[Congressional Bills 113th Congress]
[From the U.S. Government Publishing Office]
[S. 534 Reported in Senate (RS)]

                                                       Calendar No. 151
113th CONGRESS
  1st Session
                                 S. 534

                          [Report No. 113-82]

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


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             March 12, 2013

   Mr. Tester (for himself, Mr. Johanns, Mr. Bennet, Mr. Crapo, Mr. 
   Murphy, Mr. Chambliss, Mr. Warner, Ms. Heitkamp, Mr. Wicker, Mr. 
Carper, Mr. Moran, Mr. Menendez, Mr. Nelson, Mr. Heller, Mr. Blunt, Mr. 
Udall of Colorado, Mr. Baucus, Mrs. Shaheen, Mr. Harkin, Mr. Thune, Mr. 
    Brown, Mr. Coons, Ms. Ayotte, and Ms. Klobuchar) introduced the 
 following bill; which was read twice and referred to the Committee on 
                  Banking, Housing, and Urban Affairs

                             July 29, 2013

       Reported by Mr. Johnson of South Dakota, with an amendment
 [Strike out all after the enacting clause and insert the part printed 
                               in italic]

_______________________________________________________________________

                                 A BILL


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

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

<DELETED>SECTION 1. SHORT TITLE.</DELETED>

<DELETED>    This Act may be cited as the ``National Association of 
Registered Agents and Brokers Reform Act of 2013''.</DELETED>

<DELETED>SEC. 2. REESTABLISHMENT OF THE NATIONAL ASSOCIATION OF 
              REGISTERED AGENTS AND BROKERS.</DELETED>

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

 <DELETED>``Subtitle C--National Association of Registered Agents and 
                           Brokers</DELETED>

<DELETED>``SEC. 321. NATIONAL ASSOCIATION OF REGISTERED AGENTS AND 
              BROKERS.</DELETED>

<DELETED>    ``(a) Establishment.--There is established the National 
Association of Registered Agents and Brokers (hereafter in this 
subtitle referred to as the `Association').</DELETED>
<DELETED>    ``(b) Status.--The Association shall--</DELETED>
        <DELETED>    ``(1) be a nonprofit corporation;</DELETED>
        <DELETED>    ``(2) have succession until dissolved by an Act of 
        Congress;</DELETED>
        <DELETED>    ``(3) not be an agent or instrumentality of the 
        United States Government; and</DELETED>
        <DELETED>    ``(4) except as otherwise provided in this 
        subtitle, be subject to, and have all the powers conferred 
        upon, a nonprofit corporation by the District of Columbia 
        Nonprofit Corporation Act (D.C. Code, sec. 29-301.01 et 
        seq.).</DELETED>
<DELETED>    ``(c) Effective Date.--The provisions of this subtitle 
shall take effect upon the expiration of the 24-month period beginning 
on the date of enactment of the National Association of Registered 
Agents and Brokers Reform Act of 2013. Notwithstanding the effective 
date, such persons as are required to establish the Association shall 
take such actions as are necessary to establish the operations of the 
Association by the effective date.</DELETED>

<DELETED>``SEC. 322. PURPOSE.</DELETED>

<DELETED>    ``The purpose of the Association shall be to provide a 
mechanism through which licensing, continuing education, and other 
nonresident insurance producer qualification requirements and 
conditions may be adopted and applied on a multi-state basis without 
affecting the laws, rules, and regulations, and preserving the rights 
of a State, pertaining to--</DELETED>
        <DELETED>    ``(1) licensing, continuing education, and other 
        qualification requirements of insurance producers who are not 
        members of the Association;</DELETED>
        <DELETED>    ``(2) resident or nonresident insurance producer 
        appointment requirements;</DELETED>
        <DELETED>    ``(3) supervising and disciplining resident and 
        nonresident insurance producers;</DELETED>
        <DELETED>    ``(4) establishing licensing fees for resident and 
        nonresident insurance producers so that there is no loss of 
        insurance producer licensing revenue to the State; 
        and</DELETED>
        <DELETED>    ``(5) prescribing and enforcing laws and 
        regulations regulating the conduct of resident and nonresident 
        insurance producers.</DELETED>

<DELETED>``SEC. 323. MEMBERSHIP.</DELETED>

<DELETED>    ``(a) Eligibility.--</DELETED>
        <DELETED>    ``(1) In general.--Any insurance producer licensed 
        in its home State shall, subject to paragraphs (2) and (4), be 
        eligible to become a member of the Association.</DELETED>
        <DELETED>    ``(2) Ineligibility for suspension or revocation 
        of license.--Subject to paragraph (3), an insurance producer is 
        not eligible to become a member of the Association if a State 
        insurance regulator has suspended or revoked the insurance 
        license of the insurance producer in that State.</DELETED>
        <DELETED>    ``(3) Resumption of eligibility.--Paragraph (2) 
        shall cease to apply to any insurance producer if--</DELETED>
                <DELETED>    ``(A) the State insurance regulator 
                reissues or renews the license of the insurance 
                producer in the State in which the license was 
                suspended or revoked, or otherwise terminates or 
                vacates the suspension or revocation; or</DELETED>
                <DELETED>    ``(B) the suspension or revocation expires 
                or is subsequently overturned by a court of competent 
                jurisdiction.</DELETED>
        <DELETED>    ``(4) Criminal background record check required.--
        </DELETED>
                <DELETED>    ``(A) In general.--An insurance producer 
                shall not be eligible to become a member of the 
                Association unless the insurance producer has undergone 
                a national criminal background record check of its 
                Federal Bureau of Investigation identification record 
                that complies with regulations prescribed by the 
                Attorney General under subparagraph (L).</DELETED>
                <DELETED>    ``(B) Criminal background record check 
                requested by home state.--An insurance producer who is 
                licensed in a State and who has undergone a national 
                criminal background record check of its Federal Bureau 
                of Investigation identification record during the 2-
                year period preceding the date of submission of an 
                application to become a member of the Association, in 
                compliance with such requirements as a condition for 
                such licensure, shall be deemed to have undergone a 
                national criminal background record check for purposes 
                of subparagraph (A).</DELETED>
                <DELETED>    ``(C) Criminal background record check 
                requested by association.--</DELETED>
                        <DELETED>    ``(i) In general.--The Association 
                        shall, upon request by an insurance producer 
                        licensed in a State, submit identification 
                        information obtained from the insurance 
                        producer, and a request for a national criminal 
                        background record check of the insurance 
                        producer, to the Federal Bureau of 
                        Investigation.</DELETED>
                        <DELETED>    ``(ii) Bylaws or rules.--The board 
                        of directors of the Association shall prescribe 
                        bylaws or rules for obtaining and utilizing 
                        identification information and criminal history 
                        record information, including the establishment 
                        of reasonable fees required to perform a 
                        criminal background record check and 
                        appropriate safeguards for maintaining 
                        confidentiality and security of the 
                        information.</DELETED>
                <DELETED>    ``(D) Form of request.--A submission under 
                subparagraph (C)(i) shall include such identification 
                information as required by the Attorney General 
                concerning the person about whom the record is 
                requested and a statement signed by the person 
                authorizing the Association to obtain the 
                information.</DELETED>
                <DELETED>    ``(E) Provision of information by attorney 
                general.--Upon receiving a submission under 
                subparagraph (C)(ii) from the Association, the Attorney 
                General shall search all records of the Criminal 
                Justice Information Services Division of the Federal 
                Bureau of Investigation that the Attorney General deems 
                appropriate for criminal history records corresponding 
                to the identification information provided under 
                subparagraph (D) and provide all information contained 
                in the records that pertains to the request to the 
                Association.</DELETED>
                <DELETED>    ``(F) Limitation on permissible uses of 
                information.--The Association may use information 
                provided under subparagraph (E) only--</DELETED>
                        <DELETED>    ``(i) for purposes of determining 
                        compliance with membership criteria established 
                        by the Association; or</DELETED>
                        <DELETED>    ``(ii) to disclose to State 
                        insurance regulators, or Federal or State law 
                        enforcement agencies, in conformance with 
                        applicable law.</DELETED>
                <DELETED>    ``(G) Applicant access to criminal history 
                records.--Notwithstanding subparagraph (F), an 
                insurance producer shall have the right to obtain from 
                the Association a copy of any criminal history record 
                information concerning the insurance producer that is 
                provided to the Association under subparagraph 
                (E).</DELETED>
                <DELETED>    ``(H) Penalty for improper use or 
                disclosure.--Whoever knowingly uses any information 
                provided under subparagraph (E) for a purpose not 
                authorized in subparagraph (F), or discloses any such 
                information to anyone not authorized to receive it, 
                shall be fined under title 18, United States Code, 
                imprisoned for not more than 2 years, or 
                both.</DELETED>
                <DELETED>    ``(I) Reliance on information.--Neither 
                the Association nor any of its directors, officers, or 
                employees shall be liable in any action for using 
                information provided under subparagraph (E) as 
                permitted under subparagraph (F) in good faith and in 
                reasonable reliance on its accuracy.</DELETED>
                <DELETED>    ``(J) Fees.--The Attorney General may 
                charge a reasonable fee to defray the expense of 
                conducting the search and providing the information 
                under subparagraph (E), and any such fee shall be 
                collected and remitted by the Association.</DELETED>
                <DELETED>    ``(K) Rule of construction.--Nothing in 
                this paragraph shall be construed as--</DELETED>
                        <DELETED>    ``(i) requiring a State insurance 
                        regulator to perform criminal background checks 
                        under this section; or</DELETED>
                        <DELETED>    ``(ii) limiting any other 
                        authority that allows access to criminal 
                        background records.</DELETED>
                <DELETED>    ``(L) Regulations.--The Attorney General 
                shall prescribe regulations to carry out this 
                paragraph, which shall include--</DELETED>
                        <DELETED>    ``(i) appropriate protections for 
                        ensuring the confidentiality of information 
                        provided under subparagraph (E); and</DELETED>
                        <DELETED>    ``(ii) procedures providing a 
                        reasonable opportunity for an insurance 
                        producer to contest the accuracy of information 
                        regarding the insurance producer provided under 
                        subparagraph (E).</DELETED>
                <DELETED>    ``(M) Ineligibility for membership.--
                </DELETED>
                        <DELETED>    ``(i) In general.--The Association 
                        may, under reasonably consistently applied 
                        standards, deny membership to an insurance 
                        producer on the basis of criminal history 
                        information provided under subparagraph (E), or 
                        where the insurance producer has been subject 
                        to disciplinary action, as described in 
                        paragraph (2).</DELETED>
                        <DELETED>    ``(ii) Rights of applicants denied 
                        membership.--The Association shall notify any 
                        insurance producer who is denied membership on 
                        the basis of criminal history record 
                        information provided under subparagraph (E) of 
                        the right of the insurance producer to--
                        </DELETED>
                                <DELETED>    ``(I) obtain a copy of all 
                                criminal history record information 
                                provided to the Association under 
                                subparagraph (E) with respect to the 
                                insurance producer; and</DELETED>
                                <DELETED>    ``(II) challenge the 
                                accuracy and completeness of the 
                                information.</DELETED>
<DELETED>    ``(b) Authority To Establish Membership Criteria.--The 
Association may establish membership criteria that bear a reasonable 
relationship to the purposes for which the Association was 
established.</DELETED>
<DELETED>    ``(c) Establishment of Classes and Categories of 
Membership.--</DELETED>
        <DELETED>    ``(1) Classes of membership.--The Association may 
        establish separate classes of membership, with separate 
        criteria, if the Association reasonably determines that 
        performance of different duties requires different levels of 
        education, training, experience, or other 
        qualifications.</DELETED>
        <DELETED>    ``(2) Business entities.--The Association shall 
        establish a class of membership and membership criteria for 
        business entities. A business entity that applies for 
        membership shall be required to designate an individual 
        Association member responsible for the compliance of the 
        business entity with Association rules and the insurance laws, 
        rules, and regulations of any State in which the business 
        entity seeks to do business on the basis of Association 
        membership.</DELETED>
        <DELETED>    ``(3) Categories.--</DELETED>
                <DELETED>    ``(A) Separate categories for insurance 
                producers permitted.--The Association may establish 
                separate categories of membership for insurance 
                producers and for other persons within each class, 
                based on the types of licensing categories that exist 
                under State laws.</DELETED>
                <DELETED>    ``(B) Separate treatment for depository 
                institutions prohibited.--No special categories of 
                membership, and no distinct membership criteria, shall 
                be established for members which are depository 
                institutions or for employees, agents, or affiliates of 
                depository institutions.</DELETED>
<DELETED>    ``(d) Membership Criteria.--</DELETED>
        <DELETED>    ``(1) In general.--The Association may establish 
        criteria for membership which shall include standards for 
        personal qualifications, education, training, and experience. 
        The Association shall not establish criteria that unfairly 
        limit the ability of a small insurance producer to become a 
        member of the Association, including imposing discriminatory 
        membership fees.</DELETED>
        <DELETED>    ``(2) Qualifications.--In establishing criteria 
        under paragraph (1), the Association shall not adopt any 
        qualification less protective to the public than that contained 
        in the NAIC Producer Licensing Model Act in effect as of the 
        date of enactment of the National Association of Registered 
        Agents and Brokers Reform Act of 2013, and shall consider the 
        highest levels of insurance producer qualifications established 
        under the licensing laws of the States.</DELETED>
        <DELETED>    ``(3) Assistance from states.--</DELETED>
                <DELETED>    ``(A) In general.--The Association may 
                request a State to provide assistance in investigating 
                and evaluating the eligibility of a prospective member 
                for membership in the Association.</DELETED>
                <DELETED>    ``(B) Rule of construction.--Subparagraph 
                (A) shall not be construed as requiring or authorizing 
                any State to adopt new or additional requirements 
                concerning the licensing or evaluation of insurance 
                producers.</DELETED>
        <DELETED>    ``(4) Denial of membership.--The Association may, 
        based on reasonably consistently applied standards, deny 
        membership to any State-licensed insurance producer for failure 
        to meet the membership criteria established by the 
        Association.</DELETED>
<DELETED>    ``(e) Effect of Membership.--</DELETED>
        <DELETED>    ``(1) Authority of association members.--
        Membership in the Association shall--</DELETED>
                <DELETED>    ``(A) authorize an insurance producer to 
                sell, solicit, or negotiate insurance in any State for 
                which the member pays the licensing fee set by the 
                State for any line or lines of insurance specified in 
                the home State license of the insurance producer, and 
                exercise all such incidental powers as shall be 
                necessary to carry out such activities, including 
                claims adjustments and settlement to the extent 
                permissible under the laws of the State, risk 
                management, employee benefits advice, retirement 
                planning, and any other insurance-related consulting 
                activities;</DELETED>
                <DELETED>    ``(B) be the equivalent of a nonresident 
                insurance producer license for purposes of authorizing 
                the insurance producer to engage in the activities 
                described in subparagraph (A) in any State where the 
                member pays the licensing fee; and</DELETED>
                <DELETED>    ``(C) be the equivalent of a nonresident 
                insurance producer license for the purpose of 
                subjecting an insurance producer to all laws, 
                regulations, provisions or other action of any State 
                concerning revocation, suspension, or other enforcement 
                action related to the ability of a member to engage in 
                any activity within the scope of authority granted 
                under this subsection and to all State laws, 
                regulations, provisions, and actions preserved under 
                paragraph (5).</DELETED>
        <DELETED>    ``(2) Violent crime control and law enforcement 
        act of 1994.--Nothing in this subtitle shall be construed to 
        alter, modify, or supercede any requirement established by 
        section 1033 of title 18, United States Code.</DELETED>
        <DELETED>    ``(3) Agent for remitting fees.--The Association 
        shall act as an agent for any member for purposes of remitting 
        licensing fees to any State pursuant to paragraph 
        (1).</DELETED>
        <DELETED>    ``(4) Regulator notification.--</DELETED>
                <DELETED>    ``(A) In general.--The Association shall 
                notify the States and National Association of Insurance 
                Commissioners (hereinafter referred to in this subtitle 
                as `NAIC') or its designee when an insurance producer 
                has satisfied the membership criteria of this section. 
                The States and NAIC or its designee shall have10 
                business days after the notification to provide the 
                Association with evidence that the insurance producer 
                does not satisfy the criteria for membership for 
                consideration by the Association in its final 
                membership determination.</DELETED>
                <DELETED>    ``(B) Ongoing disclosures required.--On an 
                ongoing basis, the Association shall disclose to the 
                States and NAIC or its designee the States in which 
                each member is authorized to operate. The Association 
                shall immediately notify the States and NAIC or its 
                designee when a member is newly authorized to operate 
                in one or more States, or is no longer authorized to 
                operate in one or more States on the basis of 
                Association membership.</DELETED>
        <DELETED>    ``(5) Preservation of state consumer protection 
        and market conduct regulation.--No provision of this section 
        shall be construed as altering or affecting the applicability 
        or continuing effectiveness of any law, regulation, provision, 
        or other action of any State, including any law, regulation, 
        provision, or other action that--</DELETED>
                <DELETED>    ``(A) regulates market conduct, insurance 
                producer conduct, or unfair trade practices;</DELETED>
                <DELETED>    ``(B) establishes consumer protections; 
                or</DELETED>
                <DELETED>    ``(C) requires insurance producers to be 
                appointed by a licensed or authorized 
                insurer,</DELETED>
        <DELETED>to the extent that the law, regulation, provision, or 
        other action is not inconsistent with the provisions of this 
        subtitle related to market entry for nonresident insurance 
        producers, and then only to the extent of the 
        inconsistency.</DELETED>
<DELETED>    ``(f) Biennial Renewal.--Membership in the Association 
shall be renewed on a biennial basis.</DELETED>
<DELETED>    ``(g) Continuing Education.--</DELETED>
        <DELETED>    ``(1) In general.--The Association shall 
        establish, as a condition of membership, continuing education 
        requirements which shall be comparable to the continuing 
        education requirements under the licensing laws of a majority 
        of the States.</DELETED>
        <DELETED>    ``(2) State continuing education requirements.--A 
        member may not be required to satisfy continuing education 
        requirements imposed under the laws, regulations, provisions, 
        or actions of any State other than the home State of the 
        member.</DELETED>
        <DELETED>    ``(3) Reciprocity.--The Association shall not 
        require a member to satisfy continuing education requirements 
        that are equivalent to any continuing education requirements of 
        the home State of the member that have been satisfied by the 
        member during the applicable licensing period.</DELETED>
        <DELETED>    ``(4) Limitation on association.--The Association 
        shall not directly or indirectly offer any continuing education 
        courses for insurance producers.</DELETED>
<DELETED>    ``(h) Probation, Suspension and Revocation.--</DELETED>
        <DELETED>    ``(1) Disciplinary action.--The Association may 
        place an insurance producer that is a member of the Association 
        on probation or suspend or revoke the membership of the 
        insurance producer in the Association, or assess monetary fines 
        or penalties, as the Association determines to be appropriate, 
        if--</DELETED>
                <DELETED>    ``(A) the insurance producer fails to meet 
                the applicable membership criteria or other rules of 
                the Association;</DELETED>
                <DELETED>    ``(B) the insurance producer has been 
                subject to disciplinary action pursuant to a final 
                adjudicatory proceeding under the jurisdiction of a 
                State insurance regulator;</DELETED>
                <DELETED>    ``(C) an insurance license held by the 
                insurance producer has been suspended or revoked by a 
                State insurance regulator; or</DELETED>
                <DELETED>    ``(D) the insurance producer has been 
                convicted of a crime that would have resulted in the 
                denial of membership pursuant to subsection 
                (a)(4)(M)(i) at the time of application and the 
                Association has received a copy of the final 
                disposition from a court of competent 
                jurisdiction.</DELETED>
        <DELETED>    ``(2) Violations of association rules.--The 
        Association shall have the power to investigate alleged 
        violations of Association rules.</DELETED>
        <DELETED>    ``(3) Reporting.--The Association shall 
        immediately notify NAIC or its designee when the membership of 
        an insurance producer has been placed on probation or has been 
        suspended, revoked, or otherwise terminated, or when the 
        Association has assessed monetary fines or penalties.</DELETED>
<DELETED>    ``(i) Consumer Complaints.--</DELETED>
        <DELETED>    ``(1) In general.--The Association shall--
        </DELETED>
                <DELETED>    ``(A) refer any complaint against a member 
                of the Association from a consumer relating to alleged 
                misconduct or violations of State insurance laws to the 
                State insurance regulator where the consumer resides 
                and, when appropriate, to any additional State 
                insurance regulator, as determined by rules adopted by 
                the Association; and</DELETED>
                <DELETED>    ``(B) make any related records and 
                information available to NAIC or its designee and to 
                each State insurance regulator to whom the complaint is 
                forwarded.</DELETED>
        <DELETED>    ``(2) Telephone and other access.--The Association 
        shall maintain a toll-free number for purposes of this 
        subsection and, as practicable, other alternative means of 
        communication with consumers, such as an Internet 
        webpage.</DELETED>
        <DELETED>    ``(3) Final disposition of investigation.--State 
        insurance regulators shall provide the Association with 
        information regarding the final disposition of a complaint 
        referred pursuant to paragraph (1)(A), but nothing shall be 
        construed to compel a State to release confidential 
        investigation reports or other information protected by State 
        law to the Association.</DELETED>
<DELETED>    ``(j) Information Sharing.--The Association may share 
documents, materials, or other information, including confidential and 
privileged documents, with a State, Federal, or international 
regulatory agency or enforcement authority, or with NAIC or its 
designee, provided that the recipient has the authority and agrees to 
maintain the confidentiality or privileged status of the document, 
material, or other information.</DELETED>

<DELETED>``SEC. 324. BOARD OF DIRECTORS.</DELETED>

<DELETED>    ``(a) Establishment.--There is established the board of 
directors of the Association (hereafter in this subtitle referred to as 
the `Board'), which shall have authority to govern and supervise all 
activities of the Association.</DELETED>
<DELETED>    ``(b) Powers.--The Board shall have such of the powers and 
authority of the Association as may be specified in the bylaws of the 
Association.</DELETED>
<DELETED>    ``(c) Composition.--</DELETED>
        <DELETED>    ``(1) In general.--The Board shall consist of 13 
        members who shall be appointed by the President, by and with 
        the advice and consent of the Senate, of whom--</DELETED>
                <DELETED>    ``(A) 8 shall be State insurance 
                commissioners appointed in the manner provided in 
                paragraph (2);</DELETED>
                <DELETED>    ``(B) 2 shall be representatives of 
                property and casualty insurance producers;</DELETED>
                <DELETED>    ``(C) 1 shall be a representative of life 
                or health insurance producers;</DELETED>
                <DELETED>    ``(D) 1 shall be a representative of 
                property and casualty insurers; and</DELETED>
                <DELETED>    ``(E) 1 shall be a representative of life 
                or health insurers.</DELETED>
        <DELETED>    ``(2) State insurance regulator representatives.--
        </DELETED>
                <DELETED>    ``(A) Before making any appointments 
                pursuant to subparagraph (A) of paragraph (1), the 
                President shall request a list of recommended 
                candidates from NAIC, which shall not be binding on the 
                President. If NAIC fails to submit a list of 
                recommendations within 15 business days of the request, 
                the President may make the requisite appointments 
                without considering the views of NAIC.</DELETED>
                <DELETED>    ``(B) Not more than 4 members appointed to 
                membership on the Board pursuant to subparagraph (A) of 
                paragraph (1) shall belong to the same political 
                party.</DELETED>
                <DELETED>    ``(C) If fewer than 8 State insurance 
                commissioners accept appointment to the Board, the 
                President may appoint the remaining State insurance 
                commissioner members of the Board from among 
                individuals who are former State insurance 
                commissioners, provided that any former insurance 
                commissioner so appointed shall not be employed by or 
                have a present direct or indirect financial interest in 
                any insurer, insurance producer, or other entity in the 
                insurance industry other than direct or indirect 
                ownership of, or beneficial interest in, an insurance 
                policy or annuity contract written or sold by an 
                insurer.</DELETED>
        <DELETED>    ``(3) Private sector representatives.--In making 
        any appointments pursuant to subparagraphs (B) through (E) of 
        paragraph (1), the President may seek recommendations for 
        candidates from national trade associations representing the 
        category of individuals described, which shall not be binding 
        on the President.</DELETED>
        <DELETED>    ``(4) State insurance commissioner defined.--For 
        purposes of this subsection, the term `State insurance 
        commissioner' means a person who serves in the position in 
        State government, or on the board, commission, or other body 
        that is the principal insurance regulatory authority for the 
        State.</DELETED>
<DELETED>    ``(d) Terms.--</DELETED>
        <DELETED>    ``(1) In general.--The term of each Board member 
        shall be for 2 years, except that--</DELETED>
                <DELETED>    ``(A) the term of--</DELETED>
                        <DELETED>    ``(i) 4 of the State insurance 
                        commissioner members of the Board initially 
                        appointed under subparagraph (A) of paragraph 
                        (1);</DELETED>
                        <DELETED>    ``(ii) 1 of the property and 
                        casualty insurance producer members of the 
                        Board initially appointed under subparagraph 
                        (B) of paragraph (1); and</DELETED>
                        <DELETED>    ``(iii) 1 of the insurer 
                        representative members of the Board initially 
                        appointed under subparagraphs (D) and (E) of 
                        paragraph (1),</DELETED>
                <DELETED>shall be 1 year, as designated by the 
                President at the time of the nomination of the 
                members;</DELETED>
                <DELETED>    ``(B) a member of the Board may continue 
                to serve after the expiration of the term to which the 
                member was appointed until a successor is qualified; 
                and</DELETED>
                <DELETED>    ``(C) any member of the Board appointed to 
                fill a vacancy occurring before the expiration of the 
                term for which the predecessor of the member was 
                appointed shall be appointed only for the remainder of 
                that term.</DELETED>
        <DELETED>    ``(2) Successive terms.--Board members may be 
        reappointed to successive terms.</DELETED>
<DELETED>    ``(e) Initial Appointments.--The appointment of initial 
Board members shall be made no later than 90 days after the date of 
enactment of the National Association of Registered Agents and Brokers 
Reform Act of 2013.</DELETED>
<DELETED>    ``(f) Meetings.--</DELETED>
        <DELETED>    ``(1) In general.--The Board shall meet at the 
        call of the chairperson, as requested in writing to the 
        chairperson by at least 5 members of the Board, or as otherwise 
        provided by the bylaws of the Association.</DELETED>
        <DELETED>    ``(2) Quorum required.--A majority of directors 
        shall constitute a quorum.</DELETED>
        <DELETED>    ``(3) Voting.--Decisions of the Board shall 
        require the approval of a majority of all directors present at 
        a meeting, a quorum being present.</DELETED>
        <DELETED>    ``(4) Initial meeting.--The Board shall hold its 
        first meeting not later than 45 days after the date on which 
        all initial members of the Board have been appointed.</DELETED>
<DELETED>    ``(g) Restriction on Confidential Information.--Members of 
the Board appointed pursuant to paragraph (3) of subsection (c) shall 
not have access to confidential information received by the Association 
in connection with complaints, investigations, or disciplinary 
proceedings involving insurance producers.</DELETED>
<DELETED>    ``(h) Ethics and Conflicts of Interest.--The Board shall 
issue and enforce an ethical conduct code to address permissible and 
prohibited activities of Board members and Association officers, 
employees, agents, or consultants. The code shall, at a minimum, 
include provisions that prohibit any Board member or Association 
officer, employee, agent or consultant from--</DELETED>
        <DELETED>    ``(1) engaging in unethical conduct in the course 
        of performing Association duties;</DELETED>
        <DELETED>    ``(2) participating in the making or influencing 
        the making of any Association decision, the outcome of which he 
        or she knows or had reason to know would have a reasonably 
        foreseeable material financial effect, distinguishable from its 
        effect on the publicly generally, on the person or a member of 
        his or her immediate family;</DELETED>
        <DELETED>    ``(3) accepting any gift from any person or entity 
        other than the Association that is given because of the 
        position held by the person in the Association;</DELETED>
        <DELETED>    ``(4) making political contributions to any person 
        or entity on behalf of the Association; and</DELETED>
        <DELETED>    ``(5) lobbying or paying someone to lobby on 
        behalf of the Association.</DELETED>

<DELETED>``SEC. 325. OFFICERS.</DELETED>

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

<DELETED>``SEC. 326. BYLAWS, RULES, AND DISCIPLINARY ACTION.</DELETED>

<DELETED>    ``(a) Adoption and Amendment of Bylaws and Rules.--
</DELETED>
        <DELETED>    ``(1) Copy required to be filed.--The Board shall 
        submit to the President and NAIC any proposed bylaw or rules of 
        the Association or any proposed amendment to the bylaws or 
        rules, accompanied by a concise general statement of the basis 
        and purpose of such proposal. Rules shall be promulgated in 
        accordance with the Federal Administrative Procedure 
        Act.</DELETED>
        <DELETED>    ``(2) Effective date.--Any proposed bylaw or rule 
        or proposed amendment to the bylaws or rules shall take effect, 
        after notice published in the Federal Register and opportunity 
        for comment, upon such date as the Association may designate, 
        unless suspended under subsection (c) of section 330.</DELETED>
<DELETED>    ``(b) Disciplinary Action by the Association.--</DELETED>
        <DELETED>    ``(1) Specification of charges.--In any proceeding 
        to determine whether membership shall be denied, suspended, 
        revoked, or not renewed or to determine whether a member of the 
        Association should be placed on probation (in this section 
        referred to as a `disciplinary action') or whether to assess 
        fines or monetary penalties, the Association shall bring 
        specific charges, notify the member of the charges, give the 
        member an opportunity to defend against the charges, and keep a 
        record.</DELETED>
        <DELETED>    ``(2) Supporting statement.--A determination to 
        take disciplinary action shall be supported by a statement 
        setting forth--</DELETED>
                <DELETED>    ``(A) any act or practice in which the 
                member has been found to have been engaged;</DELETED>
                <DELETED>    ``(B) the specific provision of this 
                subtitle, the rules or regulations under this subtitle, 
                or the rules of the Association which any such act or 
                practice is deemed to violate; and</DELETED>
                <DELETED>    ``(C) the sanction imposed and the reason 
                for the sanction.</DELETED>
        <DELETED>    ``(3) Ineligibility of private sector 
        representatives.--Members of the Board appointed pursuant to 
        section 324(c)(3) shall not participate in any disciplinary 
        action, and shall not have access to confidential information 
        concerning the actions.</DELETED>

<DELETED>``SEC. 327. POWERS.</DELETED>

<DELETED>    ``In addition to all the powers conferred upon a nonprofit 
corporation by the District of Columbia Nonprofit Corporation Act, the 
Association shall have the following powers:</DELETED>
        <DELETED>    ``(1) To establish and collect such membership 
        fees as the Association finds necessary to impose to cover the 
        costs of its operations.</DELETED>
        <DELETED>    ``(2) To adopt, amend, and repeal bylaws and rules 
        governing the conduct of Association business and performance 
        of its duties.</DELETED>
        <DELETED>    ``(3) To establish procedures for providing notice 
        and opportunity for comment pursuant to section 
        326(a).</DELETED>
        <DELETED>    ``(4) To enter into and perform such agreements as 
        necessary to carry out its duties.</DELETED>
        <DELETED>    ``(5) To hire employees, professionals, or 
        specialists, and elect or appoint officers, and to fix their 
        compensation, define their duties and give them appropriate 
        authority to carry out the purposes of this subtitle, and 
        determine their qualification; and to establish the 
        Association's personnel policies and programs relating to, 
        among other things, conflicts of interest, rates of 
        compensation, and qualifications of personnel.</DELETED>
        <DELETED>    ``(6) To borrow money.</DELETED>
        <DELETED>    ``(7) To secure funding for such amounts as the 
        Association determines to be necessary and appropriate to 
        organize and begin operations of the Association, which shall 
        be treated as loans to be repaid by the Association with 
        interest at market rate, except that the Board shall not secure 
        funding from an insurer, insurance producer, or insurance 
        association, but may secure funding from NAIC.</DELETED>

<DELETED>``SEC. 328. REPORT BY ASSOCIATION.</DELETED>

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

<DELETED>``SEC. 329. LIABILITY OF THE ASSOCIATION AND THE DIRECTORS, 
              OFFICERS, AND EMPLOYEES OF THE ASSOCIATION.</DELETED>

<DELETED>    ``(a) In General.--The Association shall not be deemed to 
be an insurer or insurance producer within the meaning of any State 
law, rule, regulation, or order regulating or taxing insurers, 
insurance producers, or other entities engaged in the business of 
insurance, including provisions imposing premium taxes, regulating 
insurer solvency or financial condition, establishing guaranty funds 
and levying assessments, or requiring claims settlement 
practices.</DELETED>
<DELETED>    ``(b) Liability of Directors, Officers, and Employees.--No 
director, officer, or employee of the Association shall be personally 
liable to any person for any action taken or omitted in good faith in 
any matter within the scope of their responsibilities in connection 
with the Association.</DELETED>

<DELETED>``SEC. 330. PRESIDENTIAL OVERSIGHT.</DELETED>

<DELETED>    ``(a) Removal of Board.--If the President determines that 
the Association is acting in a manner contrary to the interests of the 
public or the purposes of this subtitle or has failed to perform its 
duties under this subtitle, the President may remove the entire 
existing Board for the remainder of the term to which the members of 
the Board were appointed and appoint, in accordance with section 324 
and with the advice and consent of the Senate, new members to fill the 
vacancies on the Board for the remainder of the terms.</DELETED>
<DELETED>    ``(b) Removal of Board Member.--The President may remove a 
member of the Board only for neglect of duty or malfeasance in 
office.</DELETED>
<DELETED>    ``(c) Suspension of Rules or Actions.--Following notice to 
the Board, the President, or a person designated by the President for 
such purpose, may suspend the effectiveness of any rule, or prohibit 
any action, of the Association which the President or the designee 
determines is contrary to the purposes of this subtitle.</DELETED>

<DELETED>``SEC. 331. RELATIONSHIP TO STATE LAW.</DELETED>

<DELETED>    ``(a) Preemption of State Laws.--State laws, regulations, 
provisions, or other actions purporting to regulate insurance producers 
shall be preempted to the extent provided in subsection (b).</DELETED>
<DELETED>    ``(b) Prohibited Actions.--</DELETED>
        <DELETED>    ``(1) In general.--No State shall--</DELETED>
                <DELETED>    ``(A) impede the activities of, take any 
                action against, or apply any provision of law or 
                regulation arbitrarily or discriminatorily to, any 
                insurance producer because that insurance producer or 
                any affiliate plans to become, has applied to become, 
                or is a member of the Association;</DELETED>
                <DELETED>    ``(B) impose any requirement upon a member 
                of the Association that it pay fees different from 
                those required to be paid to that State were it not a 
                member of the Association; or</DELETED>
                <DELETED>    ``(C) impose any continuing education 
                requirements on any nonresident insurance producer that 
                is a member of the Association.</DELETED>
        <DELETED>    ``(2) States other than a home state.--No State, 
        other than a member's home State, shall--</DELETED>
                <DELETED>    ``(A) impose any licensing, personal or 
                corporate qualifications, education, training, 
                experience, residency, continuing education, or bonding 
                requirement upon a member of the Association that is 
                different from the criteria for membership in the 
                Association or renewal of such membership;</DELETED>
                <DELETED>    ``(B) impose any requirement upon a member 
                of the Association that it be licensed, registered, or 
                otherwise qualified to do business or remain in good 
                standing in the State, including any requirement that 
                the insurance producer register as a foreign company 
                with the secretary of state or equivalent State 
                official;</DELETED>
                <DELETED>    ``(C) require that a member of the 
                Association submit to a criminal history record check 
                as a condition of doing business in the State; 
                or</DELETED>
                <DELETED>    ``(D) impose any licensing, registration, 
                or appointment requirements upon a member of the 
                Association, or require a member of the Association to 
                be authorized to operate as an insurance producer, in 
                order to sell, solicit, or negotiate insurance for 
                commercial property and casualty risks to an insured 
                with risks located in more than one State, if the 
                member is licensed or otherwise authorized to operate 
                in the State where the insured maintains its principal 
                place of business and the contract of insurance insures 
                risks located in that State.</DELETED>
        <DELETED>    ``(3) Preservation of state disciplinary 
        authority.--Nothing in this section may be construed to 
        prohibit a State from investigating and taking appropriate 
        disciplinary action, including suspension or revocation of 
        authority of an insurance producer to do business in a State, 
        in accordance with State law and that is not inconsistent with 
        the provisions of this section, against a member of the 
        Association as a result of a complaint or for any alleged 
        activity, regardless of whether the activity occurred before or 
        after the insurance producer commenced doing business in the 
        State pursuant to Association membership.</DELETED>

<DELETED>``SEC. 332. COORDINATION WITH OTHER REGULATORS.</DELETED>

<DELETED>    ``(a) Coordination With State Insurance Regulators.--The 
Association may--</DELETED>
        <DELETED>    ``(1) establish a central clearinghouse, or 
        utilize NAIC or any other appropriate entity as a central 
        clearinghouse, through which members of the Association may 
        pursuant to section 323(e) disclose their intent to operate in 
        1 or more States and pay the licensing fees to the appropriate 
        States; and</DELETED>
        <DELETED>    ``(2) establish a national database for the 
        collection of regulatory information concerning the activities 
        of insurance producers or contract with NAIC or any other 
        entity to utilize such a database.</DELETED>
<DELETED>    ``(b) Coordination With the Financial Industry Regulatory 
Authority.--The Association shall coordinate with the Financial 
Industry Regulatory Authority in order to ease any administrative 
burdens that fall on persons that are members of both associations, 
consistent with the requirements of this subtitle and the Federal 
securities laws.</DELETED>

<DELETED>``SEC. 333. RIGHT OF ACTION.</DELETED>

<DELETED>    ``(a) Right of Action.--Any person aggrieved by a decision 
or action of the Association may, after reasonably exhausting available 
avenues for resolution within the Association, commence a civil action 
in an appropriate United States district court, and obtain all 
appropriate relief.</DELETED>
<DELETED>    ``(b) Association Interpretations.--In any such action, 
the court shall give appropriate weight to the Association's 
interpretation of its bylaws and this subtitle.</DELETED>

<DELETED>``SEC. 334. DEFINITIONS.</DELETED>

<DELETED>    ``For purposes of this subtitle, the following definitions 
shall apply:</DELETED>
        <DELETED>    ``(1) Business entity.--The term `business entity' 
        means a corporation, association, partnership, limited 
        liability company, limited liability partnership, or other 
        legal entity.</DELETED>
        <DELETED>    ``(2) Home state.--The term `home State' means the 
        State in which the insurance producer maintains its principal 
        place of residence or business and is licensed to act as an 
        insurance producer.</DELETED>
        <DELETED>    ``(3) Insurance.--The term `insurance' means any 
        product, other than title insurance or bail bonds, defined or 
        regulated as insurance by the appropriate State insurance 
        regulatory authority.</DELETED>
        <DELETED>    ``(4) Insurance producer.--The term `insurance 
        producer' means any insurance agent or broker, excess or 
        surplus lines broker or agent, insurance consultant, limited 
        insurance representative, and any other individual or entity 
        that sells, solicits, or negotiates policies of insurance or 
        offers advice, counsel, opinions or services related to 
        insurance.</DELETED>
        <DELETED>    ``(5) Principal place of business.--The term 
        `principal place of business' means the State in which an 
        insurance producer maintains the headquarters of the insurance 
        producer and, in the case of a business entity, where high-
        level officers of the entity direct, control, and coordinate 
        the business activities of the business entity.</DELETED>
        <DELETED>    ``(6) Principal place of residence.--The term 
        `principal place of residence' means the State in which an 
        insurance producer resides for the greatest number of days 
        during a calendar year.</DELETED>
        <DELETED>    ``(7) State.--The term `State' includes any State, 
        the District of Columbia, any territory of the United States, 
        and Puerto Rico, Guam, American Samoa, the Trust Territory of 
        the Pacific Islands, the Virgin Islands, and the Northern 
        Mariana Islands.</DELETED>
        <DELETED>    ``(8) State law.--</DELETED>
                <DELETED>    ``(A) In general.--The term `State law' 
                includes all laws, decisions, rules, regulations, or 
                other State action having the effect of law, of any 
                State.</DELETED>
                <DELETED>    ``(B) Laws applicable in the district of 
                columbia.--A law of the United States applicable only 
                to or within the District of Columbia shall be treated 
                as a State law rather than a law of the United 
                States.''.</DELETED>
<DELETED>    (b) Clerical Amendment.--The table of contents for the 
Gramm-Leach-Bliley Act is amended by striking the items relating to 
subtitle C of title III and inserting the following new 
items:</DELETED>

 <DELETED>``Subtitle C--National Association of Registered Agents and 
                                Brokers

<DELETED>``Sec. 321. National Association of Registered Agents and 
                            Brokers.
<DELETED>``Sec. 322. Purpose.
<DELETED>``Sec. 323. Membership.
<DELETED>``Sec. 324. Board of directors.
<DELETED>``Sec. 325. Officers.
<DELETED>``Sec. 326. Bylaws, rules, and disciplinary action.
<DELETED>``Sec. 327. Powers.
<DELETED>``Sec. 328. Report by Association.
<DELETED>``Sec. 329. Liability of the Association and the directors, 
                            officers, and employees of the Association.
<DELETED>``Sec. 330. Presidential oversight.
<DELETED>``Sec. 331. Relationship to State law.
<DELETED>``Sec. 332. Coordination with other regulators.
<DELETED>``Sec. 333. Right of action.
<DELETED>``Sec. 334. Definitions.''.

</DELETED>SECTION 1. SHORT TITLE.

    This Act may be cited as the ``National Association of Registered 
Agents and Brokers Reform Act of 2013''.

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

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

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

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

    ``(a) Establishment.--There is established the National Association 
of Registered Agents and Brokers (referred to in this subtitle as the 
`Association').
    ``(b) Status.--The Association shall--
            ``(1) be a nonprofit corporation;
            ``(2) not be an agent or instrumentality of the Federal 
        Government;
            ``(3) be an independent organization that may not be merged 
        with or into any other private or public entity; and
            ``(4) except as otherwise provided in this subtitle, be 
        subject to, and have all the powers conferred upon, a nonprofit 
        corporation by the District of Columbia Nonprofit Corporation 
        Act (D.C. Code, sec. 29-301.01 et seq.) or any successor 
        thereto.

``SEC. 322. PURPOSE.

    ``The purpose of the Association shall be to provide a mechanism 
through which licensing, continuing education, and other nonresident 
insurance producer qualification requirements and conditions may be 
adopted and applied on a multi-state basis without affecting the laws, 
rules, and regulations, and preserving the rights of a State, 
pertaining to--
            ``(1) licensing, continuing education, and other 
        qualification requirements of insurance producers that are not 
        members of the Association;
            ``(2) resident or nonresident insurance producer 
        appointment requirements;
            ``(3) supervising and disciplining resident and nonresident 
        insurance producers;
            ``(4) establishing licensing fees for resident and 
        nonresident insurance producers so that there is no loss of 
        insurance producer licensing revenue to the State; and
            ``(5) prescribing and enforcing laws and regulations 
        regulating the conduct of resident and nonresident insurance 
        producers.

``SEC. 323. MEMBERSHIP.

    ``(a) Eligibility.--
            ``(1) In general.--Any insurance producer licensed in its 
        home State shall, subject to paragraphs (2) and (4), be 
        eligible to become a member of the Association.
            ``(2) Ineligibility for suspension or revocation of 
        license.--Subject to paragraph (3), an insurance producer is 
        not eligible to become a member of the Association if a State 
        insurance regulator has suspended or revoked the insurance 
        license of the insurance producer in that State.
            ``(3) Resumption of eligibility.--Paragraph (2) shall cease 
        to apply to any insurance producer if--
                    ``(A) the State insurance regulator reissues or 
                renews the license of the insurance producer in the 
                State in which the license was suspended or revoked, or 
                otherwise terminates or vacates the suspension or 
                revocation; or
                    ``(B) the suspension or revocation expires or is 
                subsequently overturned by a court of competent 
                jurisdiction.
            ``(4) Criminal history record check required.--
                    ``(A) In general.--An insurance producer who is an 
                individual shall not be eligible to become a member of 
                the Association unless the insurance producer has 
                undergone a criminal history record check that complies 
                with regulations prescribed by the Attorney General of 
                the United States under subparagraph (K).
                    ``(B) Criminal history record check requested by 
                home state.--An insurance producer who is licensed in a 
                State and who has undergone a criminal history record 
                check during the 2-year period preceding the date of 
                submission of an application to become a member of the 
                Association, in compliance with a requirement to 
                undergo such criminal history record check as a 
                condition for such licensure in the State, shall be 
                deemed to have undergone a criminal history record 
                check for purposes of subparagraph (A).
                    ``(C) Criminal history record check requested by 
                association.--
                            ``(i) In general.--The Association shall, 
                        upon request by an insurance producer licensed 
                        in a State, submit identification information 
                        obtained from the insurance producer, and a 
                        request for a criminal history record check of 
                        the insurance producer, to the Federal Bureau 
                        of Investigation.
                            ``(ii) Procedures.--The board of directors 
                        of the Association (referred to in this 
                        subtitle as the `Board') shall prescribe 
                        procedures for obtaining and utilizing 
                        identification information and criminal history 
                        record information, including the establishment 
                        of reasonable fees required to perform a 
                        criminal history record check and appropriate 
                        safeguards for maintaining confidentiality and 
                        security of the information.
                    ``(D) Form of request.--A submission under 
                subparagraph (C)(i) shall include such identification 
                information as is required by the Attorney General 
                concerning the person about whom the criminal history 
                record check is requested, and a statement signed by 
                the person authorizing the Attorney General to provide 
                the information to the Association and for the 
                Association to receive the information.
                    ``(E) Provision of information by attorney 
                general.--Upon receiving a submission under 
                subparagraph (C)(i) from the Association, the Attorney 
                General shall search all criminal history records of 
                the Federal Bureau of Investigation, including records 
                of the Criminal Justice Information Services Division 
                of the Federal Bureau of Investigation, that the 
                Attorney General determines appropriate for criminal 
                history records corresponding to the identification 
                information provided under subparagraph (D) and provide 
                all criminal history record information included in the 
                request to the Association.
                    ``(F) Limitation on permissible uses of 
                information.--Any information provided to the 
                Association under subparagraph (E) may only--
                            ``(i) be used for purposes of determining 
                        compliance with membership criteria established 
                        by the Association;
                            ``(ii) be disclosed to State insurance 
                        regulators, or Federal or State law enforcement 
                        agencies, in conformance with applicable law; 
                        or
                            ``(iii) be disclosed, upon request, to the 
                        insurance producer to whom the criminal history 
                        record information relates.
                    ``(G) Penalty for improper use or disclosure.--
                Whoever knowingly uses any information provided under 
                subparagraph (E) for a purpose not authorized in 
                subparagraph (F), or discloses any such information to 
                anyone not authorized to receive it, shall be fined 
                under title 18, United States Code, imprisoned for not 
                more than 2 years, or both.
                    ``(H) Reliance on information.--Neither the 
                Association nor any of its Board members, officers, or 
                employees shall be liable in any action for using 
                information provided under subparagraph (E) as 
                permitted under subparagraph (F) in good faith and in 
                reasonable reliance on its accuracy.
                    ``(I) Fees.--The Attorney General may charge a 
                reasonable fee for conducting the search and providing 
                the information under subparagraph (E), and any such 
                fee shall be collected and remitted by the Association 
                to the Attorney General.
                    ``(J) Rule of construction.--Nothing in this 
                paragraph shall be construed as--
                            ``(i) requiring a State insurance regulator 
                        to perform criminal history record checks under 
                        this section; or
                            ``(ii) limiting any other authority that 
                        allows access to criminal history records.
                    ``(K) Regulations.--The Attorney General shall 
                prescribe regulations to carry out this paragraph, 
                which shall include--
                            ``(i) appropriate protections for ensuring 
                        the confidentiality of information provided 
                        under subparagraph (E); and
                            ``(ii) procedures providing a reasonable 
                        opportunity for an insurance producer to 
                        contest the accuracy of information regarding 
                        the insurance producer provided under 
                        subparagraph (E).
                    ``(L) Ineligibility for membership.--
                            ``(i) In general.--The Association may, 
                        under reasonably consistently applied 
                        standards, deny membership to an insurance 
                        producer on the basis of criminal history 
                        record information provided under subparagraph 
                        (E), or where the insurance producer has been 
                        subject to disciplinary action, as described in 
                        paragraph (2).
                            ``(ii) Rights of applicants denied 
                        membership.--The Association shall notify any 
                        insurance producer who is denied membership on 
                        the basis of criminal history record 
                        information provided under subparagraph (E) of 
                        the right of the insurance producer to--
                                    ``(I) obtain a copy of all criminal 
                                history record information provided to 
                                the Association under subparagraph (E) 
                                with respect to the insurance producer; 
                                and
                                    ``(II) challenge the denial of 
                                membership based on the accuracy and 
                                completeness of the information.
                    ``(M) Definition.--For purposes of this paragraph, 
                the term `criminal history record check' means a 
                national background check of criminal history records 
                of the Federal Bureau of Investigation.
    ``(b) Authority to Establish Membership Criteria.--The Association 
may establish membership criteria that bear a reasonable relationship 
to the purposes for which the Association was established.
    ``(c) Establishment of Classes and Categories of Membership.--
            ``(1) Classes of membership.--The Association may establish 
        separate classes of membership, with separate criteria, if the 
        Association reasonably determines that performance of different 
        duties requires different levels of education, training, 
        experience, or other qualifications.
            ``(2) Business entities.--The Association shall establish a 
        class of membership and membership criteria for business 
        entities. A business entity that applies for membership shall 
        be required to designate an individual Association member 
        responsible for the compliance of the business entity with 
        Association standards and the insurance laws, rules, and 
        regulations of any State in which the business entity seeks to 
        do business on the basis of Association membership.
            ``(3) Categories.--
                    ``(A) Separate categories for insurance producers 
                permitted.--The Association may establish separate 
                categories of membership for insurance producers and 
                for other persons or entities within each class, based 
                on the types of licensing categories that exist under 
                State laws.
                    ``(B) Separate treatment for depository 
                institutions prohibited.--No special categories of 
                membership, and no distinct membership criteria, shall 
                be established for members that are depository 
                institutions or for employees, agents, or affiliates of 
                depository institutions.
    ``(d) Membership Criteria.--
            ``(1) In general.--The Association may establish criteria 
        for membership which shall include standards for personal 
        qualifications, education, training, and experience. The 
        Association shall not establish criteria that unfairly limit 
        the ability of a small insurance producer to become a member of 
        the Association, including imposing discriminatory membership 
        fees.
            ``(2) Qualifications.--In establishing criteria under 
        paragraph (1), the Association shall not adopt any 
        qualification less protective to the public than that contained 
        in the National Association of Insurance Commissioners 
        (referred to in this subtitle as the `NAIC') Producer Licensing 
        Model Act in effect as of the date of enactment of the National 
        Association of Registered Agents and Brokers Reform Act of 
        2013, and shall consider the highest levels of insurance 
        producer qualifications established under the licensing laws of 
        the States.
            ``(3) Assistance from states.--
                    ``(A) In general.--The Association may request a 
                State to provide assistance in investigating and 
                evaluating the eligibility of a prospective member for 
                membership in the Association.
                    ``(B) Authorization of information sharing.--A 
                submission under subsection (a)(4)(C)(i) made by an 
                insurance producer licensed in a State shall include a 
                statement signed by the person about whom the 
                assistance is requested authorizing--
                            ``(i) the State to share information with 
                        the Association; and
                            ``(ii) the Association to receive the 
                        information.
                    ``(C) Rule of construction.--Subparagraph (A) shall 
                not be construed as requiring or authorizing any State 
                to adopt new or additional requirements concerning the 
                licensing or evaluation of insurance producers.
            ``(4) Denial of membership.--The Association may, based on 
        reasonably consistently applied standards, deny membership to 
        any State-licensed insurance producer for failure to meet the 
        membership criteria established by the Association.
    ``(e) Effect of Membership.--
            ``(1) Authority of association members.--Membership in the 
        Association shall--
                    ``(A) authorize an insurance producer to sell, 
                solicit, or negotiate insurance in any State for which 
                the member pays the licensing fee set by the State for 
                any line or lines of insurance specified in the home 
                State license of the insurance producer, and exercise 
                all such incidental powers as shall be necessary to 
                carry out such activities, including claims adjustments 
                and settlement to the extent permissible under the laws 
                of the State, risk management, employee benefits 
                advice, retirement planning, and any other insurance-
                related consulting activities;
                    ``(B) be the equivalent of a nonresident insurance 
                producer license for purposes of authorizing the 
                insurance producer to engage in the activities 
                described in subparagraph (A) in any State where the 
                member pays the licensing fee; and
                    ``(C) be the equivalent of a nonresident insurance 
                producer license for the purpose of subjecting an 
                insurance producer to all laws, regulations, provisions 
                or other action of any State concerning revocation, 
                suspension, or other enforcement action related to the 
                ability of a member to engage in any activity within 
                the scope of authority granted under this subsection 
                and to all State laws, regulations, provisions, and 
                actions preserved under paragraph (5).
            ``(2) Violent crime control and law enforcement act of 
        1994.--Nothing in this subtitle shall be construed to alter, 
        modify, or supercede any requirement established by section 
        1033 of title 18, United States Code.
            ``(3) Agent for remitting fees.--The Association shall act 
        as an agent for any member for purposes of remitting licensing 
        fees to any State pursuant to paragraph (1).
            ``(4) Notification of action.--
                    ``(A) In general.--The Association shall notify the 
                States (including State insurance regulators) and the 
                NAIC when an insurance producer has satisfied the 
                membership criteria of this section. The States 
                (including State insurance regulators) shall have 10 
                business days after the date of the notification in 
                order to provide the Association with evidence that the 
                insurance producer does not satisfy the criteria for 
                membership in the Association.
                    ``(B) Ongoing disclosures required.--On an ongoing 
                basis, the Association shall disclose to the States 
                (including State insurance regulators) and the NAIC a 
                list of the States in which each member is authorized 
                to operate. The Association shall immediately notify 
                the States (including State insurance regulators) and 
                the NAIC when a member is newly authorized to operate 
                in one or more States, or is no longer authorized to 
                operate in one or more States on the basis of 
                Association membership.
            ``(5) Preservation of consumer protection and market 
        conduct regulation.--
                    ``(A) In general.--No provision of this section 
                shall be construed as altering or affecting the 
                applicability or continuing effectiveness of any law, 
                regulation, provision, or other action of any State, 
                including those described in subparagraph (B), to the 
                extent that the State law, regulation, provision, or 
                other action is not inconsistent with the provisions of 
                this subtitle related to market entry for nonresident 
                insurance producers, and then only to the extent of the 
                inconsistency.
                    ``(B) Preserved regulations.--The laws, 
                regulations, provisions, or other actions of any State 
                referred to in subparagraph (A) include laws, 
                regulations, provisions, or other actions that--
                            ``(i) regulate market conduct, insurance 
                        producer conduct, or unfair trade practices;
                            ``(ii) establish consumer protections; or
                            ``(iii) require insurance producers to be 
                        appointed by a licensed or authorized insurer.
    ``(f) Biennial Renewal.--Membership in the Association shall be 
renewed on a biennial basis.
    ``(g) Continuing Education.--
            ``(1) In general.--The Association shall establish, as a 
        condition of membership, continuing education requirements 
        which shall be comparable to the continuing education 
        requirements under the licensing laws of a majority of the 
        States.
            ``(2) State continuing education requirements.--A member 
        may not be required to satisfy continuing education 
        requirements imposed under the laws, regulations, provisions, 
        or actions of any State other than the home State of the 
        member.
            ``(3) Reciprocity.--The Association shall not require a 
        member to satisfy continuing education requirements that are 
        equivalent to any continuing education requirements of the home 
        State of the member that have been satisfied by the member 
        during the applicable licensing period.
            ``(4) Limitation on the association.--The Association shall 
        not directly or indirectly offer any continuing education 
        courses for insurance producers.
    ``(h) Probation, Suspension and Revocation.--
            ``(1) Disciplinary action.--The Association may place an 
        insurance producer that is a member of the Association on 
        probation or suspend or revoke the membership of the insurance 
        producer in the Association, or assess monetary fines or 
        penalties, as the Association determines to be appropriate, 
        if--
                    ``(A) the insurance producer fails to meet the 
                applicable membership criteria or other standards 
                established by the Association;
                    ``(B) the insurance producer has been subject to 
                disciplinary action pursuant to a final adjudicatory 
                proceeding under the jurisdiction of a State insurance 
                regulator;
                    ``(C) an insurance license held by the insurance 
                producer has been suspended or revoked by a State 
                insurance regulator; or
                    ``(D) the insurance producer has been convicted of 
                a crime that would have resulted in the denial of 
                membership pursuant to subsection (a)(4)(L)(i) at the 
                time of application, and the Association has received a 
                copy of the final disposition from a court of competent 
                jurisdiction.
            ``(2) Violations of association standards.--The Association 
        shall have the power to investigate alleged violations of 
        Association standards.
            ``(3) Reporting.--The Association shall immediately notify 
        the States (including State insurance regulators) and the NAIC 
        when the membership of an insurance producer has been placed on 
        probation or has been suspended, revoked, or otherwise 
        terminated, or when the Association has assessed monetary fines 
        or penalties.
    ``(i) Consumer Complaints.--
            ``(1) In general.--The Association shall--
                    ``(A) refer any complaint against a member of the 
                Association from a consumer relating to alleged 
                misconduct or violations of State insurance laws to the 
                State insurance regulator where the consumer resides 
                and, when appropriate, to any additional State 
                insurance regulator, as determined by standards adopted 
                by the Association; and
                    ``(B) make any related records and information 
                available to each State insurance regulator to whom the 
                complaint is forwarded.
            ``(2) Telephone and other access.--The Association shall 
        maintain a toll-free number for purposes of this subsection 
        and, as practicable, other alternative means of communication 
        with consumers, such as an Internet webpage.
            ``(3) Final disposition of investigation.--State insurance 
        regulators shall provide the Association with information 
        regarding the final disposition of a complaint referred 
        pursuant to paragraph (1)(A), but nothing shall be construed to 
        compel a State to release confidential investigation reports or 
        other information protected by State law to the Association.
    ``(j) Information Sharing.--The Association may--
            ``(1) share documents, materials, or other information, 
        including confidential and privileged documents, with a State, 
        Federal, or international governmental entity or with the NAIC 
        or other appropriate entity referenced in paragraphs (3) and 
        (4), provided that the recipient has the authority and agrees 
        to maintain the confidentiality or privileged status of the 
        document, material, or other information;
            ``(2) limit the sharing of information as required under 
        this subtitle with the NAIC or any other non-governmental 
        entity, in circumstances under which the Association determines 
        that the sharing of such information is unnecessary to further 
        the purposes of this subtitle;
            ``(3) establish a central clearinghouse, or utilize the 
        NAIC or another appropriate entity, as determined by the 
        Association, as a central clearinghouse, for use by the 
        Association and the States (including State insurance 
        regulators), through which members of the Association may 
        disclose their intent to operate in 1 or more States and pay 
        the licensing fees to the appropriate States; and
            ``(4) establish a database, or utilize the NAIC or another 
        appropriate entity, as determined by the Association, as a 
        database, for use by the Association and the States (including 
        State insurance regulators) for the collection of regulatory 
        information concerning the activities of insurance producers.
    ``(k) Effective Date.--The provisions of this section shall take 
effect on the later of--
            ``(1) the expiration of the 2-year period beginning on the 
        date of enactment of the National Association of Registered 
        Agents and Brokers Reform Act of 2013; and
            ``(2) the date of incorporation of the Association.

``SEC. 324. BOARD OF DIRECTORS.

    ``(a) Establishment.--There is established a board of directors of 
the Association, which shall have authority to govern and supervise all 
activities of the Association.
    ``(b) Powers.--The Board shall have such of the powers and 
authority of the Association as may be specified in the bylaws of the 
Association.
    ``(c) Composition.--
            ``(1) In general.--The Board shall consist of 13 members 
        who shall be appointed by the President, by and with the advice 
        and consent of the Senate, in accordance with the procedures 
        established under Senate Resolution 116 of the 112th Congress, 
        of whom--
                    ``(A) 8 shall be State insurance commissioners 
                appointed in the manner provided in paragraph (2), 1 of 
                whom shall be designated by the President to serve as 
                the chairperson of the Board until the Board elects one 
                such State insurance commissioner Board member to serve 
                as the chairperson of the Board;
                    ``(B) 3 shall have demonstrated expertise and 
                experience with property and casualty insurance 
                producer licensing; and
                    ``(C) 2 shall have demonstrated expertise and 
                experience with life or health insurance producer 
                licensing.
            ``(2) State insurance regulator representatives.--
                    ``(A) Recommendations.--Before making any 
                appointments pursuant to paragraph (1)(A), the 
                President shall request a list of recommended 
                candidates from the States through the NAIC, which 
                shall not be binding on the President. If the NAIC 
                fails to submit a list of recommendations not later 
                than 15 business days after the date of the request, 
                the President may make the requisite appointments 
                without considering the views of the NAIC.
                    ``(B) Political affiliation.--Not more than 4 Board 
                members appointed under paragraph (1)(A) shall belong 
                to the same political party.
                    ``(C) Former state insurance commissioners.--
                            ``(i) In general.--If, after offering each 
                        currently serving State insurance commissioner 
                        an appointment to the Board, fewer than 8 State 
                        insurance commissioners have accepted 
                        appointment to the Board, the President may 
                        appoint the remaining State insurance 
                        commissioner Board members, as required under 
                        paragraph (1)(A), of the appropriate political 
                        party as required under subparagraph (B), from 
                        among individuals who are former State 
                        insurance commissioners.
                            ``(ii) Limitation.--A former State 
                        insurance commissioner appointed as described 
                        in clause (i) may not be employed by or have 
                        any present direct or indirect financial 
                        interest in any insurer, insurance producer, or 
                        other entity in the insurance industry, other 
                        than direct or indirect ownership of, or 
                        beneficial interest in, an insurance policy or 
                        annuity contract written or sold by an insurer.
                    ``(D) Service through term.--If a Board member 
                appointed under paragraph (1)(A) ceases to be a State 
                insurance commissioner during the term of the Board 
                member, the Board member shall cease to be a Board 
                member.
            ``(3) Private sector representatives.--In making any 
        appointment pursuant to subparagraphs (B) and (C) of paragraph 
        (1), the President may seek recommendations for candidates from 
        groups representing the category of individuals described, 
        which shall not be binding on the President.
            ``(4) State insurance commissioner defined.--For purposes 
        of this subsection, the term `State insurance commissioner' 
        means a person who serves in the position in State government, 
        or on the board, commission, or other body that is the primary 
        insurance regulatory authority for the State.
    ``(d) Terms.--
            ``(1) In general.--Except as provided under paragraph (2), 
        the term of service for each Board member shall be 2 years.
            ``(2) Exceptions.--
                    ``(A) 1-year terms.--The term of service shall be 1 
                year, as designated by the President at the time of the 
                nomination of the subject Board members for--
                            ``(i) 4 of the State insurance commissioner 
                        Board members initially appointed under 
                        paragraph (1)(A), of whom not more than 2 shall 
                        belong to the same political party;
                            ``(ii) 1 of the Board members initially 
                        appointed under paragraph (1)(B); and
                            ``(iii) 1 of the Board members initially 
                        appointed under paragraph (1)(C).
                    ``(B) Expiration of term.--A Board member may 
                continue to serve after the expiration of the term to 
                which the Board member was appointed for the earlier of 
                2 years or until a successor is appointed.
                    ``(C) Mid-term appointments.--A Board member 
                appointed to fill a vacancy occurring before the 
                expiration of the term for which the predecessor of the 
                Board member was appointed shall be appointed only for 
                the remainder of that term.
            ``(3) Successive terms.--Board members may be reappointed 
        to successive terms.
    ``(e) Initial Appointments.--The appointment of initial Board 
members shall be made no later than 90 days after the date of enactment 
of the National Association of Registered Agents and Brokers Reform Act 
of 2013.
    ``(f) Meetings.--
            ``(1) In general.--The Board shall meet--
                    ``(A) at the call of the chairperson;
                    ``(B) as requested in writing to the chairperson by 
                not fewer than 5 Board members; or
                    ``(C) as otherwise provided by the bylaws of the 
                Association.
            ``(2) Quorum required.--A majority of all Board members 
        shall constitute a quorum.
            ``(3) Voting.--Decisions of the Board shall require the 
        approval of a majority of all Board members present at a 
        meeting, a quorum being present.
            ``(4) Initial meeting.--The Board shall hold its first 
        meeting not later than 45 days after the date on which all 
        initial Board members have been appointed.
    ``(g) Restriction on Confidential Information.--Board members 
appointed pursuant to subparagraphs (B) and (C) of subsection (c)(1) 
shall not have access to confidential information received by the 
Association in connection with complaints, investigations, or 
disciplinary proceedings involving insurance producers.
    ``(h) Ethics and Conflicts of Interest.--The Board shall issue and 
enforce an ethical conduct code to address permissible and prohibited 
activities of Board members and Association officers, employees, 
agents, or consultants. The code shall, at a minimum, include 
provisions that prohibit any Board member or Association officer, 
employee, agent or consultant from--
            ``(1) engaging in unethical conduct in the course of 
        performing Association duties;
            ``(2) participating in the making or influencing the making 
        of any Association decision, the outcome of which the Board 
        member, officer, employee, agent, or consultant knows or had 
        reason to know would have a reasonably foreseeable material 
        financial effect, distinguishable from its effect on the public 
        generally, on the person or a member of the immediate family of 
        the person;
            ``(3) accepting any gift from any person or entity other 
        than the Association that is given because of the position held 
        by the person in the Association;
            ``(4) making political contributions to any person or 
        entity on behalf of the Association; and
            ``(5) lobbying or paying a person to lobby on behalf of the 
        Association.
    ``(i) Compensation.--
            ``(1) In general.--Except as provided in paragraph (2), no 
        Board member may receive any compensation from the Association 
        or any other person or entity on account of Board membership.
            ``(2) Travel expenses and per diem.--Board members may be 
        reimbursed only by the Association for travel expenses, 
        including per diem in lieu of subsistence, at rates consistent 
        with rates authorized for employees of Federal agencies under 
        subchapter I of chapter 57 of title 5, United States Code, 
        while away from home or regular places of business in 
        performance of services for the Association.

``SEC. 325. BYLAWS, STANDARDS, AND DISCIPLINARY ACTIONS.

    ``(a) Adoption and Amendment of Bylaws and Standards.--
            ``(1) Procedures.--The Association shall adopt procedures 
        for the adoption of bylaws and standards that are similar to 
        procedures under subchapter II of chapter 5 of title 5, United 
        States Code (commonly known as the `Administrative Procedure 
        Act').
            ``(2) Copy required to be filed.--The Board shall submit to 
        the President, through the Department of the Treasury, and the 
        States (including State insurance regulators), and shall 
        publish on the website of the Association, all proposed bylaws 
        and standards of the Association, or any proposed amendment to 
        the bylaws or standards of the Association, accompanied by a 
        concise general statement of the basis and purpose of such 
        proposal.
            ``(3) Effective date.--Any proposed bylaw or standard of 
        the Association, and any proposed amendment to the bylaws or 
        standards of the Association, shall take effect, after notice 
        under paragraph (2) and opportunity for public comment, on such 
        date as the Association may designate, unless suspended under 
        section 329(c).
            ``(4) Rule of construction.--Nothing in this section shall 
        be construed to subject the Board or the Association to the 
        requirements of subchapter II of chapter 5 of title 5, United 
        States Code (commonly known as the `Administrative Procedure 
        Act').
    ``(b) Disciplinary Action by the Association.--
            ``(1) Specification of charges.--In any proceeding to 
        determine whether membership shall be denied, suspended, 
        revoked, or not renewed, or to determine whether a member of 
        the Association should be placed on probation (referred to in 
        this section as a `disciplinary action') or whether to assess 
        fines or monetary penalties, the Association shall bring 
        specific charges, notify the member of the charges, give the 
        member an opportunity to defend against the charges, and keep a 
        record.
            ``(2) Supporting statement.--A determination to take 
        disciplinary action shall be supported by a statement setting 
        forth--
                    ``(A) any act or practice in which the member has 
                been found to have been engaged;
                    ``(B) the specific provision of this subtitle or 
                standard of the Association that any such act or 
                practice is deemed to violate; and
                    ``(C) the sanction imposed and the reason for the 
                sanction.
            ``(3) Ineligibility of private sector representatives.--
        Board members appointed pursuant to section 324(c)(3) may not--
                    ``(A) participate in any disciplinary action or be 
                counted toward establishing a quorum during a 
                disciplinary action; and
                    ``(B) have access to confidential information 
                concerning any disciplinary action.

``SEC. 326. POWERS.

    ``In addition to all the powers conferred upon a nonprofit 
corporation by the District of Columbia Nonprofit Corporation Act, the 
Association shall have the power to--
            ``(1) establish and collect such membership fees as the 
        Association finds necessary to impose to cover the costs of its 
        operations;
            ``(2) adopt, amend, and repeal bylaws, procedures, or 
        standards governing the conduct of Association business and 
        performance of its duties;
            ``(3) establish procedures for providing notice and 
        opportunity for comment pursuant to section 325(a);
            ``(4) enter into and perform such agreements as necessary 
        to carry out the duties of the Association;
            ``(5) hire employees, professionals, or specialists, and 
        elect or appoint officers, and to fix their compensation, 
        define their duties and give them appropriate authority to 
        carry out the purposes of this subtitle, and determine their 
        qualification;
            ``(6) establish personnel policies of the Association and 
        programs relating to, among other things, conflicts of 
        interest, rates of compensation, where applicable, and 
        qualifications of personnel;
            ``(7) borrow money; and
            ``(8) secure funding for such amounts as the Association 
        determines to be necessary and appropriate to organize and 
        begin operations of the Association, which shall be treated as 
        loans to be repaid by the Association with interest at market 
        rate.

``SEC. 327. REPORT BY THE ASSOCIATION.

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

``SEC. 328. LIABILITY OF THE ASSOCIATION AND THE BOARD MEMBERS, 
              OFFICERS, AND EMPLOYEES OF THE ASSOCIATION.

    ``(a) In General.--The Association shall not be deemed to be an 
insurer or insurance producer within the meaning of any State law, 
rule, regulation, or order regulating or taxing insurers, insurance 
producers, or other entities engaged in the business of insurance, 
including provisions imposing premium taxes, regulating insurer 
solvency or financial condition, establishing guaranty funds and 
levying assessments, or requiring claims settlement practices.
    ``(b) Liability of Board Members, Officers, and Employees.--No 
Board member, officer, or employee of the Association shall be 
personally liable to any person for any action taken or omitted in good 
faith in any matter within the scope of their responsibilities in 
connection with the Association.

``SEC. 329. PRESIDENTIAL OVERSIGHT.

    ``(a) Removal of Board.--If the President determines that the 
Association is acting in a manner contrary to the interests of the 
public or the purposes of this subtitle or has failed to perform its 
duties under this subtitle, the President may remove the entire 
existing Board for the remainder of the term to which the Board members 
were appointed and appoint, in accordance with section 324 and with the 
advice and consent of the Senate, in accordance with the procedures 
established under Senate Resolution 116 of the 112th Congress, new 
Board members to fill the vacancies on the Board for the remainder of 
the terms.
    ``(b) Removal of Board Member.--The President may remove a Board 
member only for neglect of duty or malfeasance in office.
    ``(c) Suspension of Bylaws and Standards and Prohibition of 
Actions.--Following notice to the Board, the President, or a person 
designated by the President for such purpose, may suspend the 
effectiveness of any bylaw or standard, or prohibit any action, of the 
Association that the President or the designee determines is contrary 
to the purposes of this subtitle.

``SEC. 330. RELATIONSHIP TO STATE LAW.

    ``(a) Preemption of State Laws.--State laws, regulations, 
provisions, or other actions purporting to regulate insurance producers 
shall be preempted to the extent provided in subsection (b).
    ``(b) Prohibited Actions.--
            ``(1) In general.--No State shall--
                    ``(A) impede the activities of, take any action 
                against, or apply any provision of law or regulation 
                arbitrarily or discriminatorily to, any insurance 
                producer because that insurance producer or any 
                affiliate plans to become, has applied to become, or is 
                a member of the Association;
                    ``(B) impose any requirement upon a member of the 
                Association that it pay fees different from those 
                required to be paid to that State were it not a member 
                of the Association; or
                    ``(C) impose any continuing education requirements 
                on any nonresident insurance producer that is a member 
                of the Association.
            ``(2) States other than a home state.--No State, other than 
        the home State of a member of the Association, shall--
                    ``(A) impose any licensing, personal or corporate 
                qualifications, education, training, experience, 
                residency, continuing education, or bonding requirement 
                upon a member of the Association that is different from 
                the criteria for membership in the Association or 
                renewal of such membership;
                    ``(B) impose any requirement upon a member of the 
                Association that it be licensed, registered, or 
                otherwise qualified to do business or remain in good 
                standing in the State, including any requirement that 
                the insurance producer register as a foreign company 
                with the secretary of state or equivalent State 
                official;
                    ``(C) require that a member of the Association 
                submit to a criminal history record check as a 
                condition of doing business in the State; or
                    ``(D) impose any licensing, registration, or 
                appointment requirements upon a member of the 
                Association, or require a member of the Association to 
                be authorized to operate as an insurance producer, in 
                order to sell, solicit, or negotiate insurance for 
                commercial property and casualty risks to an insured 
                with risks located in more than one State, if the 
                member is licensed or otherwise authorized to operate 
                in the State where the insured maintains its principal 
                place of business and the contract of insurance insures 
                risks located in that State.
            ``(3) Preservation of state disciplinary authority.--
        Nothing in this section may be construed to prohibit a State 
        from investigating and taking appropriate disciplinary action, 
        including suspension or revocation of authority of an insurance 
        producer to do business in a State, in accordance with State 
        law and that is not inconsistent with the provisions of this 
        section, against a member of the Association as a result of a 
        complaint or for any alleged activity, regardless of whether 
        the activity occurred before or after the insurance producer 
        commenced doing business in the State pursuant to Association 
        membership.

``SEC. 331. COORDINATION WITH FINANCIAL INDUSTRY REGULATORY AUTHORITY.

    ``The Association shall coordinate with the Financial Industry 
Regulatory Authority in order to ease any administrative burdens that 
fall on members of the Association that are subject to regulation by 
the Financial Industry Regulatory Authority, consistent with the 
requirements of this subtitle and the Federal securities laws .

``SEC. 332. RIGHT OF ACTION.

    ``(a) Right of Action.--Any person aggrieved by a decision or 
action of the Association may, after reasonably exhausting available 
avenues for resolution within the Association, commence a civil action 
in an appropriate United States district court, and obtain all 
appropriate relief.
    ``(b) Association Interpretations.--In any action under subsection 
(a), the court shall give appropriate weight to the interpretation of 
the Association of its bylaws and standards and this subtitle.

``SEC. 333. FEDERAL FUNDING PROHIBITED.

    ``The Association may not receive, accept, or borrow any amounts 
from the Federal Government to pay for, or reimburse the Association 
for, the costs of establishing or operating the Association.

``SEC. 334. DEFINITIONS.

    ``For purposes of this subtitle, the following definitions shall 
apply:
            ``(1) Business entity.--The term `business entity' means a 
        corporation, association, partnership, limited liability 
        company, limited liability partnership, or other legal entity.
            ``(2) Depository institution.--The term `depository 
        institution' has the meaning as in section 3 of the Federal 
        Deposit Insurance Act (12 U.S.C. 1813).
            ``(3) Home state.--The term `home State' means the State in 
        which the insurance producer maintains its principal place of 
        residence or business and is licensed to act as an insurance 
        producer.
            ``(4) Insurance.--The term `insurance' means any product, 
        other than title insurance or bail bonds, defined or regulated 
        as insurance by the appropriate State insurance regulatory 
        authority.
            ``(5) Insurance producer.--The term `insurance producer' 
        means any insurance agent or broker, excess or surplus lines 
        broker or agent, insurance consultant, limited insurance 
        representative, and any other individual or entity that sells, 
        solicits, or negotiates policies of insurance or offers advice, 
        counsel, opinions or services related to insurance.
            ``(6) Insurer.--The term `insurer' has the meaning as in 
        section 313(e)(2)(B) of title 31, United States Code .
            ``(7) Principal place of business.--The term `principal 
        place of business' means the State in which an insurance 
        producer maintains the headquarters of the insurance producer 
        and, in the case of a business entity, where high-level 
        officers of the entity direct, control, and coordinate the 
        business activities of the business entity.
            ``(8) Principal place of residence.--The term `principal 
        place of residence' means the State in which an insurance 
        producer resides for the greatest number of days during a 
        calendar year.
            ``(9) State.--The term `State' includes any State, the 
        District of Columbia, any territory of the United States, and 
        Puerto Rico, Guam, American Samoa, the Trust Territory of the 
        Pacific Islands, the Virgin Islands, and the Northern Mariana 
        Islands.
            ``(10) State law.--
                    ``(A) In general.--The term `State law' includes 
                all laws, decisions, rules, regulations, or other State 
                action having the effect of law, of any State.
                    ``(B) Laws applicable in the district of 
                columbia.--A law of the United States applicable only 
                to or within the District of Columbia shall be treated 
                as a State law rather than a law of the United 
                States.''.
    (b) Technical Amendment.--The table of contents for the Gramm-
Leach-Bliley Act is amended by striking the items relating to subtitle 
C of title III and inserting the following new items:

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

``Sec. 321. National Association of Registered Agents and Brokers.
``Sec. 322. Purpose.
``Sec. 323. Membership.
``Sec. 324. Board of directors.
``Sec. 325. Bylaws, standards, and disciplinary actions.
``Sec. 326. Powers.
``Sec. 327. Report by the Association.
``Sec. 328. Liability of the Association and the Board members, 
                            officers, and employees of the Association.
``Sec. 329. Presidential oversight.
``Sec. 330. Relationship to State law.
``Sec. 331. Coordination with Financial Industry Regulatory Authority.
``Sec. 332. Right of action.
``Sec. 333. Federal funding prohibited.
``Sec. 334. Definitions.''.
                                                       Calendar No. 151

113th CONGRESS

  1st Session

                                 S. 534

                          [Report No. 113-82]

_______________________________________________________________________

                                 A BILL

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

_______________________________________________________________________

                             July 29, 2013

                       Reported with an amendment