3c"><enum>(b)</enum><header>Exemption
authority</header><text>The Bureau may, by regulation, exempt from the
requirements of this title any State-chartered depository institution within
any State or subdivision thereof, if the agency determines that, under the law
of such State or subdivision, that institution is subject to requirements that
are substantially similar to those imposed under this title, and that such law
contains adequate provisions for enforcement. Notwithstanding any other
provision of this subsection, compliance with the requirements imposed under
this subsection shall be enforced by the Office of the Comptroller of the
Currency under section 8 of the Federal Deposit Insurance Act, in the case of
national banks and savings associations, the deposits of which are insured by
the Federal Deposit Insurance
Corporation.</text>
</subsection><after-quoted-block>;
and</after-quoted-block></quoted-block>
</paragraph><paragraph id="ID119c58f5692b4c07af20e401811d9095"><enum>(6)</enum><text>by striking section 307
(12 U.S.C. 2806) and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id5C90BF6EFE414A6B842198516BEDD2DD" reported-display-style="italic" style="OLC">
<section id="id2ADDBE4FFCE54BD58FC6D44C1A5095B9"><enum>307.</enum><header>Compliance improvement
methods</header>
<subsection id="IDd286df2eb3dc44349bcdccdab888ae00"><enum>(a)</enum><header>In general</header>
<paragraph id="id990A8CA738BB4FF69D34AED406EE0212"><enum>(1)</enum><header>Consultation
required</header><text>The Director of the Bureau of Consumer Financial
Protection, with the assistance of the Secretary, the Director of the Bureau of
the Census, the Board of Governors of the Federal Reserve System, the Federal
Deposit Insurance Corporation, and such other persons as the Bureau deems
appropriate, shall develop or assist in the improvement of, methods of matching
addresses and census tracts to facilitate compliance by depository institutions
in as economical a manner as possible with the requirements of this
title.</text>
</paragraph><paragraph id="ID4b84c051b6b64682a1d85c7420d68afb"><enum>(2)</enum><header>Authorization of
appropriations</header><text>There are authorized to be appropriated, such sums
as may be necessary to carry out this subsection.</text>
</paragraph><paragraph id="ID5d92f4414a2243fd9d69e1813e4fd688"><enum>(3)</enum><header>Contracting
authority</header><text>The Director of the Bureau of Consumer Financial
Protection is authorized to utilize, contract with, act through, or compensate
any person or agency in order to carry out this subsection.</text>
</paragraph></subsection><subsection id="ID9d656d8e9972460ea13d3f6611887115"><enum>(b)</enum><header>Recommendations to
Congress</header><text>The Director of the Bureau of Consumer Financial
Protection shall recommend to the Committee on Banking, Housing, and Urban
Affairs of the Senate and the Committee on Financial Services of the House of
Representatives, such additional legislation as the Director of the Bureau of
Consumer Financial Protection deems appropriate to carry out the purpose of
this
title.</text>
</subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></section><section id="IDa301387a2b7b4b9fa26088128f6912aa"><enum>1093.</enum><header>Amendments to the
Homeowners Protection Act of 1998</header><text display-inline="no-display-inline">Section 10 of the Homeowners Protection Act
of 1998 (12 U.S.C. 4909) is amended—</text>
<paragraph id="ID502ebe53081a4162a16710c880b0d242"><enum>(1)</enum><text>in subsection (a)—</text>
<subparagraph id="idCBBC8600B7C64B32B0681E7833DA67E1"><enum>(A)</enum><text>by striking
<quote>Compliance</quote> and inserting <quote>Except as otherwise provided by
subtitle B of the Consumer Financial Protection Act of 2010,
compliance</quote>;</text>
</subparagraph><subparagraph id="IDb1f1250d6cee4419a46eb707de35731e"><enum>(B)</enum><text>in paragraph (2), by
striking <quote>and</quote> at the end;</text>
</subparagraph><subparagraph id="IDc34f0efd3cf1429bbd258edab28d373b"><enum>(C)</enum><text>in paragraph (3), by
striking the period at the end and inserting <quote>; and</quote>; and</text>
</subparagraph><subparagraph id="IDefa819f550974aa5b765b18716809780"><enum>(D)</enum><text>by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id56659E5E2FD6472D8F8A277713FB0D8C" reported-display-style="italic" style="OLC">
<paragraph id="ID5b925ae0c18a4542813f6071c8300b84"><enum>(4)</enum><text>subtitle E of the
Consumer Financial Protection Act of 2010, by the Bureau of Consumer Financial
Protection.</text>
</paragraph><after-quoted-block>;
and</after-quoted-block></quoted-block>
</subparagraph></paragraph><paragraph id="ID143fd32c70bb40b59e0d7aee5598159d"><enum>(2)</enum><text>in subsection (b)(2), by
inserting before the period at the end the following: <quote>, subject to
subtitle B of the Consumer Financial Protection Act of 2010</quote>.</text>
</paragraph></section><section id="ID55f2c1f3f85847d88093a7699a85adf8"><enum>1094.</enum><header>Amendments to the
Home Ownership and Equity Protection Act of 1994</header><text display-inline="no-display-inline">The Home Ownership and Equity Protection Act
of 1994 (15 U.S.C. 1601 note) is amended—</text>
<paragraph id="ID543b12db21d14a62850ee4d8d8d956e5"><enum>(1)</enum><text>in section 158(a), by
striking <quote>Consumer Advisory Council of the Board</quote> and inserting
<quote>Advisory Board to the Bureau</quote>; and</text>
</paragraph><paragraph id="ID803207589f0f4566bc6300093138264e"><enum>(2)</enum><text>by striking
<quote>Board</quote> each place that term appears and inserting
<quote>Bureau</quote>.</text>
</paragraph></section><section id="ID33bd23aa65b043fc941485f025783d8f"><enum>1095.</enum><header>Amendments to the
Omnibus Appropriations Act, 2009</header><text display-inline="no-display-inline">Section 626 of the Omnibus Appropriations
Act, 2009 (15 U.S.C. 1638 note) is amended—</text>
<paragraph id="ID8c4d2fe1dfd143909229920db68a9256"><enum>(1)</enum><text>by striking subsection
(a) and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id8BF34CB56E9F4F7694395BEB265FDA60" reported-display-style="italic" style="OLC">
<subsection id="IDe977f1c7350f48559c6f6bfd45fadca9"><enum>(a)</enum><paragraph commented="no" display-inline="yes-display-inline" id="idF7E27519E1904501BA170156A4C19F05"><enum>(1)</enum><text>The Bureau of Consumer
Financial Protection shall have authority to prescribe rules with respect to
mortgage loans in accordance with section 553 of title 5, United States Code.
Such rulemaking shall relate to unfair or deceptive acts or practices regarding
mortgage loans, which may include unfair or deceptive acts or practices
involving loan modification and foreclosure rescue services. Any violation of a
rule prescribed under this paragraph shall be treated as a violation of a rule
prohibiting unfair, deceptive, or abusive acts or practices under the Consumer
Financial Protection Act of 2010 and a violation of a rule under section 18 of
the Federal Trade Commission Act (15 U.S.C. 57a) regarding unfair or deceptive
acts or practices.</text>
</paragraph><paragraph changed="added" id="id2D2DAA4A241F4127BFF5E8CEC6E49D8F" indent="up1" reported-display-style="italic"><enum>(2)</enum><text>The Bureau of Consumer
Financial Protection shall enforce the rules issued under paragraph (1) in the
same manner, by the same means, and with the same jurisdiction, powers, and
duties, as though all applicable terms and provisions of the Consumer Financial
Protection Act of 2010 were incorporated into and made part of this
subsection.</text>
</paragraph></subsection><after-quoted-block>;
and</after-quoted-block></quoted-block>
</paragraph><paragraph id="id5169E21E81DC427E872DCA9F0B522824"><enum>(2)</enum><text>in subsection (b)—</text>
<subparagraph id="id82204CB01AC84D6CA4A440BA68B5C280"><enum>(A)</enum><text>by striking paragraph (1)
and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id74B3F10ED3E54316A4D1A6D6EA9395EF" reported-display-style="italic" style="OLC">
<paragraph id="id3CCA94A05FAA4B05AB9C1E9FCE9FD89A"><enum>(1)</enum><text>Except as provided in
paragraph (6), in any case in which the attorney general of a State has reason
to believe that an interest of the residents of the State has been or is
threatened or adversely affected by the engagement of any person subject to a
rule prescribed under subsection (a) in practices that violate such rule, the
State, as parens patriae, may bring a civil action on behalf of its residents
in an appropriate district court of the United States or other court of
competent jurisdiction—</text>
<subparagraph id="idB493FC7BB73C4FFDBDC68F84AA9B931B"><enum>(A)</enum><text>to enjoin that
practice;</text>
</subparagraph><subparagraph id="id31992BA8023D40B2AB81C4D581AA3562"><enum>(B)</enum><text>to enforce compliance
with the rule;</text>
</subparagraph><subparagraph id="idCF0B907A4F984F8E8C09949CBE55A101"><enum>(C)</enum><text>to obtain damages,
restitution, or other compensation on behalf of the residents of the State;
or</text>
</subparagraph><subparagraph id="idFAC041A6E67C4EF18724E7C1DAC93D5D"><enum>(D)</enum><text>to obtain penalties and
relief provided under the Consumer Financial Protection Act of 2010, the
Federal Trade Commission Act, and such other relief as the court deems
appropriate.</text>
</subparagraph></paragraph><after-quoted-block>;</after-quoted-block></quoted-block>
</subparagraph><subparagraph id="idF1AD2FE2F8D143C4A290C0B346886351"><enum>(B)</enum><text>in paragraphs (2) and
(3), by striking <quote>the primary Federal regulator</quote> each time the
term appears and inserting <quote>the Bureau of Consumer Financial Protection
or the Commission, as appropriate</quote>;</text>
</subparagraph><subparagraph id="idFB06E45B22444CFF853D0748540A6870"><enum>(C)</enum><text>in paragraph (3), by
inserting <quote>and subject to subtitle B of the Consumer Financial Protection
Act of 2010,</quote> after <quote>paragraph (2),</quote>; and</text>
</subparagraph><subparagraph id="id04196314D72E4DFF83206B89CC894680"><enum>(D)</enum><text>in paragraph (6), by
striking <quote>the primary Federal regulator</quote> each place that term
appears and inserting <quote>the Bureau of Consumer Financial Protection or the
Commission</quote>.</text>
</subparagraph></paragraph></section><section id="ID90351306dbd5499b9fb15ae28b830fbf"><enum>1096.</enum><header>Amendments to the
Real Estate Settlement Procedures Act</header><text display-inline="no-display-inline">The Real Estate Settlement Procedures Act of
1974 (12 U.S.C. 2601 et seq.) is amended—</text>
<paragraph id="ID64f145de3de2464ba07768e7e0e2ec57"><enum>(1)</enum><text>in section 3 (12 U.S.C.
2602)—</text>
<subparagraph id="id94F2C77C869A4BCC9CE3FDF25D9C2D68"><enum>(A)</enum><text>in paragraph (7), by
striking <quote>and</quote> at the end;</text>
</subparagraph><subparagraph id="idC27E7FA107274724B588BE54AB8592C9"><enum>(B)</enum><text>in paragraph (8), by
striking the period at the end and inserting <quote>; and</quote>; and</text>
</subparagraph><subparagraph id="id922D280A7349491F9CFFDCE2750D5260"><enum>(C)</enum><text>by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idF8DC4D811F62420C962F3D2C76DFD57F" reported-display-style="italic" style="OLC">
<paragraph id="ID0583994ae1b54b9a8c6830e495a979c7"><enum>(9)</enum><text>the term
<term>Bureau</term> means the Bureau of Consumer Financial
Protection.</text>
</paragraph><after-quoted-block>;</after-quoted-block></quoted-block>
</subparagraph></paragraph><paragraph id="ID25dd3575133e4d17a60da2490cb832ea"><enum>(2)</enum><text>in section 4 (12 U.S.C.
2603)—</text>
<subparagraph id="ID4720b10c454d4430b323bba90ccf0349"><enum>(A)</enum><text>in subsection (a), by
striking the first sentence and inserting the following: <quote>The Bureau
shall publish a single, integrated disclosure for mortgage loan transactions
(including real estate settlement cost statements) which includes the
disclosure requirements of this title, in conjunction with the disclosure
requirements of the Truth in Lending Act that, taken together, may apply to a
transaction that is subject to both or either provisions of law. The purpose of
such model disclosure shall be to facilitate compliance with the disclosure
requirements of this title and the Truth in Lending Act, and to aid the
borrower or lessee in understanding the transaction by utilizing readily
understandable language to simplify the technical nature of the
disclosures.</quote>;</text>
</subparagraph><subparagraph id="IDf65ece0a01f74c418a5d92662ed2d208"><enum>(B)</enum><text>by striking
<quote>Secretary</quote> each place that term appears and inserting
<quote>Bureau</quote>; and</text>
</subparagraph><subparagraph id="IDb7a308d2c7184abaa3a9ca2e77b9be1c"><enum>(C)</enum><text>by striking
<quote>form</quote> each place that term appears and inserting
<quote>forms</quote>;</text>
</subparagraph></paragraph><paragraph id="ID89501b145ebd44379fe02068cfea200d"><enum>(3)</enum><text>in section 5 (12 U.S.C.
2604)—</text>
<subparagraph id="ID15a6a88d71324eeeb490ea4bebce1497"><enum>(A)</enum><text>by striking
<quote>Secretary</quote> each place that term appears and inserting
<quote>Bureau</quote>; and</text>
</subparagraph><subparagraph id="IDd81ea5b2cd7a4a92b18caf4f59f14814"><enum>(B)</enum><text>in subsection (a), by
striking the first sentence and inserting the following: <quote>The Bureau
shall prepare and distribute booklets jointly addressing compliance with the
requirements of the Truth in Lending Act and the provisions of this title, in
order to help persons borrowing money to finance the purchase of residential
real estate better to understand the nature and costs of real estate settlement
services.</quote>;</text>
</subparagraph></paragraph><paragraph id="ID49afd246204a4417b2653d27309fc4b7"><enum>(4)</enum><text>in section 6(j)(3) (12
U.S.C. 2605(j)(3))—</text>
<subparagraph id="id2975F12B779746FF9EA6F96EC2F9E1F8"><enum>(A)</enum><text>by striking
<quote>Secretary</quote> and inserting <quote>Bureau</quote>; and</text>
</subparagraph><subparagraph id="id72EE2C96EAA94B8AA730B5CB67F7D0D8"><enum>(B)</enum><text>by striking <quote>, by
regulations that shall take effect not later than April 20,
1991,</quote>;</text>
</subparagraph></paragraph><paragraph id="IDabced6e0bd9b4e2a95d47a7861427bdc"><enum>(5)</enum><text>in section 7(b) (12
U.S.C. 2606(b)) by striking <quote>Secretary</quote> and inserting
<quote>Bureau</quote>;</text>
</paragraph><paragraph id="ID2240c40588274e1e93accc9bc40f03bc"><enum>(6)</enum><text>in section 8(d) (12
U.S.C. 2607(d))—</text>
<subparagraph id="IDcb1e6ced77d34a9cba46a56feb8329f5"><enum>(A)</enum><text>in the subsection
heading, by inserting <quote><header-in-text level="subsection" style="OLC">Bureau and</header-in-text></quote> before <quote><header-in-text level="subparagraph" style="OLC">Secretary</header-in-text></quote>; and</text>
</subparagraph><subparagraph id="ID313ff8afe5f54f8ca62776cb885e0948"><enum>(B)</enum><text>by striking paragraph
(4), and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id1B119A2E88D9459B84B363BE36850B95" reported-display-style="italic" style="OLC">
<paragraph id="idA059F9713AAF42B7907E65B565FEC65D"><enum>(4)</enum><text>The Bureau, the
Secretary, or the attorney general or the insurance commissioner of any State
may bring an action to enjoin violations of this section. Except, to the extent
that a person is subject to the jurisdiction of the Bureau, the Secretary, or
the attorney general or the insurance commissioner of any State, the Bureau
shall have primary authority to enforce or administer this section, subject to
subtitle B of the Consumer Financial Protection Act of
2010.</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subparagraph></paragraph><paragraph id="IDf75c1b1ea6c44edc8c7a523272319108"><enum>(7)</enum><text>in section 10(c) (12
U.S.C. 2609(c) and (d)), by striking <quote>Secretary</quote> and inserting
<quote>Bureau</quote>;</text>
</paragraph><paragraph id="IDcb1cee5d7801498e83d2cdba03ecd7d9"><enum>(8)</enum><text>in section 16 (12 U.S.C.
2614), by inserting <quote>the Bureau,</quote> before <quote>the
Secretary</quote>;</text>
</paragraph><paragraph id="IDde8b829a6edd4f4cb6ef31c7ce2d5811"><enum>(9)</enum><text>in section 18 (12 U.S.C.
2616), by striking <quote>Secretary</quote> each place that term appears and
inserting <quote>Bureau</quote>; and</text>
</paragraph><paragraph id="ID3c6ec7cfbe054508aa38eacf6bdfcf17"><enum>(10)</enum><text>in section 19 (12 U.S.C.
2617)—</text>
<subparagraph id="idDC892A230C9A4946818FCB6CFF469631"><enum>(A)</enum><text>in the section heading by
striking <quote><header-in-text level="section" style="OLC">Secretary</header-in-text></quote> and inserting
<quote><header-in-text level="section" style="OLC">Bureau</header-in-text></quote>;</text>
</subparagraph><subparagraph id="id379387E90C6948BE88813FFBC9B31419"><enum>(B)</enum><text>by striking
<quote>Secretary</quote> each place that term appears and inserting
<quote>Bureau</quote>;</text>
</subparagraph><subparagraph id="id4B2CE8813245482A98A7BA4095048FFF"><enum>(C)</enum><text>in subsection (b), by
inserting <quote>the Bureau</quote> before <quote>the Secretary</quote>;
and</text>
</subparagraph><subparagraph id="idC19A4E34833A4533A7B10216C76808BC"><enum>(D)</enum><text>in subsection (c), by
inserting <quote>or the Bureau</quote> after <quote>the Secretary</quote> each
time that term appears.</text>
</subparagraph></paragraph></section><section id="IDf1357fd9a7b04af399efd2871741eb31"><enum>1097.</enum><header>Amendments to the
Right to Financial Privacy Act of 1978</header><text display-inline="no-display-inline">The Right to Financial Privacy Act of 1978
(12 U.S.C. 3401 et seq.) is amended—</text>
<paragraph id="idF58C08326CF4452099BCE3EABC516AF5"><enum>(1)</enum><text>in section 1101—</text>
<subparagraph commented="no" id="IDe9dbdd924a504bfab92ad7d99a71a3c1"><enum>(A)</enum><text>in paragraph (6)—</text>
<clause commented="no" id="ID5b633d08e2bc47aa8c41c31924492d99"><enum>(i)</enum><text>in subparagraph (A), by
inserting <quote>and</quote> after the semicolon;</text>
</clause><clause commented="no" id="IDf2ca1f16077c466aa2b88f35f6618b78"><enum>(ii)</enum><text>in subparagraph (B), by
striking <quote>and</quote> at the end; and</text>
</clause><clause commented="no" id="ID67972501b1ad47ac9e49828a87a4f643"><enum>(iii)</enum><text>by striking
subparagraph (C); and</text>
</clause></subparagraph><subparagraph commented="no" id="IDccb53e1f28e84be2a37bc7dc604e1cf4"><enum>(B)</enum><text>in paragraph (7), by
striking subparagraph (E), and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id52CE1AF7E5744F60853770A82E35181C" reported-display-style="italic" style="OLC">
<subparagraph commented="no" id="IDa5128a29d7074282910196e0fd3eda4d"><enum>(E)</enum><text>the Bureau of Consumer
Financial
Protection;</text>
</subparagraph><after-quoted-block>;</after-quoted-block></quoted-block>
</subparagraph></paragraph><paragraph commented="no" id="idC3F90A001F9A43B6B452ABF3D644EF42"><enum>(2)</enum><text>in section 1112(e) (12
U.S.C. 3412(e)), by striking <quote>and the Commodity Futures Trading
Commission is permitted</quote> and inserting <quote>the Commodity Futures
Trading Commission, and the Bureau of Consumer Financial Protection is
permitted</quote>; and</text>
</paragraph><paragraph commented="no" id="ID54165f90af73474c8b83d9efe4315b0b"><enum>(3)</enum><text>in section 1113 (12
U.S.C. 3413), by adding at the end the following new subsection:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id011908D6A6B6439D8DEC5433D0215B78" reported-display-style="italic" style="OLC">
<subsection commented="no" id="ID499d3ae0989e42fca9d1dabb765ed57c"><enum>(r)</enum><header>Disclosure to the
Bureau of Consumer Financial Protection</header><text>Nothing in this title
shall apply to the examination by or disclosure to the Bureau of Consumer
Financial Protection of financial records or information in the exercise of its
authority with respect to a financial
institution.</text>
</subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></section><section id="ID8cbf5020621e4233b186b146acd2c393"><enum>1098.</enum><header>Amendments to the
Secure and Fair Enforcement for Mortgage Licensing Act of 2008</header><text display-inline="no-display-inline">The S.A.F.E. Mortgage Licensing Act of 2008
(12 U.S.C. 5101 et seq.) is amended—</text>
<paragraph id="IDecf140f64b1347b691a263123bc98e72"><enum>(1)</enum><text>by striking <quote>a
Federal banking agency</quote> each place that term appears, other than in
paragraphs (7) and (11) of section 1503 and section 1507(a)(1), and inserting
<quote>the Bureau</quote>;</text>
</paragraph><paragraph id="ID5cc6d253f2a24aa4a9ec39b1f44aff6d"><enum>(2)</enum><text>by striking
<quote>Federal banking agencies</quote> each place that term appears and
inserting “Bureau”; and</text>
</paragraph><paragraph id="ID755702ba24644b62ba7d0f5cf0fef471"><enum>(3)</enum><text>by striking
<quote>Secretary</quote> each place that term appears and inserting
<quote>Director</quote>;</text>
</paragraph><paragraph id="IDc66d64ed1d7448c3b66a20184a03df59"><enum>(4)</enum><text>in section 1503 (12
U.S.C. 5102)—</text>
<subparagraph commented="no" id="id49E524954F464BC48AC94BF8322D0309"><enum>(A)</enum><text>by redesignating
paragraphs (2) through (12) as (3) through (13), respectively;</text>
</subparagraph><subparagraph id="IDe791d3c3a64d43d5af518f352f3e69ef"><enum>(B)</enum><text>by striking paragraph (1)
and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id4A8590D23442457184DA68E3D779CC89" reported-display-style="italic" style="OLC">
<paragraph id="id09F9CF82DB1F4DE5A95F08CBD29B25B9"><enum>(1)</enum><header>Bureau</header><text>The
term <term>Bureau</term> means the Bureau of Consumer Financial
Protection.</text>
</paragraph><paragraph id="ID17205b97cbc34e1a880d20fcbec9cafa"><enum>(2)</enum><header>Federal banking
agency</header><text>The term <term>Federal banking agency</term> means the
Board of Governors of the Federal Reserve System, the Office of the Comptroller
of the Currency, the National Credit Union Administration, and the Federal
Deposit Insurance Corporation.</text>
</paragraph><after-quoted-block>;
and</after-quoted-block></quoted-block>
</subparagraph><subparagraph id="ID329f834c178a4bb0836b76f00c8ef91f"><enum>(C)</enum><text>by striking paragraph
(10), as so designated by this section, and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idAC27943223B343E2B99DDA85B5BE6DE0" reported-display-style="italic" style="OLC">
<paragraph id="id404E6BCE8F5B413C83E59F16A0EAD4CB"><enum>(10)</enum><header>Director</header><text>The
term <term>Director</term> means the Director of the Bureau of Consumer
Financial Protection.</text>
</paragraph><after-quoted-block>;
and</after-quoted-block></quoted-block>
</subparagraph></paragraph><paragraph id="ID3b69eca22d7a446f8783fe8364fe5f67"><enum>(5)</enum><text>in section 1507 (12
U.S.C. 5106)—</text>
<subparagraph id="IDff497288822c4576b0021a50ef19d20d"><enum>(A)</enum><text>in subsection (a)—</text>
<clause id="IDf85fcb2afc924ce8be0f53a57f1a69ea"><enum>(i)</enum><text>by striking paragraph (1)
and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id897CD82FF0F94B28BB8E627B0530F753" reported-display-style="italic" style="OLC">
<paragraph id="idDDB6ECBEC8C446FB89AEA1D9B102E0C8"><enum>(1)</enum><header>In
general</header><text>The Bureau shall develop and maintain a system for
registering employees of a depository institution, employees of a subsidiary
that is owned and controlled by a depository institution and regulated by a
Federal banking agency, or employees of an institution regulated by the Farm
Credit Administration, as registered loan originators with the Nationwide
Mortgage Licensing System and Registry. The system shall be implemented before
the end of the 1-year period beginning on the date of enactment of the Consumer
Financial Protection Act of 2010.</text>
</paragraph><after-quoted-block>;
and</after-quoted-block></quoted-block>
</clause><clause id="IDd51ca25df7ed420bbdfb9f40fb82daf0"><enum>(ii)</enum><text>in paragraph (2)—</text>
<subclause id="id64A06DD05150486AB758C70B72D86177"><enum>(I)</enum><text>by striking
<quote>appropriate Federal banking agency and the Farm Credit
Administration</quote> and inserting <quote>Bureau</quote>; and</text>
</subclause><subclause id="idF2141D90F74046CE86D8245F6B4C4992"><enum>(II)</enum><text>by striking
<quote>employees's identity</quote> and inserting <quote>identity of the
employee</quote>; and</text>
</subclause></clause></subparagraph><subparagraph id="ID9c9cdfd8d9d04e0eba77451d329d1aa9"><enum>(B)</enum><text>in subsection (b), by
striking <quote>through the Financial Institutions Examination Council, and the
Farm Credit Administration</quote>, and inserting <quote>and the Bureau of
Consumer Financial Protection</quote>;</text>
</subparagraph></paragraph><paragraph id="IDa2d52fd12c6446259c66ff785e0a630b"><enum>(6)</enum><text>in section 1508 (12
U.S.C. 5107)—</text>
<subparagraph id="IDfb63f66cf3dc4c65b42f0b9917fa9dd0"><enum>(A)</enum><text>by striking the section
heading and inserting the following: <quote><header-in-text level="section" style="OLC">Sec. 1508. Bureau of Consumer Financial Protection backup authority
to establish loan originator licensing system.</header-in-text></quote>;
and</text>
</subparagraph><subparagraph id="ID1a0c9a77a1b14feeb2d34de0eb3c8d81"><enum>(B)</enum><text>by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idC863211915074A328D7711D23B72ACF4" reported-display-style="italic" style="OLC">
<subsection id="ID63c79cce141c4f6d8c53ff85721c1208"><enum>(f)</enum><header>Regulation
authority</header>
<paragraph id="id8695BBEDD75B4E98988EF821D3C5E8B3"><enum>(1)</enum><header>In
general</header><text>The Bureau is authorized to promulgate regulations
setting minimum net worth or surety bond requirements for residential mortgage
loan originators and minimum requirements for recovery funds paid into by loan
originators.</text>
</paragraph><paragraph id="ID1ea9dd0806da440db9e145fa9d7c93cd"><enum>(2)</enum><header>Considerations</header><text>In
issuing regulations under paragraph (1), the Bureau shall take into account the
need to provide originators adequate incentives to originate affordable and
sustainable mortgage loans, as well as the need to ensure a competitive
origination market that maximizes consumer access to affordable and sustainable
mortgage
loans.</text>
</paragraph></subsection><after-quoted-block>;</after-quoted-block></quoted-block>
</subparagraph></paragraph><paragraph id="ID3b0e0b3b27904b7c9222e7a8301110b0"><enum>(7)</enum><text>by striking section 1510
(12 U.S.C. 5109) and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idB445CBBB23714BF381D2B06CC2CE94B1" reported-display-style="italic" style="OLC">
<section id="ID94b63db3f9fb4fcbba4002f517546b2e"><enum>1510.</enum><header>Fees</header><text display-inline="no-display-inline">The Bureau, the Farm Credit Administration,
and the Nationwide Mortgage Licensing System and Registry may charge reasonable
fees to cover the costs of maintaining and providing access to information from
the Nationwide Mortgage Licensing System and Registry, to the extent that such
fees are not charged to consumers for access to such system and
registry.</text>
</section><after-quoted-block>;</after-quoted-block></quoted-block>
</paragraph><paragraph id="ID3b286e5054854e6b9feef87fc9be30c0"><enum>(8)</enum><text>by striking section 1513
(12 U.S.C. 5112) and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id786FAAD8C56E4431A792B52C16597279" reported-display-style="italic" style="OLC">
<section id="ID021b01963550430a9c47612b1fdfbd80"><enum>1513.</enum><header>Liability
provisions</header><text display-inline="no-display-inline">The Bureau, any
State official or agency, or any organization serving as the administrator of
the Nationwide Mortgage Licensing System and Registry or a system established
by the Director under section 1509, or any officer or employee of any such
entity, shall not be subject to any civil action or proceeding for monetary
damages by reason of the good faith action or omission of any officer or
employee of any such entity, while acting within the scope of office or
employment, relating to the collection, furnishing, or dissemination of
information concerning persons who are loan originators or are applying for
licensing or registration as loan
originators.</text>
</section><after-quoted-block>;
and</after-quoted-block></quoted-block>
</paragraph><paragraph id="ID9d2351443eff46419e39de0e91741253"><enum>(9)</enum><text>in section 1514 (12
U.S.C. 5113) in the section heading, by striking <quote><header-in-text level="section" style="OLC">Under HUD backup licensing
system</header-in-text></quote> and inserting <quote><header-in-text level="section" style="OLC">By the Bureau</header-in-text></quote>.</text>
</paragraph></section><section id="ID97f30e8198714dc3ba161f535129c107"><enum>1099.</enum><header>Amendments to the
Truth in Lending Act</header><text display-inline="no-display-inline">The Truth
in Lending Act (15 U.S.C. 1601 et seq.) is amended—</text>
<paragraph id="id9BF696333A014B55B6AD2D63A43B4B7F"><enum>(1)</enum><text display-inline="yes-display-inline">in section 103 (5 U.S.C. 1602)—</text>
<subparagraph id="ID68c56bd572eb41698c5c28f428585a3c"><enum>(A)</enum><text>by redesignating
subsections (b) through (bb) as subsections (c) through (cc), respectively;
and</text>
</subparagraph><subparagraph id="IDa270fda510ae4af29d462a865b15b502"><enum>(B)</enum><text>by inserting after
subsection (a) the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idA44667B5A1844D7AAD879890D44D5CA5" reported-display-style="italic" style="OLC">
<subsection id="ID363a50df37c047de9ca843ca3cc05aac"><enum>(b)</enum><header>Bureau</header><text>The
term <term>Bureau</term> means the Bureau of Consumer Financial
Protection.</text>
</subsection><after-quoted-block>;</after-quoted-block></quoted-block>
</subparagraph></paragraph><paragraph id="id8A9803FA68E94915B03D7E3D12860054"><enum>(2)</enum><text>by striking
<quote>Board</quote> each place that term appears, other than in section 140(d)
and section 108(a), as amended by this section, and inserting
<quote>Bureau</quote>;</text>
</paragraph><paragraph id="idCBDCD33285E4470CAEE8EBF08496F296"><enum>(3)</enum><text>by striking
<quote>Federal Trade Commission</quote> each place that term appears, other
than in section 108(c) and section 129(m), as amended by this Act, and other
than in the context of a reference to the Federal Trade Commission Act, and
inserting <quote>Bureau</quote>;</text>
</paragraph><paragraph id="id8150B68E9E76433CA6B5C0596342F945"><enum>(4)</enum><text>in section 105(a) (15
U.S.C. 1604(a)), in the second sentence—</text>
<subparagraph id="ID9471534ce12b49cab6cecfe061e05d92"><enum>(A)</enum><text>by striking <quote>Except
in the case of a mortgage referred to in section 103(aa), these regulations may
contain such</quote> and inserting <quote>Except with respect to the provisions
of section 129 that apply to a mortgage referred to in section 103(aa), such
regulations may contain such additional requirements,</quote>; and</text>
</subparagraph><subparagraph id="ID8db159b7cacb4b4faa2b062918a27703"><enum>(B)</enum><text>by inserting <quote>all
or</quote> after <quote>exceptions for</quote>;</text>
</subparagraph></paragraph><paragraph id="ID95d2bd5dcf6a489386b7a9ff83012915"><enum>(5)</enum><text>in section 105(b) (15
U.S.C. 1604(b)), by striking the first sentence and inserting the following:
<quote>The Bureau shall publish a single, integrated disclosure for mortgage
loan transactions (including real estate settlement cost statements) which
includes the disclosure requirements of this title in conjunction with the
disclosure requirements of the Real Estate Settlement Procedures Act of 1974
that, taken together, may apply to a transaction that is subject to both or
either provisions of law. The purpose of such model disclosure shall be to
facilitate compliance with the disclosure requirements of this title and the
Real Estate Settlement Procedures Act of 1974, and to aid the borrower or
lessee in understanding the transaction by utilizing readily understandable
language to simplify the technical nature of the disclosures.</quote>;</text>
</paragraph><paragraph id="IDa889994cebd14b37a4a8643e53fb3bc7"><enum>(6)</enum><text>in section 105(f)(1) (15
U.S.C. 1604(f)(1)), by inserting <quote>all or</quote> after <quote>from all or
part of this title</quote>;</text>
</paragraph><paragraph id="ID9df413bfc4424461b2a273529cd8955d"><enum>(7)</enum><text>in section 108 (15 U.S.C.
1607)—</text>
<subparagraph id="ID36c7f3726e6b4b3dac395d36fd9d9153"><enum>(A)</enum><text>by striking subsection
(a) and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idCD4A467AA16343D797EAE91BDE0CE2D6" reported-display-style="italic" style="OLC">
<subsection id="ID5cfed2987e0c424480c65a5c517a3a68"><enum>(a)</enum><header>Enforcing
agencies</header><text>Except as otherwise provided in subtitle B of the
Consumer Financial Protection Act of 2010, compliance with the requirements
imposed under this title shall be enforced under—</text>
<paragraph id="ID71dc2fc662764745bb0a15d09d0a8ae1"><enum>(1)</enum><text>section 8 of the Federal
Deposit Insurance Act, in the case of—</text>
<subparagraph id="IDaea5f9fffa6c48e98bf54c440d29ce14"><enum>(A)</enum><text>any national bank, and
Federal branch or Federal agency of a foreign bank, by the Office of the
Comptroller of the Currency;</text>
</subparagraph><subparagraph id="IDccbc97c2ccc24f25b7c55367be1ec0e7"><enum>(B)</enum><text>any member bank of the
Federal Reserve System (other than a national bank), any branch or agency of a
foreign bank (other than a Federal branch, Federal agency, or insured State
branch of a foreign bank), any commercial lending company owned or controlled
by a foreign bank, and organizations operating under section 25 or 25(a) of the
Federal Reserve Act, by the Board; and</text>
</subparagraph><subparagraph id="ID35e9311fe40a47a39febe7460b69d897"><enum>(C)</enum><text>any bank insured by the
Federal Deposit Insurance Corporation (other than a member of the Federal
Reserve System) and an insured State branch of a foreign bank, by the Board of
Directors of the Federal Deposit Insurance Corporation;</text>
</subparagraph></paragraph><paragraph id="ID4bdeed4e8d6d449db281afe9125ba00c"><enum>(2)</enum><text>subtitle E of the
Consumer Financial Protection Act of 2010, by the Bureau;</text>
</paragraph><paragraph id="ID66c81aa0eebc425fbdf424d9736606f4"><enum>(3)</enum><text>the Federal Credit Union
Act, by the Director of the National Credit Union Administration, with respect
to any Federal credit union;</text>
</paragraph><paragraph id="ID87cce5ab6b94469995b8d90a8c03bd17"><enum>(4)</enum><text>the Federal Aviation Act
of 1958, by the Secretary of Transportation, with respect to any air carrier or
foreign air carrier subject to that Act;</text>
</paragraph><paragraph id="IDa0489f28cb004eb8a99bb52b9e9702b5"><enum>(5)</enum><text>the Packers and
Stockyards Act, 1921 (except as provided in section 406 of that Act), by the
Secretary of Agriculture, with respect to any activities subject to that Act;
and</text>
</paragraph><paragraph id="ID05e6282b310244a48442e53035aa3b15"><enum>(6)</enum><text>the Farm Credit Act of
1971, by the Farm Credit Administration with respect to any Federal land bank,
Federal land bank association, Federal intermediate credit bank, or production
credit association.</text>
</paragraph></subsection><after-quoted-block>;
and</after-quoted-block></quoted-block>
</subparagraph><subparagraph id="ID47e839d7ba9541949f3bd20dba1de0d2"><enum>(B)</enum><text>by striking subsection
(c) and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id31CF18D7494A4E2783A32D84D7C3C1ED" reported-display-style="italic" style="OLC">
<subsection id="IDb046a0c724bc4a938e74d323b48937d1"><enum>(c)</enum><header>Overall enforcement
authority of the Federal trade commission</header><text>Except to the extent
that enforcement of the requirements imposed under this title is specifically
committed to some other Government agency under subsection (a), and subject to
subtitle B of the Consumer Financial Protection Act of 2010, the Federal Trade
Commission shall enforce such requirements. For the purpose of the exercise by
the Federal Trade Commission of its functions and powers under the Federal
Trade Commission Act, a violation of any requirement imposed under this title
shall be deemed a violation of a requirement imposed under that Act. All of the
functions and powers of the Federal Trade Commission under the Federal Trade
Commission Act are available to the Federal Trade Commission to enforce
compliance by any person with the requirements under this title, irrespective
of whether that person is engaged in commerce or meets any other jurisdictional
tests under the Federal Trade Commission
Act.</text>
</subsection><after-quoted-block>;</after-quoted-block></quoted-block>
</subparagraph></paragraph><paragraph id="IDa8f0a187737f4912a821cd3853d4ba5b"><enum>(8)</enum><text>in section 129 (15 U.S.C.
1639), by striking subsection (m) and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id1166A85F44EF43ABACE16D5FC05064A2" reported-display-style="italic" style="OLC">
<subsection id="IDd4b5d66be8e64e27b9324df64d0fc397"><enum>(m)</enum><header>Civil penalties in
Federal trade commission enforcement actions</header><text>For purposes of
enforcement by the Federal Trade Commission, any violation of a regulation
issued by the Bureau pursuant to subsection (l)(2) shall be treated as a
violation of a rule promulgated under section 18 of the Federal Trade
Commission Act (15 U.S.C. 57a) regarding unfair or deceptive acts or
practices.</text>
</subsection><after-quoted-block>;
and</after-quoted-block></quoted-block>
</paragraph><paragraph commented="no" id="id72771C3866E5462CABB4AF3397777079"><enum>(9)</enum><text>in chapter 5 (15 U.S.C.
1667 et seq.)—</text>
<subparagraph commented="no" id="id4B6E560424664EE286DF775C82A39EC3"><enum>(A)</enum><text>by striking <quote>the
Board</quote> each place that term appears and inserting <quote>the
Bureau</quote>; and</text>
</subparagraph><subparagraph commented="no" id="id78DD4B0AE678430EBDA825F6F1CFF606"><enum>(B)</enum><text>by striking <quote>The
Board</quote> each place that term appears and inserting <quote>The
Bureau</quote>.</text>
</subparagraph></paragraph></section><section id="IDc4fcac4ab543453cbd8365505d6d928a"><enum>1100.</enum><header>Amendments to the
Truth in Savings Act</header><text display-inline="no-display-inline">The Truth
in Savings Act (12 U.S.C. 4301 et seq.) is amended—</text>
<paragraph id="idE66F152271984F418AE8BA2FE9027A5F"><enum>(1)</enum><text display-inline="yes-display-inline">by striking <quote>Board</quote> each place
that term appears and inserting <quote>Bureau</quote>;</text>
</paragraph><paragraph id="id92E3FF6E27AA44C8A447EB407EAD4294"><enum>(2)</enum><text display-inline="yes-display-inline">in section 270(a) (12 U.S.C. 4309)—</text>
<subparagraph id="ID73bc0f91ccf34a59ab14b4c899fccc0c"><enum>(A)</enum><text>by striking
<quote>Compliance</quote> and inserting <quote>Except as otherwise provided in
subtitle B of the Consumer Financial Protection Act of 2010,
compliance</quote>;</text>
</subparagraph><subparagraph id="ID3c98953571904a22aa94c5ca889c5afd"><enum>(B)</enum><text>in paragraph (1)—</text>
<clause id="idC06ABB9833A24CEBA5DE456B330A9F18"><enum>(i)</enum><text>in subparagraph (B), by
striking <quote>and</quote> at the end; and</text>
</clause><clause id="ID5749ce46ac014326a9a9ea8a6a0f8bff"><enum>(ii)</enum><text>by striking subparagraph
(C);</text>
</clause></subparagraph><subparagraph id="id43434C6D66714AEAAC215658E24AFCB9"><enum>(C)</enum><text>in paragraph (2), by
striking the period at the end and inserting <quote>; and</quote>; and</text>
</subparagraph><subparagraph id="ID93d4ba9e844b481abfac182832a7e6ee"><enum>(D)</enum><text>by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id5C27BD5ABEF648F3A3AACF657BB7852E" reported-display-style="italic" style="OLC">
<paragraph id="IDadcff2f211c448aaa8ab141e14f77722"><enum>(3)</enum><text>subtitle E of the
Consumer Financial Protection Act of 2010, by the
Bureau.</text>
</paragraph><after-quoted-block>;</after-quoted-block></quoted-block>
</subparagraph></paragraph><paragraph id="idD0C4999444E0472F82D48D4696639374"><enum>(3)</enum><text>in section 272(b) (12
U.S.C. 4311(b)), by striking <quote>regulation prescribed by the Board</quote>
each place that term appears and inserting <quote>regulation prescribed by the
Bureau</quote>; and</text>
</paragraph><paragraph id="id5268E0B96ACA4EA89BC8CE1A55EA8501"><enum>(4)</enum><text>in section 274 (12 U.S.C.
4313), by striking paragraph (4) and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idD5BA680182504D198662420CC5D8B7AA" reported-display-style="italic" style="OLC">
<paragraph id="IDfc545037926247e99cc4ce9e743dcd1c"><enum>(4)</enum><header>Bureau</header><text>The
term <term>Bureau</term> means the Bureau of Consumer Financial
Protection.</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></section><section id="ID52822a43e9ba448583f6879312cdc782"><enum>1101.</enum><header>Amendments to the
Telemarketing and Consumer Fraud and Abuse Prevention Act</header>
<subsection id="ID9b7006224c2c4d43b771129c0a7e28bc"><enum>(a)</enum><header>Amendments to Section
<enum-in-header>3</enum-in-header></header><text>Section 3 of the Telemarketing
and Consumer Fraud and Abuse Prevention Act (15 U.S.C. 6102) is amended by
striking subsections (b) and (c) and inserting the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id5C9328610EBA4FABB67064B0C0305844" reported-display-style="italic" style="OLC">
<subsection id="idDC6B5CF14D28413EA3051AE26D69CC17"><enum>(b)</enum><header>Rulemaking
authority</header><text>The Commission shall have authority to prescribe rules
under subsection (a), in accordance with section 553 of title 5, United States
Code. In prescribing a rule under this section that relates to the provision of
a consumer financial product or service that is subject to the Consumer
Financial Protection Act of 2010, including any enumerated consumer law
thereunder, the Commission shall consult with the Bureau of Consumer Financial
Protection regarding the consistency of a proposed rule with standards,
purposes, or objectives administered by the Bureau of Consumer Financial
Protection.</text>
</subsection><subsection id="IDf799efc736bd400da36934576e3cc673"><enum>(c)</enum><header>Violations</header><text>Any
violation of any rule prescribed under subsection (a)—</text>
<paragraph id="id6CE964115CA6462099A6E1856D8870F9"><enum>(1)</enum><text>shall be treated as a
violation of a rule under section 18 of the Federal Trade Commission Act
regarding unfair or deceptive acts or practices; and</text>
</paragraph><paragraph id="id20750DD05895447AB58E29FD45C9514A"><enum>(2)</enum><text>that is committed by a
person subject to the Consumer Financial Protection Act of 2010 shall be
treated as a violation of a rule under section 1031 of that Act regarding
unfair, deceptive, or abusive acts or
practices.</text>
</paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="IDd6bf502b17564e8ebc8df4a47d429dfc"><enum>(b)</enum><header>Amendments to Section
<enum-in-header>4</enum-in-header></header><text>Section 4(d) of the
Telemarketing and Consumer Fraud and Abuse Prevention Act (15 U.S.C. 6103(d))
is amended by inserting after <quote>Commission</quote> each place that term
appears the following: <quote>or the Bureau of Consumer Financial
Protection</quote>.</text>
</subsection><subsection id="ID9ec7646154d3451a996d54622096bd61"><enum>(c)</enum><header>Amendments to Section
<enum-in-header>5</enum-in-header></header><text>Section 5(c) of the
Telemarketing and Consumer Fraud and Abuse Prevention Act (15 U.S.C. 6104(c))
is amended by inserting after <quote>Commission</quote> each place that term
appears the following: <quote>or the Bureau of Consumer Financial
Protection</quote>.</text>
</subsection><subsection id="ID2a5e35bcc7f94e269c08bbd9fe085b8b"><enum>(d)</enum><header>Amendment to Section
<enum-in-header>6</enum-in-header></header><text>Section 6 of the Telemarketing
and Consumer Fraud and Abuse Prevention Act (15 U.S.C. 6105) is amended by
adding at the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id736EE58C20DD4BB5B4AD00E79A7B443D" reported-display-style="italic" style="OLC">
<subsection id="IDe0ee9a9d58a042b5aaa25091e2536619"><enum>(d)</enum><header>Enforcement by Bureau
of Consumer Financial Protection</header><text>Except as otherwise provided in
sections 3(d), 3(e), 4, and 5, and subject to subtitle B of the Consumer
Financial Protection Act of 2010, this Act shall be enforced by the Bureau of
Consumer Financial Protection under subtitle E of the Consumer Financial
Protection Act of
2010.</text>
</subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection></section><section id="IDdeb74a7f657042c7a0ae1cebfc5706cc"><enum>1102.</enum><header>Amendments to the
Paperwork Reduction Act</header>
<subsection id="ID6932b553b22d453fb2ed58c6aa0bce3f"><enum>(a)</enum><header>Designation as an
independent agency</header><text>Section 2(5) of the Paperwork Reduction Act
(44 U.S.C. 3502(5)) is amended by inserting <quote>the Bureau of Consumer
Financial Protection, the Office of Financial Research,</quote> after
<quote>the Securities and Exchange Commission,</quote>.</text>
</subsection><subsection id="id5B4C10AAFF3A4BD38FDD989951ADA14D"><enum>(b)</enum><header>Comparable
treatment</header><text>Section 3513 of title 44, United States Code, is
amended by adding at the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idF3D8D8701C98486289A0CBD1966BAEA4" reported-display-style="italic" style="OLC">
<subsection id="ID94bdcb3f07f54ad4920ad5b113a1bfea"><enum>(c)</enum><header>Comparable
treatment</header><text>Notwithstanding any other provision of law, the
Director shall treat or review a rule or order prescribed or proposed by the
Director of the Bureau of Consumer Financial Protection on the same terms and
conditions as apply to any rule or order prescribed or proposed by the Board of
Governors of the Federal Reserve
System.</text>
</subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection></section><section id="idB05FF1B545A7485BB84EFFD17881308A"><enum>1103.</enum><header>Adjustments for
inflation in the Truth in Lending Act</header>
<subsection id="idE2DEE83C981D47D883293DE802C3AF90"><enum>(a)</enum><header>Caps</header>
<paragraph id="idB518C8478D3242DEA3EA874C2BC57A52"><enum>(1)</enum><header>Credit
transactions</header><text>Section 104(3) of the Truth in Lending Act (15
U.S.C. 1603(3)) is amended by striking <quote>$25,000</quote> and inserting
<quote>$50,000</quote>.</text>
</paragraph><paragraph id="id5AE72916C6744042B2189FEFE3C52626"><enum>(2)</enum><header>Consumer
leases</header><text>Section 181(1) of the Truth in Lending Act (15 U.S.C.
1667(1)) is amended by striking <quote>$25,000</quote> and inserting
<quote>$50,000</quote>.</text>
</paragraph></subsection><subsection id="id9C3C1EE23AFC4F8FBF34F4A4FA17EF5C"><enum>(b)</enum><header>Adjustments for
inflation</header><text>On and after December 31, 2011, the Bureau may adjust
annually the dollar amounts described in sections 104(3) and 181(1) of the
Truth in Lending Act (as amended by this section), by the annual percentage
increase in the Consumer Price Index for Urban Wage Earners and Clerical
Workers, as published by the Bureau of Labor Statistics, rounded to the nearest
multiple of $100, or $1,000, as applicable.</text>
</subsection></section><section id="id713C78C8B5364419A9C94355077D7250"><enum>1104.</enum><header>Small business
fairness and regulatory transparency</header>
<subsection id="id2B5CFDF962C049B5932DED08BC9E5B25"><enum>(a)</enum><header>Panel
requirement</header><text>Section 609(d) of title 5, United States Code, is
amended by striking <quote>means the</quote> and all that follows and inserting
the following: “means—</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id933C51E2B7694D608C3D00FA3566EEE4" reported-display-style="italic" style="OLC">
<paragraph id="id98855CC1966046DCAC12BF4B3EBFF0A3"><enum>(1)</enum><text>the Environmental
Protection Agency;</text>
</paragraph><paragraph id="id431A327DFD674B60A8527D45658A6541"><enum>(2)</enum><text>the Consumer Financial
Protection Bureau of the Federal Reserve System; and</text>
</paragraph><paragraph id="id4EB1B000E5FA4B2E89FA4646EF62782F"><enum>(3)</enum><text>the Occupational Safety
and Health Administration of the Department of
Labor.</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="id566256FB845049EAB88B07904A32F184"><enum>(b)</enum><header>Initial regulatory
flexibility analysis</header><text>Section 603 of title 5, United States Code,
is amended by adding at the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id13C9E5E3B772461A8D0620CFC2DC42BF" reported-display-style="italic" style="OLC">
<subsection id="id0419608540744261B59DF509C2E4657B"><enum>(d)</enum><paragraph commented="no" display-inline="yes-display-inline" id="id373AA3811E08486C9584CC969E6D5DC6"><enum>(1)</enum><text>For a covered agency,
as defined in section 609(d)(2), each initial regulatory flexibility analysis
shall include a description of—</text>
<subparagraph changed="added" id="id784222F875EC4302BD14F92B50CFA0CE" indent="up1" reported-display-style="italic"><enum>(A)</enum><text>any
projected increase in the cost of credit for small entities;</text>
</subparagraph><subparagraph changed="added" id="IDd3e60d2225384d828f5e157d87f82003" indent="up1" reported-display-style="italic"><enum>(B)</enum><text>any
significant alternatives to the proposed rule which accomplish the stated
objectives of applicable statutes and which minimize any increase in the cost
of credit for small entities; and</text>
</subparagraph><subparagraph changed="added" id="ID81409ca493e84f37a9d2d527a37d7410" indent="up1" reported-display-style="italic"><enum>(C)</enum><text>advice
and recommendations of representatives of small entities relating to issues
described in subparagraphs (A) and (B) and subsection (b).</text>
</subparagraph></paragraph><paragraph changed="added" id="idF77C39B8E14B4DF39156C87C5E32F6E5" indent="up1" reported-display-style="italic"><enum>(2)</enum><text>A covered agency, as
defined in section 609(d)(2), shall, for purposes of complying with paragraph
(1)(C)—</text>
<subparagraph id="id2634FD35A014436D8CC483FCBBE5DB06"><enum>(A)</enum><text>identify representatives
of small entities in consultation with the Chief Counsel for Advocacy of the
Small Business Administration; and</text>
</subparagraph><subparagraph id="idBCDB7AC647B342ABB54EFB8D96481F45"><enum>(B)</enum><text>collect advice and
recommendations from the representatives identified under subparagraph (A)
relating to issues described in subparagraphs (A) and (B) of paragraph (1) and
subsection
(b).</text>
</subparagraph></paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="id00BC346EECCD49239BAD6E5747E4F910"><enum>(c)</enum><header>Final regulatory
flexibility analysis</header><text>Section 604(a) of title 5, United States
Code, is amended—</text>
<paragraph id="idE8670A68756A490EACCE00499DF12DD1"><enum>(1)</enum><text>in paragraph (4), by
striking <quote>and</quote> at the end;</text>
</paragraph><paragraph id="id22DB892887C84498BEB48B956C893C74"><enum>(2)</enum><text>in paragraph (5), by
striking the period at the end and inserting <quote>; and</quote>; and</text>
</paragraph><paragraph id="id68AF7C5382DA4491A945A486286ACF66"><enum>(3)</enum><text>by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idD9B287E74E0A4CFD965FA985C66AFA14" reported-display-style="italic" style="OLC">
<paragraph id="IDb639751359f94a65aa60f9d1a6e18de7"><enum>(6)</enum><text>for a covered agency, as
defined in section 609(d)(2), a description of the steps the agency has taken
to minimize any additional cost of credit for small
entities.</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection></section><section id="idAAB5992EC33049EAA9651AA1644C37C2"><enum>1105.</enum><header>Effective
date</header><text display-inline="no-display-inline">Except as otherwise
provided in this subtitle and the amendments made by this subtitle, this
subtitle and the amendments made by this subtitle, other than sections 1081 and
1082, shall become effective on the designated transfer date.</text>
</section></subtitle><enum>XI</enum><header>Federal Reserve System
provisions</header>
<section id="ID416b4b5aa5734030bea137c106abc636"><enum>1151.</enum><header>Federal Reserve Act
amendments on emergency lending authority</header>
<subsection commented="no" display-inline="no-display-inline" id="idDD1184191F844A109865ED78A9BC378C"><enum>(a)</enum><header display-inline="yes-display-inline">Federal Reserve Act</header><text display-inline="yes-display-inline">The third undesignated paragraph of section
13 of the Federal Reserve Act (12 U.S.C. 343) (relating to emergency lending
authority) is amended—</text>
<paragraph id="IDefc7b03aef0e4fc59d7ba40a16bd2475"><enum>(1)</enum><text>by inserting
<quote>(3)(A)</quote> before <quote>In unusual</quote>;</text>
</paragraph><paragraph id="ID870445cc96b74c35a441fb1c210fd81f"><enum>(2)</enum><text>by striking
<quote>individual, partnership, or corporation</quote> the first place that
term appears and inserting the following: <quote>participant in any program or
facility with broad-based eligibility</quote>;</text>
</paragraph><paragraph id="ID93cb4e932f494fc29c2ffacfe1052212"><enum>(3)</enum><text>by striking
<quote>exchange for an individual or a partnership or corporation</quote> and
inserting <quote>exchange,</quote>;</text>
</paragraph><paragraph id="id16006ADFC3264C29AEF8212EF7222BA9"><enum>(4)</enum><text>by striking <quote>such
individual, partnership, or corporation</quote> and inserting the following:
<quote>such participant in any program or facility with broad-based
eligibility</quote>;</text>
</paragraph><paragraph id="ID8deb715161364dc4be2dea575f0b22bf"><enum>(5)</enum><text>by striking <quote>for
individuals, partnerships, corporations</quote> and inserting <quote>for any
participant in any program or facility with broad-based
eligibility</quote>;</text>
</paragraph><paragraph id="ID53767ecec298439da5450a1ff4b1afe3"><enum>(6)</enum><text>by striking <quote>may
prescribe.</quote> and inserting the following: “may prescribe.</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idC8093127D1354DB1ADE2B03F0B80B231" reported-display-style="italic" style="OLC">
<subparagraph id="ID9bf7377c94fd4a1c899ea4e4ed4e47fb"><enum>(B)</enum><clause commented="no" display-inline="yes-display-inline" id="idFD7ABD811D474C03A5E71E16685F1CE0"><enum>(i)</enum><text>As soon as is
practicable after the date of enactment of this subparagraph, the Board shall
establish, by regulation, in consultation with the Secretary of the Treasury,
the policies and procedures governing emergency lending under this paragraph.
Such policies and procedures shall be designed to ensure that any emergency
lending program or facility is for the purpose of providing liquidity to the
financial system, and not to aid a failing financial company, and that the
collateral for emergency loans is sufficient to protect taxpayers from and that
any such program is terminated in a timely and orderly fashion losses. The
policies and procedures established by the Board shall require that a Federal
reserve bank assign, consistent with sound risk management practices and to
ensure protection for the taxpayer, a lendable value to all collateral for a
loan executed by a Federal reserve bank under this paragraph in determining
whether the loan is secured satisfactorily for purposes of this
paragraph.</text>
</clause><clause changed="added" id="ID37d9f91320ea4cd18544f58c5478f529" indent="up1" reported-display-style="italic"><enum>(ii)</enum><text>The Board shall
establish procedures to prohibit borrowing from programs and facilities by
borrowers that are insolvent. Such procedures may include a certification from
the chief executive officer (or other authorized officer) of the borrower, at
the time the borrower initially borrows under the program or facility (with a
duty by the borrower to update the certification if the information in the
certification materially changes), that the borrower is not insolvent. A
borrower shall be considered insolvent for purposes of this subparagraph, if
the borrower is in bankruptcy, resolution under title II of the Restoring
American Financial Stability Act of 2010, or any other Federal or State
insolvency proceeding.</text>
</clause><clause changed="added" id="ID29b5ca569a2d4f2883388ff9c3f95542" indent="up1" reported-display-style="italic"><enum>(iii)</enum><text>A
program or facility that is structured to remove assets from the balance sheet
of a single and specific company, or that is established for the purpose of
assisting a single and specific company avoid bankruptcy, resolution under
title II of the Restoring American Financial Stability Act of 2010, or any
other Federal or State insolvency proceeding, shall not be considered a program
or facility with broad-based eligibility.</text>
</clause><clause changed="added" id="id3D389811375044539A7D351FD6A30B0D" indent="up1" reported-display-style="italic"><enum>(iv)</enum><text>The Board may not
establish any program or facility under this paragraph without the prior
approval of the Secretary of the Treasury.</text>
</clause></subparagraph><subparagraph id="ID58ce12ec610542ed928abcb6576f4fc1"><enum>(C)</enum><text>The Board shall provide
to the Committee on Banking, Housing, and Urban Affairs of the Senate and the
Committee on Financial Services of the House of Representatives—</text>
<clause id="ID12dd3c4613494a07bdb546478fcb5e8e"><enum>(i)</enum><text>not later than 7 days
after providing any loan or other financial assistance under this paragraph, a
report that includes—</text>
<subclause id="IDefbbd025efd644a1882343e710e2f27c"><enum>(I)</enum><text>the justification for the
exercise of authority to provide such assistance;</text>
</subclause><subclause id="IDb8f3327ad5d844a5a31233b5c4e8ec6a"><enum>(II)</enum><text>the identity of the
recipients of such assistance;</text>
</subclause><subclause id="ID8a6fe03f697a490cace044968b062e16"><enum>(III)</enum><text>the date and amount of
the assistance, and form in which the assistance was provided; and</text>
</subclause><subclause id="ID9551e9fe52924a829f21b095bdf1a024"><enum>(IV)</enum><text>the material terms of
the assistance, including—</text>
<item id="ID4c3a9375670247f89fafdd87bc572a71"><enum>(aa)</enum><text>duration;</text>
</item><item id="ID9b677095562644aeab0e27091fd7c6ef"><enum>(bb)</enum><text>collateral pledged and
the value thereof;</text>
</item><item id="ID24e0c131a5a7426088bd7dba85d0d641"><enum>(cc)</enum><text>all interest, fees, and
other revenue or items of value to be received in exchange for the
assistance;</text>
</item><item id="IDb10b4ad5578d466b83fc5e0142d4a2ac"><enum>(dd)</enum><text>any requirements imposed
on the recipient with respect to employee compensation, distribution of
dividends, or any other corporate decision in exchange for the assistance;
and</text>
</item><item id="ID8d407dd594824cf7a6ca3ee8ee67e3c3"><enum>(ee)</enum><text>the expected costs to
the taxpayers of such assistance; and</text>
</item></subclause></clause><clause id="ID3d0c51029302480db4d5f1d402693338"><enum>(ii)</enum><text>once every 30 days, with
respect to any outstanding loan or other financial assistance under this
paragraph, written updates on—</text>
<subclause id="ID53b05ae51afe4190888931210a38729b"><enum>(I)</enum><text>the value of
collateral;</text>
</subclause><subclause id="ID1ba00a07e15c401093b7fe5499fa5d9d"><enum>(II)</enum><text>the amount of interest,
fees, and other revenue or items of value received in exchange for the
assistance; and</text>
</subclause><subclause id="ID5c89c65f13fc40b69cd405dc6e7e5a37"><enum>(III)</enum><text>the expected or final
cost to the taxpayers of such assistance.</text>
</subclause></clause></subparagraph><subparagraph id="ID61dca82ea15c4d4eab16862323e85a96"><enum>(D)</enum><text>The information submitted
to Congress under subparagraph (C) related to—</text>
<clause id="ID7b0c51340abf48bf8a61acc7d0babeb8"><enum>(i)</enum><text>the identity of the
participants in an emergency lending program or facility commenced under this
paragraph;</text>
</clause><clause id="IDfa437738ef11477ba502919f723c64ee"><enum>(ii)</enum><text>the amounts borrowed by
each participant in any such program or facility;</text>
</clause><clause id="ID7ebbd543cebe4d7d833e475f570e736d"><enum>(iii)</enum><text>identifying details
concerning the assets or collateral held by, under, or in connection with such
a program or facility,</text>
</clause><continuation-text continuation-text-level="subparagraph">shall be kept confidential, upon the
written request of the Chairman of the Board, in which case such information
shall be made available only to the Chairpersons and Ranking Members of the
Committees described in subparagraph (C).</continuation-text></subparagraph><subparagraph id="IDcc84dcf3071e4722bf60c2f2fc942445"><enum>(E)</enum><text>If an entity to which a
Federal reserve bank has provided a loan under this paragraph becomes a covered
financial company, as defined in section 203 of the Restoring American
Financial Stability Act of 2010, at any time while such loan is outstanding,
and the Federal reserve bank incurs a realized net loss on the loan, then the
Federal reserve bank shall have a claim equal to the amount of the net realized
loss against the covered entity, with the same priority as an obligation to the
Secretary of the Treasury under sections 210(n) and 210(o) of the Restoring
American Financial Stability Act of
2010.</text>
</subparagraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection commented="no" display-inline="no-display-inline" id="id381F8C8CF59A462BBE2C86343204C015"><enum>(b)</enum><header>Conforming
amendment</header><text>Section 507(a)(2) of title 11, United States Code, is
amended by inserting <quote>claims of any Federal reserve bank related to loans
made through programs or facilities authorized under the third undesignated
paragraph of the Federal Reserve Act (12 U.S.C. 343),</quote> after <quote>this
title,</quote>.</text>
</subsection></section><section id="IDe3e4c47d05354ee08890820ba02928ec"><enum>1152.</enum><header>Reviews of special
Federal reserve credit facilities</header>
<subsection id="ID12178b0c192042c3b88fdd628ab53e22"><enum>(a)</enum><header>Reviews</header><text>Section
714 of title 31, United States Code, is amended by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id8884BF9C68674454B0407CEDBE46779C" reported-display-style="italic" style="OLC">
<subsection id="IDf8e90af9590e4bc4b873b790a6f77747"><enum>(f)</enum><header>Reviews of credit
facilities of the Federal reserve system</header>
<paragraph id="ID12adbaf970d04930a32106afcb3cc025"><enum>(1)</enum><header>Definition</header><text>In
this subsection, the term <term>credit facility</term> means a program or
facility, including any special purpose vehicle or other entity established by
or on behalf of the Board of Governors of the Federal Reserve System or a
Federal reserve bank, authorized by the Board of Governors under the third
undesignated paragraph of section 13 of the Federal Reserve Act (12 U.S.C.
343), that is not subject to audit under subsection (e), including—</text>
<subparagraph id="ID0249ecea7b0b40e8a580ad13417603ea"><enum>(A)</enum><text>the Asset-Backed
Commercial Paper Money Market Mutual Fund Liquidity Facility;</text>
</subparagraph><subparagraph id="IDbaf739ade5c24386a3eaf6c975d1fdd3"><enum>(B)</enum><text>the Term Asset-Backed
Securities Loan Facility;</text>
</subparagraph><subparagraph id="ID388c14c5389b4b3485869f515b639fd9"><enum>(C)</enum><text>the Primary Dealer Credit
Facility;</text>
</subparagraph><subparagraph id="ID962ce11f703a4dc9a6c1e1d5e6af8746"><enum>(D)</enum><text>the Commercial Paper
Funding Facility; and</text>
</subparagraph><subparagraph id="IDd6a95381206f422f88b9c75e9cbfad73"><enum>(E)</enum><text>the Term Securities
Lending Facility.</text>
</subparagraph></paragraph><paragraph id="IDf55f30095ca34fc681a099c21633fe7b"><enum>(2)</enum><header>Authority for reviews
and examinations</header><text>Subject to paragraph (3), and notwithstanding
any limitation in subsection (b) on the auditing and oversight of certain
functions of the Board of Governors of the Federal Reserve System or any
Federal reserve bank, the Comptroller General of the United States may conduct
reviews, including onsite examinations, of the Board of Governors, a Federal
reserve bank, or a credit facility, if the Comptroller General determines that
such reviews are appropriate, solely for the purposes of assessing, with
respect to a credit facility—</text>
<subparagraph id="idC4D6946794624B86B59CD91D243C0C2C"><enum>(A)</enum><text>the operational
integrity, accounting, financial reporting, and internal controls of the credit
facility;</text>
</subparagraph><subparagraph id="ID573393e8d6c341f0b309ed5100b51797"><enum>(B)</enum><text>the effectiveness of the
collateral policies established for the facility in mitigating risk to the
relevant Federal reserve bank and taxpayers;</text>
</subparagraph><subparagraph id="IDc6931b76da624e38834cc50519d6469d"><enum>(C)</enum><text>whether the credit
facility inappropriately favors one or more specific participants over other
institutions eligible to utilize the facility; and</text>
</subparagraph><subparagraph id="IDa4b89a6747f243d1a2d961205afa72e1"><enum>(D)</enum><text>the policies governing
the use, selection, or payment of third-party contractors by or for any credit
facility.</text>
</subparagraph></paragraph><paragraph id="IDe363261ff3ba44709ca0bcc508ba3014"><enum>(3)</enum><header>Reports and delayed
disclosure</header>
<subparagraph id="ID774884b8a7c947f0b26b3f3f05c583ff"><enum>(A)</enum><header>Reports
required</header><text>A report on each review conducted under paragraph (2)
shall be submitted by the Comptroller General to the Congress before the end of
the 90-day period beginning on the date on which such review is
completed.</text>
</subparagraph><subparagraph id="IDcd5dd0cecbad4d8c84b2e7d65129a1be"><enum>(B)</enum><header>Contents</header><text>The
report under subparagraph (A) shall include a detailed description of the
findings and conclusions of the Comptroller General with respect to the matters
described in paragraph (2) that were reviewed and are the subject of the
report, together with such recommendations for legislative or administrative
action relating to such matters as the Comptroller General may determine to be
appropriate.</text>
</subparagraph><subparagraph id="IDc82513a2779f4f8bb50ab566d4b5751d"><enum>(C)</enum><header>Delayed release of
certain information</header>
<clause id="ID1e315be138d346b98ad6ae625e393f36"><enum>(i)</enum><header>In
general</header><text>The Comptroller General shall not disclose to any person
or entity, including to Congress, the names or identifying details of specific
participants in any credit facility, the amounts borrowed by specific
participants in any credit facility, or identifying details regarding assets or
collateral held by, under, or in connection with any credit facility, and any
report provided under subparagraph (A) shall be redacted to ensure that such
names and details are not disclosed.</text>
</clause><clause id="ID4cb356cec1904926a074399da164113d"><enum>(ii)</enum><header>Delayed
release</header><text>The nondisclosure obligation under clause (i) shall
expire with respect to any participant on the date on which the Board of
Governors, directly or through a Federal reserve bank, publicly discloses the
identity of the subject participant or the identifying details of the subject
assets or collateral.</text>
</clause><clause id="ID096ab7a8dd3a413db553e31cc5c2ee9a"><enum>(iii)</enum><header>General
release</header><text>The Comptroller General shall release a nonredacted
version of any report on a credit facility 1 year after the effective date of
the termination by the Board of Governors of the authorization for the credit
facility. For purposes of this clause, a credit facility shall be deemed to
have terminated 24 months after the date on which the credit facility ceases to
make extensions of credit and loans, unless the credit facility is otherwise
terminated by the Board of Governors.</text>
</clause><clause id="ID953f33d93dea4fb180417f8497694f37"><enum>(iv)</enum><header>Exceptions</header><text>The
nondisclosure obligation under clause (i) shall not apply to the credit
facilities Maiden Lane, Maiden Lane II, and Maiden Lane
III.</text>
</clause></subparagraph></paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="ID57fbaf589bcc46318df9713530835c9e"><enum>(b)</enum><header>Access to
records</header><text>Section 714(d) of title 31, United States Code, is
amended—</text>
<paragraph id="ID90a116ba2d514308985ce5547dfc017b"><enum>(1)</enum><text>in paragraph (2), by
inserting <quote>or any person or entity described in paragraph (3)(A)</quote>
after <quote>used by an agency</quote>;</text>
</paragraph><paragraph id="IDc2d3cc6f21084517b05790e4287cc04a"><enum>(2)</enum><text>in paragraph (3), by
inserting <quote>or (f)</quote> after <quote>subsection (e)</quote> each place
that term appears; and</text>
</paragraph><paragraph id="IDc602a6c60ae543a7a1763a0e7573f0ad"><enum>(3)</enum><text>in paragraph (3)(B), by
adding at the end the following: <quote>The Comptroller General may make and
retain copies of books, accounts, and other records provided under subparagraph
(A) as the Comptroller General deems appropriate. The Comptroller General shall
provide to any person or entity described in subparagraph (A) a current list of
officers and employees to whom, with proper identification, records and
property may be made available, and who may make notes or copies necessary to
carry out a review or examination under this subsection.</quote>.</text>
</paragraph></subsection></section><section id="ID25fe61267e0c4974981b365a5b765189"><enum>1153.</enum><header>Public access to
information</header><text display-inline="no-display-inline">Section 2B of the
Federal Reserve Act (12 U.S.C. 225b) is amended by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id9F93FF4C2CE741CEB4D329669173334D" reported-display-style="italic" style="OLC">
<subsection id="ID1d43260132e64bd69bfcf49b34d62653"><enum>(c)</enum><header>Public access to
information</header><text>The Board shall place on its home Internet website, a
link entitled <quote>Audit</quote>, which shall link to a webpage that shall
serve as a repository of information made available to the public for a
reasonable period of time, not less than 6 months following the date of release
of the relevant information, including—</text>
<paragraph id="IDc30bf0593c3d4d118c53b91f22886172"><enum>(1)</enum><text>the reports prepared by
the Comptroller General under section 714 of title 31, United States
Code;</text>
</paragraph><paragraph id="ID752172b5bc8f4d6195104d612856188e"><enum>(2)</enum><text>the annual financial
statements prepared by an independent auditor for the Board in accordance with
section 11B;</text>
</paragraph><paragraph id="IDe1a8548c44df4e768192cbe61415ca11"><enum>(3)</enum><text>the reports to the
Committee on Banking, Housing, and Urban Affairs of the Senate required under
the third undesignated paragraph of section 13 (relating to emergency lending
authority); and</text>
</paragraph><paragraph id="ID7944d36f4bb54d52a789ef449703b7a8"><enum>(4)</enum><text>such other information as
the Board reasonably believes is necessary or helpful to the public in
understanding the accounting, financial reporting, and internal controls of the
Board and the Federal reserve
banks.</text>
</paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</section><section id="IDd04bd019e5e345cabfb18fa00b33c3ec"><enum>1154.</enum><header>Liquidity event
determination</header>
<subsection id="IDc457d14544f1444bbcbeda232da2bab8"><enum>(a)</enum><header>Determination and
written recommendation</header>
<paragraph id="IDd450ff0cc1124a2c9315c8961d8ed070"><enum>(1)</enum><header>Determination
request</header><text>The Secretary may request the Corporation and the Board
of Governors to determine whether a liquidity event exists that warrants use of
the guarantee program authorized under section 1155.</text>
</paragraph><paragraph id="ID3756566e0dbb4a7fa6101385ba0c4101"><enum>(2)</enum><header>Requirements of
determination</header><text>Any determination pursuant to paragraph (1)
shall—</text>
<subparagraph id="IDc89ff80bbf694c90964a8a4a7425069f"><enum>(A)</enum><text>be written; and</text>
</subparagraph><subparagraph id="IDe077ac589ccc47a5a581a39510cabaf4"><enum>(B)</enum><text>contain an evaluation of
the evidence that—</text>
<clause id="IDfdb8cb8584a34b2c8224fd7a6e340207"><enum>(i)</enum><text>a liquidity event
exists;</text>
</clause><clause id="ID85a67d2371b346caa7b18fb8c283a546"><enum>(ii)</enum><text>failure to take action
would have serious adverse effects on financial stability or economic
conditions in the United States; and</text>
</clause><clause id="IDdde8da8f934e43d6ba5da642360a9554"><enum>(iii)</enum><text>actions authorized
under section 1155 are needed to avoid or mitigate potential adverse effects on
the United States financial system or economic conditions.</text>
</clause></subparagraph></paragraph></subsection><subsection id="ID88e0a4872c6f475bb8fc8051fa648657"><enum>(b)</enum><header>Procedures</header><text>Notwithstanding
any other provision of Federal or State law, upon the determination of both the
Corporation (upon a vote of not fewer than <fraction>2/3</fraction> of the
members of the Corporation then serving) and the Board of Governors (upon a
vote of not fewer than <fraction>2/3</fraction> of the members of the Board of
Governors then serving) under subsection (a) that a liquidity event exists that
warrants use of the guarantee program authorized under section 1155, and with
the written consent of the Secretary—</text>
<paragraph id="IDeed8b11d2b6744b49bfb47fcca4049cc"><enum>(1)</enum><text>the Corporation shall
take action in accordance with section 1155(a); and</text>
</paragraph><paragraph id="IDa7a97f93dd63401cb772f67c07a0a8b9"><enum>(2)</enum><text>the Secretary (in
consultation with the President) shall take action in accordance with section
1155(c).</text>
</paragraph></subsection><subsection id="IDd4182713ae7145e6b8ef7120bbf7f442"><enum>(c)</enum><header>Documentation and
review</header>
<paragraph id="ID55688e6ebcb74012a38f4e559a39254b"><enum>(1)</enum><header>Documentation</header><text>The
Secretary shall—</text>
<subparagraph id="IDb897f69375084437a60cc5b2ec6e9757"><enum>(A)</enum><text>maintain the written
documentation of each determination of the Corporation and the Board of
Governors under this section; and</text>
</subparagraph><subparagraph id="ID6ea40b0ee62c4063b006168788b1e87d"><enum>(B)</enum><text>provide the documentation
for review under paragraph (2).</text>
</subparagraph></paragraph><paragraph id="ID191cebbf707744d4834db4488761bd52"><enum>(2)</enum><header>GAO
review</header><text>The Comptroller General of the United States shall review
and report to Congress on any determination of the Corporation and the Board of
Governors under subsection (a), including—</text>
<subparagraph id="ID0382a8ea6ab442ada33c9fd3c32e6f03"><enum>(A)</enum><text>the basis for the
determination; and</text>
</subparagraph><subparagraph id="ID513c8f855644436db18151fdf83b6b2d"><enum>(B)</enum><text>the likely effect of the
actions taken.</text>
</subparagraph></paragraph></subsection><subsection id="ID475cec03c2a34401b61107fe80cb3a49"><enum>(d)</enum><header>Report to
Congress</header><text>On the earlier of the date of a submission made to
Congress under section 1155(c), or within 30 days of the date of a
determination under subsection (a), the Secretary shall provide written notice
of the determination of the Corporation and the Board of Governors to the
Committee on Banking, Housing, and Urban Affairs of the Senate and the
Committee on Financial Services of the House of Representatives, including a
description of the basis for the determination.</text>
</subsection></section><section id="ID43a1f4784c2b4c0dbb40421813caf7cb"><enum>1155.</enum><header>Emergency financial
stabilization</header>
<subsection id="ID5d37f0ee19f44e109e1fff28eace3882"><enum>(a)</enum><header>In
general</header><text>Upon the written determination of the Corporation and the
Board of Governors under section 1154, the Corporation shall create a widely
available program to guarantee obligations of solvent insured depository
institutions or solvent depository institution holding companies (including any
affiliates thereof) during times of severe economic distress, except that a
guarantee of obligations under this section may not include the provision of
equity in any form.</text>
</subsection><subsection id="ID4cc001852b9844fd927bf08829a0333d"><enum>(b)</enum><header>Rulemaking and terms
and conditions</header>
<paragraph id="IDb1c2567bee8c40b78e7acc79c5d3a3a1"><enum>(1)</enum><header>Policies and
procedures</header><text>As soon as is practicable after the date of enactment
of this Act, the Corporation shall establish, by regulation, and in
consultation with the Secretary, policies and procedures governing the issuance
of guarantees authorized by this section. Such policies and procedures may
include a requirement of collateral as a condition of any such
guarantee.</text>
</paragraph><paragraph id="IDac659cfdbb6849478352818a8ee724b5"><enum>(2)</enum><header>Terms and
conditions</header><text>The terms and conditions of any guarantee program
shall be established by the Corporation, with the concurrence of the
Secretary.</text>
</paragraph></subsection><subsection id="ID88ecd89fa3404a4d9ae2b6b3001f1f0a"><enum>(c)</enum><header>Determination of
guaranteed amount</header>
<paragraph id="ID84fd2a03ff0e438c8a751b5ef6bc2657"><enum>(1)</enum><header>In
general</header><text>In connection with any program established pursuant to
subsection (a) and subject to paragraph (2) of this subsection, the Secretary
(in consultation with the President) shall determine the maximum amount of debt
outstanding that the Corporation may guarantee under this section, and the
President may transmit to Congress a written report on the plan of the
Corporation to exercise the authority under this section to issue guarantees up
to that maximum amount and a request for approval of such plan. The Corporation
shall exercise the authority under this section to issue guarantees up to that
specified maximum amount upon passage of the joint resolution of approval, as
provided in subsection (d). Absent such approval, the Corporation shall issue
no such guarantees.</text>
</paragraph><paragraph id="ID4e99ccbf9f4941b89819e40b07b1d992"><enum>(2)</enum><header>Additional debt
guarantee authority</header><text>If the Secretary (in consultation with the
President) determines, after a submission to Congress under paragraph (1), that
the maximum guarantee amount should be raised, and the Council concurs with
that determination, the President may transmit to Congress a written report on
the plan of the Corporation to exercise the authority under this section to
issue guarantees up to the increased maximum debt guarantee amount. The
Corporation shall exercise the authority under this section to issue guarantees
up to that specified maximum amount upon passage of the joint resolution of
approval, as provided in subsection (d). Absent such approval, the Corporation
shall issue no such guarantees.</text>
</paragraph></subsection><subsection id="idF618E8E97C334B8C83275B4E470CFF49"><enum>(d)</enum><header>Resolution of
approval</header>
<paragraph commented="no" display-inline="no-display-inline" id="H59817ECA79884F5C9CA22DDE4300FC04"><enum>(1)</enum><header display-inline="yes-display-inline">Additional debt guarantee
authority</header><text display-inline="yes-display-inline">A request by the
President under this section shall be considered granted by Congress upon
adoption of a joint resolution approving such request. Such joint resolution
shall be considered in the Senate under expedited procedures.</text>
</paragraph><paragraph id="ID80116d2fbbff450f9ad75a95ed8e6833"><enum>(2)</enum><header>Fast track
consideration in Senate</header>
<subparagraph id="ID07517532b8e140cb97279b1980256990"><enum>(A)</enum><header>Reconvening</header><text>Upon
receipt of a request under subsection (c), if the Senate has adjourned or
recessed for more than 2 days, the majority leader of the Senate, after
consultation with the minority leader of the Senate, shall notify the Members
of the Senate that, pursuant to this section, the Senate shall convene not
later than the second calendar day after receipt of such message.</text>
</subparagraph><subparagraph id="IDba173e3f10df464abb296de833e1498f"><enum>(B)</enum><header>Placement on
calendar</header><text>Upon introduction in the Senate, the joint resolution
shall be placed immediately on the calendar.</text>
</subparagraph><subparagraph id="ID1e8e50e1c9124b9fb406b5c71c54fd8d"><enum>(C)</enum><header>Floor
consideration</header>
<clause id="ID8f5b8f3c38c140d29013ec8499ffc00c"><enum>(i)</enum><header>In
general</header><text>Notwithstanding Rule XXII of the Standing Rules of the
Senate, it is in order at any time during the period beginning on the 4th day
after the date on which Congress receives a request under subsection (c), and
ending on the 7th day after that date (even though a previous motion to the
same effect has been disagreed to) to move to proceed to the consideration of
the joint resolution, and all points of order against the joint resolution (and
against consideration of the joint resolution) are waived. The motion to
proceed is not debatable. The motion is not subject to a motion to postpone. A
motion to reconsider the vote by which the motion is agreed to or disagreed to
shall not be in order. If a motion to proceed to the consideration of the
resolution is agreed to, the joint resolution shall remain the unfinished
business until disposed of.</text>
</clause><clause id="ID89dbfbe702134a02bc9ed4a98860f81d"><enum>(ii)</enum><header>Debate</header><text>Debate
on the joint resolution, and on all debatable motions and appeals in connection
therewith, shall be limited to not more than 10 hours, which shall be divided
equally between the majority and minority leaders or their designees. A motion
further to limit debate is in order and not debatable. An amendment to, or a
motion to postpone, or a motion to proceed to the consideration of other
business, or a motion to recommit the joint resolution is not in order.</text>
</clause><clause id="ID97821c7d274c40fb988f2ca0f342d8d8"><enum>(iii)</enum><header>Vote on
passage</header><text>The vote on passage shall occur immediately following the
conclusion of the debate on the joint resolution, and a single quorum call at
the conclusion of the debate if requested in accordance with the rules of the
Senate.</text>
</clause><clause id="ID21d80b1d839d49d8b15c4397e47f64fe"><enum>(iv)</enum><header>Rulings of the chair
on procedure</header><text>Appeals from the decisions of the Chair relating to
the application of the rules of the Senate, as the case may be, to the
procedure relating to a joint resolution shall be decided without
debate.</text>
</clause></subparagraph></paragraph><paragraph id="idE19C1DB73A3C44F598CA0B79CA3BF3D0"><enum>(3)</enum><header>Rules</header>
<subparagraph id="ID333b1b8dff2c4b789242f8c5484ee17f"><enum>(A)</enum><header>Coordination with
action by house of Representatives</header><text>If, before the passage by the
Senate of a joint resolution of the Senate, the Senate receives a joint
resolution, from the House of Representatives, then the following procedures
shall apply:</text>
<clause id="ID61ff25a54a1d4252bd20e5c21ca8ae9b"><enum>(i)</enum><text>The joint resolution of
the House of Representatives shall not be referred to a committee.</text>
</clause><clause id="ID9134a90635e74287b3a7da5701e6bebb"><enum>(ii)</enum><text>With respect to a joint
resolution of the Senate—</text>
<subclause id="ID55967cae9ead49279b5a9943aaacdfee"><enum>(I)</enum><text>the procedure in the
Senate shall be the same as if no joint resolution had been received from the
other House; but</text>
</subclause><subclause id="ID1bc39092cdea4c25aeec22f64a63f42e"><enum>(II)</enum><text>the vote on passage
shall be on the joint resolution of the House of Representatives.</text>
</subclause></clause></subparagraph><subparagraph id="IDd2fc2f54f30c441bb4dc4af28ab825ab"><enum>(B)</enum><header>Treatment of joint
resolution of House of Representatives</header><text>If the Senate fails to
introduce or consider a joint resolution under this section, the joint
resolution of the House of Representatives shall be entitled to expedited floor
procedures under this subsection.</text>
</subparagraph><subparagraph id="ID9b9d4da159574b088813d769798f6c4f"><enum>(C)</enum><header>Treatment of companion
measures</header><text>If, following passage of the joint resolution in the
Senate, the Senate then receives the companion measure from the House of
Representatives, the companion measure shall not be debatable.</text>
</subparagraph><subparagraph id="IDf37f2eae706949119f6f19089bf35ba8"><enum>(D)</enum><header>Rules of the
Senate</header><text>This subsection is enacted by Congress—</text>
<clause id="ID258e9e444855498c956e2a85fad55b66"><enum>(i)</enum><text>as an exercise of the
rulemaking power of the Senate, and as such it is deemed a part of the rules of
the Senate, but applicable only with respect to the procedure to be followed in
the Senate in the case of a joint resolution, and it supersedes other rules,
only to the extent that it is inconsistent with such rules; and</text>
</clause><clause id="ID261987d4f8084d2aa33e15a24934506f"><enum>(ii)</enum><text>with full recognition of
the constitutional right of the Senate to change the rules (so far as relating
to the procedure of the Senate) at any time, in the same manner, and to the
same extent as in the case of any other rule of the Senate.</text>
</clause></subparagraph></paragraph><paragraph id="id1D833BF13C554C3291D0460232471E94"><enum>(4)</enum><header>Definition</header><text>As
used in this subsection, the term <quote>joint resolution</quote> means only a
joint resolution—</text>
<subparagraph id="ID62473c0485754cc9b8260cf7061d0672"><enum>(A)</enum><text>that is introduced not
later than 3 calendar days after the date on which the request referred to in
subsection (c) is received by Congress;</text>
</subparagraph><subparagraph id="ID7511de9e9c524c418fdd6e1aa5170803"><enum>(B)</enum><text>that does not have a
preamble;</text>
</subparagraph><subparagraph id="IDe6674be380d24e6098d728a3650f622c"><enum>(C)</enum><text>the title of which is as
follows: <quote>Joint resolution relating to the approval of a plan to
guarantee obligations under section 1155 of the Restoring American Financial
Stability Act of 2010</quote>; and</text>
</subparagraph><subparagraph id="ID9305f51988ce4f138aa9c8a55e1cc3e1"><enum>(D)</enum><text>the matter after the
resolving clause of which is as follows: <quote>That Congress approves the
obligation of any amount described in section 1155(c) of the Restoring American
Financial Stability Act of 2010.</quote>.</text>
</subparagraph></paragraph></subsection><subsection id="ID84af377f7120408388a34cce5a52d264"><enum>(e)</enum><header>Funding</header>
<paragraph id="ID34e7755a4adf47bf850988eb57e62882"><enum>(1)</enum><header>Fees and other
charges</header><text>The Corporation shall charge fees and other assessments
to all participants in the program established pursuant to this section, in
such amounts as are necessary to offset projected losses and administrative
expenses, including amounts borrowed pursuant to paragraph (3), and such
amounts shall be available to the Corporation.</text>
</paragraph><paragraph id="IDa48dd974076b48268e97f90cf9aa5cad"><enum>(2)</enum><header>Excess
funds</header><text>If, at the conclusion of the program established under this
section, there are any excess funds collected from the fees associated with
such program, the funds shall be deposited in the General Fund of the
Treasury.</text>
</paragraph><paragraph id="ID3c3bac957f394e19b5a67525d6ba08fa"><enum>(3)</enum><header>Authority of
corporation</header><text>The Corporation—</text>
<subparagraph id="ID3b030c9dc89d433089ee076b5782ce98"><enum>(A)</enum><text>may borrow funds from the
Secretary of the Treasury and issue obligations of the Corporation to the
Secretary for amounts borrowed, and the amounts borrowed shall be available to
the Corporation for purposes of carrying out a program established pursuant to
this section, including the payment of reasonable costs of administering the
program, and the obligations issued shall be repaid in full with interest
through fees and charges paid by participants in accordance with paragraphs (1)
and (4), as applicable; and</text>
</subparagraph><subparagraph id="ID52af18592e004a6eb7e513503550601f"><enum>(B)</enum><text>may not borrow funds from
the Deposit Insurance Fund established pursuant to section 11(a)(4) of the
Federal Deposit Insurance Act.</text>
</subparagraph></paragraph><paragraph id="ID56ad808ee1104671abb3c97e74b300ae"><enum>(4)</enum><header>Backup special
assessments</header><text>To the extent that the funds collected pursuant to
paragraph (1) are insufficient to cover any losses or expenses, including
amounts borrowed pursuant to paragraph (3), arising from a program established
pursuant to this section, the Corporation shall impose a special assessment
solely on participants in the program, in amounts necessary to address such
insufficiency, and which shall be available to the Corporation to cover such
losses or expenses.</text>
</paragraph><paragraph id="ID7aee81e8ab124183aac24a7aeb5cd013"><enum>(5)</enum><header>Authority of the
Secretary</header><text>The Secretary may purchase any obligations issued under
paragraph (3)(A). For such purpose, the Secretary may use the proceeds of the
sale of any securities issued under chapter 31 of title 31, United States Code,
and the purposes for which securities may be issued under that chapter 31 are
extended to include such purchases, and the amount of any securities issued
under that chapter 31 for such purpose shall be treated in the same manner as
securities issued under section 208(n)(3)(B).</text>
</paragraph></subsection><subsection id="ID9eb0a3b239794cbdad10825249db1d1c"><enum>(f)</enum><header>Rule of
construction</header><text>For purposes of this section, a guarantee of
deposits held by insured depository institutions shall not be treated as a debt
guarantee program.</text>
</subsection><subsection id="IDa1c7ed52dd11465a9892d5dda0c8298d"><enum>(g)</enum><header>Definitions</header><text>For
purposes of this section, the following definitions shall apply:</text>
<paragraph id="ID680fbbcd3dcd49a8bcd58ac4503da8da"><enum>(1)</enum><header>Company</header><text>The
term <term>company</term> means any entity other than a natural person that is
incorporated or organized under Federal law or the laws of any State.</text>
</paragraph><paragraph id="ID75ae39e8704e4874b0ad0c02090ae65c"><enum>(2)</enum><header>Depository institution
holding company</header><text>The term <term>depository institution holding
company</term> has the same meaning as in section 3 of the Federal Deposit
Insurance Act (12 U.S.C. 1813).</text>
</paragraph><paragraph id="IDbfef31e079234b12b73d53b2f1c6d1ff"><enum>(3)</enum><header>Liquidity
event</header><text>The term <term>liquidity event</term> means—</text>
<subparagraph id="IDaf943cd8dd17453e9674941578b238d2"><enum>(A)</enum><text>an exceptional and broad
reduction in the general ability of financial market participants—</text>
<clause id="IDfafad4be606540019c9e41280f5f428d"><enum>(i)</enum><text>to sell financial assets
without an unusual and significant discount; or</text>
</clause><clause id="ID97b6f5adc7b2411da27a24f288fef188"><enum>(ii)</enum><text>to borrow using
financial assets as collateral without an unusual and significant increase in
margin; or</text>
</clause></subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="IDa8df63055e2d4e11bcd7023d74619511"><enum>(B)</enum><text>an unusual and
significant reduction in the ability of financial market participants to obtain
unsecured credit.</text>
</subparagraph></paragraph><paragraph id="ID7926316373c54ee2a38963e252bc9027"><enum>(4)</enum><header>Solvent</header><text>The
term <term>solvent</term> means that the value of the assets of an entity
exceed its obligations to creditors.</text>
</paragraph></subsection></section><section id="ID7d11ebec200b4166b01844d85793e9d6"><enum>1156.</enum><header>Additional related
amendments</header>
<subsection id="ID076c7c3cb9ef444f8a399694f1d0f47e"><enum>(a)</enum><header>Suspension of parallel
Federal deposit insurance Act authority</header><text>Effective upon the date
of enactment of this section, the Corporation may not exercise its authority
under section 13(c)(4)(G)(i) of the Federal Deposit Insurance Act (12 U.S.C.
1823(c)(4)(G)(i)) to establish any widely available debt guarantee program for
which section 1155 would provide authority.</text>
</subsection><subsection id="ID5989ca500be74fe0a42ba5798a3f301f"><enum>(b)</enum><header>Federal Deposit
Insurance Act</header><text>Section 13(c)(4)(G) of the Federal Deposit
Insurance Act (12 U.S.C. 1823(c)(4)(G)) is amended—</text>
<paragraph id="ID9455c41bf9084875abaaf1c2b2ead781"><enum>(1)</enum><text>in clause (i)—</text>
<subparagraph id="id592758F6813D429A9363BC0F01FC9335"><enum>(A)</enum><text>in subclause (I), by
inserting <quote>for which the Corporation has been appointed receiver</quote>
before <quote>would have serious</quote>; and</text>
</subparagraph><subparagraph id="ID2e28e6efabb943ff8568ebf04c991049"><enum>(B)</enum><text>in the undesignated
matter following subclause (II), by inserting <quote>for the purpose of winding
up the insured depository institution for which the Corporation has been
appointed receiver</quote> after <quote>provide assistance under this
section</quote>; and</text>
</subparagraph></paragraph><paragraph id="IDbd96794b9fbd41bb990dd1628ec190ec"><enum>(2)</enum><text>in clause (v)(I), by
striking <quote>The</quote> and inserting <quote>Not later than 3 days after
making a determination under clause (i), the</quote>.</text>
</paragraph></subsection><subsection id="ID2bb1d606276041298dc5a1c7d3a08ad0"><enum>(c)</enum><header>Effect of Default on an
FDIC Guarantee</header><text>If an insured depository institution or depository
institution holding company (as those terms are defined in section 3 of the
Federal Deposit Insurance Act) participating in a program under section 1155,
or any participant in a debt guarantee program established pursuant to section
13(c)(4)(G)(i) of the Federal Deposit Insurance Act defaults on any obligation
guaranteed by the Corporation after the date of enactment of this Act, the
Corporation shall—</text>
<paragraph id="ID347552767c164aa79e174e2fe1d911bd"><enum>(1)</enum><text>appoint itself as
receiver for the insured depository institution that defaults; and</text>
</paragraph><paragraph id="ID8c3facfb8c3a4248828919af41592b3d"><enum>(2)</enum><text>with respect to any other
participating company that is not an insured depository institution that
defaults—</text>
<subparagraph id="ID703885d5c3d043eea9996194d90537b7"><enum>(A)</enum><text>require—</text>
<clause id="idEEAD62F1B65D4C2CAFD2BB9A33964109"><enum>(i)</enum><text>consideration of whether
a determination shall be made, as provided in section 202 to resolve the
company under section 203; and</text>
</clause><clause id="IDe07c4f6e0d67456d966f376f6bfdbbb5"><enum>(ii)</enum><text>the company to file a
petition for bankruptcy under section 301 of title 11, United States Code, if
the Corporation is not appointed receiver pursuant to section 203 within 30
days of the date of default; or</text>
</clause></subparagraph><subparagraph id="ID96d0a5fefa22434f8dc2287e8c364041"><enum>(B)</enum><text>file a petition for
involuntary bankruptcy on behalf of the company under section 303 of title 11,
United States Code.</text>
</subparagraph></paragraph></subsection></section><section id="ID201c00d5f8b742c69cb42e0217b9f786"><enum>1157.</enum><header>Federal Reserve Act
amendments on Federal reserve bank governance</header><text display-inline="no-display-inline">The Federal Reserve Act (12 U.S.C. 221 et
seq.) is amended in section 4 by adding at the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id8FDE51CC7D0C477893A0D12075B2F0EC" reported-display-style="italic" style="OLC">
<paragraph id="ID8f165f271d0b4ccb945036523a0ce8ef"><enum>(25)</enum><header>Selection of the
President of the Federal reserve bank of New York</header><text>Notwithstanding
any other provision of this section, after the date of enactment of the
Restoring American Financial Stability Act of 2010, the president of the
Federal Reserve Bank of New York shall be appointed by the President, by and
with the advice and consent of the Senate, for terms of 5 years.</text>
</paragraph><paragraph id="ID7c902665902b4f0a9e1de2e53042804a"><enum>(26)</enum><header>Limitation on
eligibility to vote for or serve as a Federal reserve bank
director</header><text>Notwithstanding any other provision of this section,
after the date of enactment of the Restoring American Financial Stability Act
of 2010, no company, or subsidiary or affiliate of a company that is supervised
by the Board, may vote for members of the board of directors of a Federal
reserve bank, and no past or current officer, director, or employee of such
company, or subsidiary or affiliate of such company, may serve as a member of
the board of directors of a Federal reserve
bank.</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</section><section id="IDd9eb545a9f274402b18d8a80262c9100"><enum>1158.</enum><header>Amendments to the
Federal Reserve Act relating to supervision and regulation policy</header>
<subsection id="IDf21608c9ef85419aaba1e5e1d87146f8"><enum>(a)</enum><header>Establishment of the
position of vice chairman for supervision</header>
<paragraph id="IDdd930bc0b0ad484c81b2342aadd91137"><enum>(1)</enum><header>Position
established</header><text>The second undesignated paragraph of section 10 of
the Federal Reserve Act (12 U.S.C. 242) (relating to the Chairman and Vice
Chairman of the Board) is amended by striking the third sentence and inserting
the following: <quote>Of the persons thus appointed, 1 shall be designated by
the President, by and with the advice and consent of the Senate, to serve as
Chairman of the Board for a term of 4 years, and 2 shall be designated by the
President, by and with the advice and consent of the Senate, to serve as Vice
Chairmen of the Board, each for a term of 4 years, 1 of whom shall serve in the
absence of the Chairman, as provided in the fourth undesignated paragraph of
this section, and 1 of whom shall be designated Vice Chairman for Supervision.
The Vice Chairman for Supervision shall develop policy recommendations for the
Board regarding supervision and regulation of depository institution holding
companies and other financial firms supervised by the Board, and shall oversee
the supervision and regulation of such firms.</quote>.</text>
</paragraph><paragraph id="ID3c8d188065a24ef999ff9d02d1012671"><enum>(2)</enum><header>Effective
date</header><text>The amendment made by subsection (a) takes effect on the
date of enactment of this title and applies to individuals who are designated
by the President on or after that date to serve as Vice Chairman of
Supervision.</text>
</paragraph></subsection><subsection id="ID815a995170184b22aa03d478342d2a79"><enum>(b)</enum><header>Financial stability as
board function</header><text>Section 10 of the Federal Reserve Act (12 U.S.C.
241) is amended by adding at the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idF0B90F511021436781B9BA469CD737AB" reported-display-style="italic" style="OLC">
<paragraph commented="no" id="ID1828803623c44577999c6c395263a6aa"><enum>(11)</enum><header>Financial stability
function</header><text>The Board of Governors shall identify, measure, monitor,
and mitigate risks to the financial stability of the United
States.</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="IDf4aca155e6ea440aa6c4074197203cf8"><enum>(c)</enum><header>Appearances before
congress</header><text>Section 10 of the Federal Reserve Act (12 U.S.C. 241) is
amended by adding at the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id4A8AEDA7611A4E5F8F047F7FFE4F4D6B" reported-display-style="italic" style="OLC">
<paragraph id="ID26ec7b6ae6604d8aa4d9fc81d4f3af13"><enum>(12)</enum><header>Appearances before
congress</header><text>The Vice Chairman for Supervision shall appear before
the Committee on Banking, Housing, and Urban Affairs of the Senate and the
Committee on Financial Services of the House of Representatives and at
semi-annual hearings regarding the efforts, activities, objectives, and plans
of the Board with respect to the conduct of supervision and regulation of
depository institution holding companies and other financial firms supervised
by the
Board.</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="IDb025cc398b8f4c5ebc757c160cfed378"><enum>(d)</enum><header>Board responsibility To
set supervision and regulatory policy</header><text>Section 11 of the Federal
Reserve Act (12 U.S.C. 248) (relating to enumerated powers of the Board) is
amended by adding at the end of subsection (k) (relating to delegation) the
following: <quote>The Board of Governors may not delegate to a Federal reserve
bank its functions for the establishment of policies for the supervision and
regulation of depository institution holding companies and other financial
firms supervised by the Board of Governors.</quote>.</text>
</subsection></section><section id="idD606426BCBE7425A845552C8ED4AEF20"><enum>1159.</enum><header>GAO audit of the
Federal Reserve facilities; Publication of Board actions</header>
<subsection id="idFF1FBE3E95A641918B08D334FD839AF0"><enum>(a)</enum><header>GAO Audit</header>
<paragraph id="id63518FDE10024D258F175644E76F0DD0"><enum>(1)</enum><header>In
general</header><text>Notwithstanding section 714(b) of title 31, United States
Code, or any other provision of law, the Comptroller General of the United
States (in this subsection referred to as the <quote>Comptroller
General</quote>) shall conduct a one-time audit of all loans and other
financial assistance provided during the period beginning on December 1, 2007
and ending on the date of enactment of this Act by the Board of Governors under
the Asset-Backed Commercial Paper Money Market Mutual Fund Liquidity Facility,
the Term Asset-Backed Securities Loan Facility, the Primary Dealer Credit
Facility, the Commercial Paper Funding Facility, the Term Securities Lending
Facility, the Term Auction Facility, Maiden Lane, Maiden Lane II, Maiden Lane
III, the agency Mortgage-Backed Securities program, foreign currency liquidity
swap lines, and any other program created as a result of the third undesignated
paragraph of section 13 of the Federal Reserve Act.</text>
</paragraph><paragraph id="idC217AB7023CC40F58F5D80D184A438ED"><enum>(2)</enum><header>Assessments</header><text>In
conducting the audit under paragraph (1), the Comptroller General shall
assess—</text>
<subparagraph id="ID9904ff0dea234681bb1835ba5aef307e"><enum>(A)</enum><text>the operational
integrity, accounting, financial reporting, and internal controls of the credit
facility;</text>
</subparagraph><subparagraph id="ID573393e8d6c341f0b309ed5100b517973"><enum>(B)</enum><text>the effectiveness of the
collateral policies established for the facility in mitigating risk to the
relevant Federal reserve bank and taxpayers;</text>
</subparagraph><subparagraph id="IDc6931b76da624e38834cc50519d6469d5"><enum>(C)</enum><text>whether the credit
facility inappropriately favors one or more specific participants over other
institutions eligible to utilize the facility;</text>
</subparagraph><subparagraph id="IDa4b89a6747f243d1a2d961205afa72e177"><enum>(D)</enum><text>the policies governing
the use, selection, or payment of third-party contractors by or for any credit
facility; and</text>
</subparagraph><subparagraph id="id89D936FCCBE04C62B318BE9E2447A48A"><enum>(E)</enum><text>whether there were
conflicts of interest with respect to the manner in which such facility was
established or operated.</text>
</subparagraph></paragraph><paragraph id="idDFCF9691AC8B42258433D781E14B4822"><enum>(3)</enum><header>Timing</header><text>The
audit required by this subsection shall be commenced not later than 30 days
after the date of enactment of this Act, and shall be completed not later than
12 months after that date of enactment.</text>
</paragraph><paragraph id="id46164D1D8F0C4D5D948AF190D4111D75"><enum>(4)</enum><header>Report
required</header><text>The Comptroller General shall submit a report on the
audit conducted under paragraph (1) to the Congress not later than 12 months
after the date of enactment of this Act, and such report shall be made
available to—</text>
<subparagraph id="ID11a93bada50e4757af869c2d3ba8acf7"><enum>(A)</enum><text>the Speaker of the House
of Representatives;</text>
</subparagraph><subparagraph id="ID0d01c1bf50584b32b54257f2d73a704b"><enum>(B)</enum><text>the majority and minority
leaders of the House of Representatives;</text>
</subparagraph><subparagraph id="IDf5547267bb4d4d72934ad31e903cb963"><enum>(C)</enum><text>the majority and minority
leaders of the Senate;</text>
</subparagraph><subparagraph id="IDaa73f79cc92546769165203dce2f344e"><enum>(D)</enum><text>the Chairman and Ranking
Member of the Committee on Banking, Housing, and Urban Affairs of the Senate
and of the Committee on Financial Services of the House of Representatives;
and</text>
</subparagraph><subparagraph id="ID11ba63b640414d808a70a3502230c1c5"><enum>(E)</enum><text>any member of Congress
who requests it.</text>
</subparagraph></paragraph></subsection><subsection id="id9F0A423F1B484813B3665B0E7B7327ED"><enum>(b)</enum><header>Audit of Federal
Reserve Bank Governance</header>
<paragraph id="id7B28D1F49DCE4107BC3E6E9E886EE5D2"><enum>(1)</enum><header>Audit</header>
<subparagraph id="id525F84C6843E457C89F38F4D0BC2FAB1"><enum>(A)</enum><header>In
general</header><text>Not later than 1 year after the date of enactment of this
Act, the Comptroller General shall complete an audit of the governance of the
Federal reserve bank system.</text>
</subparagraph><subparagraph id="idA070AEEE9AAB49F08F0F177401629FDD"><enum>(B)</enum><header>Required
examinations</header><text>The audit required under subparagraph (A)
shall—</text>
<clause id="ID92a018c1c8aa47d6943d817d15cbfac0"><enum>(i)</enum><text>examine the extent to
which the current system of appointing Federal reserve bank directors
effectively represents <quote>the public, without discrimination on the basis
of race, creed, color, sex or national origin, and with due but not exclusive
consideration to the interests of agriculture, commerce, industry, services,
labor, and consumers</quote> in the selection of bank directors, as such
requirement is set forth under section 4 of the Federal Reserve Act;</text>
</clause><clause id="ID85460a75c4e3476797b1c5c8f137ec48"><enum>(ii)</enum><text>examine whether there
are actual or potential conflicts of interest created when the directors of
Federal reserve banks, which execute the supervisory functions of the Board of
Governors of the Federal Reserve System, are elected by member banks;</text>
</clause><clause id="idDEE7423D0D3648879D6E8B09FBBEF6A9"><enum>(iii)</enum><text>examine the
establishment and operations of each facility described in subsection (a)(1)
and each Federal reserve bank involved in the establishment and operations
thereof; and</text>
</clause><clause id="ID1a847f0864d74fe5a24498773960719d"><enum>(iv)</enum><text>identify changes to
selection procedures for Federal reserve bank directors, or to other aspects of
Federal reserve bank governance, that would—</text>
<subclause id="id4A75F93228A64126AFCB3E8CC0D695BF"><enum>(I)</enum><text>improve how the public is
represented;</text>
</subclause><subclause id="idE0295EEF47D94437A2644EBD304E27B4"><enum>(II)</enum><text>eliminate actual or
potential conflicts of interest in bank supervision;</text>
</subclause><subclause id="idDF278AD3B8BA42DFA202F9E5E3216003"><enum>(III)</enum><text>increase the
availability of information useful for the formation and execution of monetary
policy; or</text>
</subclause><subclause id="id3A0EE40D23F44FB3B34E91DA854C30EA"><enum>(IV)</enum><text>in other ways increase
the effectiveness or efficiency of reserve banks.</text>
</subclause></clause></subparagraph></paragraph><paragraph id="id759854CC0FBA4041831ED309284AA73B"><enum>(2)</enum><header>Report
required</header><text>A report on the audit conducted under paragraph (1)
shall be submitted by the Comptroller General to the Congress before the end of
the 90-day period beginning on the date on which such audit is completed, and
such report shall be made available to—</text>
<subparagraph id="id81951FDF48DB4F5C9E9E4FEC48905CB1"><enum>(A)</enum><text>the Speaker of the House
of Representatives;</text>
</subparagraph><subparagraph id="idB7C88D500E364114A3E45B4866934C94"><enum>(B)</enum><text>the majority and minority
leaders of the House of Representatives;</text>
</subparagraph><subparagraph id="id65FEB5AC06C7425E9851B330541A5B56"><enum>(C)</enum><text>the majority and minority
leaders of the Senate;</text>
</subparagraph><subparagraph id="id414F4D59B5AC41A5AECDAD1FE33A247C"><enum>(D)</enum><text>the Chairman and Ranking
Member of the Committee on Banking, Housing, and Urban Affairs of the Senate
and of the Committee on Financial Services of the House of Representatives;
and</text>
</subparagraph><subparagraph id="idEB91791BF0F54A35B2475E85A40C0A14"><enum>(E)</enum><text>any member of Congress
who requests it.</text>
</subparagraph></paragraph></subsection><subsection id="idD209D754943445FB8D952FFFCA57DAAE"><enum>(c)</enum><header>Publication of Board
actions</header><text display-inline="yes-display-inline">Notwithstanding any
other provision of law, the Board of Governors shall publish on its website,
not later than December 1, 2010, with respect to all loans and other financial
assistance it has provided during the period beginning on December 1, 2007 and
ending on the date of enactment of this Act under the Asset-Backed Commercial
Paper Money Market Mutual Fund Liquidity Facility, the Term Asset-Backed
Securities Loan Facility, the Primary Dealer Credit Facility, the Commercial
Paper Funding Facility, the Term Securities Lending Facility, the Term Auction
Facility, Maiden Lane, Maiden Lane II, Maiden Lane III, the agency
Mortgage-Backed Securities program, foreign currency liquidity swap lines, and
any other program created as a result of the third undesignated paragraph of
section 13 of the Federal Reserve Act—</text>
<paragraph id="ID23f1a1a3cb0942c3a3022a8694feab6d"><enum>(1)</enum><text>the identity of each
business, individual, entity, or foreign central bank to which the Board of
Governors has provided such assistance;</text>
</paragraph><paragraph id="ID4a5e6152a57c4de9aef89008705252d9"><enum>(2)</enum><text>the type of financial
assistance provided to that business, individual, entity, or foreign central
bank;</text>
</paragraph><paragraph id="IDe730e239a892475db0bd45036a370024"><enum>(3)</enum><text>the value or amount of
that financial assistance;</text>
</paragraph><paragraph id="ID8b4900ba73a74903a6ee6c3b95224356"><enum>(4)</enum><text>the date on which the
financial assistance was provided;</text>
</paragraph><paragraph id="ID46f4ec473b5149d88e2ea3ea08b2781b"><enum>(5)</enum><text>the specific terms of any
repayment expected, including the repayment time period, interest charges,
collateral, limitations on executive compensation or dividends, and other
material terms; and</text>
</paragraph><paragraph id="ID4767f4ed4e1d4238b9e7c656e5286d60"><enum>(6)</enum><text>the specific rationale
for each such facility or program.</text>
</paragraph></subsection></section><enum>XII</enum><header>Improving access to
mainstream financial institutions</header>
<section id="id95C9B8F372AD46558D7498D05084A693" section-type="subsequent-section"><enum>1201.</enum><header>Short
title</header><text display-inline="no-display-inline">This title may be cited
as the <quote>Improving Access to Mainstream Financial Institutions Act of
2010</quote>.</text>
</section><section id="idDCB8A73B64254A5BA4EF2FCC74971A93"><enum>1202.</enum><header>Purpose</header><text display-inline="no-display-inline">The purpose of this title is to encourage
initiatives for financial products and services that are appropriate and
accessible for millions of Americans who are not fully incorporated into the
financial mainstream.</text>
</section><section id="idFC7F7A2922CB46CA994A9B6E929092EC"><enum>1203.</enum><header>Definitions</header><text display-inline="no-display-inline">In this title, the following definitions
shall apply:</text>
<paragraph id="IDca8fe64ad57b492fb2be466b9cffc04b"><enum>(1)</enum><header>Account</header><text>The
term <term>account</term> means an agreement between an individual and an
eligible entity under which the individual obtains from or through the entity 1
or more banking products and services, and includes a deposit account, a
savings account (including a money market savings account), an account for a
closed-end loan, and other products or services, as the Secretary deems
appropriate.</text>
</paragraph><paragraph id="IDfb0a89d3a8414c77971292e41eb9fd2b"><enum>(2)</enum><header>Community development
financial institution</header><text>The term <term>community development
financial institution</term> has the same meaning as in section 103(5) of the
Community Development Banking and Financial Institutions Act of 1994 (12 U.S.C.
4702(5)).</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="id04FC0F2908C64D5B9B2642AE4412BB01"><enum>(3)</enum><header>Eligible
entity</header><text display-inline="yes-display-inline">The term
<term>eligible entity</term> means—</text>
<subparagraph commented="no" display-inline="no-display-inline" id="IDed5f59536e904b848fe261e78d2db1d0"><enum>(A)</enum><text display-inline="yes-display-inline">an organization described in section
501(c)(3) of the Internal Revenue Code of 1986, and exempt from tax under
section 501(a) of such Code;</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="IDf024ba5c4c0d4511acefa2b34592f86f"><enum>(B)</enum><text display-inline="yes-display-inline">a federally insured depository
institution;</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="ID09c2e7fb55a249a789e4fe8b4bf24662"><enum>(C)</enum><text display-inline="yes-display-inline">a community development financial
institution;</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="id812A4E1644BC4EA992B1A82AC36F8B95"><enum>(D)</enum><text>a State, local, or tribal
government entity; or</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="ID8581ee12b5dc420ba0253b79343a8ae8"><enum>(E)</enum><text display-inline="yes-display-inline">a partnership or other joint venture
comprised of 1 or more of the entities described in subparagraphs (A) through
(D), in accordance with regulations prescribed by the Secretary under this
title.</text>
</subparagraph></paragraph><paragraph id="ID70ef2fe03c66477f95f5aa50106a262e"><enum>(4)</enum><header>Federally insured
depository institution</header><text>The term <term>federally insured
depository institution</term> means any insured depository institution (as that
term is defined in section 3 of the Federal Deposit Insurance Act (12 U.S.C.
1813)) and any insured credit union (as that term is defined in section 101 of
the Federal Credit Union Act (12 U.S.C. 1752)).</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="IDce163fb48d65457d839f2bdb64077ad3"><enum>(5)</enum><header>Payday
loan</header><text display-inline="yes-display-inline">The term <quote>payday
loan</quote> means any transaction in which a small cash advance is made to a
consumer in exchange for—</text>
<subparagraph commented="no" display-inline="no-display-inline" id="id41284C796F714A8DBB68A4722B7CFABC"><enum>(A)</enum><text display-inline="yes-display-inline">the personal check or share draft of the
consumer, in the amount of the advance plus a fee, where presentment or
negotiation of such check or share draft is deferred by agreement of the
parties until a designated future date; or</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="idBBD64285F7D740319AD6689E2185B170"><enum>(B)</enum><text display-inline="yes-display-inline">the authorization of the consumer to debit
the transaction account or share draft account of the consumer, in the amount
of the advance plus a fee, where such account will be debited on or after a
designated future date.</text>
</subparagraph></paragraph></section><section id="id2D1CC4D75CB042BDB1761FEBD1F7810C"><enum>1204.</enum><header>Expanded access to
mainstream financial institutions</header>
<subsection id="IDd5f30a2f535a45199475bcac792ee748"><enum>(a)</enum><header>In
general</header><text>The Secretary is authorized to establish a multiyear
program of grants, cooperative agreements, financial agency agreements, and
similar contracts or undertakings to promote initiatives designed—</text>
<paragraph id="IDfb527b268d644490bf0587aaf7b04171"><enum>(1)</enum><text>to enable low- and
moderate-income individuals to establish one or more accounts in a federally
insured depository institution that are appropriate to meet the financial needs
of such individuals; and</text>
</paragraph><paragraph id="ID2c000d77c7e14db79a3ee8ebb2971f04"><enum>(2)</enum><text>to improve access to the
provision of accounts, on reasonable terms, for low- and moderate-income
individuals.</text>
</paragraph></subsection><subsection id="ID592c4b2459604fe8af2d863df6d565ec"><enum>(b)</enum><header>Program eligibility and
activities</header>
<paragraph id="ID4b77a58cf3dd43e9a1dc0f71fe5b062d"><enum>(1)</enum><header>In
general</header><text>The Secretary shall restrict participation in any program
established under subsection (a) to an eligible entity. Subject to regulations
prescribed by the Secretary under this title, 1 or more eligible entities may
participate in 1 or several programs established under subsection (a).</text>
</paragraph><paragraph id="ID9d221bec2d1445c9a24297a2531eb5a3"><enum>(2)</enum><header>Account
activities</header><text>Subject to regulations prescribed by the Secretary, an
eligible entity may, in participating in a program established under subsection
(a), offer or provide to low- and moderate-income individuals products and
services relating to accounts, including—</text>
<subparagraph id="ID83ca73f2340e42b0be18aeb2c72540bf"><enum>(A)</enum><text>small-dollar value loans;
and</text>
</subparagraph><subparagraph id="IDfc9a19e955fa439cad777db27375c03f"><enum>(B)</enum><text>financial education and
counseling relating to conducting transactions in and managing accounts.</text>
</subparagraph></paragraph></subsection></section><section id="id4FBB1C1FBCFA447695934A68EB93C91E"><enum>1205.</enum><header>Low-cost alternatives
to payday loans</header>
<subsection commented="no" display-inline="no-display-inline" id="id7641C6944F8641DC97660F78DE687181"><enum>(a)</enum><header>Grants
authorized</header><text display-inline="yes-display-inline">The Secretary is
authorized to establish multiyear demonstration programs by means of grants,
cooperative agreements, financial agency agreements, and similar contracts or
undertakings, with eligible entities to provide low-cost, small loans to
consumers that will provide alternatives to more costly payday loans.</text>
</subsection><subsection commented="no" display-inline="no-display-inline" id="IDb73ec85e75d5458e9201fec968966a97"><enum>(b)</enum><header>Terms and
conditions</header>
<paragraph id="ID3269172151564e11b065d31d286ef7df"><enum>(1)</enum><header>In
general</header><text>Loans under this section shall be made on terms and
conditions, and pursuant to lending practices, that are reasonable for
consumers.</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="id5DD0F5CB12304D6E86B5633835959C6B"><enum>(2)</enum><header>Financial literacy and
education opportunities</header>
<subparagraph id="ID7cd9a733fa69499183b4c90e7e5b88c9"><enum>(A)</enum><header>In
general</header><text>Each eligible entity awarded a grant under this section
shall promote and take appropriate steps to ensure the provision of financial
literacy and education opportunities, such as relevant counseling services,
educational courses, or wealth building programs, to each consumer provided
with a loan pursuant to this section.</text>
</subparagraph><subparagraph id="ID92c54c011b3044489ad14148727ba6ee"><enum>(B)</enum><header>Authority to expand
access</header><text>As part of the grants, agreements, and undertakings
established under this section, the Secretary may implement reasonable measures
or programs designed to expand access to financial literacy and education
opportunities, including relevant counseling services, educational courses, or
wealth building programs to be provided to individuals who obtain loans from
eligible entities under this section.</text>
</subparagraph></paragraph></subsection></section><section id="ID77a50a49fd4d435f994074f632f629f2"><enum>1206.</enum><header>Grants to establish
loan-loss reserve funds</header><text display-inline="no-display-inline">The
Community Development Banking and Financial Institutions Act of 1994 (12 U.S.C.
4701 et seq.) is amended by adding at the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idEB207C6764594E46ACBCB0B8BB32185E" reported-display-style="italic" style="OLC">
<section id="IDdb62fb31fd57412097749ec361da8840"><enum>122.</enum><header>Grants to establish
loan-loss reserve funds</header>
<subsection id="ID5c3f471e7ca1449db188e4412e752255"><enum>(a)</enum><header>Purposes</header><text>The
purposes of this section are—</text>
<paragraph id="IDe385bc0b943f435a9230237b5014405a"><enum>(1)</enum><text>to make financial
assistance available from the Fund in order to help community development
financial institutions defray the costs of operating small dollar loan
programs, by providing the amounts necessary for such institutions to establish
their own loan loss reserve funds to mitigate some of the losses on such small
dollar loan programs; and</text>
</paragraph><paragraph id="IDb4ceb2e3949a4ae7aa38046f5185548e"><enum>(2)</enum><text>to encourage community
development financial institutions to establish and maintain small dollar loan
programs that would help give consumers access to mainstream financial
institutions and combat payday lending.</text>
</paragraph></subsection><subsection id="ID18fe4a6f66cd4f7ba296aea16c68afee"><enum>(b)</enum><header>Grants</header>
<paragraph id="ID516dc66c83b347d3a6240ca5b79f63e3"><enum>(1)</enum><header>Loan-loss reserve fund
grants</header><text>The Fund shall make grants to community development
financial institutions or to any partnership between such community development
financial institutions and any other federally insured depository institution
with a primary mission to serve targeted investment areas, as such areas are
defined under section 103(16), to enable such institutions or any partnership
of such institutions to establish a loan-loss reserve fund in order to defray
the costs of a small dollar loan program established or maintained by such
institution.</text>
</paragraph><paragraph id="IDcc29e7f841e9490e9379b45be84cbb3a"><enum>(2)</enum><header>Matching
requirement</header><text>A community development financial institution or any
partnership of institutions established pursuant to paragraph (1) shall provide
non-Federal matching funds in an amount equal to 50 percent of the amount of
any grant received under this section.</text>
</paragraph><paragraph id="ID403720e7222d4c96bea85f1fcd0024e3"><enum>(3)</enum><header>Use of
funds</header><text>Any grant amounts received by a community development
financial institution or any partnership between or among such institutions
under paragraph (1)—</text>
<subparagraph id="ID3d6c769beec6450ebf91b23dbf160b78"><enum>(A)</enum><text>may not be used by such
institution to provide direct loans to consumers;</text>
</subparagraph><subparagraph id="ID5a636be93da346c796c54cbcfb4870ad"><enum>(B)</enum><text>may be used by such
institution to help recapture a portion or all of a defaulted loan made under
the small dollar loan program of such institution; and</text>
</subparagraph><subparagraph id="IDc39aef2c83e049f69f2dd0dc0b541793"><enum>(C)</enum><text>may be used to designate
and utilize a fiscal agent for services normally provided by such an
agent.</text>
</subparagraph></paragraph><paragraph id="IDe551d0f0e6ef48eca7f60cf58d53e3c9"><enum>(4)</enum><header>Technical assistance
grants</header><text>The Fund shall make technical assistance grants to
community development financial institutions or any partnership between or
among such institutions to support and maintain a small dollar loan program.
Any grant amounts received under this paragraph may be used for technology,
staff support, and other costs associated with establishing a small dollar loan
program.</text>
</paragraph></subsection><subsection id="ID8993c05f8f5c42c782ca47e83a9aad8b"><enum>(c)</enum><header>Definitions</header><text>For
purposes of this section—</text>
<paragraph id="IDd5944e4bcf0f43148ba144c15e907c6b"><enum>(1)</enum><text>the term <term>consumer
reporting agency that compiles and maintains files on consumers on a nationwide
basis</term> has the same meaning given such term in section 603(p) of the Fair
Credit Reporting Act (15 U.S.C. 1681a(p)); and</text>
</paragraph><paragraph id="ID32f96c5e037b489b9f4404615e4a1bb0"><enum>(2)</enum><text>the term <term>small
dollar loan program</term> means a loan program wherein a community development
financial institution or any partnership between or among such institutions
offers loans to consumers that—</text>
<subparagraph id="ID4ed1603b15a3478097c197117193cff1"><enum>(A)</enum><text>are made in amounts not
exceeding $2,500;</text>
</subparagraph><subparagraph id="IDad18ebcb9d7f491b92de0430a3cdbc01"><enum>(B)</enum><text>must be repaid in
installments;</text>
</subparagraph><subparagraph id="IDf7277d1c71f0451883a687d41c96169e"><enum>(C)</enum><text>have no pre-payment
penalty;</text>
</subparagraph><subparagraph id="ID4333da9887fb4a71b2d63efbe1bde041"><enum>(D)</enum><text>the institution has to
report payments regarding the loan to at least 1 of the consumer reporting
agencies that compiles and maintains files on consumers on a nationwide basis;
and</text>
</subparagraph><subparagraph id="IDa0ac9bd6790947cc9202279b7a060b06"><enum>(E)</enum><text>meet any other
affordability requirements as may be established by the
Administrator.</text>
</subparagraph></paragraph></subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</section><section id="id68EDD4AC681F4ADEAE1C9A855CFADCEA"><enum>1207.</enum><header>Procedural
provisions</header><text display-inline="no-display-inline">An eligible entity
desiring to participate in a program or obtain a grant under this title shall
submit an application to the Secretary, in such form and containing such
information as the Secretary may require.</text>
</section><section id="ID90729ff92f63438897d2378302f260ce"><enum>1208.</enum><header>Authorization of
appropriations</header>
<subsection id="id037E756AC16C46139303EECA168FB2E7"><enum>(a)</enum><header>Authorization to the
Secretary</header><text>There are authorized to be appropriated to the
Secretary, such sums as are necessary to both administer and fund the programs
and projects authorized by this title, to remain available until
expended.</text>
</subsection><subsection id="idD6D2AF44AA0F4DE9A778F0D1F33A87C6"><enum>(b)</enum><header>Authorization to the
fund</header><text>There is authorized to be appropriated to the Fund for each
fiscal year beginning in fiscal year 2010, an amount equal to the amount of the
administrative costs of the Fund for the operation of the grant program
established under this title.</text>
</subsection></section><section commented="no" display-inline="no-display-inline" id="IDfe20938f79cf408590074604ffd7096b" section-type="subsequent-section"><enum>1209.</enum><header>Regulations</header>
<subsection commented="no" display-inline="no-display-inline" id="id0681051F3CFD4C03B1309C0711F8E2BA"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">The Secretary is
authorized to promulgate regulations to implement and administer the grant
programs and undertakings authorized by this title.</text>
</subsection><subsection id="ID051aa05a9b7b42f79bb94992c7d0e6bb"><enum>(b)</enum><header>Regulatory
authority</header><text>Regulations prescribed under this section may contain
such classifications, differentiations, or other provisions, and may provide
for such adjustments and exceptions for any class of grant programs,
undertakings, or eligible entities, as, in the judgment of the Secretary, are
necessary or proper to effectuate the purposes of this title, to prevent
circumvention or evasion of this title, or to facilitate compliance with this
title.</text>
</subsection></section><section commented="no" display-inline="no-display-inline" id="ID36bcec0a12554bcb9cce6ef90f6fb93d" section-type="subsequent-section"><enum>1210.</enum><header>Evaluation and
reports to Congress</header><text display-inline="no-display-inline">For each
fiscal year in which a program or project is carried out under this title, the
Secretary shall submit a report to the Committee on Banking, Housing, and Urban
Affairs of the Senate and the Committee on Financial Services of the House of
Representatives containing a description of the activities funded, amounts
distributed, and measurable results, as appropriate and available.</text>
</section><enum>XIII</enum><header>Pay It Back
Act</header>
<section id="id5D0DE99BA98F43E09B0B87E7BB3DD44B"><enum>1301.</enum><header>Short
title</header><text display-inline="no-display-inline">This title may be cited
as the <quote><short-title>Pay It Back
Act</short-title></quote>.</text>
</section><section id="id6F44EC42368647D9A67552F9418BC826"><enum>1302.</enum><header>Amendment to reduce
TARP authorization</header><text display-inline="no-display-inline">Section
115(a) of the Emergency Economic Stabilization Act of 2008 (12 U.S.C. 5225(a))
is amended—</text>
<paragraph id="IDddde15436558455f8f7f640763835f3a"><enum>(1)</enum><text>in paragraph (3)—</text>
<subparagraph id="IDd22260d638fe427f8ed6a958ab72ee56"><enum>(A)</enum><text>by striking
<quote>If</quote> and inserting <quote>Except as provided in paragraph (4),
if</quote>;</text>
</subparagraph><subparagraph id="IDc172b53d9b7f40489b5a732d51f96f31"><enum>(B)</enum><text>by striking <quote>,
$700,000,000,000, as such amount is reduced by $1,259,000,000, as such amount
is reduced by $1,244,000,000</quote> and inserting
<quote>$550,000,000,000</quote>; and</text>
</subparagraph><subparagraph id="IDa45fbaf66b2640b7a339614c5211c6d9"><enum>(C)</enum><text>by striking
<quote>outstanding at any one time</quote>; and</text>
</subparagraph></paragraph><paragraph id="ID4c08697b5e39472e9b732829eb1ecc18"><enum>(2)</enum><text>by adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id53A6DCE2292F44D6B16C561B685C1313" reported-display-style="italic" style="OLC">
<paragraph id="ID765a48fc5f6c4ffd8526784c77cc5a96"><enum>(4)</enum><text>If the Secretary, with
the concurrence of the Chairman of the Board of Governors of the Federal
Reserve System, determines that there is an immediate and substantial threat to
the economy arising from financial instability, the Secretary is authorized to
purchase troubled assets under this Act in an amount equal to amounts received
by the Secretary before, on, or after the date of enactment of the
<short-title>Pay It Back Act</short-title> for repayment
of the principal of financial assistance by an entity that has received
financial assistance under the TARP or any other program enacted by the
Secretary under the authorities granted to the Secretary under this Act, but
only—</text>
<subparagraph id="id16EC9D355FDA4A41A58A8F61ED6AC64D"><enum>(A)</enum><text>to the extent necessary
to address the threat; and</text>
</subparagraph><subparagraph id="id9E337EAB9D394F12A5E9DF8819570327"><enum>(B)</enum><text>upon transmittal of such
determination, in writing, to the appropriate committees of
Congress.</text>
</subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></section><section id="id4276004B1EC542F5B7074822DC8D4C44"><enum>1303.</enum><header>Report</header><text display-inline="no-display-inline">Section 106 of the Emergency Economic
Stabilization Act of 2008 (12 U.S.C. 5216) is amended by inserting at the end
the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id968D86541DD642079E5D8E626D722BAC" reported-display-style="italic" style="OLC">
<subsection id="id4BF18766953E436288678AD0257A1E59"><enum>(f)</enum><header>Report</header><text>The
Secretary of the Treasury shall report to Congress every 6 months on amounts
received and transferred to the general fund under subsection
(d).</text>
</subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</section><section id="idB5D266E6854E4163AB6F3F79FD35073B"><enum>1304.</enum><header>Amendments to Housing
and Economic Recovery Act of 2008</header>
<subsection id="idD7DDB4CB8B174D2E8C1D9D988E23A869"><enum>(a)</enum><header>Sale of Fannie Mae
obligations and securities by the Treasury; deficit
reduction</header><text>Section 304(g)(2) of the Federal National Mortgage
Association Charter Act (12 U.S.C. 1719(g)(2)) is amended—</text>
<paragraph id="id8EBFBB9F7F5444C290775B4904DAB705"><enum>(1)</enum><text>by redesignating
subparagraph (C) as subparagraph (D); and</text>
</paragraph><paragraph id="idE70DEE4784C24849840F9AEF15668023"><enum>(2)</enum><text>by inserting after
subparagraph (B) the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idC0264581CBAA428F8514EAE989466CAE" reported-display-style="italic" style="OLC">
<subparagraph id="idF8367388428945F796DA5CCA4AF6696C"><enum>(C)</enum><header>Deficit
reduction</header><text>The Secretary of the Treasury shall deposit in the
General Fund of the Treasury any amounts received by the Secretary from the
sale of any obligation acquired by the Secretary under this subsection, where
such amounts shall be—</text>
<clause id="id0E8F74C6707D430785C2F1A812C58A80"><enum>(i)</enum><text>dedicated for the sole
purpose of deficit reduction; and</text>
</clause><clause id="id34E915D74DD440588A052770C9A77F8C"><enum>(ii)</enum><text>prohibited from use as
an offset for other spending increases or revenue
reductions.</text>
</clause></subparagraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="idDB7BABF9C1EF46448F8575E765E321A2"><enum>(b)</enum><header>Sale of Freddie Mac
obligations and securities by the Treasury; deficit
reduction</header><text>Section 306(l)(2) of the Federal Home Loan Mortgage
Corporation Act (12 U.S.C. 1455(l)(2)) is amended—</text>
<paragraph id="id2454A13067B046A0858F9681ED79F2D4"><enum>(1)</enum><text>by redesignating
subparagraph (C) as subparagraph (D); and</text>
</paragraph><paragraph id="id6866753D78F846C084696E3D1CA0DE34"><enum>(2)</enum><text>by inserting after
subparagraph (B) the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id04829B5E67D34256A1C4BA38FFEAD4C3" reported-display-style="italic" style="OLC">
<subparagraph id="id37B76CF25A2D42F4AE8D4C13155720E4"><enum>(C)</enum><header>Deficit
reduction</header><text>The Secretary of the Treasury shall deposit in the
General Fund of the Treasury any amounts received by the Secretary from the
sale of any obligation acquired by the Secretary under this subsection, where
such amounts shall be—</text>
<clause id="idBBC76DCA817E43509407721CA8D23ECD"><enum>(i)</enum><text>dedicated for the sole
purpose of deficit reduction; and</text>
</clause><clause id="id67A3962C964F4A4CA6A2897A422DCA1C"><enum>(ii)</enum><text>prohibited from use as
an offset for other spending increases or revenue
reductions.</text>
</clause></subparagraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="id374E17F419404DA4840359815B341144"><enum>(c)</enum><header>Sale of Federal Home
Loan Banks obligations by the Treasury; deficit reduction</header><text>Section
11(l)(2) of the Federal Home Loan Bank Act (12 U.S.C. 1431(l)(2)) is
amended—</text>
<paragraph id="idCC856ECE4950493C86434ACC32686FD7"><enum>(1)</enum><text>by redesignating
subparagraph (C) as subparagraph (D); and</text>
</paragraph><paragraph id="id7671E4AB03D6476F8D1C54EC33B1DBB2"><enum>(2)</enum><text>by inserting after
subparagraph (B) the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id56B5E7E1D02A418989D25CEF0B1699A5" reported-display-style="italic" style="OLC">
<subparagraph id="idB2034E5BC85C4C60B42B8659B494A02D"><enum>(C)</enum><header>Deficit
reduction</header><text>The Secretary of the Treasury shall deposit in the
General Fund of the Treasury any amounts received by the Secretary from the
sale of any obligation acquired by the Secretary under this subsection, where
such amounts shall be—</text>
<clause id="id6610EEAB41504EEBAA0444CDB615FFA0"><enum>(i)</enum><text>dedicated for the sole
purpose of deficit reduction; and</text>
</clause><clause id="id1920EFEE1DA449CD8131285A52E50DF4"><enum>(ii)</enum><text>prohibited from use as
an offset for other spending increases or revenue
reductions.</text>
</clause></subparagraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="id7FC7597729FA48D6820D7A2374B0A93D"><enum>(d)</enum><header>Repayment of
fees</header><text>Any periodic commitment fee or any other fee or assessment
paid by the Federal National Mortgage Association or Federal Home Loan Mortgage
Corporation to the Secretary of the Treasury as a result of any preferred stock
purchase agreement, mortgage-backed security purchase program, or any other
program or activity authorized or carried out pursuant to the authorities
granted to the Secretary of the Treasury under section 1117 of the Housing and
Economic Recovery Act of 2008 (Public Law 110–289; 122 Stat. 2683), including
any fee agreed to by contract between the Secretary and the Association or
Corporation, shall be deposited in the General Fund of the Treasury where such
amounts shall be—</text>
<paragraph id="id358B5D6C07FD4B43AA189F3EF8B05D72"><enum>(1)</enum><text>dedicated for the sole
purpose of deficit reduction; and</text>
</paragraph><paragraph id="id92B330ACB06D429B9F49A1366F1D629E"><enum>(2)</enum><text>prohibited from use as an
offset for other spending increases or revenue reductions.</text>
</paragraph></subsection></section><section id="id65B6342B5E2241659F0160160C33956B"><enum>1305.</enum><header>Federal Housing
Finance Agency report</header><text display-inline="no-display-inline">The
Director of the Federal Housing Finance Agency shall submit to Congress a
report on the plans of the Agency to continue to support and maintain the
Nation's vital housing industry, while at the same time guaranteeing that the
American taxpayer will not suffer unnecessary losses.</text>
</section><section id="idB357AD75149449F68728EADB88FCD7D2"><enum>1306.</enum><header>Repayment of
unobligated ARRA funds</header>
<subsection id="id680F86053971443CA3C239E443CBE1D6"><enum>(a)</enum><header>Rejection of ARRA funds
by State</header><text>Section 1607 of the American Recovery and Reinvestment
Act of 2009 (Public Law 111–5; 123 Stat. 305) is amended by adding at the end
the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idA84CD7CCBE674E99B072AA5F51AE8531" reported-display-style="italic" style="OLC">
<subsection id="idE295460435DC47E6A4149B7513313113"><enum>(d)</enum><header>Statewide rejection of
funds</header><text>If funds provided to any State in any division of this Act
are not accepted for use by the Governor of the State pursuant to subsection
(a) or by the State legislature pursuant to subsection (b), then all such funds
shall be—</text>
<paragraph id="idD23282D274DC44DCB3DCF2D4BADBA82D"><enum>(1)</enum><text>rescinded; and</text>
</paragraph><paragraph id="id045E3DCB4CBD4E6A880B1F22A010637D"><enum>(2)</enum><text>deposited in the General
Fund of the Treasury where such amounts shall be—</text>
<subparagraph id="id5698F7269E76423D92BC89BD64E7D686"><enum>(A)</enum><text>dedicated for the sole
purpose of deficit reduction; and</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="idF9B56EA50B3749B999521E5B26A06C6F"><enum>(B)</enum><text>prohibited from use as an
offset for other spending increases or revenue
reductions.</text>
</subparagraph></paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="id3179777D71D944D08E4C60754C98812E"><enum>(b)</enum><header>Withdrawal or recapture
of unobligated funds</header><text>Title XVI of the American Recovery and
Reinvestment Act of 2009 (Public Law 111–5; 123 Stat. 302) is amended by adding
at the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idD1BB44073CC8414F9D71B7B0DF21AC5C" reported-display-style="italic" style="OLC">
<section id="id9C3C55BFB9A34DAA9211081BB282EC87"><enum>1613.</enum><header>Withdrawal or
recapture of unobligated funds</header><text display-inline="no-display-inline">Notwithstanding any other provision of this
Act, if the head of any executive agency withdraws or recaptures for any reason
funds appropriated or otherwise made available under this division, and such
funds have not been obligated by a State to a local government or for a
specific project, such recaptured funds shall be—</text>
<paragraph id="id07DF6C97D64A4C489D0C72ACA39D519D"><enum>(1)</enum><text display-inline="yes-display-inline">rescinded; and</text>
</paragraph><paragraph id="idC01CF1588DDD4514802B71BA16BFF781"><enum>(2)</enum><text display-inline="yes-display-inline">deposited in the General Fund of the
Treasury where such amounts shall be—</text>
<subparagraph id="id98A47EEED1BE4D7CB141D619D45C3C4E"><enum>(A)</enum><text>dedicated for the sole
purpose of deficit reduction; and</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="idEF7F8E7044CB46FC8D2EFF5C3D38B1A1"><enum>(B)</enum><text display-inline="yes-display-inline">prohibited from use as an offset for other
spending increases or revenue
reductions.</text>
</subparagraph></paragraph></section><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="id79E2F8D52FA64F1684B71363BA1B8EF7"><enum>(c)</enum><header>Return of unobligated
funds by end of 2012</header><text>Section 1603 of the American Recovery and
Reinvestment Act of 2009 (Public Law 111–5; 123 Stat. 302) is amended
by—</text>
<paragraph id="id760E653241794B6782E69A4A8DA4C533"><enum>(1)</enum><text>striking <quote>All
funds</quote> and inserting <quote>(a)
<header-in-text level="subsection" style="OLC">In general</header-in-text>.—All
funds</quote>; and</text>
</paragraph><paragraph id="id20482AC2322B494ABEC4B1C0D25381C8"><enum>(2)</enum><text>adding at the end the
following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idA82F16CAD9664A15B50E0FF450852B3E" reported-display-style="italic" style="OLC">
<subsection id="idC51422EA0FF6439C8C781E54DAF9EEFC"><enum>(b)</enum><header>Repayment of
unobligated funds</header><text>Any discretionary appropriations made available
in this division that have not been obligated as of December 31, 2012, are
hereby rescinded, and such amounts shall be deposited in the General Fund of
the Treasury where such amounts shall be—</text>
<paragraph id="id74593A0E8561476DA03A590391305692"><enum>(1)</enum><text>dedicated for the sole
purpose of deficit reduction; and</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="idA0C7E3E2A23C47E78AFDE45732CC7998"><enum>(2)</enum><text>prohibited from use as an
offset for other spending increases or revenue reductions.</text>
</paragraph></subsection><subsection commented="no" display-inline="no-display-inline" id="id731F6C3022814527A81332DF22BF91B4"><enum>(c)</enum><header>Presidential waiver
authority</header>
<paragraph commented="no" display-inline="no-display-inline" id="idB00949AFC85948738D4E05BA2A204822"><enum>(1)</enum><header>In
general</header><text>The President may waive the requirements under subsection
(b), if the President determines that it is not in the best interest of the
Nation to rescind a specific unobligated amount after December 31, 2012.</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="id638C61759AE04311BA8DE68D07805E8A"><enum>(2)</enum><header>Requests</header><text>The
head of an executive agency may also apply to the President for a waiver from
the requirements under subsection
(b).</text>
</paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection></section><enum>XIV</enum><header>Miscellaneous</header>
<section id="idD594BD9E6EC645BD90751619F38FBC30"><enum>1401.</enum><header>Restrictions on use
of Federal funds to finance bailouts of foreign governments</header><text display-inline="no-display-inline">The Bretton Woods Agreements Act (22 U.S.C.
286 et seq.) is amended by adding at the end the following:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="idE39218CFADA54B578CA930735080F6BF" reported-display-style="italic" style="OLC">
<section id="idAE98C2A7377B43B5801E90ADC157A223"><enum>68.</enum><header>Restrictions on use of
Federal funds to finance bailouts of foreign governments</header>
<subsection id="id2791D5B5A36A407A86454C975819CB2F"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">The President shall
direct the United States Executive Director of the International Monetary
Fund—</text>
<paragraph id="idC27F1EF131304D3E990DADB7A99F8EAA"><enum>(1)</enum><text display-inline="yes-display-inline">to evaluate any proposed loan to a country
by the Fund if the amount of the public debt of the country exceeds the gross
domestic product of the country;</text>
</paragraph><paragraph id="idC1EAC6CE0B534E0D83DF2D436E4BFF0B"><enum>(2)</enum><text>to determine whether or
not the loan will be repaid and certify that determination to Congress.</text>
</paragraph></subsection><subsection id="idDB88DEAA896048BD97B0E5A5E36CD488"><enum>(b)</enum><header>Opposition to loans
unlikely To be repaid</header><text>If the Executive Director determines under
subsection (a)(2) that a loan by the International Monetary Fund to a country
will not be repaid, the President shall direct the Executive Director to use
the voice and vote of the United States to vote in opposition to the proposed
loan.</text>
</subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</section><enum>XV</enum><header>Congo Conflict
Minerals</header>
<section commented="no" display-inline="no-display-inline" id="id413D25547FAA48C0972FC9D211C44513" section-type="subsequent-section"><enum>1501.</enum><header>Sense of Congress
on exploitation and trade of columbite-tantalite, cassiterite, gold, and
wolframite originating in Democratic Republic of Congo</header><text display-inline="no-display-inline">It is the sense of Congress that the
exploitation and trade of columbite-tantalite, cassiterite, gold, and
wolframite in the eastern Democratic Republic of Congo is helping to finance
extreme levels of violence in the eastern Democratic Republic of Congo,
particularly sexual and gender-based violence, and contributing to an emergency
humanitarian situation therein, warranting the provisions of section 13(o) of
the Securities Exchange Act of 1934, as added by section 1302.</text>
</section><section commented="no" display-inline="no-display-inline" id="id5F803F047600463A912403164CB0A2A1" section-type="subsequent-section"><enum>1502.</enum><header display-inline="yes-display-inline">Disclosure to Securities and Exchange
Commission relating to columbite-tantalite, cassiterite, gold, and wolframite
originating in Democratic Republic of Congo</header><text display-inline="no-display-inline">Section 13 of the Securities Exchange Act of
1934 (15 U.S.C. 78m), as amended by section 763 of this Act, is further amended
by adding at the end the following new subsection:</text>
<quoted-block changed="added" display-inline="no-display-inline" id="id08947C922DD24221938CBAD44470F041" reported-display-style="italic" style="OLC">
<subsection commented="no" display-inline="no-display-inline" id="ID45a42f679cb548138d79f4f39b5c0485"><enum>(o)</enum><header display-inline="yes-display-inline">Disclosures to Commission relating to
columbite-tantalite, cassiterite, gold, and wolframite originating in
Democratic Republic of Congo</header>
<paragraph commented="no" display-inline="no-display-inline" id="id1F91FA520B9D40C7A734EBDDD8065754"><enum>(1)</enum><header>In
general</header><text>Not later than 180 days after the date of the enactment
of this subsection, the Commission shall promulgate rules requiring any person
described in paragraph (2)—</text>
<subparagraph commented="no" display-inline="no-display-inline" id="id3983818F9826460CB461F3509D255726"><enum>(A)</enum><text>to disclose annually to
the Commission in a report—</text>
<clause commented="no" display-inline="no-display-inline" id="idB45B9AD2CE7B43C69053A1C521C1F917"><enum>(i)</enum><text>whether the
columbite-tantalite, cassiterite, gold, or wolframite that was necessary as
described in paragraph (2)(A)(ii) in the year for which such report is
submitted originated or may have originated in the Democratic Republic of Congo
or an adjoining country; and</text>
</clause><clause commented="no" display-inline="no-display-inline" id="idFBF7FF4561584923939545BC466BECDB"><enum>(ii)</enum><text>a description of the
measures taken by the person, which may include an independent audit, to
exercise due diligence on the source and chain of custody of such
columbite-tantalite, cassiterite, gold, or wolframite, or derivatives of such
minerals, in order to ensure that the activities of such person that involve
such minerals or derivatives did not directly or indirectly finance or benefit
armed groups in the Democratic Republic of Congo or an adjoining country;
and</text>
</clause></subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="id6ECAC1A7F5B34160B2B2FEA71F08CA2E"><enum>(B)</enum><text>make the information
disclosed under subparagraph (A) available to the public on the Internet
website of the person.</text>
</subparagraph></paragraph><paragraph commented="no" display-inline="no-display-inline" id="ID6d7634f91b694f44a5356223cfc09783"><enum>(2)</enum><header display-inline="yes-display-inline">Person described</header>
<subparagraph commented="no" display-inline="no-display-inline" id="idF263392D321942869D7A9C3E1AEB77B4"><enum>(A)</enum><header>In
general</header><text display-inline="yes-display-inline">A person is described
in this paragraph if—</text>
<clause commented="no" display-inline="no-display-inline" id="idC6C528886A6B4A5D99392D592DAC3176"><enum>(i)</enum><text display-inline="yes-display-inline">the person is required to file reports to
the Commission under subsection (a)(2); and</text>
</clause><clause commented="no" display-inline="no-display-inline" id="IDc3bdc01ec4a545a5b563fdc9a539be1a"><enum>(ii)</enum><text display-inline="yes-display-inline">columbite-tantalite, cassiterite, gold, or
wolframite is necessary to the functionality or production of a product
manufactured by such person.</text>
</clause></subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="id35E8AD02952643888C70311322EF1078"><enum>(B)</enum><header>Derivatives</header><text>For
purposes of this paragraph, if a derivative of a mineral is necessary to the
functionality or production of a product manufactured by a person, such mineral
shall also be considered necessary to the functionality or production of a
product manufactured by the person.</text>
</subparagraph></paragraph><paragraph commented="no" display-inline="no-display-inline" id="ID4d5f59ecfb8a46ff93e7efadb7ff69af"><enum>(3)</enum><header display-inline="yes-display-inline">Revisions and waivers</header><text>The
Commission shall revise or temporarily waive the requirements described in
paragraph (1) if the President determines that such revision or waiver is in
the public interest.</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="ID3b155881849248a4be7f2f144e46a51e"><enum>(4)</enum><header display-inline="yes-display-inline">Termination of disclosure
requirements</header>
<subparagraph commented="no" display-inline="no-display-inline" id="idD0B3EB19E8E3427B94512D7F95CA2DA1"><enum>(A)</enum><header>In
general</header><text display-inline="yes-display-inline">Except as provided in
subparagraph (B), the requirements of paragraph (1) shall terminate on the date
that is 5 years after the date of the enactment of this subsection.</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="id713D7A4C2B684C64B68A36676262C6E9"><enum>(B)</enum><header>Extension by Secretary
of State</header><text display-inline="yes-display-inline">The date described
in subparagraph (A) shall be extended by 1 year for each year in which the
Secretary of State certifies that armed parties to the ongoing armed conflict
in the Democratic Republic of Congo or adjoining countries continue to be
directly involved and benefitting from commercial activity involving
columbite-tantalite, cassiterite, gold, or wolframite.</text>
</subparagraph></paragraph><paragraph commented="no" display-inline="no-display-inline" id="idF13C52FD4D2643518D875DDA8140B56E"><enum>(5)</enum><header>Adjoining country
defined</header><text>In this subsection, the term <term>adjoining
country</term>, with respect to the Democratic Republic of Congo, means a
country that shares an internationally recognized border with the Democratic
Republic of
Congo.</text>
</paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</section><section commented="no" display-inline="no-display-inline" id="id35C2F9F5F8064FD7AE6D01FF02445EC2"><enum>1503.</enum><header>Report</header><text display-inline="no-display-inline">Not later than 2 years after the date of the
enactment of this Act, the Comptroller General of the United States shall
submit to Congress a report that includes the following:</text>
<paragraph commented="no" display-inline="no-display-inline" id="id2116E74C1F3D40E59F2EAE8FA24BD5AB"><enum>(1)</enum><text display-inline="yes-display-inline">An assessment of the effectiveness of
section 13(o) of the Securities Exchange Act of 1934, as added by section 1302,
in promoting peace and security in the eastern Democratic Republic of
Congo.</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="idED23C2F4AED04909B0937748425A4E6A"><enum>(2)</enum><text display-inline="yes-display-inline">A description of the problems, if any,
encountered by the Securities and Exchange Commission in carrying out the
provisions of such section 13(o).</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="id17EDC86E953941BA9FA1FDA83BFC671D"><enum>(3)</enum><text>A description of the
adverse impacts of carrying out the provisions of such section 13(o), if any,
on communities in the eastern Democratic Republic of Congo.</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="id1BE399C430564B88B3E11BB6D380296C"><enum>(4)</enum><text>Recommendations for
legislative or regulatory actions that can be taken—</text>
<subparagraph commented="no" display-inline="no-display-inline" id="idE80A6A290E90409CB77EBDD800D5BDF9"><enum>(A)</enum><text>to improve the
effectiveness of the provisions of such section 13(o) to promote peace and
security in the eastern Democratic Republic of Congo;</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="id78A3921E1B5644648C908497D7A000C0"><enum>(B)</enum><text>to resolve the problems
described pursuant to paragraph (2), if any; and</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="id225F6CFE9287413A8927209091431B88"><enum>(C)</enum><text>to mitigate the adverse
impacts described pursuant paragraph (3), if any.</text>
</subparagraph></paragraph></section>
Amend the title so as to read: An Act to
promote the financial stability of the United States by improving
accountability and transparency in the financial system, to end ‘too big to
fail’, to protect the American taxpayer by ending bailouts, to protect
consumers from abusive financial services practices, and for other
purposes.
.
Secretary