118 HR 6505 IH: Fentanyl Reduction Engrained by Economic Deterrence Act
U.S. House of Representatives
2023-11-29
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I
118th CONGRESS
1st Session
H. R. 6505
IN THE HOUSE OF REPRESENTATIVES
November 29, 2023
Mr. James (for himself and Ms. Pettersen) introduced the following bill; which was referred to the Committee on Financial Services, and in addition to the Committees on Foreign Affairs, the Judiciary, and Oversight and Accountability, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned
A BILL
To amend the Fentanyl Sanctions Act to strengthen the imposition of sanctions under that Act, and for other purposes.
1.

Short title
This Act may be cited as the “Fentanyl Reduction Engrained by Economic Deterrence Act” or the “FREED Act”.
2.

Expansion of sanctions under the Fentanyl Sanctions Act
(a)

In general
Section 7212 of the Fentanyl Sanctions Act (21 U.S.C. 2312) is amended to read as follows:
“7212.

Imposition of sanctions
(a)

Application to foreign persons
The President shall impose the sanctions described in section 7213(a)(6) with respect to any foreign person that—
(1)
is identified as a foreign opioid trafficker in the report submitted under section 7211(a); or
(2)
the President determines—
(A)
knowingly has engaged in, or attempted to engage in, an activity or transaction that has materially contributed to, or poses a significant risk of materially contributing to, opioid trafficking;
(B)
knowingly has received any property or interest in property that the foreign person knows or should have known—
(i)
constitutes or is derived from the proceeds of an activity or transaction described in subparagraph (A); or
(ii)
was used or intended to be used to commit or to facilitate such an activity or transaction;
(C)
knowingly has provided, or attempted to provide, financial, material, or technological support for, including through the provision of goods or services in support of—
(i)
any activity or transaction described in subparagraph (A); or
(ii)
any foreign person described in paragraph (1) or clause (i) of this subparagraph;
(D)
is an adult spouse or other family member of an individual described in paragraph (1) or subparagraph (A), (B), or (C) of this paragraph; or
(E)
is or has been owned, controlled, or directed by, or has knowingly acted or purported to act for or on behalf of, directly or indirectly, any foreign person described in paragraph (1) or subparagraph (A), (B), or (C) of this paragraph.
(b)

Application to agencies and instrumentalities of foreign states
The President shall impose 3 or more of the sanctions described in section 7213 with respect to—
(1)
each agency or instrumentality of a foreign state (as defined in section 1603(b) of title 28, United States Code) that the President determines—
(A)
has engaged in, or attempted to engage in, an activity or transaction that has materially contributed to, or poses a significant risk of materially contributing to, opioid trafficking; or
(B)
has provided, or attempted to provide, financial, material, or technological support for, including through the provision of goods or services in support of, any activity or transaction described in subparagraph (A);
(2)
each foreign person the President determines is a senior official of an agency or instrumentality of a foreign state described in paragraph (1); and
(3)
each foreign person that the President determines is or has been owned, controlled, or directed by, or has knowingly acted or purported to act for or on behalf of, directly or indirectly, an agency or instrumentality of a foreign state described in paragraph (1) or a foreign person described in paragraph (2).
(c)

Determination of applicability to certain foreign persons
(1)

In general
The sanctions described in section 7213 may not apply to a foreign person described in subsection (a)(1)(D) if the President determines that there is clear and convincing evidence the person—
(A)
is no longer in contact with the individual described in paragraph (1) of subsection (a) or subparagraph (A), (B), or (C) of paragraph (2) of that subsection; and
(B)
has provided reliable assurances that the person will not engage in any conduct described in subsection (a) in the future.
(2)

Notification
Not later than 30 days after making a determination under paragraph (1), the President shall submit to the appropriate congressional committees and leadership a report on the determination.
(d)

Waiver authority
(1)

In general
The President may waive the imposition of sanctions under this section, on a case-by-case basis and for a period not to exceed 180 days per waiver, with respect to a foreign person or agency or instrumentality of a foreign state, as the case may be, if the President certifies in writing to the appropriate congressional committees that such waiver is vital to the national security interests of the United States or would ensure the delivery of humanitarian assistance such as medicine, agricultural products, food, or fuel.
(2)

Briefings
Not later than 30 days after issuing a waiver under paragraph (1) with respect to a foreign person or agency or instrumentality of a foreign state, and every 180 days thereafter for such period of time as the waiver remains in effect, the President shall provide to the appropriate congressional committees a briefing on the status of the involvement of the foreign person or agency or instrumentality of a foreign state in activities described in this section.” .
(b)

Effective date
The amendment made by subsection (a) shall take effect on the date that is 90 days after the date of the enactment of this Act.
(c)

Regulatory authority
(1)

In general
Not later than 180 days after the date of the enactment of this Act, the President shall prescribe regulations as necessary for the implementation of the amendment made by subsection (a).
(2)

Notification to Congress
Not later than 10 days prior to prescribing regulations under paragraph (1), the President shall notify the appropriate congressional committees and leadership (as defined in section 7203 of the Fentanyl Sanctions Act (21 U.S.C. 2302)) with respect to the proposed regulations.
3.

Determinations with respect to primary money laundering concern relating to illicit fentanyl and narcotics financing
If the Secretary of the Treasury determines that 1 or more financial institutions operating outside of the United States, 1 or more classes of transactions within, or involving, a jurisdiction outside of the United States, or 1 or more types of accounts within, or involving, a jurisdiction outside of the United States, is of primary money laundering concern in connection with the financing of illicit fentanyl and other narcotics, the Secretary of the Treasury may, by order, regulation, or otherwise as permitted by law, require domestic financial institutions and domestic financial agencies to take one or more of the special measures described in section 5318A(b) of title 31, United States Code.
4.

Report on improved enforcement with respect to money laundering relating to illicit fentanyl and narcotic drugs financing
(a)

In general
Not later than one year after the date of the enactment of this Act, the Secretary of the Treasury shall submit to appropriate congressional committees a report that identifies any additional regulations, statutory changes, enhanced due diligence requirements, or reporting requirements the Secretary determines are necessary to better identify, prevent, and combat money laundering connected with the financing of illicit fentanyl and other narcotic drugs, including related to—
(1)
identifying the beneficial ownership of anonymous entities; and
(2)
enhanced know-your-customer procedures and screenings for transactions involving any organization identified by the Secretary as—
(A)
a drug cartel or other criminal organization based in Mexico;
(B)
a money laundering organization based in the People's Republic of China; or
(C)
any other entity involved in the financing of illicit fentanyl.
(b)

Form
(1)

In general
The report required by subsection (a) shall be submitted in unclassified form, but may include a classified annex and be accompanied by a classified briefing.
(2)

Public availability
The unclassified portion of the report required by subsection (a) shall be made available to the public, including on a publicly accessible internet website of the Department of the Treasury.
(c)

Appropriate congressional committees defined
In this section, the term appropriate congressional committees means—
(1)
the Committee on Banking, Housing, and Urban Affairs and the Committee on Foreign Relations of the Senate; and
(2)
the Committee on Financial Services and the Committee on Foreign Affairs of the House of Representatives.
5.

Sense of Congress on international cooperation
It is the sense of Congress that the Secretary of the Treasury and other relevant Federal officials should work jointly with financial intelligence units, trade transparency units, and appropriate law enforcement authorities of Canada, European and European Union countries, and the United Kingdom to identify and present, in the report required by section 4 and in future analyses of suspicious transaction reports, cash transaction reports, currency and monetary instrument reports, and other relevant data to identify trends and assess risks in the movement of illicit funds from illicit fentanyl operations from Mexico, India, the People's Republic of China, or any country in the Western Hemisphere through the financial systems of the United States, the United Kingdom, and Europe.